Document:

EXHIBIT 4.1

                     FORM OF POOLING AND SERVICING AGREEMENT

                RESIDENTIAL FUNDING MORTGAGE SECURITIES II, INC.,

                                   Depositor,

                        RESIDENTIAL FUNDING COMPANY, LLC,

                                Master Servicer,

                                       and

                                    [______],

                 Trustee and Supplemental Interest Trust Trustee

                         POOLING AND SERVICING AGREEMENT

                         DATED AS OF [______] 1, 20[__]

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES

                               Series 20[__]-[___]

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

ARTICLE I         DEFINITIONS................................................. 3

           Section 1.01.    Definitions....................................... 3

           Section 1.02.    Determination of LIBOR........................... 51

ARTICLE II        CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE
                  OF CERTIFICATES............................................ 52

           Section 2.01.    Conveyance of Mortgage Loans..................... 52

           Section 2.02.    Acceptance by Trustee............................ 57

           Section 2.03.    Representations, Warranties and Covenants
                            of the Master Servicer and the Depositor......... 58

           Section 2.04.    Representations and Warranties of
                            Residential Funding.............................. 61

           Section 2.05.    Execution and Authentication of Certificates;
                            Conveyance of REMIC Regular Interests............ 63

           Section 2.06.    Purposes and Powers of the Trust................. 64

           Section 2.07.    Agreement Regarding Ability to Disclose.......... 64

ARTICLE III       ADMINISTRATION AND SERVICING OF MORTGAGE LOANS............. 64

           Section 3.01.    Master Servicer to Act as Servicer............... 64

           Section 3.02.    Subservicing Agreements Between Master Servicer
                            and Subservicers; Enforcement of Subservicers'
                            Obligations...................................... 67

           Section 3.03.    Successor Subservicers........................... 68

           Section 3.04.    Liability of the Master Servicer................. 68

           Section 3.05.    No Contractual Relationship Between Subservicer
                            and Trustee or Certificateholders................ 69

           Section 3.06.    Assumption or Termination of Subservicing
                            Agreements by Trustee............................ 69

           Section 3.07.    Collection of Certain Mortgage Loan Payments;
                            Deposits to Custodial Account.................... 69

           Section 3.08.    Subservicing Accounts; Servicing Accounts........ 72

           Section 3.09.    Access to Certain Documentation and Information
                            Regarding the Mortgage Loans..................... 74

           Section 3.10.    Permitted Withdrawals from the Custodial
                            Account.......................................... 74

           Section 3.11.    Maintenance of Primary Insurance Coverage........ 76

           Section 3.12.    Maintenance of Fire Insurance and Omissions
                            and Fidelity Coverage............................ 76

                                      -i-

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

                                                                            Page

           Section 3.13.    Enforcement of Due-on-Sale Clauses; Assumption
                            and Modification Agreements; Certain
                            Assignments...................................... 78

           Section 3.14.    Realization Upon Defaulted Mortgage Loans........ 80

           Section 3.15.    Trustee to Cooperate; Release of Custodial
                            Files............................................ 82

           Section 3.16.    Servicing and Other Compensation; Eligible
                            Master Servicing Compensation.................... 84

           Section 3.17.    Reports to the Trustee and the Depositor......... 85

           Section 3.18.    Annual Statement as to Compliance and
                            Servicing Assessment............................. 85

           Section 3.19.    Annual Independent Public Accountants'
                            Servicing Report................................. 85

           Section 3.20.    Right of the Depositor in Respect of the
                            Master Servicer.................................. 86

           Section 3.21.    Advance Facility................................. 86

ARTICLE IV        PAYMENTS TO CERTIFICATEHOLDERS............................. 90

           Section 4.01.    Certificate Account.............................. 90

           Section 4.02.    Distributions.................................... 91

           Section 4.03.    Statements to Certificateholders; Statements to
                            Rating Agencies; Exchange Act Reporting.......... 97

           Section 4.04.    Distribution of Reports to the Trustee and the
                            Depositor; Advances by the Master Servicer...... 102

           Section 4.05.    Allocation of Realized Losses................... 103

           Section 4.06.    Reports of Foreclosures and Abandonment of
                            Mortgaged Property.............................. 106

           Section 4.07.    Optional Purchase of Defaulted Mortgage Loans... 106

           Section 4.08.    [Reserved]...................................... 107

           Section 4.09.    The Swap Agreement.............................. 107

           Section 4.10.    Posted Collateral Account....................... 110

           Section 4.11.    [Reserved]...................................... 110

           Section 4.12.    Tax Treatment of Swap Payments and Swap
                            Termination Payments............................ 111

ARTICLE V         THE CERTIFICATES.......................................... 112

           Section 5.01.    The Certificates................................ 112

           Section 5.02.    Registration of Transfer and Exchange of
                            Certificates.................................... 114

           Section 5.03.    Mutilated, Destroyed, Lost or Stolen
                            Certificates.................................... 123

                                      -ii-

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

                                                                            Page

           Section 5.04.    Persons Deemed Owners........................... 123

           Section 5.05.    Appointment of Paying Agent..................... 124

ARTICLE VI        THE DEPOSITOR AND THE MASTER SERVICER..................... 124

           Section 6.01.    Respective Liabilities of the Depositor
                            and the Master Servicer......................... 124

           Section 6.02.    Merger or Consolidation of the Depositor or
                            the Master Servicer; Assignment of Rights
                            and Delegation of Duties by Master Servicer..... 124

           Section 6.03.    Limitation on Liability of the Depositor,
                            the Master Servicer and Others.................. 125

           Section 6.04.    Depositor and Master Servicer Not to Resign..... 126

ARTICLE VII       DEFAULT................................................... 126

           Section 7.01.    Events of Default............................... 126

           Section 7.02.    Trustee or Depositor to Act; Appointment
                            of Successor.................................... 128

           Section 7.03.    Notification to Certificateholders.............. 129

           Section 7.04.    Waiver of Events of Default..................... 130

ARTICLE VIII      CONCERNING THE TRUSTEE.................................... 130

           Section 8.01.    Duties of Trustee............................... 130

           Section 8.02.    Certain Matters Affecting the Trustee........... 132

           Section 8.03.    Trustee Not Liable for Certificates
                            or Mortgage Loans............................... 133

           Section 8.04.    Trustee May Own Certificates.................... 133

           Section 8.05.    Master Servicer to Pay Trustee's Fees and
                            Expenses; Indemnification....................... 134

           Section 8.06.    Eligibility Requirements for Trustee............ 135

           Section 8.07.    Resignation and Removal of the Trustee.......... 135

           Section 8.08.    Successor Trustee............................... 136

           Section 8.09.    Merger or Consolidation of Trustee.............. 136

           Section 8.10.    Appointment of Co-Trustee or Separate Trustee... 137

           Section 8.11.    Appointment of the Custodian.................... 138

           Section 8.12.    Appointment of Office or Agency................. 138

           Section 8.13.    DTC Letter of Representations................... 138

           Section 8.14.    Swap Agreement.................................. 138

                                     -iii-

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

ARTICLE IX        TERMINATION............................................... 138

           Section 9.01.    Termination Upon Purchase by Residential
                            Funding or Liquidation of All Mortgage Loans.... 138

           Section 9.02.    Additional Termination Requirements............. 144

ARTICLE X         REMIC PROVISIONS.......................................... 144

           Section 10.01.   REMIC Administration............................ 144

           Section 10.02.   Master Servicer, REMIC Administrator and
                            Trustee Indemnification......................... 148

ARTICLE XI        MISCELLANEOUS PROVISIONS.................................. 149

           Section 11.01.   Amendment....................................... 149

           Section 11.02.   Recordation of Agreement; Counterparts.......... 151

           Section 11.03.   Limitation on Rights of Certificateholders...... 152

           Section 11.04.   Governing Law................................... 153

           Section 11.05.   Notices......................................... 153

           Section 11.06.   Notices to Rating Agencies...................... 153

           Section 11.07.   Severability of Provisions...................... 154

           Section 11.08.   Supplemental Provisions for Resecuritization.... 154

           Section 11.09.   [Reserved]...................................... 155

           Section 11.10.   Third Party Beneficiaries....................... 155

ARTICLE XII       COMPLIANCE WITH REGULATION AB............................. 155

           Section 12.01.   Intent of Parties; Reasonableness............... 155

           Section 12.02.   Additional Representations and Warranties
                            of the Trustee.................................. 155

           Section 12.03.   Information to be Provided by the Trustee....... 156

           Section 12.04.   Report on Assessment of Compliance and
                            Attestation..................................... 157

           Section 12.05.   Indemnification; Remedies....................... 157

                                      -iv-

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

Exhibits

Exhibit A         Form of Class A Certificate

Exhibit B         Form of Class M Certificate

Exhibit C-1       Form of Rule 144A Global Class B Certificate

Exhibit C-2       Form of Temporary Regulation S Global Class B Certificate

Exhibit C-3       Form of Permanent Regulation S Global Class B Certificate

Exhibit D-1       Form of Rule 144A Global Class SB Certificate

Exhibit D-2       Form of Temporary Regulation S Global Class SB Certificate

Exhibit D-3       Form of Permanent Regulation S Global Class SB Certificate

Exhibit E         Form of Class R Certificate

Exhibit F         Form of Custodial Agreement

Exhibit G         Mortgage Loan Schedule

Exhibit H         Form of Request for Release

Exhibit I-1       Form of Transfer Affidavit and Agreement

Exhibit I-2       Form of Transferor Certificate

Exhibit J         Form of Investor Representation Letter

Exhibit K         Form of Transferor Representation Letter

Exhibit L         Text of Amendment to Pooling and Servicing Agreement Pursuant
                  to Section 11.01(e) for a Limited Guaranty

Exhibit M         Form of Limited Guaranty

Exhibit N         Form of Lender Certification for Assignment of Mortgage Loan

Exhibit O         Form of Rule 144A Investment Representation

Exhibit P         [Reserved]

Exhibit Q-1       Form of ERISA Representation Letter [Class B Certificates]

Exhibit Q-2       Form of ERISA Representation Letter [Class A Certificates and
                  Class M Certificates]

Exhibit R-1       Form 10-K Certification

Exhibit R-2       Form 10-K Back-up Certification

Exhibit S         Information to be Provided by the Master Servicer to the
                  Rating Agencies Relating to Reportable Modified Mortgage Loans

Exhibit T         Schedule of Swap Agreement Notional Balances

Exhibit U         Swap Agreement

Exhibit V         Servicing Criteria To Be Addressed In Assessment of Compliance

Exhibit W-1       Form of Certificate to be Given by Certificate Owner

Exhibit W-2       Form of Certificate to be Given by Euroclear or Cedel

Exhibit X         Form of Certificate to be Given by Transferee of Beneficial
                  Interest in a Regulation S Book-Entry Certificate

Exhibit Y         Form of Transfer Certificate for Exchange or Transfer from
                  144A Book-Entry Certificate to Regulation S Book-Entry
                  Certificate

Exhibit Z         Form of Initial Purchaser Exchange Instructions

                                      -v-

<PAGE>

      This Pooling and  Servicing  Agreement,  effective as of [____] 1, 20[__],
among RESIDENTIAL  FUNDING MORTGAGE  SECURITIES II, INC., as depositor (together
with its permitted successors and assigns, the "Depositor"), RESIDENTIAL FUNDING
COMPANY,  LLC, as master  servicer  (together with its permitted  successors and
assigns, the "Master Servicer"),  and [______], a national association organized
under the laws of the United States, as trustee and supplemental  interest trust
trustee (together with its permitted  successors and assigns,  the "Trustee" and
the "Supplemental Interest Trust Trustee", respectively).

                             PRELIMINARY STATEMENT:

      The Depositor intends to sell home equity loan  pass-through  certificates
(collectively,  the  "Certificates"),  to be  issued  hereunder  in  [seventeen]
Classes,  which in the aggregate will evidence the entire  beneficial  ownership
interest in the Mortgage  Loans (as defined  herein) and certain  other  related
assets.

                                     REMIC I

      As provided herein, the REMIC Administrator will make an election to treat
the segregated pool of assets consisting of the Mortgage Loans and certain other
related  assets  (exclusive of the  Supplemental  Interest Trust Account and the
Swap Agreement)  subject to this Agreement as a real estate mortgage  investment
conduit (a "REMIC") for federal income tax purposes, and such segregated pool of
assets  will be  designated  as  "REMIC  I." The  Class  R-I  Certificates  will
represent the sole Class of "residual  interests" in REMIC I for purposes of the
REMIC Provisions (as defined herein) under federal income tax law. The following
table   irrevocably   sets   forth  the   designation,   remittance   rate  (the
"Uncertificated REMIC I Pass-Through Rate") and initial Uncertificated Principal
Balance  for each of the  "regular  interests"  in REMIC I (the "REMIC I Regular
Interests").  The "latest  possible  maturity date"  (determined for purposes of
satisfying  Treasury  regulation  Section  1.860G-1(a)(4)(iii))  for the REMIC I
Regular  Interests shall be the  Distribution  Date  immediately  succeeding the
360th Distribution Date. The REMIC I Regular Interests will not be certificated.

<PAGE>

                                           Initial
                 Uncertificated         Uncertificated
                     REMIC I               REMIC I           Latest Possible
Designation     Pass-Through Rate     Principal Balance       Maturity Date
-----------     -----------------     -----------------     ------------------
    [AA            Variable(1)              $[___]          [_____ __], 20[__]
    A-1            Variable(1)              $[___]          [_____ __], 20[__]
    A-2            Variable(1)              $[___]          [_____ __], 20[__]
    A-3            Variable(1)              $[___]          [_____ __], 20[__]
    A-4            Variable(1)              $[___]          [_____ __], 20[__]
   M-1S            Variable(1)              $[___]          [_____ __], 20[__]
   M-2S            Variable(1)              $[___]          [_____ __], 20[__]
   M-3S            Variable(1)              $[___]          [_____ __], 20[__]
    M-4            Variable(1)              $[___]          [_____ __], 20[__]
    M-5            Variable(1)              $[___]          [_____ __], 20[__]
    M-6            Variable(1)              $[___]          [_____ __], 20[__]
    M-7            Variable(1)              $[___]          [_____ __], 20[__]
    M-8            Variable(1)              $[___]          [_____ __], 20[__]
    M-9            Variable(1)              $[___]          [_____ __], 20[__]
     B             Variable(1)              $[___]          [_____ __], 20[__]
    ZZ]            Variable(1)              $[___]          [_____ __], 20[__]

(1)  Calculated in accordance  with the  definition of  "Uncertificated  REMIC I
Pass-Through Rate" herein.

                                    REMIC II

      As  provided  herein,  the  REMIC  Administrator  will  elect to treat the
segregated pool of assets consisting of the REMIC I Regular Interests as a REMIC
for federal  income tax  purposes,  and such  segregated  pool of assets will be
designated as "REMIC II". The Class R Certificates will represent the sole class
of "residual  interests" in REMIC II for purposes of the REMIC  Provisions under
federal  income  tax  law.  The  following  table  irrevocably  sets  forth  the
designation, Pass-Through Rate, aggregate Initial Certificate Principal Balance,
certain features, Final Scheduled Distribution Date and initial ratings for each
Class of Certificates  comprising the interests representing "regular interests"
in REMIC II. The "latest  possible  maturity date"  (determined  for purposes of
satisfying  Treasury Regulation Section  1.860G-1(a)(4)(iii))  for each Class of
REMIC II Regular Interests shall be the Distribution Date immediately succeeding
the 360th Distribution Date.

<TABLE>
<CAPTION>
                                                           Aggregate Initial
                                                              Certificate           Final Scheduled
 Designation              Type        Pass-Through Rate    Principal Balance       Distribution Date         Initial Ratings
-------------          ----------     -----------------    -----------------       -----------------       -------------------
                                                                                                           Moody's        S&P
<S>                      <C>          <C>                        <C>              <C>                        <C>          <C>
[Class A-1(1)            Senior       Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aaa          AAA
Class A-2(1)             Senior       Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aaa          AAA
Class A-3(1)             Senior       Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aaa          AAA
Class A-4(1)             Senior       Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aaa          AAA
Class M-1S(1)          Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aa1          AA+
Class M-2S(1)          Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aa2           AA
Class M-3S(1)          Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Aa3          AA-
Class M-4(1)           Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]         A1            A+
</TABLE>

                                       2
<PAGE>

<TABLE>
<CAPTION>
                                                           Aggregate Initial
                                                              Certificate           Final Scheduled
 Designation              Type        Pass-Through Rate    Principal Balance       Distribution Date         Initial Ratings
-------------          ----------     -----------------    -----------------       -----------------       -------------------
                                                                                                           Moody's        S&P
<S>                      <C>          <C>                        <C>              <C>                        <C>          <C>
Class M-5(1)           Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]         A2            A
Class M-6(1)           Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]         A3            A-
Class M-7(1)           Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]        Baa1          BBB+
Class M-8(1)           Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]        Baa2          BBB
Class M-9(1)           Mezzanine      Adjustable(2) (3)          $[___]           [_____ __], 20[__]        Baa#          BBB-
Class B               Subordinate     Adjustable(2) (3)          $[___]           [_____ __], 20[__]         Ba1          BB+
Class SB Interest     Subordinate        Variable(4)             $[___]                   N/A                N/R          N/R
Class R-I               Residual             N/A                  N/A                     N/A                N/R          N/R
Class R-II]             Residual             N/A                  N/A                     N/A                N/R          N/R
</TABLE>

(1) The Class A Certificates, Class M Certificates and Class B Certificates will
represent  ownership of REMIC II Regular Interests  together with certain rights
to payments  to be made from  amounts  received  under the Swap  Agreement,  the
payments on which will be deemed made for federal income tax purposes outside of
REMIC II by the  Holder  of the Class SB  Certificates  as the Owner of the Swap
Agreement.

(2) The REMIC II Regular Interests, the ownership of which is represented by the
Class A Certificates, Class M Certificates and Class B Certificates, will accrue
interest  at a per annum rate equal to LIBOR plus the  applicable  Margin,  each
subject to payment caps as described in the  definition of  "Pass-Through  Rate"
and the provisions for the payment of Class A Basis Risk Shortfall Carry-Forward
Amounts,  Class M Basis Risk Shortfall  Carry-Forward  Amounts and Class B Basis
Risk Shortfall  Carry-Forward Amounts herein, which payments will not be part of
the entitlement of the REMIC II Regular Interests related to such Certificates.

(3) The Class A Certificates, Class M Certificates and Class B Certificates will
also entitle their  holders to certain  payments from the Holder of the Class SB
Certificates  from  amounts  to which  the  related  REMIC II  Regular  Interest
component is entitled,  which will not be a part of their ownership of the REMIC
II Regular Interests.

(4)  The  Class  SB  Certificates  will  accrue  interest  as  described  in the
definition of Accrued  Certificate  Interest.  The Class SB  Certificates do not
have a  Certificate  Principal  Balance.  The  Class  SB  Certificates  will  be
comprised of two REMIC II regular  interests,  a principal only regular interest
designated  component  SB-PO and an interest  only  regular  interest  component
designated as SB-IO which will be entitled to distributions as set forth herein.
The REMIC regular  interest  SB-PO shall have no  entitlement  to interest,  and
shall be  entitled  to  distributions  of  principal  subject  to the  terms and
conditions   hereof,   in  the   aggregate   amount   equal   to   the   initial
Overcollateralization  Amount pursuant to the terms and conditions  hereof.  The
rights of the  Holder of the Class SB  Certificates  to  payments  from the Swap
Agreement  shall be outside and apart from its rights under the REMIC II Regular
Interests SB-IO and SB-PO.

      The Mortgage Loans have an aggregate  Cut-off Date Principal Balance equal
to  $[___].  The  Mortgage  Loans  are  fixed-rate  and  adjustable-rate,  fully
amortizing,  first and junior lien  mortgage  loans  having terms to maturity at
origination or modification of generally not more than 30 years.

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

                                   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.

                                       3
<PAGE>

      Accrued Certificate  Interest:  With respect to each Distribution Date and
the  Class  A  Certificates,  Class M  Certificates  and  Class B  Certificates,
interest  accrued during the related  Interest Accrual Period on the Certificate
Principal  Balance thereof  immediately  prior to such  Distribution Date at the
related Pass-Through Rate for that Distribution Date.

      The amount of Accrued  Certificate  Interest on each Class of Certificates
shall be reduced by the amount of Prepayment Interest Shortfalls on the Mortgage
Loans  during the prior  calendar  month (to the extent not  covered by Eligible
Master  Servicing  Compensation  pursuant to Section  3.16) and by the amount of
Relief Act  Shortfalls on the Mortgage  Loans during the related Due Period,  in
each case to the extent  allocated  to that Class of  Certificates  pursuant  to
Section 4.02(g). Accrued Certificate Interest for each Class on any Distribution
Date  shall be further  reduced  by the  interest  portion  of  Realized  Losses
allocated to any Class of Certificates pursuant to Section 4.05.

      With  respect  to each  Distribution  Date and the Class SB  Certificates,
interest  accrued  during the preceding  Interest  Accrual Period at the related
Pass  Through Rate for that  Distribution  Date on the  Uncertificated  Notional
Amount as specified in the definition of Pass Through Rate, immediately prior to
such Distribution Date,  reduced by any interest  shortfalls with respect to the
Mortgage  Loans,  including  Prepayment  Interest  Shortfalls  to the extent not
covered by Eligible Master Servicing Compensation pursuant to Section 3.16 or by
the Excess Cash Flow pursuant to clauses (xvi) and (xvii) of Section  4.02(c) or
by the Swap Agreement pursuant to clauses (iii) and (iv) of Section 4.09(c).  In
addition,  Accrued Certificate  Interest with respect to each Distribution Date,
as to the Class SB  Certificates,  shall be  reduced  by an amount  equal to the
interest  portion of  Realized  Losses  allocated  to the  Overcollateralization
Amount  pursuant to Section 4.05  hereof.  Accrued  Certificate  Interest on the
Class A Certificates, Class M Certificates and Class B Certificates shall accrue
on the  basis of a 360-day  year and the  actual  number of days in the  related
Interest  Accrual  Period.   Accrued  Certificate   Interest  on  the  Class  SB
Certificates shall accrue on the basis of a 360 day year consisting of twelve 30
day months.

      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
related Subservicing Fee Rate.

      Adjustment Date: With respect to each adjustable-rate  Mortgage Loan, each
date set  forth in the  related  Mortgage  Note on  which an  adjustment  to the
interest rate on such Mortgage Loan becomes effective.

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

      Affected Party: As defined in the Swap Agreement.

      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.

                                       4
<PAGE>

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

      Amount  Held for Future  Distribution:  With  respect to any  Distribution
Date,  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,  REO Proceeds,  Insurance Proceeds,  Principal
Prepayments,  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,  REO Proceeds,  Subsequent Recoveries
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 (ii)
payments which  represent  early receipt of scheduled  payments of principal and
interest  due on a date or dates  subsequent  to the Due Date in the related Due
Period.

      Appraised  Value:  With  respect  to any  Mortgaged  Property,  one of the
following:  (i) the lesser of (a) the appraised value of such Mortgaged Property
based upon the  appraisal  made at the time of the  origination  of the  related
Mortgage Loan, and (b) the sales price of the Mortgaged Property at such time of
origination,  (ii) in the case of a Mortgaged  Property securing a refinanced or
modified  Mortgage Loan, one of (1) the appraised value based upon the appraisal
made at the time of  origination  of the loan which was  refinanced or modified,
(2)  the  appraised  value  determined  in an  appraisal  made  at the  time  of
refinancing or modification or (3) the sales price of the Mortgaged Property, or
(iii) with respect to the Mortgage  Loans for which a broker's price opinion was
obtained, the value contained in such opinion.

      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.

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

      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: With respect to any Distribution Date, 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 with  respect to the
Mortgage Loans,  (iii) any amount  deposited in the  Certificate  Account on the
related  Certificate Account

                                       5
<PAGE>

Deposit Date pursuant to Section 3.12(a) in respect of the Mortgage Loans,  (iv)
any amount  that the Master  Servicer  is not  permitted  to  withdraw  from the
Custodial  Account pursuant to Section 3.16(e) in respect of the Mortgage Loans,
(v) any amount deposited in the Certificate Account pursuant to Section 4.07 and
any amounts deposited in the Custodial Account pursuant to Section 9.01 and (vi)
any amount described in clauses (i) and (ii) of Section 4.09(c),  reduced by (b)
the sum as of the close of business on the immediately  preceding  Determination
Date of: (w) any payments or collections consisting of prepayment charges on the
Mortgage Loans that were received during the related  Prepayment Period, (x) the
Amount Held for Future  Distribution,  (y) amounts  permitted to be withdrawn by
the Master Servicer from the Custodial  Account  pursuant to clauses  (ii)-(xi),
inclusive,  of Section  3.10(a) and (z) any Net Swap  Payments  owed to the Swap
Counterparty and Swap Termination Payments owed to the Swap Counterparty not due
to Swap Counterparty Trigger Event for such Distribution Date.

      Balloon  Loan:  Each of the  Mortgage  Loans  having an  original  term to
maturity that is shorter than the related amortization term.

      Balloon  Payment:  With respect to any Balloon Loan,  the related  Monthly
Payment payable on the stated maturity date of such Balloon Loan.

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

      Basis Risk Shortfall: Any Class A Basis Risk Shortfall, Class M Basis Risk
Shortfall or Class B Basis Risk Shortfall, as applicable.

      Basis  Risk  Shortfall  Carry-Forward  Amount:  Any  Class  A  Basis  Risk
Shortfall  Carry-Forward  Amount,  Class M Basis  Risk  Shortfall  Carry-Forward
Amount or Class B Basis Risk Shortfall Carry-Forward Amount, as applicable.

      Book-Entry  Certificate:  Any  Certificate  registered  in the name of the
Depository or its nominee.

      Business  Day: Any day other than (i) a Saturday or a Sunday or (ii) a day
on which banking institutions in the States of California,  New York, Minnesota,
Illinois,  Texas or  Michigan  (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.

      Call Rights: As defined in Section 9.01(e).

      Capitalization  Reimbursement  Amount:  With  respect to any  Distribution
Date, the amount of unreimbursed  Advances or Servicing Advances that were added
to the  Stated  Principal  Balance  of the  related  Mortgage  Loans  during the
preceding  calendar month and  reimbursed to the Master  Servicer or Subservicer
pursuant to Section 3.10(a)(vii) on or prior to such Distribution Date.

      Cash Liquidation: With respect 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

                                       6
<PAGE>

which the Master  Servicer  reasonably  and in good faith  expects to be finally
recoverable with respect to such Mortgage Loan.

      Certificate:  Any  Class  A  Certificate,  Class  M  Certificate,  Class B
Certificate, Class SB Certificate or Class R Certificate.

      Certificate  Account:  The  account or  accounts  created  and  maintained
pursuant to Section 4.01, which shall be entitled "[______] as trustee, in trust
for the registered holders of Residential  Funding Mortgage Securities II, Inc.,
Home Equity  Loan  Pass-Through  Certificates,  Series  20[__]-[___]"  and which
account shall be held for the benefit of the  Certificateholders  and which must
be an Eligible Account.

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

      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 any Class A, Class M or
Class B 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 minus (ii) 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(c)  and  4.02(d)  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 with respect
to any  Distribution  Date, the Certificate  Principal  Balance of each class of
Class A Certificates or Class M Certificates and Class B Certificates to which a
Realized  Loss  was  previously  allocated  and  remains  unreimbursed  will  be
increased,  sequentially,  as follows:  first, the Class A Certificates on a pro
rata basis,  then the Class M-1S,  Class M-2S, Class M-3S, Class M-4, Class M-5,
Class M-6,  Class M-7, Class M-8,  Class M-9 and Class B  Certificates,  in that
order,  to the  extent of  Realized  Losses  previously  allocated  thereto  and
remaining unreimbursed, but only to the extent of Subsequent Recoveries received
during the previous  calendar month and available for  distribution  pursuant to
Section 4.02(c)(xii).

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

      Certificateholder  or Holder:  The Person in whose name a  Certificate  is
registered  in the  Certificate  Register,  except that  neither a  Disqualified
Organization  nor a  Non-United  States  Person  shall be a holder  of a Class R
Certificate for any purpose hereof. 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 Depositor, 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

                                       7
<PAGE>

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.

      Class:  Collectively,  all of the Certificates or uncertificated interests
bearing the same designation.

      Class A Basis Risk  Shortfall:  With  respect to each Class of the Class A
Certificates and any Distribution  Date for which the Pass-Through  Rate for any
such Class of  Certificates is equal to the Net WAC Cap Rate, an amount equal to
the excess of (x) Accrued Certificate  Interest on that Class of Certificates on
such Distribution Date, calculated at a rate (not to exceed the Maximum Mortgage
Loan Rate) equal to LIBOR plus the related  Class A Margin,  as  calculated  for
such  Distribution Date over (y) Accrued  Certificate  Interest on such Class of
Class A Certificates  for such  Distribution  Date calculated at the Net WAC Cap
Rate.

      Class A Basis Risk Shortfall  Carry-Forward  Amount:  With respect to each
Class of Class A  Certificates  and any  Distribution  Date,  the sum of (a) the
aggregate  amount  of  Class A Basis  Risk  Shortfall  for  such  Class  on such
Distribution Date plus (b) any Class A Basis Risk Shortfall Carry-Forward Amount
for such Class remaining unpaid from the preceding  Distribution  Date, plus (c)
one month's interest on the amount in clause (b) (based on the number of days in
the preceding Interest Accrual Period), to the extent previously unreimbursed by
the Excess Cash Flow pursuant to Section 4.02(c)(xvii) or amounts received under
the Swap  Agreement  pursuant  to  Section  4.09(c)(v),  at a rate  equal to the
related Pass-Through Rate.

      Class A  Certificate:  Any one of the Class A-1,  Class A-2,  Class A-3 or
Class A-4 Certificates.

      Class A Interest  Distribution Amount: With respect to each Class of Class
A  Certificates  and any  Distribution  Date,  the  aggregate  amount of Accrued
Certificate  Interest  to be  distributed  to the  holders of each such Class of
Class A  Certificates  for such  Distribution  Date,  plus any  related  Accrued
Certificate Interest thereon remaining unpaid from any prior Distribution Date.

      Class A Margin:  With  respect  to the Class A-1  Certificates,  initially
[___]%  per  annum,  and  on  any  Distribution  Date  on or  after  the  second
Distribution Date after the first possible Optional Termination Date, [___]% per
annum. With respect to the Class A-2  Certificates,  initially [___]% per annum,
and on any Distribution Date on or after the second  Distribution Date after the
first possible Optional  Termination Date, [___]% per annum. With respect to the
Class A-3 Certificates, initially [___]% per annum, and on any Distribution Date
on or after the  second  Distribution  Date  after the first  possible  Optional
Termination  Date, [___]% per annum. With respect to the Class A-4 Certificates,
initially [___]% per annum, and on any Distribution  Date on or after the second
Distribution Date after the first possible Optional Termination Date, [___]% per
annum.

                                       8
<PAGE>

      Class A Principal  Distribution  Amount:  With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger  Event  is  in  effect  for  that   Distribution   Date,  the  Principal
Distribution  Amount for that Distribution Date or (ii) on or after the Stepdown
Date if a Trigger Event is not in effect for that Distribution  Date, the lesser
of:

            (i) the Principal  Distribution  Amount for that Distribution  Date;
      and

            (ii) the excess, if any, of (A) the aggregate  Certificate Principal
      Balance of the Class A Certificates immediately prior to that Distribution
      Date over (B) the lesser of (x) the  product of (1)  approximately  [___]%
      and (2) the aggregate Stated Principal Balance of the Mortgage Loans after
      giving effect to  distributions to be made on that  Distribution  Date and
      (y) the excess,  if any, of the aggregate Stated Principal  Balance of the
      Mortgage  Loans after giving  effect to  distributions  to be made on that
      Distribution Date, over the Overcollateralization Floor.

      Class A-1 Certificate:  Any one of the Class A-1 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form  annexed  hereto as Exhibit A, senior to the Class M, Class B, Class SB and
Class R  Certificates  with  respect  to  distributions  and the  allocation  of
Realized  Losses as set forth in Section 4.05,  and  evidencing  (i) an interest
designated  as a  "regular  interest"  in REMIC  II for  purposes  of the  REMIC
Provisions  and (ii) the  right to  receive  the  Class A Basis  Risk  Shortfall
Carry-Forward  Amount from Excess Cash Flow,  the  Supplemental  Interest  Trust
Account and the Swap Agreement to the extent described herein.

      Class A-2 Certificate:  Any one of the Class A-2 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form  annexed  hereto as Exhibit A, senior to the Class M, Class B, Class SB and
Class R  Certificates  with  respect  to  distributions  and the  allocation  of
Realized  Losses as set forth in Section 4.05,  and  evidencing  (i) an interest
designated  as a  "regular  interest"  in REMIC  II for  purposes  of the  REMIC
Provisions  and (ii) the  right to  receive  the  Class A Basis  Risk  Shortfall
Carry-Forward  Amount from Excess Cash Flow,  the  Supplemental  Interest  Trust
Account and the Swap Agreement to the extent described herein.

      Class A-3 Certificate:  Any one of the Class A-3 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form  annexed  hereto as Exhibit A, senior to the Class M, Class B, Class SB and
Class R  Certificates  with  respect  to  distributions  and the  allocation  of
Realized  Losses as set forth in Section 4.05,  and  evidencing  (i) an interest
designated  as a  "regular  interest"  in REMIC  II for  purposes  of the  REMIC
Provisions  and (ii) the  right to  receive  the  Class A Basis  Risk  Shortfall
Carry-Forward  Amount from Excess Cash Flow,  the  Supplemental  Interest  Trust
Account and the Swap Agreement to the extent described herein.

      Class A-4 Certificate:  Any one of the Class A-4 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form  annexed  hereto as Exhibit A, senior to the Class M, Class B, Class SB and
Class R  Certificates  with  respect  to  distributions  and the  allocation  of
Realized  Losses as set forth in Section 4.05,  and  evidencing  (i) an interest
designated  as a  "regular  interest"  in REMIC  II for  purposes  of the  REMIC
Provisions  and (ii) the  right to  receive  the  Class A Basis  Risk  Shortfall
Carry-Forward  Amount from Excess Cash Flow,  the  Supplemental  Interest  Trust
Account and the Swap Agreement to the extent described herein.

                                       9
<PAGE>

      Class B Basis Risk Shortfall: With respect to the Class B Certificates and
any  Distribution  Date for which the  Pass-Through  Rate for any such  Class of
Certificates  is equal to the Net WAC Cap Rate, an amount equal to the excess of
(x)  Accrued  Certificate  Interest  on  that  Class  of  Certificates  on  such
Distribution Date, calculated at a rate (not to exceed the Maximum Mortgage Loan
Rate) equal to LIBOR plus the related  Class B Margin,  as  calculated  for such
Distribution  Date  over  (y)  Accrued  Certificate  Interest  on such  Class of
Certificates for such Distribution Date calculated at the Net WAC Cap Rate.

      Class B Basis Risk  Shortfall  Carry-Forward  Amount:  With respect to the
Class B  Certificates  and any  Distribution  Date, the sum of (a) the aggregate
amount of Class B Basis Risk Shortfall for such Class on such  Distribution Date
plus (b) any Class B Basis Risk  Shortfall  Carry-Forward  Amount for such Class
remaining  unpaid from the  preceding  Distribution  Date,  plus (c) one month's
interest  on the  amount  in  clause  (b)  (based  on the  number of days in the
preceding Interest Accrual Period), to the extent previously unreimbursed by the
Excess Cash Flow pursuant to Section  4.02(c)(xviii)  or amounts  received under
the Swap  Agreement  pursuant  to  Section  4.09(c)(v),  at a rate  equal to the
related Pass-Through Rate.

      Class B Certificate:  Any one of the Class B Certificates  executed by the
Trustee and authenticated by the Certificate Registrar substantially in the form
annexed  hereto as Exhibit  C-1,  C-2 or C-3,  as  provided  in Section  5.02(e)
hereof,  senior  to the  Class  SB and  Class R  Certificates  with  respect  to
distributions  and the  allocation  of  Realized  Losses as set forth in Section
4.05, and evidencing (i) an interest designated as a "regular interest" in REMIC
II for purposes of the REMIC  Provisions and (ii) the right to receive the Class
B Basis Risk  Shortfall  Carry-Forward  Amount  from the Excess  Cash Flow,  the
Supplemental  Interest  Trust  Account  and the  Swap  Agreement  to the  extent
described herein.

      Class B Margin: With respect to the Class B Certificates, initially [___]%
per annum, and on any Distribution Date on or after the second Distribution Date
after the first possible Optional Termination Date, [___]% per annum.

      Class  B  Interest  Distribution  Amount:  With  respect  to the  Class  B
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class B Principal  Distribution  Amount:  With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal Distribution Amount, Sequential Class M Principal Distribution Amount,
Class  M-4  Principal  Distribution  Amount,  Class M-5  Principal  Distribution
Amount,   Class  M-6  Principal   Distribution   Amount,   Class  M-7  Principal
Distribution  Amount,  Class M-8  Principal  Distribution  Amount  and Class M-9
Principal Distribution Amount or (ii) on or after the Stepdown Date if a Trigger
Event is not in effect for that Distribution Date, the lesser of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount,  Sequential  Class M  Principal

                                       10
<PAGE>

      Distribution  Amount,  Class M-4 Principal  Distribution Amount, Class M-5
      Principal  Distribution Amount,  Class M-6 Principal  Distribution Amount,
      Class M-7 Principal  Distribution Amount, Class M-8 Principal Distribution
      Amount and Class M-9 Principal Distribution Amount;

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A, Class M-1SS,  Class M-2SS,
      Class M-3SS,  Class M-4,  Class M-5,  Class M-6,  Class M-7, Class M-8 and
      Class M-9 Certificates (after taking into account the payment of the Class
      A Principal Distribution Amount, Sequential Class M Principal Distribution
      Amount,  Class M-4  Principal  Distribution  Amount,  Class M-5  Principal
      Distribution  Amount,  Class M-6 Principal  Distribution Amount, Class M-7
      Principal Distribution Amount, Class M-8 Principal Distribution Amount and
      Class M-9 Principal  Distribution  Amount for that Distribution  Date) and
      (2)  the  Certificate  Principal  Balance  of  the  Class  B  Certificates
      immediately prior to that Distribution Date over (B) the lesser of (x) the
      product of (1) approximately [___]% and (2) the aggregate Stated Principal
      Balance of the Mortgage Loans after giving effect to  distributions  to be
      made  on  that  Distribution  Date  and (y)  the  excess,  if any,  of the
      aggregate  Stated  Principal  Balance of the  Mortgage  Loans after giving
      effect to  distributions  to be made on that  Distribution  Date, over the
      Overcollateralization Floor.

      Class M Basis Risk Shortfall:  With respect to the Class M-1S, Class M-2S,
Class M-3S,  Class M-4, Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates and any Distribution  Date for which the Pass-Through  Rate for any
such Class of  Certificates is equal to the Net WAC Cap Rate, an amount equal to
the excess of (x) Accrued Certificate  Interest on that Class of Certificates on
such  Distribution Date calculated at a rate (not to exceed the Maximum Mortgage
Loan Rate) equal to LIBOR plus the related  Class M Margin,  as  calculated  for
such  Distribution Date over (y) Accrued  Certificate  Interest on such Class of
Class M Certificates  for such  Distribution  Date calculated at the Net WAC Cap
Rate.

      Class M Basis Risk  Shortfall  Carry-Forward  Amount:  With respect to the
Class M-1S,  Class M-2S, Class M-3S, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8 and Class M-9 Certificates  and any Distribution  Date, the sum of (a)
the aggregate amount of Class M Basis Risk Shortfall for each such Class on such
Distribution Date plus (b) any Class M Basis Risk Shortfall Carry-Forward Amount
for such Classes remaining unpaid from the preceding Distribution Date, plus (c)
one month's interest on the amount in clause (b) (based on the number of days in
the preceding Interest Accrual Period), to the extent previously unreimbursed by
the Excess Cash Flow pursuant to Section 4.02(c)(xvii) or amounts received under
the Swap  Agreement  pursuant  to  Section  4.09(c)(v),  at a rate  equal to the
related Pass-Through Rate.

      Class M Certificate:  Any one of the Class M-1S,  Class M-2S,  Class M-3S,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8 or Class M-9 Certificates.

      Class M Margin:  With  respect to the Class M-1S  Certificates,  initially
[___]%  per  annum,  and  on  any  Distribution  Date  on or  after  the  second
Distribution Date after the first possible Optional Termination Date, [___]% per
annum. With respect to the Class M-2S Certificates,  initially [___]% per annum,
and on any Distribution Date on or after the second

                                       11
<PAGE>

Distribution Date after the first possible Optional Termination Date, [___]% per
annum. With respect to the Class M-3S Certificates,  initially [___]% per annum,
and on any Distribution Date on or after the second  Distribution Date after the
first possible Optional  Termination Date, [___]% per annum. With respect to the
Class M-4 Certificates, initially [___]% per annum, and on any Distribution Date
on or after the  second  Distribution  Date  after the first  possible  Optional
Termination  Date, [___]% per annum. With respect to the Class M-5 Certificates,
initially 0.380% per annum, and on any Distribution  Date on or after the second
Distribution Date after the first possible Optional Termination Date, [___]% per
annum. With respect to the Class M-6  Certificates,  initially [___]% per annum,
and on any Distribution Date on or after the second  Distribution Date after the
first possible Optional  Termination Date, [___]% per annum. With respect to the
Class M-7 Certificates, initially [___]% per annum, and on any Distribution Date
on or after the  second  Distribution  Date  after the first  possible  Optional
Termination  Date, [___]% per annum. With respect to the Class M-8 Certificates,
initially [___]% per annum, and on any Distribution  Date on or after the second
Distribution Date after the first possible Optional Termination Date, [___]% per
annum. With respect to the Class M-9  Certificates,  initially [___]% per annum,
and on any Distribution Date on or after the second  Distribution Date after the
first possible Optional Termination Date, [___]% per annum.

      Class M-1S Certificate: Any one of the Class M-1S Certificates executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed  hereto as Exhibit B, senior to the Class M-2S,  Class M-3S,  Class
M-4,  Class M-5,  Class M-6,  Class M-7, Class M-8, Class M-9, Class B, Class SB
and Class R  Certificates  with respect to  distributions  and the allocation of
Realized  Losses as set forth in Section 4.05,  and  evidencing  (i) an interest
designated  as a  "regular  interest"  in REMIC  II for  purposes  of the  REMIC
Provisions  and (ii) the  right to  receive  the  Class M Basis  Risk  Shortfall
Carry-Forward Amount from the Excess Cash Flow, the Supplemental  Interest Trust
Account and the Swap Agreement to the extent described herein.

      Class M-1S Interest  Distribution  Amount:  With respect to the Class M-1S
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-2S Certificate: Any one of the Class M-2S Certificates executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form  annexed  hereto as Exhibit B, senior to the Class M-3S,  Class M-4,  Class
M-5,  Class M-6,  Class M-7, Class M-8, Class M-9, Class B, Class SB and Class R
Certificates with respect to distributions and the allocation of Realized Losses
as set forth in Section 4.05,  and  evidencing  (i) an interest  designated as a
"regular interest" in REMIC II for purposes of the REMIC Provisions and (ii) the
right to receive  the Class M Basis Risk  Shortfall  Carry-Forward  Amount  from
Excess Cash Flow, the Supplemental Interest Trust Account and the Swap Agreement
to the extent described herein.

      Class M-2S Interest  Distribution  Amount:  With respect to the Class M-2S
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

                                       12
<PAGE>

      Class M-3S Certificate: Any one of the Class M-3S Certificates executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed hereto as Exhibit B, senior to the Class M-4, Class M-5, Class M-6,
Class M-7, Class M-8, Class M-9, Class B, Class SB and Class R Certificates with
respect to  distributions  and the allocation of Realized Losses as set forth in
Section 4.05, and evidencing (i) an interest  designated as a "regular interest"
in REMIC II for purposes of the REMIC  Provisions  and (ii) the right to receive
the Class M Basis Risk Shortfall Carry-Forward Amount from Excess Cash Flow, the
Supplemental  Interest  Trust  Account  and the  Swap  Agreement  to the  extent
described herein.

      Class M-3S Interest  Distribution  Amount:  With respect to the Class M-3S
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-4 Certificate:  Any one of the Class M-4 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed hereto as Exhibit B, senior to the Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9, Class B, Class SB and Class R Certificates with respect to
distributions  and the  allocation  of  Realized  Losses as set forth in Section
4.05, and evidencing (i) an interest designated as a "regular interest" in REMIC
II for purposes of the REMIC  Provisions and (ii) the right to receive the Class
M Basis Risk  Shortfall  Carry-Forward  Amount from the Excess Cash Flow and the
Swap Agreement to the extent described herein.

      Class M-4  Interest  Distribution  Amount:  With  respect to the Class M-4
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-4 Principal  Distribution Amount: With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal  Distribution  Amount and  Sequential  Class M Principal  Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect
for that Distribution Date, the lesser of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount and Sequential Class M Principal Distribution Amount; and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate Principal Balance of the Class A, Class M-1SS, Class M-2SS and
      Class M-3SS  Certificates  (after  taking into  account the payment of the
      Class A Principal  Distribution  Amount and  Sequential  Class M Principal
      Distribution  Amount for that  Distribution  Date) and (2) the Certificate
      Principal Balance of the Class M-4 Certificates  immediately prior to that
      Distribution  Date  over  (B)  the  lesser  of  (x)  the  product  of  (1)
      approximately [___]% and (2) the aggregate Stated Principal Balance of the
      Mortgage  Loans after giving  effect to  distributions  to be made on that
      Distribution  Date and (y) the  excess,  if any, of the

                                       13
<PAGE>

      aggregate  Stated  Principal  Balance of the  Mortgage  Loans after giving
      effect to  distributions  to be made on that  Distribution  Date, over the
      Overcollateralization Floor.

      Class M-5 Certificate:  Any one of the Class M-5 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed hereto as Exhibit B, senior to the Class M-6, Class M-7, Class M-8,
Class  M-9,  Class  B,  Class  SB and  Class  R  Certificates  with  respect  to
distributions  and the  allocation  of  Realized  Losses as set forth in Section
4.05, and evidencing (i) an interest designated as a "regular interest" in REMIC
II for purposes of the REMIC  Provisions and (ii) the right to receive the Class
M  Basis  Risk  Shortfall  Carry-Forward  Amount  from  Excess  Cash  Flow,  the
Supplemental  Interest  Trust  Account  and the  Swap  Agreement  to the  extent
described herein.

      Class M-5  Interest  Distribution  Amount:  With  respect to the Class M-5
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-5 Principal  Distribution Amount: With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal Distribution Amount,  Sequential Class M Principal Distribution Amount
and Class M-4  Principal  Distribution  Amount or (ii) on or after the  Stepdown
Date if a Trigger Event is not in effect for that Distribution  Date, the lesser
of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount,  Sequential  Class M Principal  Distribution  Amount and Class M-4
      Principal Distribution Amount; and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A, Class M-1SS,  Class M-2SS,
      Class M-3SS and Class M-4  Certificates  (after  taking  into  account the
      payment of the Class A Principal  Distribution Amount,  Sequential Class M
      Principal  Distribution Amount and Class M-4 Principal Distribution Amount
      for that Distribution  Date) and (2) the Certificate  Principal Balance of
      the Class M-5 Certificates  immediately  prior to that  Distribution  Date
      over (B) the lesser of (x) the product of (1) approximately [___]% and (2)
      the aggregate Stated Principal  Balance of the Mortgage Loans after giving
      effect to distributions to be made on that  Distribution  Date and (y) the
      excess,  if any, of the aggregate Stated Principal Balance of the Mortgage
      Loans after giving effect to distributions to be made on that Distribution
      Date, over the Overcollateralization Floor.

      Class M-6 Certificate:  Any one of the Class M-6 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed hereto as Exhibit B, senior to the Class M-7, Class M-8, Class M-9,
Class B, Class SB and Class R Certificates with respect to distributions and the
allocation of Realized  Losses as set forth in Section 4.05,  and evidencing (i)
an interest  designated as a "regular  interest" in REMIC II for purposes of the
REMIC  Provisions and (ii) the right to receive the Class M Basis Risk Shortfall

                                       14
<PAGE>

Carry-Forward  Amount from Excess Cash Flow,  the  Supplemental  Interest  Trust
Account and the Swap Agreement to the extent described herein.

      Class M-6  Interest  Distribution  Amount:  With  respect to the Class M-6
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-6 Principal  Distribution Amount: With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal Distribution Amount, Sequential Class M Principal Distribution Amount,
Class M-4 Principal  Distribution  Amount and Class M-5  Principal  Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect
for that Distribution Date, the lesser of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount,  Sequential  Class M  Principal  Distribution  Amount,  Class  M-4
      Principal Distribution Amount and Class M-5 Principal Distribution Amount;
      and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A, Class M-1SS,  Class M-2SS,
      Class  M-3SS,  Class M-4 and Class M-5  Certificates  (after  taking  into
      account  the  payment  of  the  Class  A  Principal  Distribution  Amount,
      Sequential  Class M Principal  Distribution  Amount,  Class M-4  Principal
      Distribution  Amount and Class M-5 Principal  Distribution Amount for that
      Distribution Date) and (2) the Certificate  Principal Balance of the Class
      M-6 Certificates  immediately prior to that Distribution Date over (B) the
      lesser  of (x)  the  product  of (1)  approximately  [___]%  and  (2)  the
      aggregate  Stated  Principal  Balance of the  Mortgage  Loans after giving
      effect to distributions to be made on that  Distribution  Date and (y) the
      excess,  if any, of the aggregate Stated Principal Balance of the Mortgage
      Loans after giving effect to distributions to be made on that Distribution
      Date, over the Overcollateralization Floor.

      Class M-7 Certificate:  Any one of the Class M-7 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed  hereto as Exhibit B, senior to the Class M-8,  Class M-9, Class B,
Class  SB and  Class  R  Certificates  with  respect  to  distributions  and the
allocation of Realized  Losses as set forth in Section 4.05,  and evidencing (i)
an interest  designated as a "regular  interest" in REMIC II for purposes of the
REMIC  Provisions and (ii) the right to receive the Class M Basis Risk Shortfall
Carry Forward Amount from the Excess Cash Flow, the Supplemental  Interest Trust
Account and the Swap Agreement to the extent described herein.

      Class M-7  Interest  Distribution  Amount:  With  respect to the Class M-7
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

                                       15
<PAGE>

      Class M-7 Principal  Distribution Amount: With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal Distribution Amount, Sequential Class M Principal Distribution Amount,
Class M-4 Principal Distribution Amount, Class M-5 Principal Distribution Amount
and Class M-6  Principal  Distribution  Amount or (ii) on or after the  Stepdown
Date if a Trigger Event is not in effect for that Distribution  Date, the lesser
of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount,  Sequential  Class M  Principal  Distribution  Amount,  Class  M-4
      Principal Distribution Amount, Class M-5 Principal Distribution Amount and
      Class M-6 Principal Distribution Amount; and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A, Class M-1SS,  Class M-2SS,
      Class M-3SS, Class M-4, Class M-5 and Class M-6 Certificates (after taking
      into  account the payment of the Class A  Principal  Distribution  Amount,
      Sequential  Class M Principal  Distribution  Amount,  Class M-4  Principal
      Distribution Amount, Class M-5 Principal Distribution Amount and Class M-6
      Principal  Distribution  Amount  for that  Distribution  Date) and (2) the
      Certificate  Principal  Balance of the Class M-7 Certificates  immediately
      prior to that  Distribution Date over (B) the lesser of (x) the product of
      (1) approximately [___]% and (2) the aggregate Stated Principal Balance of
      the Mortgage Loans after giving effect to distributions to be made on that
      Distribution  Date and (y) the  excess,  if any, of the  aggregate  Stated
      Principal   Balance  of  the  Mortgage   Loans  after  giving   effect  to
      distributions   to  be  made  on  that   Distribution   Date,   over   the
      Overcollateralization Floor.

      Class M-8 Certificate:  Any one of the Class M-8 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed hereto as Exhibit B, senior to the Class M-9, Class B, Class SB and
Class R  Certificates  with  respect  to  distributions  and the  allocation  of
Realized  Losses as set forth in Section 4.05,  and  evidencing  (i) an interest
designated  as a  "regular  interest"  in REMIC  II for  purposes  of the  REMIC
Provisions  and (ii) the  right to  receive  the  Class M Basis  Risk  Shortfall
Carry-Forward Amount from the Excess Cash Flow, the Supplemental  Interest Trust
Account and the Swap Agreement to the extent described herein.

      Class M-8  Interest  Distribution  Amount:  With  respect to the Class M-8
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-8 Principal  Distribution Amount: With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal Distribution Amount, Sequential Class M Principal Distribution Amount,
Class  M-4  Principal  Distribution  Amount,  Class M-5  Principal  Distribution
Amount,  Class  M-6  Principal  Distribution  Amount  and  Class  M-7  Principal

                                       16
<PAGE>

Distribution  Amount or (ii) on or after the Stepdown Date if a Trigger Event is
not in effect for that Distribution Date, the lesser of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount,  Sequential  Class M  Principal  Distribution  Amount,  Class  M-4
      Principal  Distribution Amount,  Class M-5 Principal  Distribution Amount,
      Class  M-6   Principal   Distribution   Amount  and  Class  M-7  Principal
      Distribution Amount; and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A, Class M-1SS,  Class M-2SS,
      Class M-3SS,  Class M-4, Class M-5,  Class M-6 and Class M-7  Certificates
      (after   taking  into  account  the  payment  of  the  Class  A  Principal
      Distribution  Amount,  Sequential Class M Principal  Distribution  Amount,
      Class M-4 Principal  Distribution Amount, Class M-5 Principal Distribution
      Amount,  Class M-6 Principal  Distribution  Amount and Class M-7 Principal
      Distribution  Amount for that  Distribution  Date) and (2) the Certificate
      Principal Balance of the Class M-8 Certificates  immediately prior to that
      Distribution  Date  over  (B)  the  lesser  of  (x)  the  product  of  (1)
      approximately [___]% and (2) the aggregate Stated Principal Balance of the
      Mortgage  Loans after giving  effect to  distributions  to be made on that
      Distribution  Date and (y) the  excess,  if any, of the  aggregate  Stated
      Principal   Balance  of  the  Mortgage   Loans  after  giving   effect  to
      distributions   to  be  made  on  that   Distribution   Date,   over   the
      Overcollateralization Floor.

      Class M-9 Certificate:  Any one of the Class M-9 Certificates  executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form annexed hereto as Exhibit B, senior to the Class B  Certificates,  Class SB
Certificates  and Class R  Certificates  with respect to  distributions  and the
allocation of Realized  Losses as set forth in Section 4.05,  and evidencing (i)
an interest  designated as a "regular  interest" in REMIC II for purposes of the
REMIC  Provisions and (ii) the right to receive the Class M Basis Risk Shortfall
Carry-Forward  Amount from Excess Cash Flow,  the  Supplemental  Interest  Trust
Account and the Swap Agreement to the extent described herein.

      Class M-9  Interest  Distribution  Amount:  With  respect to the Class M-9
Certificates  and  any  Distribution  Date,  the  aggregate  amount  of  Accrued
Certificate  Interest  to be  distributed  to the holders of such Class for such
Distribution  Date,  plus any related  Accrued  Certificate  Interest  remaining
unpaid from any prior Distribution Date.

      Class M-9 Principal  Distribution Amount: With respect to any Distribution
Date  (i)  prior to the  Stepdown  Date or on or after  the  Stepdown  Date if a
Trigger Event is in effect for that Distribution  Date, the remaining  Principal
Distribution Amount for that Distribution Date after distribution of the Class A
Principal Distribution Amount, Sequential Class M Principal Distribution Amount,
Class  M-4  Principal  Distribution  Amount,  Class M-5  Principal  Distribution
Amount,   Class  M-6  Principal   Distribution   Amount,   Class  M-7  Principal
Distribution  Amount and Class M-8 Principal  Distribution  Amount or (ii) on or
after  the  Stepdown  Date  if a  Trigger  Event  is  not  in  effect  for  that
Distribution Date, the lesser of:

                                       17
<PAGE>

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount,  Sequential  Class M  Principal  Distribution  Amount,  Class  M-4
      Principal  Distribution Amount,  Class M-5 Principal  Distribution Amount,
      Class M-6 Principal  Distribution Amount, Class M-7 Principal Distribution
      Amount and Class M-8 Principal Distribution Amount; and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A, Class M-1SS,  Class M-2SS,
      Class  M-3SS,  Class M-4,  Class M-5,  Class M-6,  Class M-7 and Class M-8
      Certificates  (after  taking  into  account  the  payment  of the  Class A
      Principal  Distribution Amount,  Sequential Class M Principal Distribution
      Amount,  Class M-4  Principal  Distribution  Amount,  Class M-5  Principal
      Distribution  Amount,  Class M-6 Principal  Distribution Amount, Class M-7
      Principal  Distribution Amount and Class M-8 Principal Distribution Amount
      for that Distribution  Date) and (2) the Certificate  Principal Balance of
      the Class M-9 Certificates  immediately  prior to that  Distribution  Date
      over (B) the lesser of (x) the product of (1) approximately [___]% and (2)
      the aggregate Stated Principal  Balance of the Mortgage Loans after giving
      effect to distributions to be made on that  Distribution  Date and (y) the
      excess,  if any, of the aggregate Stated Principal Balance of the Mortgage
      Loans after giving effect to distributions to be made on that Distribution
      Date, over the Overcollateralization Floor.

      Class R Certificates:  Collectively,  the Class R-I  Certificates  and the
Class R-II Certificates.

      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  hereto as Exhibit E 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  hereto as Exhibit E and  evidencing  an interest  designated  as a
"residual interest" in REMIC II for purposes of the REMIC Provisions.

      Class SB Certificate: Any one of the Class SB Certificates executed by the
Trustee and authenticated by the Certificate Registrar substantially in the form
annexed hereto as Exhibit D,  subordinate to the Class A  Certificates,  Class M
Certificates  and Class B  Certificates  with respect to  distributions  and the
allocation of Realized  Losses as set forth in Section 4.05,  and  evidencing an
interest  comprised of "regular  interests"  in REMIC II,  together with certain
rights  to  payments  under  the  Swap  Agreement  for  purposes  of  the  REMIC
Provisions.

      Clearing   System   Certificate:   As  defined  in  Section   5.02(e)  and
substantially in the form of Exhibit W- hereto.

      Clearstream: Clearstream Banking, societe anonyme.

      Closing Date: [____ __], 20[__].

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

                                       18
<PAGE>

      Commission: The Securities and Exchange Commission.

      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 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.

      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   [______],   [______],   Attention:   Structured
Finance/RFMSII Series 20[__]-[___].

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

      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
Depositor, the Master Servicer, the Trustee and a Custodian in substantially the
form of Exhibit F hereto.

                                       19
<PAGE>

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

      Custodian:  [__________], or any successor custodian appointed pursuant to
a Custodial Agreement.

      Cut-off Date: [____] 1, 20[__].

      Cut-off Date Balance: $[__________].

      Cut-off Date  Principal  Balance:  With respect 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 proceeding under the Bankruptcy Code,  except such a reduction
constituting a Deficient  Valuation or any reduction that results in a permanent
forgiveness of principal.

      Defaulting Party: As defined in the Swap Agreement.

      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 definitive, fully registered 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 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 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  August  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.

      Depositor: As defined in the preamble hereto.

      Depository:  The  Depository  Trust Company,  or any successor  Depository
hereafter  named.  The  nominee  of  the  initial  Depository  for  purposes  of
registering those Certificates that

                                       20
<PAGE>

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 Exchange Act.

      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.

      Determination  Date: With respect to any  Distribution  Date, the 20th day
(or if such  20th  day is not a  Business  Day,  the  Business  Day  immediately
following such 20th day) of the month of the related Distribution Date.

      Disqualified  Organization:  Any  organization  defined as a "disqualified
organization"  under Section  860E(e)(5) of the Code,  which includes 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) and (iv) rural  electric  and
telephone  cooperatives  described  in  Section  1381(a)(2)(C)  of the  Code.  A
Disqualified  Organization  also includes any "electing large  partnership,"  as
defined in Section  775(a) of the Code and 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 any REMIC 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.

      DTC  Letter:  The Letter of  Representations,  dated  [____  __],  20[__],
between the Trustee, on behalf of the Trust Fund, and the Depository.

      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 calendar month of
such Distribution Date.

                                       21
<PAGE>

      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 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 [______],  or (iv) in
the case of the Certificate  Account, a trust account or accounts  maintained in
the corporate trust  department of [______],  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 lower of the then-current rating or
the rating  assigned to such  Certificates as of the Closing Date by such Rating
Agency).

      Eligible Master Servicing  Compensation:  With respect to any Distribution
Date, an amount equal to Prepayment Interest Shortfalls resulting from Principal
Prepayments in Full or Curtailments  during the related  Prepayment  Period, 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,  all income and gain on amounts  held in the
Custodial  Account  and the  Certificate  Account  and  amounts  payable  to the
Certificateholders   with  respect  to  such  Distribution  Date  and  servicing
compensation  to which the Master  Servicer may be entitled  pursuant to Section
3.10(a)(v) and (vi) 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 7.02(a).

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

      Euroclear: Euroclear Bank, S.A./NA, as operator of The Euroclear System.

      Event of Default: As defined in Section 7.01.

      Excess Cash Flow: With respect to the Mortgage Loans and any  Distribution
Date,  an  amount  equal  to the sum of (A)  the  excess  of (1)  the  Available
Distribution Amount (other than the portion of the Available Distribution Amount
described in clause (a)(vi) of the definition of Available  Distribution Amount)
for that  Distribution  Date over (2) the sum of (x) the  Interest  Distribution
Amount  for that  Distribution  Date  and (y) the  lesser  of (i) the  aggregate
Certificate Principal Balance of the Class A Certificates,  Class M Certificates
and Class B Certificates  immediately  prior to such  Distribution Date and (ii)
the Principal  Remittance  Amount for that  Distribution  Date to the extent not
used to pay interest on the Class A  Certificates  and Class M  Certificates  on
such  Distribution Date and (B) the  Overcollateralization  Reduction Amount, if
any, for that Distribution Date.

                                       22
<PAGE>

      Excess  Overcollateralization  Amount:  With  respect to any  Distribution
Date,  the  excess,  if any,  of (a) the  Overcollateralization  Amount  on such
Distribution  Date over (b) the Required  Overcollateralization  Amount for such
Distribution Date.

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

      Exchange Date: As defined in Section 5.02(e)(ii).

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

      FDIC: The Federal Deposit Insurance Corporation or any successor thereto.

      FHA: The Federal Housing Administration, or its successor.

      Final Certification: As defined in Section 2.02.

      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.

      Final Scheduled  Distribution Date: Solely for purposes of the face of the
Certificates,  as  follows:  with  respect  to the Class A-1  Certificates,  the
Distribution Date in [____] 20[__];  with respect to the Class A-2 Certificates,
the  Distribution  Date in [____] 20[__];  with respect to each of the Class A-3
Certificates,  the Distribution  Date in [____] 20[__];  with respect to each of
the Class A-4 Certificates, the Distribution Date in [____] 20[__]; with respect
to the Class M-1S  Certificates,  the Distribution  Date in [____] 20[__];  with
respect to the Class M-2S Certificates,  the Distribution Date in [____] 20[__];
with respect to the Class M-3S  Certificates,  the  Distribution  Date in [____]
20[__];  with respect to the Class M-4  Certificates,  the Distribution  Date in
[____] 20[__]; with respect to the Class M-5 Certificates, the Distribution Date
in[____] 20[__];  with respect to the Class M-6  Certificates,  the Distribution
Date  in  [____]  20[__];  with  respect  to the  Class  M-7  Certificates,  the
Distribution  Date in[____] 20[__];  with respect to the Class M-8 Certificates,
the  Distribution   Date  in[____]  20[__];   with  respect  to  the  Class  M-9
Certificates, the Distribution Date in[____] 20[__]; with respect to the Class B
Certificates,  the Distribution  Date in[____]  20[__];  and with respect to the
Class SB  Certificates,  the  Distribution  Date  in[____]  20[__].  No event of
default under this Agreement will arise or become applicable solely by reason of
the failure to retire the entire  Certificate  Principal Balance of any Class of
Class A Certificates  or Class M Certificates  on or before its Final  Scheduled
Distribution Date.

      Fixed Swap Payment:  With respect to any Distribution  Date on or prior to
the Distribution Date in [_____] 20[__], an amount equal to the product of (x) a
fixed rate equal to [___]% per annum,  (y) the Swap Agreement  Notional  Balance
for that Distribution  Date and (z) a fraction,  the numerator of which is equal
to the number of days in the related  calculation period as provided in the Swap
Agreement,  the  number of days to be  calculated  on the basis of a year of 360
days with 12 30-day months, and the denominator of which is 360.

                                       23
<PAGE>

      Floating Swap Payment:  With respect to any Distribution  Date on or prior
to the  Distribution  Date in [_____] 20[__],  an amount equal to the product of
(x) Swap LIBOR, (y) the Swap Agreement  Notional  Balance for that  Distribution
Date and (z) a fraction,  the  numerator of which is equal to the number of days
in the related  calculation  period as provided  in the Swap  Agreement  and the
denominator of which is 360.

      Foreclosure  Profits:  With  respect 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 day of the month  following the month in
which such Cash Liquidation or REO Disposition occurred.

      Freddie  Mac:  The 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.

      Gross Margin:  With respect to each  adjustable  rate Mortgage  Loan,  the
fixed percentage set forth in the related Mortgage Note and indicated in Exhibit
G hereto as the "NOTE MARGIN," which percentage is added to the related Index on
each  Adjustment  Date to determine  (subject to rounding in accordance with the
related  Mortgage  Note,  the Periodic  Cap, the Maximum  Mortgage  Rate and the
Minimum Mortgage Rate) the interest rate to be borne by such Mortgage Loan until
the next Adjustment Date.

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

      Index:  With respect to any  adjustable  rate  Mortgage Loan and as to any
Adjustment  Date therefor,  the related index as stated in the related  Mortgage
Note.

      Initial  Certificate  Principal  Balance:  With  respect  to each Class of
Certificates  (other than the Class R Certificates),  the Certificate  Principal
Balance of such Class of Certificates as of the Closing Date as set forth in the
Preliminary Statement hereto.

      Initial  Purchaser:  [________],  as  initial  purchaser  of the  Class  B
Certificates and the Class SB Certificates.

      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,  to the  extent  such  proceeds  are  payable to the
mortgagee  under the  Mortgage,  any  Subservicer,  the

                                       24
<PAGE>

Master  Servicer or the Trustee  and are not applied to the  restoration  of the
related  Mortgaged  Property or released to the Mortgagor in accordance with the
procedures  that the Master  Servicer  would follow in servicing  mortgage loans
held for its own account.

      Interest Accrual Period: With respect to the Class A Certificates, Class M
Certificates and Class B Certificates, (i) with respect to the Distribution Date
in [____]  20[__],  the period  commencing on the Closing Date and ending on the
day preceding the Distribution  Date in[____]  20[__],  and (ii) with respect to
any Distribution  Date after the Distribution  Date in[____] 20[__],  the period
commencing on the Distribution Date in the month immediately preceding the month
in which such  Distribution  Date  occurs and ending on the day  preceding  such
Distribution   Date.  With  respect  to  the  Class  SB  Certificates   and  any
Distribution Date, the prior calendar month.

      Interest  Distribution  Amount:  The sum of the Class A, Class M-1S, Class
M-2S,  Class M-3S,  Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class
M-9 and Class B Interest Distribution Amounts.

      Interested  Person:  As of any date of determination,  the Depositor,  the
Master  Servicer,  the  Trustee,  any  Mortgagor,  any  Manager  of a  Mortgaged
Property,  or any Person known to a Responsible  Officer of the Trustee to be an
Affiliate of any of them.

      Interim Certification: As defined in Section 2.02.

      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.

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

      LIBOR  Business Day: Any day other than (i) a Saturday or Sunday or (ii) a
day on which banking institutions in London,  England are required or authorized
to by law to be closed.

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

      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 and  Subsequent
Recoveries.

      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  (plus,  in the case of a
junior lien Mortgage Loan, the principal  balance of the

                                       25
<PAGE>

Senior Mortgage Loan on the Related  Mortgaged  Property) and the denominator of
which is the Appraised Value of the related Mortgaged Property.

      Marker  Rate:  With respect to the Class SB  Certificates  or the REMIC II
Regular Interest SB-IO and any Distribution  Date, a per annum rate equal to two
(2)  multiplied  by  the  weighted  average  of  the   Uncertificated   REMIC  I
Pass-Through  Rates for each REMIC I Regular  Interest  (other  than the REMIC I
Regular Interest AA) with the rates on each such REMIC I Regular Interest (other
than REMIC I Regular  Interest  ZZ)  subject to a cap equal to the  Pass-Through
Rate for the corresponding Class for such REMIC I Regular Interest, and the rate
on REMIC I  Regular  Interest  ZZ  subject  to a cap of zero,  in each  case for
purposes of this calculation.

      Maturity  Date:  With respect to each Class of  Certificates  representing
ownership of regular interest or Uncertificated Regular Interests issued by each
of REMIC I and REMIC II 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 such Class of Certificates  representing a
regular  interest in the Trust Fund would be reduced to zero, which is, for each
such regular  interest,  the  Distribution  Date in[____]  20[__],  which is the
Distribution  Date occurring in the month  following the last scheduled  monthly
payment of the Mortgage Loans.

      Maximum Mortgage Loan Rate: With respect to the Class A, Class M and Class
B Certificates and any Interest Accrual Period, [___]% per annum.

      Maximum  Mortgage Rate: With respect to any adjustable rate Mortgage Loan,
the rate indicated in Exhibit G hereto as the "NOTE  CEILING," which rate is the
maximum  interest rate that may be applicable to such  adjustable  rate Mortgage
Loan at any time during the life of such Mortgage Loan.

      Maximum Net Mortgage Rate:  With respect to any  adjustable  rate Mortgage
Loan and any date of  determination,  the Maximum Mortgage Rate minus the sum of
(i) the Subservicing Fee Rate and (ii) the Servicing Fee Rate.

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

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

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

      Minimum  Mortgage Rate: With respect to any adjustable rate Mortgage Loan,
the  greater  of (i) the Note  Margin and (ii) the rate  indicated  in Exhibit G
hereto as the "NOTE FLOOR", which rate may be applicable to such adjustable rate
Mortgage Loan at any time during the life of such adjustable rate Mortgage Loan.

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

                                       26
<PAGE>

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

      Modified Net Mortgage Rate:  With respect 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 the Due Date in any Due  Period,  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,
the mortgage,  deed of trust or other comparable  instrument creating a first or
junior lien on an estate in fee simple or  leasehold  interest in real  property
securing a Mortgage Note.

      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 Loan Schedule: The lists of the Mortgage Loans attached hereto as
Exhibit G (as  amended  from time to time to reflect the  addition of  Qualified
Substitute  Mortgage  Loans),  which  lists  shall set  forth at a  minimum  the
following information as to each Mortgage Loan:

      (i) the Mortgage Loan identifying number ("RFC LOAN #");

            (ii) [reserved];

            (iii)  the  maturity  of  the  Mortgage  Note  ("MATURITY  DATE"  or
      "MATURITY DT") for Mortgage Loans;

            (iv) the Mortgage Rate as of origination ("ORIG RATE");

            (v) the Mortgage Rate as of the Cut-off Date for an adjustable  rate
      Mortgage Loan ("CURR RATE");

            (vi) the Net Mortgage Rate as of the Cut-off Date ("CURR NET");

                                       27
<PAGE>

            (vii) the  scheduled  monthly  payment  of  principal,  if any,  and
      interest as of the Cut-off  Date  ("ORIGINAL P & I" or "CURRENT P & I" for
      the adjustable rate Mortgage Loans);

            (viii) the Cut-off Date Principal Balance ("PRINCIPAL BAL");

            (ix) the Loan-to-Value Ratio at origination ("LTV");

            (x) a code  "T",  "BT"  or  "CT"  under  the  column  "LN  FEATURE,"
      indicating  that the  Mortgage  Loan is  secured  by a second or  vacation
      residence (the absence of any such code means the Mortgage Loan is secured
      by a primary residence);

            (xi) a code "N" under the column  "OCCP CODE",  indicating  that the
      Mortgage Loan is secured by a non-owner occupied residence (the absence of
      any such code means the  Mortgage  Loan is  secured  by an owner  occupied
      residence);

            (xii) the Maximum  Mortgage  Rate for the  adjustable  rate Mortgage
      Loans ("NOTE CEILING");

            (xiii)  the  Maximum  Net  Mortgage  Rate  for the  adjustable  rate
      Mortgage Loans ("NET CEILING");

            (xiv) the Note Margin for the adjustable  rate Mortgage Loans ("NOTE
      MARGIN");

            (xv) the  first  Adjustment  Date  after  the  Cut-off  Date for the
      adjustable rate Mortgage Loans ("NXT INT CHG DT");

            (xvi)  the  Periodic  Cap for the  adjustable  rate  Mortgage  Loans
      ("PERIODIC DECR" or "PERIODIC INCR"); and

            (xvii) (the rounding of the semi-annual or annual  adjustment to the
      Mortgage Rate with respect to the  adjustable  rate Mortgage  Loans ("NOTE
      METHOD").

      Such schedules may consist of multiple reports that collectively set forth
all of the information required.

      Mortgage Loans: Such of the 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,  and (ii) with respect to each  Mortgage  Loan other than a Cooperative
Loan,  each related  Mortgage  Note,  Mortgage and Mortgage  File and all rights
appertaining thereto.

                                       28
<PAGE>

      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.

      Mortgage Rate:  With respect to any Mortgage Loan, the interest rate borne
by the related Mortgage Note, or any modification thereto other than a Servicing
Modification.  The Mortgage  Rate on the  adjustable  rate  Mortgage  Loans will
adjust on each Adjustment Date to equal the sum (rounded to the nearest multiple
of  one-eighth  of one percent  (0.125%) or up to the nearest  one-eighth of one
percent,  which are  indicated  by a "U" on Exhibit G, except in the case of the
adjustable  rate Mortgage Loans indicated by an "X" on Exhibit G or hereto under
the heading "NOTE METHOD"),  of the related Index plus the Note Margin,  in each
case subject to the applicable  Periodic Cap,  Maximum Mortgage Rate and Minimum
Mortgage Rate.

      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.

      Net Mortgage  Rate:  With  respect to any Mortgage  Loan as of any date of
determination,  a per annum rate equal to the  Mortgage  Rate for such  Mortgage
Loan as of such date  minus the sum of (i) the  related  Servicing  Fee Rate and
(ii) the related Subservicing Fee Rate.

      Net Swap Payment:  With respect to each Distribution Date, the net payment
required to be made  pursuant to the terms of the Swap  Agreement  by either the
Swap Counterparty or the Supplemental  Interest Trust Trustee,  on behalf of the
Supplemental  Interest Trust,  which net payment shall not take into account any
Swap Termination Payment.

      Net WAC Cap Rate: With respect to any  Distribution  Date and the Class A,
Class M and Class B Certificates,  a per annum rate (which will not be less than
zero) equal to the  excess,  if any,  of (I),  the  product of (A) the  weighted
average of the Net Mortgage Rates (or, if applicable,  the Modified Net Mortgage
Rates) of the  Mortgage  Loans  using the Net  Mortgage  Rates in effect for the
Monthly  Payments due on such  Mortgage  Loans during the related Due Period and
(B) a fraction  expressed as a percentage,  the numerator of which is 30 and the
denominator  of which  is the  actual  number  of days in the  related  Interest
Accrual  Period,  over  (II)  the  product  of  (A) a  fraction  expressed  as a
percentage,  the  numerator of which is any Net Swap  Payments  owed to the Swap
Counterparty or Swap Termination Payment not due to a Swap Counterparty  Trigger
Event  owed to the  Swap  Counterparty  as of  such  Distribution  Date  and the
denominator of which is the aggregate Stated  Principal  Balance of the Mortgage
Loans  before  giving  effect to  distributions  of principal to be made on such
Distribution Date and (B) a fraction expressed as a percentage, the numerator of
which is 360 and the  denominator  of which is the actual  number of days in the
related Interest Accrual Period. For federal income tax purposes,  however, with
respect  to any  Distribution  Date  and the  REMIC  II  Regular  Interests  the
ownership  of  which  is  represented  by the  Class  A  Certificates,  Class  M
Certificates  and Class B  Certificates,  a per annum rate equal to the weighted
average of the Uncertificated REMIC I Pass-Through Rates for the REMIC I Regular
Interests, weighted on the basis of the Uncertificated Principal Balance of each
such  REMIC I Regular  Interest  immediately  prior to such  Distribution  Date,
multiplied by a

                                       29
<PAGE>

fraction,  the  numerator  of which is 30, and the  denominator  of which is the
actual  number  of days in the  related  Interest  Accrual  Period.

      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.

      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 or REO Proceeds. 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 shall be evidenced by an Officer's Certificate delivered
to the  Depositor,  the  Trustee  and the  Master  Servicer  setting  forth such
determination,  which shall include any other information or reports obtained by
the Master Servicer such as property operating statements,  rent rolls, property
inspection   reports  and   engineering   reports,   which  may   support   such
determinations. Notwithstanding the above, the Trustee shall be entitled to rely
upon any  determination by the Master Servicer that any Advance  previously made
is a  Nonrecoverable  Advance  or that any  proposed  Advance,  if  made,  would
constitute a Nonrecoverable Advance.

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

      Note Margin: With respect to each adjustable rate Mortgage Loan, the fixed
percentage  set forth in the related  Mortgage  Note and  indicated in Exhibit G
hereto  as the "NOTE  MARGIN,"  which  percentage  is added to the Index on each
Adjustment Date to determine (subject to rounding in accordance with the related
Mortgage  Note,  the  Periodic  Cap, the Maximum  Mortgage  Rate and the Minimum
Mortgage  Rate) the interest rate to be borne by such  adjustable  rate Mortgage
Loan until the next Adjustment Date.

      Notional Amount: With respect to the Class SB Certificates, $[___].

      Officer's Certificate:  A certificate signed by the Chairman of the Board,
the President, a Vice President,  Assistant Vice President,  Director,  Managing
Director, the Treasurer,  the Secretary,  an Assistant Treasurer or an Assistant
Secretary  of the  Depositor  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  Depositor  or the Master
Servicer, provided that any opinion of counsel (i) referred to in the definition
of "Disqualified  Organization" or (ii) relating

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<PAGE>

to the  qualification  of REMIC I or REMIC II as REMICs or  compliance  with the
REMIC Provisions must, unless otherwise specified,  be an opinion of Independent
counsel.

      Optional  Termination  Date: Any  Distribution  Date on or after which the
Stated  Principal  Balance (after giving effect to  distributions  to be made on
such Distribution Date) of the Mortgage Loans is less than 10.00% of the Cut-off
Date Balance.

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

      Overcollateralization  Amount:  With respect to any Distribution Date, the
excess,  if any, of (a) the aggregate Stated  Principal  Balance of the Mortgage
Loans  before  giving  effect to  distributions  of principal to be made on such
Distribution  Date over (b) the aggregate  Certificate  Principal Balance of the
Class A Certificates,  Class M Certificates  and Class B Certificates as of such
date,  before taking into account  distributions of principal to be made on that
Distribution Date.

      Overcollateralization  Floor: An amount equal to the product of [___]% and
the Cut-off Date Balance.

      Overcollateralization  Increase  Amount:  With respect to any Distribution
Date,  an  amount  equal to the  lesser  of (i) the  Excess  Cash  Flow for that
Distribution Date available to make payments pursuant to Section 4.02(c)(xv) and
(ii) the excess,  if any, of (x) the Required  Overcollateralization  Amount for
that  Distribution  Date  over  (y) the  Overcollateralization  Amount  for that
Distribution Date.

      Overcollateralization  Reduction Amount:  With respect to any Distribution
Date for which the Excess  Overcollateralization  Amount is, or would be,  after
taking into  account  all other  distributions  to be made on such  Distribution
Date,  greater  than  zero,  an amount  equal to the  lesser  of (i) the  Excess
Overcollateralization  Amount for that  Distribution Date and (ii) the Principal
Remittance Amount for such Distribution Date.

      Ownership  Interest:  With respect 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.

      Pass-Through  Rate:  With  respect  to the Class A  Certificates  and each
Interest  Accrual Period,  a per annum rate equal to the least of (i) LIBOR plus
the related  Class A Margin,  (ii) the Maximum  Mortgage Loan Rate and (iii) the
Net WAC Cap Rate.  With respect to the Class M  Certificates  and each  Interest
Accrual  Period,  a per annum  rate  equal to the  least of (i)  LIBOR  plus the
related  Class M Margin,  (ii) the Maximum  Mortgage Loan Rate and (iii) the Net
WAC Cap Rate. With respect to the Class B Certificates and each Interest Accrual
Period,  a per  annum  rate  equal to the  least of (i)  LIBOR  plus the Class B
Margin, (ii) the Maximum Mortgage Loan Rate and (iii) the Net WAC Cap Rate.

                                       31
<PAGE>

      With respect to the Class SB Certificates or the REMIC II Regular Interest
SB-IO,  a per annum rate equal to the percentage  equivalent of a fraction,  the
numerator  of which is (x) the sum,  for each REMIC I Regular  Interest,  of the
excess of the Uncertificated  REMIC I Pass-Through Rate for such REMIC I Regular
Interest  over the  Marker  Rate,  applied  to a  notional  amount  equal to the
Uncertificated  Principal  Balance of the applicable  REMIC Regular Interest and
the denominator of which is (y) the Uncertificated Notional Amount.

      Paying Agent:  [______],  or any successor  Paying Agent  appointed by the
Trustee.

      Percentage  Interest:  With  respect  to any  Class A,  Class M or Class B
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  divided  by the
aggregate  Initial  Certificate  Principal Balance of all of the Certificates of
the same Class.  The Percentage  Interest with respect to a Class SB Certificate
or Class R Certificate shall be stated on the face thereof.

      Periodic Cap: With respect to each  adjustable  rate  Mortgage  Loan,  the
periodic  rate cap that  limits the  increase  or the  decrease  of the  related
Mortgage  Rate on any  Adjustment  Date  pursuant  to the  terms of the  related
Mortgage Note.

      Permanent Regulation S Global Offered Certificate:  Any one of the Class B
Certificates  substantially  in the form of Exhibit C-3 hereto or any one of the
Class SB Certificates  substantially in the form of Exhibit D-3 hereto,  and, in
both cases, more fully described in Section 5.02(e) hereof.

      Permitted Investments: One or more of the following:

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

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

                                       32
<PAGE>

      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 and demand notes shall have
      a remaining maturity of not more than 30 days;

            (v) a money market fund or a qualified investment fund rated by each
      Rating  Agency in its highest  long-term  rating  available  (which may be
      managed by the Trustee or one of its Affiliates); 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 below
      the then-current rating by such Rating Agency, as evidenced in writing;

provided,  however,  that no  instrument  shall be a Permitted  Investment if it
represents,  either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest  payments derived from  obligations  underlying such instrument and the
principal and interest payments with respect to such instrument  provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations.  References  herein to the highest  rating  available  on unsecured
long-term  debt shall  mean AAA in the case of  Standard & Poor's and Aaa in the
case of Moody's,  and 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 and
P-1 in the case of Moody's;  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 purchased 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.

                                       33
<PAGE>

      Pool Stated Principal Balance:  With respect to any date of determination,
the aggregate of the Stated Principal Balances of each Mortgage Loan that was an
Outstanding  Mortgage Loan on the Due Date immediately  preceding the Due Period
preceding such date of determination.

      Posted Collateral Account:  The separate account created and maintained by
the Supplemental  Interest Trust Trustee, on behalf of the Supplemental Interest
Trust, pursuant to Section 4.10(e).

      Prepayment  Assumption:  With  respect to the Class A, 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 prepayment rate of 20% HEP with
respect  to the  fixed-rate  Mortgage  Loans,  and 100% PPC with  respect to the
adjustable-rate Mortgage Loans.

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

      Prepayment  Period:  With respect to any  Distribution  Date, the calendar
month preceding the month of distribution.

      Primary  Insurance  Policy:  Each  primary  policy  of  mortgage  guaranty
insurance  as  indicated  by a numeric  code on Exhibit G with the  exception of
either code "23" or "96" under the column "MI CO CODE".

      Principal  Distribution Amount: With respect to any Distribution Date, the
lesser of (a) the excess of (i) the Available  Distribution Amount over (ii) the
Interest Distribution Amount and (b) the sum of:

            (i) the  principal  portion  of each  Monthly  Payment  received  or
      Advanced  with  respect  to the  related  Due  Period on each  Outstanding
      Mortgage Loan;

            (ii) the Stated  Principal  Balance of any Mortgage Loan repurchased
      during  the  related   Prepayment  Period  (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, the amount of any shortfall deposited in the Custodial
      Account in connection  with the  substitution  of a Deleted  Mortgage Loan
      pursuant to Section 2.03 or 2.04 during the related  Prepayment Period and
      the Stated  Principal  Balance of  Mortgage  Loans  purchased  pursuant to
      Section 9.01 in connection with such Distribution Date, if applicable;

                                       34
<PAGE>

            (iii) the principal  portion of all other  unscheduled  collections,
      other  than  Subsequent  Recoveries,  on the  Mortgage  Loans  (including,
      without limitation, Principal Prepayments in Full, Curtailments, Insurance
      Proceeds,  Liquidation  Proceeds  and REO  Proceeds)  received  during the
      related  Prepayment Period to the extent applied by the Master Servicer as
      recoveries of principal of the Mortgage Loans pursuant to Section 3.14;

            (iv) the lesser of (a) Subsequent  Recoveries for such  Distribution
      Date and (b) the principal portion of any Realized Losses allocated to any
      Class of Certificates on a prior Distribution Date and remaining unpaid;

            (v) the sum of (I) the lesser of (a) the  Excess  Cash Flow for that
      Distribution  Date (to the extent not used pursuant to clause (iv) of this
      definition on such Distribution Date) and (b) the principal portion of any
      Realized Losses incurred (or deemed to have been incurred) on any Mortgage
      Loans in the calendar month preceding such Distribution Date to the extent
      covered by Excess Cash Flow for that Distribution Date and (II) any amount
      described  in Clause (i) of Section  4.09(c);  and (vi) the sum of (I) the
      lesser  of (a) the  Excess  Cash Flow for such  Distribution  Date (to the
      extent not used to cover Realized  Losses  pursuant to clause (iv) and (v)
      of   this   definition   on   such   Distribution   Date)   and   (b)  the
      Overcollateralization  Increase Amount for such  Distribution  Date to the
      extent covered by Excess Cash Flow for that Distribution Date and (II) any
      amount described in Clause (ii) of Section 4.09(c);

      minus

            (vii) the amount of any  Overcollateralization  Reduction Amount for
      such Distribution Date;

            (viii) the  amount of any  Capitalization  Reimbursement  Amount for
      such Distribution Date; and

            (ix) any Net Swap Payments or Swap Termination  Payment not due to a
      Swap Counterparty Trigger Event due to the Swap Counterparty to the extent
      not previously paid from interest or principal collections on the Mortgage
      Loans;

provided,  however,  that the Principal  Distribution Amount on any Distribution
Date  shall not be less  than zero or  greater  than the  aggregate  Certificate
Principal Balance of the Class A, Class M and Class B Certificates.

      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 made by a Mortgagor
of the entire principal balance of a Mortgage Loan.

                                       35
<PAGE>

      Principal  Remittance  Amount:  With respect to any Distribution Date, the
sum of the amounts  described  in clauses  (b)(i),  (b)(ii) and  (b)(iii) of the
definition of Principal Distribution Amount for that Distribution Date.

      Private Offered  Certificates:  The Class B Certificates  and the Class SB
Certificates, collectively.

      Program  Guide:   The  Residential   Funding  Seller  Guide  for  mortgage
collateral  sellers that participate in Residential  Funding's standard mortgage
programs,  and Residential  Funding's Servicing Guide and any other subservicing
arrangements which Residential Funding has arranged to accommodate the servicing
of the Mortgage Loans.

      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, 4.07 or 4.08, an amount equal to the sum of (i) (a) if such Mortgage
Loan (or REO Property) is being purchased  pursuant to Sections 2.02, 2.03, 2.04
or 4.07 of this Agreement, 100% of the Stated Principal Balance thereof plus the
principal portion of any related  unreimbursed  Advances or (b) if such Mortgage
Loan (or REO  Property)  is being  purchased  pursuant  to Section  4.08 of this
Agreement,  the greater of (1) 100% of the Stated Principal Balance thereof plus
the principal portion of any related unreimbursed Advances on such Mortgage Loan
(or REO  Property)  and (2) the fair market  value  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 in the case of a
Modified  Mortgage  Loan) plus the rate per annum at which the  Servicing Fee is
calculated, or (b) in the case of a purchase made by the Master Servicer, at the
Net  Mortgage  Rate (or  Modified  Net  Mortgage  Rate in the case of a Modified
Mortgage Loan), in each case on the Stated Principal Balance thereof to, but not
including,  the first day of the month  following the month of purchase from the
Due Date to which interest was last paid by the Mortgagor.

      Qualified Insurer: A mortgage guaranty insurance company duly qualified as
such under the laws of the state of its  principal  place of  business  and each
state having  jurisdiction  over such insurer in  connection  with the insurance
policy issued by such insurer,  duly  authorized  and licensed in such states to
transact a mortgage guaranty  insurance business in such states and to write the
insurance  provided by the insurance policy issued by it, approved as a FNMA- or
FHLMC-approved  mortgage  insurer or having a claims paying ability rating of at
least "AA" or equivalent rating by a nationally  recognized  statistical  rating
organization.  Any replacement insurer with respect to a Mortgage Loan must have
at least as high a claims paying  ability  rating as the insurer it replaces had
on the Closing Date.

      Qualified  Substitute  Mortgage  Loan:  A  Mortgage  Loan  substituted  by
Residential  Funding or the Depositor for a Deleted Mortgage Loan which must, on
the  date  of  such  substitution,  as  confirmed  in an  Officers'  Certificate
delivered to the  Trustee,  (i) have an  outstanding  principal  balance,  after
deduction of the  principal  portion of the monthly  payment due in the month of
substitution  (or in the case of a  substitution  of more than one 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

                                       36
<PAGE>

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;  (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) in the  case of the  adjustable  rate  Mortgage
Loans,  (w) have a Mortgage Rate that adjusts with the same  frequency and based
upon the same Index as that of the Deleted Mortgage Loan, (x) have a Note Margin
not less than that of the Deleted  Mortgage  Loan;  (y) have a Periodic Rate Cap
that  is  equal  to that  of the  Deleted  Mortgage  Loan;  and (z)  have a next
Adjustment Date no later than that of the Deleted Mortgage Loan.

      Rating Agency: Moody's and Standard & Poor's. 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 Depositor,  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) 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  (or
Modified Net Mortgage Rate in the case of a Modified Mortgage Loan) from the Due
Date as to which interest was last paid or advanced to  Certificateholders up to
the last day of the month in which  the Cash  Liquidation  (or REO  Disposition)
occurred 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 (or Modified Net Mortgage Rate in the case
of a Modified  Mortgage  Loan) 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.  With respect to each Mortgage Loan
which is the  subject of a Servicing  Modification,  (a) (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 (b) 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. With
respect  to each  Mortgage  Loan 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. With respect
to each Mortgage  Loan which has become the object of a Debt Service  Reduction,
the  amount  of  such  Debt   Service   Reduction   attributable   to  interest.
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

                                       37
<PAGE>

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.

      Record Date: With respect to each Distribution Date and the Class A, Class
M and Class B  Certificates  which  are  Book-Entry  Certificates,  the close of
business on the Business Day prior to such Distribution Date.

      With respect to each  Distribution  Date and the Certificates  (other than
the Class A, Class M and Class B  Certificates),  the close of  business  on the
last  Business  Day of the month next  preceding  the month in which the related
Distribution  Date occurs,  except in the case of the first  Record Date,  which
shall be the Closing Date.

      Reference Bank Rate: As defined in Section 1.02.

      Regular Interest: Any one of the regular interests in the Trust Fund.

      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.

      Regulation S Global Offered Certificate: Any Temporary Regulation S Global
Offered Certificate or Permanent Regulation S Global Offered Certificate.

      Relief Act: The Servicemembers Civil Relief Act, as amended.

      Relief Act Shortfalls: Interest shortfalls on the Mortgage Loans resulting
from the Relief Act or similar legislation or regulations.

      REMIC: A "real estate mortgage  investment  conduit" within the meaning of
Section 860D of the Code. As used herein the term "REMIC" shall mean REMIC I and
REMIC II.

      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 successor master servicer shall appoint
a  successor   REMIC   Administrator,   subject  to   assumption  of  the  REMIC
Administrator obligations under this Agreement.

      REMIC I: The segregated  pool of assets  subject hereto  (exclusive of the
Supplemental Interest Trust Account and Swap Agreement,  each of which is not an
asset of any REMIC),  constituting a portion of the primary trust created hereby
and to be  administered  hereunder,  with

                                       38
<PAGE>

respect to which a  separate  REMIC  election  is to be made  (exclusive  of the
Supplemental Interest Trust Account and Swap Agreement,  each of which is not an
asset of any  REMIC),  consisting  of: (i) the  Mortgage  Loans and the  related
Mortgage Files;  (ii) all payments on and collections in respect of the Mortgage
Loans due after the Cut-off Date (other than  Monthly  Payments due in the month
of 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;  (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  pertaining to
the  Mortgage  Loans,  if any;  and (v) all proceeds of clauses (i) through (iv)
above.

      REMIC I Regular Interest: Any of the separate non-certificated  beneficial
ownership  interests in REMIC I issued  hereunder  and  designated as a "regular
interest" in REMIC I. Each REMIC I Regular Interest shall accrue interest at the
related  Uncertificated  REMIC I Pass-Through  Rate in effect from time to time,
and shall be entitled to  distributions  of principal,  subject to the terms and
conditions  hereof,  in an aggregate amount equal to its initial  Uncertificated
Principal  Balance  as  set  forth  in the  Preliminary  Statement  hereto.  The
designations for the respective  REMIC I Regular  Interests are set forth in the
Preliminary Statement hereto.

      REMIC I Interest Loss Allocation Amount:  With respect to any Distribution
Date,  an amount  equal to (a) the product of (i) the  aggregate  Uncertificated
Principal Balance of the REMIC I Regular Interests then outstanding and (ii) the
Uncertificated  Pass-Through  Rate for  REMIC I  Regular  Interest  AA minus the
Marker Rate, divided by (b) 12.

      REMIC  I   Overcollateralized   Amount:   With  respect  to  any  date  of
determination,  (i) 1% of the aggregate Uncertificated Principal Balances of the
REMIC I Regular  Interests  minus (ii) the  aggregate  Uncertificated  Principal
Balances of the REMIC I Regular  Interests (other than REMIC I Regular Interests
AA and ZZ), in each case as of such date of determination.

      REMIC I Principal Loss Allocation Amount: With respect to any Distribution
Date,  an amount  equal to the  product of (i) the  aggregate  Stated  Principal
Balance of the Mortgage Loans then outstanding and (ii) 1 minus a fraction,  the
numerator of which is two times the sum of the Uncertificated Principal Balances
of REMIC I Regular  Interests A-1, A-2, A-3, A-4, M-1S,  M-2S,  M-3S,  M-4, M-5,
M-6,  M-7,  M-8,  M-9  and B and  the  denominator  of  which  is the sum of the
Uncertificated  Principal  Balances of REMIC I Regular  Interests A-1, A-2, A-3,
A-4, M-1S, M-2S, M-3S, M-4, M-5, M-6, M-7, M-8, M-9, B and ZZ.

      REMIC I Regular Interest AA: A regular interest in REMIC I that is held as
an asset of REMIC II, that has an initial principal balance equal to the related
Uncertificated   Principal   Balance,   that  bears   interest  at  the  related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest A-1: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

                                       39
<PAGE>

      REMIC I Regular  Interest A-2: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest A-3: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest A-4: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-1S: A regular interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-2S: A regular interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-3S: A regular interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-4: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-5: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-6: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-7: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal

                                       40
<PAGE>

Balance, that bears interest at the related  Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.

      REMIC I Regular  Interest M-8: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest M-9: A regular  interest in REMIC I that is held
as an asset of REMIC II,  that has an  initial  principal  balance  equal to the
related  Uncertificated  Principal  Balance,  that bears interest at the related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular  Interest B: A regular interest in REMIC I that is held as
an asset of REMIC II, that has an initial principal balance equal to the related
Uncertificated   Principal   Balance,   that  bears   interest  at  the  related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular Interest ZZ: A regular interest in REMIC I that is held as
an asset of REMIC II, that has an initial principal balance equal to the related
Uncertificated   Principal   Balance,   that  bears   interest  at  the  related
Uncertificated  REMIC I Pass-Through  Rate, and that has such other terms as are
described herein.

      REMIC I Regular Interest ZZ Maximum Interest Deferral Amount: With respect
to any  Distribution  Date, the excess of (i)  Uncertificated  Accrued  Interest
calculated with the REMIC I Regular Interest ZZ Uncertificated Pass-Through Rate
and an  Uncertificated  Principal  Balance  equal  to  the  excess  of  (x)  the
Uncertificated  Principal  Balance of REMIC I Regular  Interest  ZZ over (y) the
REMIC I Overcollateralized Amount, in each case for such Distribution Date, over
(ii) the sum of Uncertificated  Accrued Interest on REMIC I Regular Interest A-1
through  REMIC I Regular  Interest B, with the rate on each such REMIC I Regular
Interest subject to a cap equal to the Pass-Through  Rate for the  corresponding
Class for the purpose of this calculation.

      REMIC II:  The  segregated  pool of assets  described  in the  Preliminary
Statement.

      REMIC II Regular Interest:  Any "regular  interest" issued by REMIC II the
ownership of which is evidenced by a Class A Certificate, a Class M Certificate,
the Class B Certificate or the Class SB Certificate.

      REMIC II  Regular  Interest  SB-IO:  A separate  non-certificated  regular
interest of REMIC II designated as a REMIC II Regular Interest. REMIC II Regular
Interest  SB-IO shall have no  entitlement to principal and shall be entitled to
distributions  of interest  subject to the terms and  conditions  hereof,  in an
aggregate  amount equal to interest  distributable  with respect to the Class SB
Certificate pursuant to the terms and conditions hereof.

      REMIC II  Regular  Interest  SB-PO:  A separate  non-certificated  regular
interest of REMIC II designated as a REMIC II Regular Interest. REMIC II Regular
Interest  SB-PO shall have no  entitlement  to interest and shall be entitled to
distributions  of principal  subject to the

                                       41
<PAGE>

terms  and  conditions  hereof,  in  an  aggregate  amount  equal  to  principal
distributable  with respect to the Class SB  Certificates  pursuant to the terms
and conditions hereof.

      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.

      REMIC  Regular  Interests:  the  REMIC I  Regular  Interests  and REMIC II
Regular Interests.

      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:  With respect to any REO Property, a determination by the
Master  Servicer  that it has received  substantially  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: With respect to any REO Property, for any period, an
amount  equivalent  to interest  (at a rate equal to the sum of 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,  on
behalf of the Trust Fund for the benefit of the  Certificateholders  pursuant to
Section 3.14,  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.

      Repurchase Event: As defined in the Assignment Agreement.

                                       42
<PAGE>

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

      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  Overcollateralization  Amount:  With respect to any Distribution
Date, (a) if such Distribution Date is prior to the Stepdown Date, [___]% of the
Cut-off  Date  Balance,  or (b) if such  Distribution  Date is on or  after  the
Stepdown  Date, the greater of (i) [___]% of the then current  aggregate  Stated
Principal  Balance of the Mortgage Loans as of the end of the related Due Period
and (ii) the Overcollateralization  Floor; provided,  however, that if a Trigger
Event is in effect, the Required  Overcollateralization Amount shall be equal to
the  Required   Overcollateralization   Amount  for  the  immediately  preceding
Distribution Date. The Required Overcollateralization Amount may be reduced from
time to time with notification to the Rating Agencies.

      Residential Funding:  Residential Funding Company, LLC, a Delaware limited
liability  company,  in its  capacity  as  seller of the  Mortgage  Loans to the
Depositor and not in its capacity as Master Servicer, 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,  in each case with direct  responsibility for the administration of
this Agreement.

      RFC Exemption: As defined in Section 5.02(f)(ii).

      Rule 144A:  Rule 144A under the  Securities Act of 1933, as in effect from
time to time.

      Rule 144A Global Offered Certificate:  Any one of the Class B Certificates
substantially  in the form of  Exhibit  C-1  hereto  or any one of the  Class SB
Certificates  substantially  in the form of Exhibit  D-1  hereto,  and,  in both
cases, more fully described in Section 5.02(e) hereof.

      Securities Act: Securities Act of 1933, as amended.

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

      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.

      Senior  Enhancement  Percentage:  For any Distribution Date, the fraction,
expressed  as a  percentage,  the  numerator  of which is (x) the sum of (i) the
aggregate  Certificate Principal Balance of the Class M Certificates and Class B
Certificates and (ii) the  Overcollateralization  Amount,  in each case prior to
the distribution of the Principal  Distribution Amount on such

                                       43
<PAGE>

Distribution  Date and the  denominator  of which  is (y) the  aggregate  Stated
Principal  Balance of the Mortgage Loans after giving effect to distributions to
be made on that Distribution Date.

      Sequential  Class M Principal  Distribution  Amount:  With  respect to any
Distribution  Date (i) prior to the  Stepdown  Date or on or after the  Stepdown
Date if a Trigger Event is in effect for that  Distribution  Date, the remaining
Principal  Distribution  Amount for that Distribution Date after distribution of
the Class A Principal Distribution Amount, or (ii) on or after the Stepdown Date
if a Trigger Event is not in effect for that Distribution Date, the lesser of:

            (i)  the   remaining   Principal   Distribution   Amount   for  that
      Distribution Date after distribution of the Class A Principal Distribution
      Amount; and

            (ii)  the  excess,  if any,  of (A)  the  sum of (1)  the  aggregate
      Certificate  Principal  Balance of the Class A Certificates  (after taking
      into account the payment of the Class A Principal  Distribution Amount for
      that  Distribution  Date)  and (2)  the  aggregate  Certificate  Principal
      Balance of the Sequential Class M Certificates  immediately  prior to that
      Distribution  Date  over  (B)  the  lesser  of  (x)  the  product  of  (1)
      approximately [___]% and (2) the aggregate Stated Principal Balance of the
      mortgage  loans after giving  effect to  distributions  to be made on that
      Distribution  Date and (y) the  excess,  if any, of the  aggregate  Stated
      Principal   Balance  of  the  mortgage   loans  after  giving   effect  to
      distributions   to  be  made  on  that   Distribution   Date,   over   the
      Overcollateralization Floor.

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

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

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

      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 equal to the  Servicing  Fee Rate
multiplied  by the  Stated  Principal  Balance of

                                       44
<PAGE>

such Mortgage Loan as of the related Due Date in the related Due Period,  as may
be adjusted pursuant to Section 3.16(e).

      Servicing Fee Rate:  With respect to any Mortgage Loan, the per annum rate
designated  on the  Mortgage  Loan  Schedule  as the  "MSTR  SERV FEE" as may be
adjusted with respect to successor Master Servicers as provided in Section 7.02,
which rate shall never be greater than the Mortgage Rate of such Mortgage Loan.

      Servicing  Modification:  Any  reduction  of the  interest  rate on or the
Stated Principal Balance of a Mortgage Loan, any extension of the final maturity
date of a Mortgage Loan, and any increase to the Stated  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 on the Closing  Date by the Master  Servicer,  as such list may from
time to time be amended.

      Sixty-Plus Delinquency  Percentage:  With respect to any Distribution Date
and  the  Mortgage  Loans,  the  arithmetic  average,  for  each  of  the  three
Distribution  Dates  ending  with  such  Distribution  Date,  of  the  fraction,
expressed as a percentage,  equal to (x) the aggregate Stated Principal  Balance
of the  Mortgage  Loans  that  are 60 or more  days  delinquent  in  payment  of
principal and interest for that Distribution  Date,  including Mortgage Loans in
bankruptcy that are 60 or more days delinquent,  foreclosure and REO Properties,
over (y) the aggregate  Stated  Principal  Balance of all of the Mortgage  Loans
immediately preceding that Distribution Date.

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

      Startup Date: The day designated as such pursuant to Article X hereof.

      Stated Principal Balance: With respect to any Mortgage Loan or related REO
Property,  at any given  time,  (i) the sum of (a) the  Cut-off  Date  Principal
Balance of the Mortgage Loan,  and (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 commencing on the first Due Period after the Cut-Off Date and 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 or 4.03 on any previous  Distribution Date, and (c) any
Realized  Loss

                                       45
<PAGE>

incurred with respect to such Mortgage Loan allocated to Certificateholders with
respect  thereto  for  any  previous   Distribution  Date.  Stepdown  Date:  The
Distribution  Date which is the  earlier to occur of (i) the  Distribution  Date
immediately  succeeding the Distribution Date on which the aggregate Certificate
Principal  Balance of the Class A Certificates  has been reduced to zero or (ii)
the later to occur of (x) the  Distribution  Date occurring in [____] 20[__] and
(y) the first  Distribution Date on which the Senior  Enhancement  Percentage is
equal to or greater than [___]%.

      Subordination:  The  provisions  described in Section 4.05 relating to the
allocation of Realized Losses.

      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 and
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 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 Depositor.

      Subservicing  Fee:  With  respect 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 with respect to each  Distribution  Date at an annual rate equal to
the  Subservicing  Fee Rate multiplied by the Stated  Principal  Balance of such
Mortgage Loan as of the related Due Date in the related Due Period.

                                       46
<PAGE>

      Subservicing  Fee Rate: The per annum rate designated on the Mortgage Loan
Schedule as the "SUBSERV FEE".

      Supplemental  Interest Trust Account:  The separate trust account  created
and maintained by the Supplemental Interest Trust Trustee for the benefit of the
Certificateholders pursuant to Section 4.09(a).

      Supplemental  Interest Trust: The separate trust created and maintained by
the Supplemental Interest Trust Trustee pursuant to Section 4.09(a). The primary
activities of the Supplemental Interest Trust shall be:

            (i) holding the Swap Agreement;

            (ii) receiving  collections  or making  payments with respect to the
      Swap Agreement; and

            (iii) engaging in other  activities that are necessary or incidental
      to accomplish these limited purposes,  which activities cannot be contrary
      to the status of the  Supplemental  Interest Trust as a qualified  special
      purpose entity under existing accounting literature.

      Swap  Agreement:  The  interest  rate  swap  agreement  between  the  Swap
Counterparty  and the  Supplemental  Interest  Trust  Trustee,  on behalf of the
Supplemental  Interest Trust, which agreement provides for Net Swap Payments and
Swap  Termination  Payments to be paid, as provided  therein,  together with any
schedules,  confirmations,  credit support annexes or other agreements  relating
thereto, attached hereto as Exhibit U.

      Swap  Agreement  Notional  Balance:  As to the  Swap  Agreement  and  each
Floating Rate Payer Payment Date (as defined in the Swap Agreement),  the amount
set forth on Exhibit T hereto for such Floating Rate Payer Payment Date.

      Swap  Counterparty:  The swap counterparty under the Swap Agreement either
(a) entitled to receive payments from the  Supplemental  Interest Trust Trustee,
on behalf of the  Supplemental  Interest  Trust,  from  amounts  payable  by the
Supplemental  Interest Trust  Trustee,  on behalf of the  Supplemental  Interest
Trust, under this Agreement or (b) required to make payments to the Supplemental
Interest  Trust  Trustee,  on behalf of the  Supplemental  Interest  Trust,  for
payments  to  the  Supplemental   Interest  Trust  Trustee,  on  behalf  of  the
Supplemental  Interest  Trust,  in either case pursuant to the terms of the Swap
Agreement,  and any  successor  in  interest  or  assign.  Initially,  the  Swap
Counterparty shall be Deutsche Bank AG, New York Branch.

      Swap LIBOR: LIBOR as determined pursuant to the Swap Agreement.

      Swap Counterparty  Trigger Event:  With respect to any Distribution  Date,
(i) an "Event of Default"  under the Swap  Agreement  with  respect to which the
Swap Counterparty is a Defaulting  Party,  (ii) a "Termination  Event" under the
Swap Agreement with respect to which the Swap  Counterparty is the sole Affected
Party, or (iii) an "Additional  Termination Event" under the Swap Agreement with
respect to which the Swap Counterparty is the sole Affected Party.

                                       47
<PAGE>

      Swap Termination  Payment:  Upon the designation of an "Early  Termination
Date"  as  defined  in  the  Swap  Agreement,  the  payment  to be  made  by the
Supplemental  Interest Trust  Trustee,  on behalf of the  Supplemental  Interest
Trust, to the Swap  Counterparty  from payments from the  Supplemental  Interest
Trust, or by the Swap  Counterparty to the Supplemental  Interest Trust Trustee,
on behalf of the  Supplemental  Interest  Trust for payment to the  Supplemental
Interest Trust, as applicable, pursuant to the terms of the Swap Agreement.

      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  due to its  classification  as a REMIC  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.

      Telerate Screen Page 3750: As defined in Section 1.02.

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

      Temporary Regulation S Global Offered Certificate:  Any one of the Class B
Certificates  substantially  in the form of Exhibit C-2 hereto or any one of the
Class SB Certificates  substantially in the form of Exhibit D-2 hereto,  and, in
both cases, more fully described in Section 5.02(e) hereof.

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

      Transfer Affidavit and Agreement: As defined in Section 5.02(f).

      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.

      Trigger  Event:  A  Trigger  Event  is  in  effect  with  respect  to  any
Distribution  Date if either (i) with  respect  to any  Distribution  Date,  the
three-month average of the Sixty-Plus Delinquency  Percentage,  as determined on
that  Distribution  Date and the immediately  preceding two Distribution  Dates,
equals  or  exceeds  [___]% of the  Senior  Enhancement  Percentage  or (ii) the
aggregate amount of Realized Losses on the Mortgage Loans as a percentage of the
Cut-off Date Balance exceeds the applicable amount set forth below:

[_____] 20[__] to [_____] 20[__]    [___]% with respect to [_____] 20[__],  plus
                                    an  additional  1/12th  of  [___]%  for each
                                    month thereafter.

                                       48
<PAGE>

[_____] 20[__] to [_____] 20[__]    [___]% with respect to [_____] 20[__],  plus
                                    an  additional  1/12th  of  [___]%  for each
                                    month thereafter.

[_____] 20[__] to [_____] 20[__]    [___]% with respect to [_____] 20[__],  plus
                                    an  additional  1/12th  of  [___]%  for each
                                    month thereafter.

[_____] 20[__] to [_____] 20[__]    [___]% with respect to [_____] 20[__],  plus
                                    an  additional  1/12th  of  [___]%  for each
                                    month thereafter.

[_____] 20[__] to [_____] 20[__]    [___]% with respect to [_____] 20[__],  plus
                                    an  additional  1/12th  of  [___]%  for each
                                    month thereafter.

[_____] 20[__] and thereafter       [___]%

      Trust Fund: The segregated pool of assets subject  hereto,  consisting of:
(i) the Mortgage Loans and the related Mortgage Files;  (ii) all payments on and
collections  in respect of the Mortgage  Loans due after the Cut-off Date (other
than  Monthly  Payments  due in the  month of 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;  (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  pertaining to the Mortgage  Loans, if any; (v) rights under
the Swap Agreement and the  Supplemental  Interest  Trust Account;  and (vi) all
proceeds of clauses (i) through (v) above.

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

      Uncertificated  Accrued  Interest:  With  respect  to any  REMIC I Regular
Interest  for  any  Distribution  Date,  one  month's  interest  at the  related
Uncertificated  REMIC I Pass-Through Rate for such Distribution Date, accrued on
its  Uncertificated  Principal  Balance  immediately  prior to such Distribution
Date.  Uncertificated  Accrued Interest for the REMIC I Regular  Interests shall
accrue on the basis of a 360-day year  consisting of twelve 30-day  months.  For
purposes of calculating the amount of  Uncertificated  Accrued  Interest for the
REMIC I Regular  Interests for any  Distribution  Date, any Prepayment  Interest
Shortfalls and Relief Act Shortfalls (to the extent not covered by  Compensating
Interest)  relating to the  Mortgage  Loans for any  Distribution  Date shall be
allocated first, to  Uncertificated  Accrued Interest payable to REMIC I Regular
Interest AA and REMIC I Regular  Interest ZZ up to an aggregate  amount equal to
the REMIC I Interest  Loss  Allocation  Amount,  98% and 2%,  respectively,  and
thereafter  any  remaining  Prepayment  Interest  Shortfalls  (to the extent not
covered by Eligible Master Servicing  Compensation)  for any  Distribution  Date
shall be allocated among REMIC I Regular  Interest AA, REMIC I Regular  Interest
A-1, REMIC I Regular Interest A-2, REMIC I Regular Interest A-3, REMIC I Regular
Interest  A-4,  REMIC I Regular  Interest M -1, REMIC I Regular  Interest  M-2S,
REMIC I Regular  Interest M-3S,  REMIC I Regular  Interest M-1S, REMIC I Regular
Interest M-4, REMIC I Regular  Interest M-5, REMIC I Regular Interest M-6, REMIC
I Regular  Interest M-7,

                                       49
<PAGE>

REMIC I Regular  Interest M-8,  REMIC I Regular  Interest  M-9,  REMIC I Regular
Interest B and REMIC I Regular Interest ZZ, pro rata based on, and to the extent
of,  Uncertificated  Accrued Interest, as calculated without application of this
sentence.

      Uncertificated  Notional  Amount:  With  respect  to the REMIC II  Regular
Interest SB-IO component of the Class SB Certificates and any Distribution Date,
an amount equal to the aggregate Uncertificated Principal Balance of the REMIC I
Regular Interests for such Distribution Date.

      Uncertificated   Principal   Balance:   As  of  the  Closing   Date,   the
Uncertificated  Principal  Balance of each REMIC I Regular  Interest shall equal
the  amount  set  forth  in the  Preliminary  Statement  hereto  as its  initial
Uncertificated  Principal Balance. On each Distribution Date, the Uncertificated
Principal  Balance  of each  REMIC I Regular  Interest  shall be  reduced by all
distributions  of principal  deemed made on such REMIC Regular  Interest on such
Distribution  Date pursuant to Section 4.02 and, if and to the extent  necessary
and appropriate,  shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 4.05, and the Uncertificated  Principal Balance of
REMIC I Regular Interest ZZ shall be increased by the related interest deferrals
as provided in Section 4.02. The Uncertificated  Principal Balance of each REMIC
I Regular  Interest shall never be less than zero.  With respect to the REMIC II
Regular  Interest  SB-PO an initial  amount equal to the amount set forth in the
Preliminary Statement hereto as its initial Uncertificated Principal Balance. On
each Distribution  Date, the  Uncertificated  Principal Balance of each REMIC II
Regular Interest shall be reduced by all  distributions of principal deemed made
on such REMIC  Regular  Interest on such  Distribution  Date pursuant to Section
4.02 and,  if and to the  extent  necessary  and  appropriate,  shall be further
reduced on such  Distribution  Date by  Realized  Losses as  provided in Section
4.05.

      Uncertificated  REMIC I  Pass-Through  Rate:  With respect to each REMIC I
Regular  Interest  and any  Distribution  Date,  a per annum  rate  equal to the
weighted  average of the Net Mortgage  Rates of the Mortgage Loans in effect for
the scheduled Monthly Payments due on such Mortgage Loans during the related Due
Period.

      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:  A citizen or  resident  of the United  States,  a
corporation,   partnership  or  other  entity   (treated  as  a  corporation  or
partnership for United States federal income tax purposes)  created or organized
in, or under the laws of, the United States, any state thereof,  or the District
of  Columbia  (except in the case of a  partnership,  to the extent  provided in
Treasury  regulations) provided that, for purposes solely of the restrictions on
the transfer of Class R Certificates,  no partnership or other entity treated as
a partnership  for United States federal income tax purposes shall be treated as
a  United  States  Person  unless  all  persons  that  own an  interest  in such
partnership  either directly or through any entity that is not a corporation for
United  States  federal  income tax  purposes  are  required  by the  applicable
operative  agreement to be United States Persons, or an estate that is described
in Section  7701(a)(30)(D)  of the Code, or a trust that is described in Section
7701(a)(30)(E) of the Code.

      VA: The Veterans Administration, or its successor.

                                       50
<PAGE>

      Voting Rights: The portion of the voting rights of all of the Certificates
which is allocated to any Certificate.  98.00% of all of the Voting Rights shall
be allocated among Holders of the Class A, Class M and Class B Certificates,  in
proportion to the outstanding Certificate Principal Balances of their respective
Certificates;  1% of all of the  Voting  Rights  shall be  allocated  among  the
Holders  of the Class SB  Certificates;  0.50% and  0.50%,  of all of the Voting
Rights shall be  allocated  to each of the Holders of the Class R  Certificates,
respectively;  in each case to be allocated among the Certificates of such Class
in accordance with their respective Percentage Interest.

      Section 1.02. Determination of LIBOR

      LIBOR applicable to the calculation of the Pass-Through  Rate on the Class
A, Class M and Class B  Certificates  for any  Interest  Accrual  Period will be
determined on each LIBOR Rate  Adjustment  Date.  On each LIBOR Rate  Adjustment
Date, or if such LIBOR Rate  Adjustment  Date is not a Business Day, then on the
next succeeding  Business Day, 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 Bridge  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 the aggregate Certificate
Principal  Balance  of the  Class  A,  Class  M and  Class B  Certificates  then
outstanding.  The Trustee shall  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 loans in U.S.  Dollars to leading European banks for
a  period  of  one  month  in  amounts  approximately  equal  to  the  aggregate
Certificate  Principal  Balance of the Class A, Class M and Class B Certificates
then outstanding.  If no such quotations can be obtained, the rate will be LIBOR
for the prior  Distribution  Date;  provided  however,  if, under the priorities
described above,  LIBOR for a Distribution  Date would be based on LIBOR for the
previous  Distribution  Date for the third  consecutive  Distribution  Date, the
Trustee shall select an alternative comparable index (over which the Trustee has
no control),  used for determining  one-month  Eurodollar  lending rates that is
calculated and published (or otherwise made available) by an independent  party.
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 the
Class A, Class M and Class B  Certificates  for the  relevant  Interest

                                       51
<PAGE>

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 shall supply to any Certificateholder so requesting by
calling  the  Trustee at  1-800-934-6802  the  Pass-Through  Rate on the Class A
Certificates  and  Class M  Certificates  for the  current  and the  immediately
preceding Interest Accrual Period.

                                   ARTICLE II
                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

      Section 2.01. Conveyance of Mortgage Loans

      (a) The Depositor,  concurrently  with the execution and delivery  hereof,
does hereby  assign to the Trustee  without  recourse  all the right,  title and
interest  of the  Depositor  in and to (i) the  Mortgage  Loans,  including  all
interest and principal on or with respect to the Mortgage  Loans due on or after
the Cut-off Date (other than Monthly  Payments due on the Mortgage  Loans in the
month of the Cut-off Date); and (ii) all proceeds of the foregoing. In addition,
on the Closing Date, the Supplemental  Interest Trust Trustee is hereby directed
to enter into the Swap  Agreement on behalf of the  Supplemental  Interest Trust
with the Swap Counterparty.

            The Depositor,  the Master Servicer and the Trustee 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 Security
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 Home Loan Practices Act effective as of January 1, 2005.

      (b) In connection with such  assignment,  and  contemporaneously  with the
delivery of this  Agreement,  the Depositor  delivered or caused to be delivered
hereunder  to the  Trustee  or a  Custodian,  and except as set forth in Section
2.01(c) below and subject to Section  2.01(d)  below,  the Depositor does hereby
(1) with respect to each 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 as the duly
appointed  agent of the Trustee for such purpose,  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 the Custodian as the duly  appointed  agent of
the Trustee for such purpose, the documents or instruments  described in clauses
(I)(i),  (iv) and (v) below and (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 the Custodian as the duly  appointed  agent of the
Trustee for such  purpose,  the  documents or  instruments  described in clauses
(I)(i), (iii), (iv) and (v) below and clause (II) below:

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

                                       52
<PAGE>

            (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) The  original  Mortgage,  noting the presence of the MIN of the
      Mortgage Loan (if the Mortgage  Loan is Registered on the MERS(R)  System)
      and  language  indicating  that  the  Mortgage  Loan is a MOM  Loan if the
      Mortgage Loan is a MOM Loan, with evidence of recording  indicated thereon
      or, if the  original  Mortgage has not yet been  returned  from the public
      recording  office,  a copy  of the  original  Mortgage  with  evidence  of
      recording indicated thereon;

            (iii) Unless the Mortgage Loan is registered on the MERS(R)  System,
      the Assignment  (which may be included in one or more blanket  assignments
      if  permitted  by  applicable  law) 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  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 any  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;

                                       53
<PAGE>

            (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  or  amendments  of the
      security  interest  referenced  in clause  (vi) above  showing an unbroken
      chain of title from the  originator to the Trustee,  each with evidence of
      recording  thereof,  evidencing the interest of the  originator  under the
      Security Agreement and the Assignment of Proprietary Lease;

            (viii) An executed  assignment of the interest of the  originator in
      the  Security   Agreement,   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 such  modification,  assumption  agreement or preferred  loan
      agreement; and

            (x) A duly completed  UCC-1 financing  statement  showing the Master
      Servicer  as debtor,  the  Depositor  as secured  party and the Trustee as
      assignee  and a duly  completed  UCC-1  financing  statement  showing  the
      Depositor  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.

      The Depositor may, in lieu of delivering the original of the documents set
forth in Sections  2.01(b)(I)(iii),  (iv) and (v) or  Sections  2.01(b)(II)(ii),
(iv),  (vii),  (ix) and (x) (or copies thereof) to the Trustee or the Custodian,
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) or Sections  2.01(b)(II)(ii),  (iv), (vii), (ix) (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 the  Custodian,  as duly  appointed  agent of the
Trustee.

      (c)  Notwithstanding  the provisions of Section 2.01(b), in the event that
in  connection  with any Mortgage  Loan,  if the  Depositor  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

                                       54
<PAGE>

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 Depositor shall deliver or cause to be delivered to the Trustee
or the respective Custodian a copy of such Mortgage,  assignment,  modification,
assumption agreement or preferred loan agreement.

      The  Depositor  shall  promptly  cause to be recorded  in the  appropriate
public office for real  property  records the  Assignment  referred to in clause
(iii) of Section  2.01(b),  except (a) in states where, in an Opinion of Counsel
acceptable to the Master Servicer, such recording is not required to protect the
Trustee's  interests in the 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  Residential  Funding and its  successors  and
assigns,  and shall  promptly  cause to be filed the Form UCC-3  assignment  and
UCC-1 financing statement referred to in clause (II)(vii) and (x), respectively,
of Section 2.01(b). If any Assignment,  Form UCC-3 or Form UCC-1, as applicable,
is lost or returned  unrecorded to the Depositor  because of any defect therein,
the Depositor shall prepare a substitute  Assignment,  Form UCC-3 or Form UCC-1,
as  applicable,  or cure  such  defect,  as the  case  may be,  and  cause  such
Assignment to be recorded in accordance with this paragraph. The Depositor shall
promptly deliver or cause to be delivered to the applicable  person described in
Section  2.01(b),  any  Assignment  or substitute  Assignment  (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 Depositor delivers to the Trustee or Custodian any Mortgage Note or
Assignment  of  Mortgage  in blank,  the  Depositor  shall,  or shall  cause the
Custodian to,  complete the  endorsement of the Mortgage Note and the 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  Depositor  further  agrees  that  it will  cause,  at the
Depositor'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
Depositor to the Trustee in  accordance  with this  Agreement for the benefit of
the  Certificateholders by including (or deleting, in the case of Mortgage Loans
which are  repurchased in accordance with this Agreement) in such computer files
(a) the code in the field which identifies the specific Trustee and (b) the code
in the field "Pool Field" which identifies the series of the Certificates issued
in connection  with such Mortgage  Loans.  The Depositor  further agrees that it
will not, and will not permit the Master  Servicer  to, and the Master  Servicer
agrees  that it will not,  alter the codes  referenced  in this  paragraph  with
respect to any Mortgage Loan during the term of this Agreement  unless and until
such  Mortgage  Loan  is  repurchased  in  accordance  with  the  terms  of this
Agreement.

      (d) It is intended that the conveyances by the Depositor to the Trustee of
the  Mortgage  Loans as provided for in this Section 2.01 be construed as a sale
by the  Depositor  to the Trustee of the  Mortgage  Loans for the benefit of the
Certificateholders.  Further,  it is not intended  that any such  conveyance  be
deemed to be a pledge of the Mortgage  Loans by the

                                       55
<PAGE>

Depositor to the Trustee to secure a debt or other  obligation of the Depositor.
However,  in the event that the  Mortgage  Loans are held to be  property of the
Depositor or of Residential Funding, or if for any reason this Agreement is held
or  deemed to create a  security  interest  in the  Mortgage  Loans,  then it is
intended that (a) this Agreement shall also be deemed to be 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
conveyances  provided for in this Section 2.01 shall be deemed to be (1) a grant
by the Depositor to the Trustee of a security interest in all of the Depositor's
right (including the power to convey title thereto), title and interest, whether
now owned or hereafter acquired, in and to (A) the Mortgage Loans, including (a)
(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  Mortgage  Loan  other  than a
Cooperative Loan, the related Mortgage Note and Mortgage,  and (b) any insurance
policies and all other  documents in the related  Mortgage File, (B) all amounts
payable  pursuant to the Mortgage Loans or the Swap Agreement in accordance with
the terms thereof and (C) 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 foregoing, and 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 Depositor
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) and (C) granted by  Residential  Funding to the
Depositor  pursuant  to the  Assignment  Agreement;  (c) the  possession  by the
Trustee,  the  Custodian or any other agent of the Trustee of Mortgage  Notes or
such other items of  property as they  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 Uniform  Commercial Code as in
effect  in the  States  of New  York  and  Minnesota  and any  other  applicable
jurisdiction;  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 Depositor and, at the Depositor'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
deemed  to  create a  security  interest  in the  Mortgage  Loans  and the other
property  described  above,  such  security  interest  would be  deemed  to be a
perfected  security  interest of first priority under applicable law and will be
maintained as such throughout the term of this Agreement.  Without  limiting the
generality  of the  foregoing,  the  Depositor  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

                                       56
<PAGE>

of the Depositor,  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,  as  evidenced by an Officers'  Certificate  of the  Depositor,
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 Depositor 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  location  of the place of  business  or the chief  executive
office of  Residential  Funding  or the  Depositor  or (3) any  transfer  of any
interest of Residential Funding or the Depositor in any 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 referred to in Section
2.01(b)(i)  above  (except  that for  purposes of such  acknowledgment  only,  a
Mortgage  Note may be endorsed in blank and an  Assignment of Mortgage may be 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,  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  Depositor 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 (the "Final 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(b) 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, upon receipt
of notification from the Custodian as specified in the succeeding sentence,  the
Trustee  shall  promptly so notify or cause the  Custodian  to notify the Master
Servicer and the Depositor;  provided, that if the Mortgage Loan related to such
Custodial  File  is  listed  on  Schedule  A of  the  Assignment  Agreement,  no
notification  shall be  necessary.  Pursuant  to  Section  2.3 of the  Custodial
Agreement,  the Custodian will notify the Master Servicer, the Depositor 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 received by it pursuant to the Custodial
Agreement.  If such  omission or defect  materially  and  adversely  affects the
interests in the related  Mortgage  Loan of the  Certificateholders,  the Master
Servicer shall promptly  notify  Residential  Funding of such omission or defect
and request that Residential

                                       57
<PAGE>

Funding correct or cure such 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,
then  Residential  Funding shall purchase such Mortgage Loan from the Trust Fund
at its  Purchase  Price,  in either case 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;  and  provided
further,  that no cure,  substitution  or  repurchase  shall be required if such
omission or defect is in respect of a Mortgage  Loan listed on Schedule A of the
Assignment  Agreement.  The Purchase  Price for any such  Mortgage Loan shall be
deposited  or caused to 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 owner's  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.  In
furtherance of the  foregoing,  if the  Subservicer or Residential  Funding that
repurchases  the  Mortgage  Loan is not a  member  of MERS and the  Mortgage  is
registered  on the MERS  System,  the Master  Servicer,  at its own  expense and
without any right of  reimbursement,  shall cause MERS to execute and deliver an
assignment of the Mortgage in recordable form to transfer the Mortgage from MERS
to such  Subservicer or Residential  Funding and shall cause such Mortgage to be
removed from registration on the MERS System in accordance with MERS's rules and
regulations.  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 Certificateholders.

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

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

            (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

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<PAGE>

      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 Depositor,  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;

            (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  shall 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  Depositor,  any  Affiliate of the
      Depositor 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 Depositor,
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

                                       59
<PAGE>

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 breach  would cause the  Mortgage  Loan to be other than a
"qualified mortgage" as defined in Section 860G(a)(3) of the Code, any such cure
or  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  Section  2.03(a)
available   to  the   Certificateholders   or  the  Trustee  on  behalf  of  the
Certificateholders.

      (b) The Depositor  hereby  represents  and warrants to the Trustee for the
benefit of the Certificateholders  that as of the Closing Date (or, if otherwise
specified below, as of the date so specified):  (i) the information set forth in
Exhibit G 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 respective
date or dates which such information is furnished; (ii) immediately prior to the
conveyance  of the Mortgage  Loans to the Trustee,  the Depositor 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 conveyance  validly  transfers  ownership of the
Mortgage Loans to the Trustee free and clear of any pledge, lien, encumbrance or
security interest; and (iii) 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).

      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 Depositor,  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)  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);  provided, however, that in the
event of a breach  of the  representation  and  warranty  set  forth in  Section
2.03(b)(iii),  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  Depositor  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 Depositor
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,  substitution  or repurchase  must occur
within 90 days from the date such breach was discovered.  Any such  substitution
shall be  effected  by the  Depositor  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 Depositor 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

                                       60
<PAGE>

respecting  such breach  available to the  Certificateholders  or the Trustee on
behalf of the Certificateholders.

      Section 2.04. Representations and Warranties of Residential Funding

      The  Depositor,  as assignee of  Residential  Funding under the Assignment
Agreement,   hereby   assigns   to  the   Trustee   for  the   benefit   of  the
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 Depositor,  the Master Servicer,  the Trustee or
the Custodian of a breach of any of the  representations  and warranties made in
the  Assignment  Agreement in respect of any Mortgage Loan or of any  Repurchase
Event  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 or Repurchase Event and request that
Residential  Funding  either  (i) cure such  breach or  Repurchase  Event in all
material  respects within 90 days from the date the Master Servicer was notified
of such breach or Repurchase  Event 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 or
substitution  must occur within 90 days from the date the breach was discovered.
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
or  substitution  must  occur  within  90 days  from  the date  the  breach  was
discovered.  If the breach of representation  and warranty that gave rise to the
obligation  to repurchase or substitute a Mortgage Loan pursuant to Section 4 of
the Assignment Agreement was the representation and warranty set forth in clause
(bb) of  Section  4  thereof,  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,  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

                                       61
<PAGE>

to Residential  Funding on the next succeeding  Distribution Date. 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 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 to the Trustee and the  Custodian.
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,  and  Residential  Funding  shall  be  deemed  to have  made  the
representations and warranties with respect to the Qualified Substitute Mortgage
Loan  contained  in  Section 4 of the  Assignment  Agreement,  as of the date of
substitution,  and the  covenants,  representations  and warranties set forth in
this Section 2.04, and 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 shall
determine the amount (if any) by which the Stated 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  created  hereunder  to fail to  qualify  as a REMIC 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 substitute  for) such 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
representation and warranty in clause (bb) of Section 4 thereof shall constitute
the sole remedy  respecting such breach available to the  Certificateholders  or
the  Trustee  on behalf of the  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 Residential Funding all of the right, title
and interest in respect of the Assignment  Agreement applicable to such Mortgage
Loan.

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      Section 2.05. Execution and Authentication of Certificates;  Conveyance of
                    REMIC Regular Interests

      (a) 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,  receipt of which is hereby  acknowledged.
Concurrently with such delivery and in exchange therefor, the Trustee,  pursuant
to the written request of the Depositor executed by an officer of the Depositor,
has executed and caused to be  authenticated  and delivered to or upon the order
of the Depositor the  Certificates  in authorized  denominations  which evidence
ownership of the entire Trust Fund.

      (b) The  Depositor,  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 Depositor 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  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
Certificates).

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

      Section 2.06. 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 Depositor 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  hereto 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  2.06 may not be amended,  without the consent of
the  Certificateholders  evidencing a majority of the aggregate Voting Rights of
the Certificates.

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<PAGE>

      Section 2.07. Agreement Regarding Ability to Disclose

      The  Depositor,   the  Master  Servicer  and  the  Trustee  hereby  agree,
notwithstanding any other express or implied agreement to the contrary, that any
and all Persons,  and any of their respective  employees,  representatives,  and
other agents may disclose,  immediately upon commencement of discussions, to any
and all Persons,  without  limitation  of any kind,  the tax  treatment  and tax
structure of the transaction  and all materials of any kind (including  opinions
or other tax  analyses)  that are  provided to any of them  relating to such tax
treatment  and tax  structure.  For purposes of this  paragraph,  the terms "tax
treatment"  and "tax  structure"  are  defined  under  Treasury  Regulation  ss.
1.6011-4(c).

                                  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,
following such procedures as it would employ in its good faith business judgment
and which are normal and usual in its general mortgage servicing activities, and
shall have full power and  authority,  acting alone or through  Subservicers  as
provided in Section 3.02,  to do 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 is  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

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<PAGE>

reimbursement;  provided, that if, as a result of MERS discontinuing or becoming
unable to continue  operations in connection with the MERS(R) System, it becomes
necessary to remove any Mortgage Loan from  registration  on the MERS(R)  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 as set forth
in  Section  3.10(a)(ii).  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  created  hereunder  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 or other documents.  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.

      (b) The Master Servicer shall, to the extent consistent with the servicing
standards set forth herein,  take whatever actions as may be necessary to file a
claim under or enforce or allow the Trustee to file a claim under or enforce any
title  insurance  policy with respect to any Mortgage  Loan  including,  without
limitation,  joining  in or  causing  any  Subservicer  (or any  other  party in
possession  of any  title  insurance  policy)  to  join in any  claims  process,
negotiations,  actions or proceedings necessary to make a claim under or enforce
any title insurance  policy.  Notwithstanding  anything in this Agreement to the
contrary, the Master Servicer shall not (unless the Mortgagor is in default with
respect to the  Mortgage  Loan or such default is, in the judgment of the Master
Servicer,  reasonably  foreseeable) make or permit any modification,  waiver, or
amendment  of any term of any  Mortgage  Loan  that  would  both (i)  effect  an
exchange or  reissuance of such Mortgage Loan under Section 1001 of the Code (or
final, temporary or proposed Treasury 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  created  hereunder to fail to qualify as a
REMIC under the Code or the imposition of any tax on  "prohibited  transactions"
or "contributions" after the startup date under the REMIC Provisions.

      (c) 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 customarily provided
by Persons  other than  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.

      (d) 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

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<PAGE>

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).

      (e)  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.

      (f) The  relationship  of the Master Servicer (and of any successor to the
Master  Servicer)  to the  Depositor  under this  Agreement  is  intended by the
parties  to be  that  of an  independent  contractor  and  not  that  of a joint
venturer, partner or agent.

      Section  3.02.   Subservicing   Agreements  Between  Master  Servicer  and
                       Subservicers; Enforcement of Subservicers' 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 shall be either (i) an institution the accounts
of which are  insured by the FDIC or (ii)  another  entity  that  engages in the
business of originating or servicing mortgage loans, and in either case shall be
authorized  to  transact  business  in the state or states in which the  related
Mortgaged  Properties  it is to  service  are  situated,  if and  to the  extent
required by applicable law to enable the  Subservicer to perform its obligations
hereunder and under the  Subservicing  Agreement,  and in either case shall be a
Freddie Mac,  Fannie Mae or HUD approved  mortgage  servicer.  In addition,  any
Subservicer  of a  Mortgage  Loan  insured  by the FHA  must be an  FHA-approved
servicer,  and any Subservicer of a Mortgage Loan guaranteed by the VA must be a
VA-approved  servicer.  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 by, permitted by or consistent with the Program Guide and
are not  inconsistent  with this  Agreement  and as the Master  Servicer and the
Subservicer have agreed. 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,

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<PAGE>

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 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,  to the extent that the non-performance of any
such  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, 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  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.

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<PAGE>

      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 reference to actions taken through a Subservicer or otherwise,
the  Master  Servicer  shall  remain  obligated  and liable to the  Trustee  and
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
Depositor  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 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
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) In the event the Master Servicer shall for any reason no longer be the
master servicer  (including by reason of an Event of Default),  the Trustee,  as
successor Master Servicer,  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.

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<PAGE>

      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 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
(subject to the terms and conditions of the Assignment  Agreement) (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 or any Subservicer
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 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.  For
purposes of delinquency  calculations,  any  capitalized  Mortgage Loan shall be
deemed to be current as of the date of the related  Servicing  Modification.  No
such  modification  shall reduce the  Mortgage  Rate (i) with respect to a fixed
rate Mortgage  Loan, (A) below one-half of the Mortgage Rate as in effect on the
Cut-off  Date or (B) below the sum of the rates at which the  Servicing  Fee and
the  Subservicing  Fee with  respect to such  Mortgage  Loan accrue or (ii) with
respect  to an  adjustable  rate  Mortgage  Loan,  (A) below the  greater of (1)
one-half of the Mortgage  Rate as in effect on the Cut-off Date and (2) one-half
of the Mortgage Rate as in effect on the date of the Servicing  Modification  or
(B) below the sum of the rates at which the Servicing  Fee and the  Subservicing
Fee with respect to such Mortgage Loan accrue.  The final  maturity date for any
Mortgage Loan shall not be extended  beyond the Maturity Date.  Also, the Stated
Principal Balance of all Reportable Modified Mortgage Loans subject to Servicing
Modifications  (measured  at the time of the

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<PAGE>

Servicing  Modification  and after giving effect to any Servicing  Modification)
can be no more than five percent of the aggregate Cut-off Date Principal Balance
of the Mortgage Loans, unless such limit is increased from time to time with the
consent of the Rating  Agencies.  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 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  purposes.  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 to be  re-amortized  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  reamortization  shall  not be  permitted  if it would  constitute  a
reissuance of the Mortgage Loan for federal income tax purposes.

      (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 Monthly
Payments due before or in the month of 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  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, 4.07 or 9.01 (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  representation  and  warranty set forth in
      clause  (bb) of Section 4 of the  Assignment  Agreement)  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; and

            (v) Any amounts required to be deposited pursuant to Section 3.07(c)
      and any  payments  or  collections  received  in the nature of  prepayment
      charges.

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<PAGE>

      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 Monthly  Payments due before or in the month of the Cut-off
Date)  and  payments  or  collections  consisting  of 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,
Subsequent  Recoveries  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.

      (d) The Master  Servicer  shall give written notice to the Trustee and the
Depositor  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

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<PAGE>

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.  The Subservicer shall not be required to deposit in
the  Subservicing  Account payments or collections in the nature of late charges
or  assumption  fees,  or  payments  or  collections  received  in the nature of
prepayment charges to the extent that the Subservicer is entitled to retain such
amounts pursuant to the Subservicing  Agreement. 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

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<PAGE>

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.

      (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

      In the event that  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 remit to the Trustee for deposit 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, 4.07, or 9.01) 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) late  recoveries of the payments for 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

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<PAGE>

      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 a rate per annum equal to the
      Net 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  deposited in 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, and any amounts remitted by Subservicers as interest
      in respect of Curtailments pursuant to Section 3.08(b);

            (vi) to pay to  itself,  a  Subservicer,  Residential  Funding,  the
      Depositor  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  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 the preceding calendar month;

            (viii) to reimburse itself or the Depositor for expenses incurred by
      and reimbursable to it or the Depositor pursuant to Section 3.14(c), 6.03,
      10.01 or otherwise;

            (ix) to reimburse  itself for amounts 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,
      including  any payoff fees or  penalties or any other  additional  amounts
      payable to the Master Servicer or Subservicer pursuant to the terms of the
      Mortgage Note.

      (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

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<PAGE>

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  made  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 Primary Insurance Coverage

      (a) The Master Servicer shall not take, or permit any Subservicer to take,
any action  which  would  result in  noncoverage  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 at origination 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 Master
Servicer had knowledge of such Primary  Insurance  Policy.  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 then-current  rating assigned to the Certificates by such Rating
Agency.

      (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 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.

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<PAGE>

      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 fire  insurance  with extended  coverage in an amount which is equal to the
lesser of the principal  balance owing on such Mortgage Loan  (together with the
principal  balance of any mortgage  loan secured by a lien that is senior to the
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
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 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).In  the event  that 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 from its own funds and 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

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<PAGE>

of the  Mortgage  Loans,  the Master  Servicer  agrees to present,  on behalf of
itself,  the  Trustee  and  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
Depositor. 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  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 both constitute a "significant  modification"
effecting an exchange or  reissuance  of such  Mortgage  Loan under the Code (or
final,  temporary or proposed Treasury

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<PAGE>

regulations  promulgated  thereunder)  and cause any REMIC created  hereunder to
fail to  qualify  as  REMICs  under  the  Code or the  imposition  of any tax on
"prohibited  transactions" or  "contributions"  after the startup 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 (or junior  lien of the same
priority in relation to any senior  mortgage loan,  with respect to any Mortgage
Loan secured by a junior  Mortgage)  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,  the  buyer/transferee  of the
Mortgaged  Property  would be  qualified  to assume the  Mortgage  Loan based on
generally  comparable  credit  quality and 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 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  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 each REMIC created hereunder would continue
to  qualify  as a REMIC  under the Code as a result  thereof  and that no tax on
"prohibited  transactions"  or  "contributions"  after the Startup Date would be
imposed on any REMIC created hereunder 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 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 Master  Servicer  with a "Lender  Certification  for  Assignment

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of  Mortgage  Loan"  in the  form  attached  hereto  as  Exhibit  N, in form and
substance satisfactory to the Master Servicer, providing the following: (i) that
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) that the
substance of the  assignment  is, and is intended to be, a  refinancing  of such
Mortgage Loan and that the form of the  transaction is solely to comply with, or
facilitate the transaction  under, such local laws; (iii) 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 (iv) 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 or action,  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 or action 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  foreclosure,   or  attempted  foreclosure  which  is  not
completed, or towards the correction of any default on a related senior mortgage
loan, 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  and  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 its funds so
expended  pursuant to Section 3.10. In addition,  the

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

      (c) In the  event  that  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  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 each
REMIC created  hereunder as a REMIC under  applicable  state law and avoid taxes
resulting from such property failing to be

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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
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  created  hereunder  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) any subject  REMIC created  hereunder 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 (other than Subsequent  Recoveries)  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 in the  related  Due Period  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)  (provided  that if any such
Class of  Certificates  to which such  Realized  Loss was allocated is no longer
outstanding,  such  subsequent  recovery shall be distributed to the persons who
were the Holders of such Class of Certificates when it was retired);  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.

      (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 shall 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.

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      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
shall 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 the form attached  hereto as Exhibit H, 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. Upon receipt of such
certification  and request,  the Trustee shall  promptly  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,  including  any  applicable  UCC
termination  statements.  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 the
form  attached  as  Exhibit  H  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  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 the Trustee's  receipt
of  notification  from  the  Master  Servicer  of the  deposit  of  the  related
Liquidation Proceeds in the Custodial Account.

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<PAGE>

      (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 shall 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;  Eligible Master Servicing
                    Compensation

      (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 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.
Prepayment charges shall be deposited into the Certificate  Account and shall be
paid on each Distribution Date to the holders of the Class SB Certificates.

      (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 the  Custodian)  and shall not be
entitled to reimbursement  therefor except as specifically  provided in Sections
3.10 and 3.14.

      (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.

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<PAGE>

      (e)  Notwithstanding  clauses (a) and (b) above,  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 Eligible  Master  Servicing
Compensation  (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);  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;  and third, to any amounts of servicing  compensation to which the
Master  Servicer is entitled  pursuant to Section  3.10(a)(v) or (vi). In making
such  reduction,  the Master  Servicer  shall 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);  (ii) shall 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)  and (iii) shall not  withdraw
from the Custodial Account any such amount of servicing compensation to which it
is entitled pursuant to Section 3.10(a)(v) or (vi).

      On each Distribution Date, Eligible Master Servicing Compensation shall be
applied to cover Prepayment Interest Shortfalls for such Distribution Date.

      Section 3.17. Reports to the Trustee and the Depositor

      Not later than fifteen  days after it receives a written  request from the
Trustee or the Depositor,  the Master  Servicer shall forward to the Trustee and
the Depositor a statement,  certified by a Servicing Officer,  setting forth the
status of the  Custodial  Account as of the close of business on the most recent
prior 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  shall deliver to the Depositor 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  Depositor's  annual  report  on Form 10-K is
required  to be filed in  accordance  with the  Exchange  Act and the  rules and
regulations of the Commission,  the date on which the Depositor's  annual report
on Form 10-K is required to be filed in accordance with the Exchange Act and the
rules and regulations of the Commission, (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:

            (i)  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.

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<PAGE>

            (ii) 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.

      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 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 Depositor's  annual report on Form 10-K is
required  to be filed in  accordance  with the  Exchange  Act and the  rules and
regulations of the  Commission,  the date on which the annual report 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 Depositor 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. Right of the Depositor in Respect of the Master Servicer

      The Master  Servicer  shall afford the  Depositor  and the  Trustee,  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 Depositor and the Trustee 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  Depositor  or
Residential  Funding.  The Depositor  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  Depositor  or its  designee.  Neither  the
Depositor  nor the Trustee  shall have the  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.

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      Section 3.21. 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 3.21 or otherwise in accordance with the
documentation establishing the Advance Facility to such Advancing Person or to a
trustee,  agent or custodian (an "Advance Facility Trustee")  designated by such
Advancing  Person in an  Advance  Facility  Notice  described  below in  Section
3.21(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  3.21(a),  the Master  Servicer  and the  related
Advancing  Person  shall  deliver to 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).

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<PAGE>

      (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  Depositor  nor the  Trustee  shall  have  any  duty or
liability with respect to the calculation of any Reimbursement Amount, nor shall
the  Depositor  or the Trustee have any  responsibility  to track or monitor the
administration  of the Advance  Facility  and the  Depositor  shall not 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 "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  provided by the Master  Servicer and reasonably  satisfactory  to the
Trustee  recognizing the interests of any 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 3.21, and such other
documents  in  connection  with  such  Advance  Facility  as may  be  reasonably
requested from time to time by any Advancing  Person or Advance Facility Trustee
and reasonably satisfactory to the Trustee.

      (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 and the
      Advancing  Person or Advance  Facility  Trustee shall be required to apply
      all amounts  available  in  accordance  with this  Section  3.21(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

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      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  3.21(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  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

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      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 3.21 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 3.21, including
      amendments to add provisions relating to a successor master servicer,  may
      be entered  into by the Trustee,  the  Depositor  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 then
      current  ratings  on such  Certificates,  and  delivery  of an  Opinion of
      Counsel as required under 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
      Depositor,  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  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  3.21 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 acting as agent of the Trustee shall establish and
maintain a  Certificate  Account in which the Master  Servicer  shall deposit or
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

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<PAGE>

for the immediately succeeding Distribution Date, (ii) any amount required to be
paid 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, (v) any prepayment  charges
on the Mortgage Loans received during the related Prepayment Period and (vi) all
other amounts constituting the Available Distribution Amount for the immediately
succeeding Distribution Date.

      (b)  On  or  prior  to  the  Business  Day   immediately   following  each
Determination  Date, the Master Servicer shall determine any amounts owed by the
Swap Counterparty under the Swap Agreement and inform the Supplemental  Interest
Trust Trustee in writing of the amount so calculated.

      (c) 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 not later than the Business Day next preceding the Distribution Date next
following  the  date of  such  investment  (except  that  (i) if such  Permitted
Investment is an obligation of the institution  that maintains such account or a
fund for which  such  institution  serves  as  custodian,  then  such  Permitted
Investment may mature on such  Distribution  Date and (ii) any other  investment
may mature 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.  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.

      Section 4.02. Distributions

      (a) On each Distribution  Date, the Trustee (or the Paying Agent on behalf
of the Trustee) shall allocate and distribute the Available Distribution Amount,
if any, for such date to the interests issued in respect of REMIC I and REMIC II
as specified in this Section.

      (b) (1) On each Distribution Date, the following amounts, in the following
order of priority, shall be distributed by REMIC I to REMIC II on account of the
REMIC I Regular Interests:

            i. to the extent of the Available Distribution Amount other than the
            portion  of  the   Available   Distribution   Amount   described  in
            clause(a)(vi) of the definition of Available  Distribution  Amount),
            to the  Holders of the REMIC I Regular  Interests,  pro rata,  in an
            amount equal to (A) the related  Uncertificated Accrued Interest for
            such  Distribution  Date,  plus (B) any  amounts in respect  thereof
            remaining unpaid from previous  Distribution Dates.  Amounts payable
            as  Uncertificated  Accrued  Interest  in respect of REMIC I Regular
            Interest ZZ shall be reduced when the REMIC I  Overcollateralization
            Amount  is less  than  the  REMIC I  Required

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<PAGE>

            Overcollateralization  Amount,  by the  lesser of (x) the  amount of
            such  difference  and (y) the REMIC I Regular  Interest  ZZ  Maximum
            Interest  Deferral  Amount,  and such  amount will be payable to the
            Holders of REMIC I Regular Interests A-1, A-2, A-3, A-4, M-1S, M-2S,
            M-3S,  M-4, M-5, M-6, M-7, M-8, M-9 and B in the same  proportion as
            the  Overcollateralization  Increase  Amount  is  allocated  to  the
            corresponding   Class  of  Certificates,   and  the   Uncertificated
            Principal  Balance  of the  REMIC I  Regular  Interest  ZZ  shall be
            increased by such amount; and

            ii. on each  Distribution  Date,  to the  Holders of REMIC I Regular
            Interests,  in an amount  equal to the  remainder  of the  Available
            Distribution  Amount  (other  than  the  portion  of  the  Available
            Distribution Amount described in clause (a)(vi) of the definition of
            Available Distribution Amount) after the distributions made pursuant
            to clause  (i) above,  allocated  as  follows  (except  as  provided
            below):  (A) to the  Holders  of the  REMIC I Regular  Interest  AA,
            98.00% of such remainder until the Uncertificated  Principal Balance
            of such REMIC I Regular  Interest  is  reduced  to zero;  (B) to the
            Holders of REMIC I Regular Interests A-1, A-2, A-3, A-4, M-1S, M-2S,
            M-3S,  M-4, M-5, M-6, M-7, M-8, M-9 and B 1.00% of such remainder in
            the same  proportion  as  amounts  are  distributed  in  respect  of
            principal on the  corresponding  Class of  Certificates;  (C) to the
            Holders of the REMIC I Regular Interest ZZ, 1.00% of such remainder;
            and  (D)  any  remaining  amounts  to the  Holders  of the  Class  R
            Certificates;  provided,  however,  that  98.00%  and  2.00%  of any
            principal payments that are attributable to an Overcollateralization
            Reduction  Amount  shall be  allocated  to  Holders  of the  REMIC I
            Regular Interest AA and REMIC I Regular  Interest ZZ,  respectively;
            and provided further,  that any prepayment charges on deposit in the
            Certificate  Account  attributable to prepayment charges received on
            the  Mortgage  Loans during the related  Prepayment  Period shall be
            deemed  distributed to REMIC II as the holder of the REMIC I Regular
            Interest AA.

            (2)  Notwithstanding  the  distributions  described  in this Section
      4.02(b),  distribution of funds from the Certificate Account shall be made
      only in accordance with Section 4.02(c).

      (c) 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
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 with respect to
each Class of  Certificates,  shall be based on the aggregate of the  Percentage
Interests  represented  by

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<PAGE>

Certificates  of the  applicable  Class  held by such  Holder  of the  following
amounts,  in the  following  order of  priority,  subject to the  provisions  of
Section 4.02(d)), to the extent of the Available  Distribution Amount on deposit
in the Certificate  Account with respect to clauses (i) through (xi), and to the
extent of the sum of the remaining Available Distribution Amount (other than the
portion of the Available  Distribution Amount described in clause (a)(vi) of the
definition  of Available  Distribution  Amount)) and to the extent of prepayment
charges on deposit in the Certificate Account):

            (i)  to  the  Class  A  Certificateholders,  the  Class  A  Interest
      Distribution  Amount,  with  such  amount  allocated  among  the  Class  A
      Certificateholders  on a pro rata basis based on the  Accrued  Certificate
      Interest on each such Class;

            (ii) to the Class M-1S  Certificateholders  from the amount, if any,
      of  the  Available  Distribution  Amount  remaining  after  the  foregoing
      distributions, the Class M-1S Interest Distribution Amount;

            (iii) to the Class M-2S  Certificateholders from the amount, if any,
      of  the  Available  Distribution  Amount  remaining  after  the  foregoing
      distributions, the Class M-2S Interest Distribution Amount;

            (iv) to the Class M-3S  Certificateholders  from the amount, if any,
      of  the  Available  Distribution  Amount  remaining  after  the  foregoing
      distributions, the Class M-3S Interest Distribution Amount;

            (v) to the Class M-4 Certificateholders  from the amount, if any, of
      the  Available   Distribution   Amount   remaining   after  the  foregoing
      distributions, the Class M-4 Interest Distribution Amount;

            (vi) to the Class M-5 Certificateholders from the amount, if any, of
      the  Available   Distribution   Amount   remaining   after  the  foregoing
      distributions, the Class M-5 Interest Distribution Amount;

            (vii) to the Class M-6  Certificateholders  from the amount, if any,
      of  the  Available  Distribution  Amount  remaining  after  the  foregoing
      distributions, the Class M-6 Interest Distribution Amount;

            (viii) to the Class M-7 Certificateholders  from the amount, if any,
      of  the  Available  Distribution  Amount  remaining  after  the  foregoing
      distributions, the Class M-7 Interest Distribution Amount;

            (ix) to the Class M-8 Certificateholders from the amount, if any, of
      the  Available   Distribution   Amount   remaining   after  the  foregoing
      distributions, the Class M-8 Interest Distribution Amount;

            (x) to the Class M-9 Certificateholders  from the amount, if any, of
      the  Available   Distribution   Amount   remaining   after  the  foregoing
      distributions, the Class M-9 Interest Distribution Amount;

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<PAGE>

            (xi) to the Class B  Certificateholders  from the amount, if any, of
      the  Available   Distribution   Amount   remaining   after  the  foregoing
      distributions, the Class B Interest Distribution Amount;

            (xii) to the Class A, Class M and Class B  Certificateholders,  from
      the amount, if any, of the Available  Distribution  Amount remaining after
      the foregoing distributions, the Principal Distribution Amount (other than
      the  amounts  set forth in clauses  (b)(iv),  (b)(v),  and  (b)(vi) of the
      definition thereof), in the order of priority described in Section 4.02(d)
      hereof,  until the Certificate  Principal Balances of the Class A, Class M
      and Class B Certificates have been reduced to zero;

            (xiii) to the Class A, Class M and Class B Certificateholders,  from
      the  amount,  if any,  of the  Excess  Cash Flow,  an amount  equal to the
      principal  portion of Realized Losses  previously  allocated to reduce the
      Certificate  Principal Balance of any Class of the Class A Certificates or
      Class M Certificates and remaining unreimbursed, but only to the extent of
      Subsequent  Recoveries for that  Distribution  Date, which amount shall be
      included in the Principal  Distribution Amount and paid in accordance with
      Section 4.02(d) hereof,  until the Certificate  Principal  Balances of the
      Class A, Class M and Class B Certificates have been reduced to zero;

            (xiv) to the Class A, Class M and Class B  Certificateholders,  from
      the amount,  if any, of the Excess Cash Flow remaining after the foregoing
      distributions, an amount equal to the principal portion of Realized Losses
      on the Mortgage Loans during the immediately  preceding Prepayment Period,
      which amount shall be included in the  Principal  Distribution  Amount and
      paid in accordance  with Section  4.02(d)  hereof,  until the  Certificate
      Principal  Balances of the Class A, Class M and Class B Certificates  have
      been reduced to zero;

            (xv) to the Class A,  Class M and Class B  Certificateholders,  from
      the amount,  if any, of the Excess Cash Flow remaining after the foregoing
      distributions,   the   Overcollateralization   Increase  Amount  for  such
      Distribution  Date,  which  amount  shall  be  included  in the  Principal
      Distribution  Amount and paid in accordance  with Section  4.02(d) hereof,
      until the Certificate Principal Balances of the Class A, Class M and Class
      B Certificates have been reduced to zero;

            (xvi) to the Class A,  Class M and Class B  Certificateholders  from
      the amount,  if any, of the Excess Cash Flow remaining after the foregoing
      distributions,  the amount of any Prepayment Interest Shortfalls allocated
      thereto for such  Distribution  Date, on a pro rata basis based on Accrued
      Certificate  Interest otherwise due thereon,  to the extent not covered by
      Eligible Master Servicing Compensation on such Distribution Date;

            (xvii) to the Class A, Class M and Class B  Certificateholders  from
      the amount,  if any, of the Excess Cash Flow remaining after the foregoing
      distributions, the amount of any Prepayment Interest Shortfalls previously
      allocated thereto on any prior Distribution Date that remain unreimbursed,
      together with interest thereon at the applicable  Pass-Through  Rate, on a
      pro  rata  basis  based  on  Prepayment  Interest  Shortfalls   previously
      allocated thereto that remain unreimbursed;

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            (xviii) from the amount,  if any, of the Excess Cash Flow  remaining
      after the foregoing distributions,  to pay the Class A Certificates,  on a
      pro rata  basis,  based on the  amount  of  Class A Basis  Risk  Shortfall
      Carry-Forward    Amount   previously   allocated   thereto   that   remain
      unreimbursed, the amount of any Class A Basis Risk Shortfall Carry-Forward
      Amounts  remaining  unpaid  as of such  Distribution  Date and then to the
      Class M Certificates, in their order of their payment priority, the amount
      of any Class M Basis Risk Shortfall Carry-Forward Amounts remaining unpaid
      as of such  Distribution  Date and then to the  Class B  Certificates  the
      amount of any Class B Basis Risk Shortfall Carry-Forward Amounts remaining
      unpaid as of each Distribution Date;

            (xix) to the Class A, Class M and Class B Certificates on a pro rata
      basis,  based on the amount of Relief Act Shortfalls  allocated thereto on
      such  Distribution  Date, from the amount, if any, of the Excess Cash Flow
      remaining after the foregoing distributions,  the amount of any Relief Act
      Shortfalls   allocated  to  those   Certificates   with  respect  to  such
      Distribution Date;

            (xx) to the Class A,  Class M and Class B  Certificateholders,  from
      the amount,  if any, of the Excess Cash Flow remaining after the foregoing
      distributions,  the principal  portion of any Realized  Losses  previously
      allocated to those Certificates and remaining  unreimbursed,  which amount
      shall be allocated first, to the Class A Certificateholders  on a pro rata
      basis, based on their respective  principal portion of any Realized Losses
      previously  allocated  thereto that remain  unreimbursed,  and then to the
      Class M Certificates,  in their order of payment  priority and then to the
      Class B Certificates;

            (xxi) from the amount,  if any,  of the Excess  Cash Flow  remaining
      after the foregoing  distributions,  to the  Supplemental  Interest  Trust
      Account for Payment to the Swap Counterparty, any Swap Termination Payment
      owed  by  the  Supplemental  Interest  Trust  Trustee,  on  behalf  of the
      Supplemental Interest Trust, due to a Swap Counterparty Trigger Event;

            (xxii) to the Class SB Certificates, (A) from the amount, if any, of
      the Excess Cash Flow remaining after the foregoing distributions,  the sum
      of (I)  Accrued  Certificate  Interest  thereon,  (II) the  amount  of any
      Overcollateralization  Reduction  Amount  for such  Distribution  Date and
      (III) for any Distribution Date after the Certificate Principal Balance of
      each Class of Class A Certificates  and Class M Certificates and the Class
      B Certificates has been reduced to zero, the Overcollateralization Amount,
      and (B) from prepayment charges on deposit in the Certificate Account, any
      prepayment  charges  received  on the  Mortgage  Loans  during the related
      Prepayment Period; and

            (xxiii) to the Class R  Certificateholders,  the balance, if any, of
      the Excess Cash Flow.

      (d) On each Distribution Date, the Principal  Distribution  Amount will be
paid as follows:

            (i) the Class A Principal  Distribution Amount shall be distributed,
      sequentially,  as follows: (w) first, to the Class A-1, Certificates until
      the  Certificate

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      Principal  Balance  thereof has been reduced to zero,  (x) second,  to the
      Class A-2  Certificates,  until the Certificate  Principal Balance thereof
      has been reduced to zero,  and (y) third,  to the Class A-3  Certificates,
      until the Certificate  Principal  Balance thereof has been reduced to zero
      and (z)  fourth,  to the Class  A-4  Certificates,  until the  Certificate
      Principal Balance thereof has been reduced to zero;

            (ii)  the  Class  M-1S  Principal   Distribution   Amount  shall  be
      distributed  to  the  Class  M-1S  Certificates,   until  the  Certificate
      Principal Balance thereof has been reduced to zero;

            (iii)  the  Class  M-2S  Principal   Distribution  Amount  shall  be
      distributed  to  the  Class  M-2S  Certificates,   until  the  Certificate
      Principal Balance thereof has been reduced to zero;

            (iv)  the  Class  M-3S  Principal   Distribution   Amount  shall  be
      distributed  to  the  Class  M-3S  Certificates,   until  the  Certificate
      Principal Balance thereof has been reduced to zero;

            (v) the Class M-4 Principal Distribution Amount shall be distributed
      to the Class M-4  Certificates,  until the Certificate  Principal  Balance
      thereof has been reduced to zero;

            (vi)  the  Class  M-5   Principal   Distribution   Amount  shall  be
      distributed to the Class M-5 Certificates, until the Certificate Principal
      Balance thereof has been reduced to zero;

            (vii)  the  Class  M-6  Principal   Distribution   Amount  shall  be
      distributed to the Class M-6 Certificates, until the Certificate Principal
      Balance thereof has been reduced to zero;

            (viii)  the  Class  M-7  Principal   Distribution  Amount  shall  be
      distributed to the Class M-7 Certificates, until the Certificate Principal
      Balance thereof has been reduced to zero;

            (ix)  the  Class  M-8   Principal   Distribution   Amount  shall  be
      distributed to the Class M-8 Certificates, until the Certificate Principal
      Balance thereof has been reduced to zero;

            (x) the Class M-9 Principal Distribution Amount shall be distributed
      to the Class M-9  Certificates,  until the Certificate  Principal  Balance
      thereof has been reduced to zero; and

            (xi) the Class B Principal  Distribution Amount shall be distributed
      to the Class B  Certificates,  until  the  Certificate  Principal  Balance
      thereof has been reduced to zero.

      (e)  Notwithstanding the foregoing clauses (c) and (d), upon the reduction
of the  Certificate  Principal  Balance of a Class of Class A  Certificates  and
Class M  Certificates  or the

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<PAGE>

Class B Certificates to zero, such Class of Certificates will not be entitled to
further  distributions  pursuant  to  Section  4.02  (other  than in  respect of
Subsequent Recoveries).

      (f) Any Prepayment Interest Shortfalls on the Mortgage Loans which are not
covered by Eligible Master  Servicing  Compensation as described in Section 3.16
and Relief Act  Shortfalls  on the Mortgage  Loans will be  allocated  among the
Class A,  Class M and  Class B  Certificates,  pro rata in  accordance  with the
amount of Accrued Certificate  Interest payable on such Distribution Date absent
such shortfalls.  Any such uncovered Prepayment Interest Shortfalls will be paid
solely pursuant to Section  4.02(c),  (xvi) and (xvii) and Section  4.09(c)(iii)
and (iv) to the  extent  funds  are  available  therefor.  Any such  Relief  Act
Shortfalls  will be paid  solely  pursuant to Section  4.02(c)(xix)  and Section
4.09(c)(vi) to the extent funds are available therefor.

      (g) In  addition  to the  foregoing  distributions,  with  respect  to any
Subsequent  Recoveries,  the Master  Servicer  shall deposit such funds into the
Custodial Account pursuant to Section 3.07(b)(iii).

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

      (i) 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
prior calendar month. 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 held in the Certificate  Account for the
benefit of such Certificateholders as provided in Section 9.01(d).

      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 forward by mail or otherwise  make  available
electronically on its website (which may be

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obtained by any  Certificateholder by telephoning the Trustee at (800) 934-6802)
to each  Holder  and the  Depositor  a  statement  setting  forth the  following
information  as to  each  Class  of  Certificates,  in each  case to the  extent
applicable:

            (i) the applicable  Record Date,  Determination  Date,  Distribution
      Date and the date on which the Interest Accrual Period commenced;

            (ii) the aggregate  amount of payments  received with respect to the
      Mortgage Loans in the aggregate, 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  including  amounts  payable as excess
      cash flow and the disposition of the excess cash flow;

            (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, 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   Certificate   Principal   Balance   for  each  Class  of
      Certificates as of the Closing Date;

            (x) the number and Stated Principal Balance of the Mortgage Loans in
      the aggregate after giving effect to the distribution of principal on such
      Distribution Date and the number of Mortgage Loans in the aggregate at the
      beginning and end of the related Due Period;

            (xi) on the  basis of the most  recent  reports  furnished  to it by
      Subservicers,  (A) the number and Stated Principal Balance of the Mortgage
      Loans in the aggregate  that are Delinquent (1) 30-59 days, (2) 60-89 days
      and (3) 90 or more days and the number and Stated Principal Balance of the
      Mortgage  Loans in the aggregate that are in  foreclosure,  (B) the number
      and Stated Principal  Balances of the Mortgage Loans in the aggregate that
      are Reportable Modified Mortgage Loans that are in foreclosure and are REO
      Property,  indicating  in each  case  capitalized  Mortgage  Loans,  other
      Servicing

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<PAGE>

      Modifications  and totals,  and (C) for all Reportable  Modified  Mortgage
      Loans, the number and Stated  Principal  Balances of the Mortgage Loans in
      the aggregate that have been liquidated,  the subject of pay-offs and that
      have been repurchased by the Master Servicer or Seller;

            (xii) 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;

            (xiii)  any  material  modifications,  extensions  or waivers to the
      terms of the Mortgage Loans in the aggregate during the Due Period or that
      have cumulatively become material over time;

            (xiv) any  material  breaches of Mortgage  Loan  representations  or
      warranties or covenants in the Agreement;

            (xv) the number,  aggregate  principal  balance and Stated Principal
      Balance of any REO Properties;

            (xvi) 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;

            (xvii) the aggregate  amount of Realized  Losses with respect to the
      Mortgage  Loans  in the  aggregate  for  such  Distribution  Date  and the
      aggregate  amount of Realized Losses with respect to the Mortgage Loans in
      the aggregate incurred since the Cut-off Date;

            (xviii) the Pass-Through  Rate on each Class of Certificates and the
      applicable Net WAC Cap Rate;

            (xix) the weighted  average of the Maximum Net  Mortgage  Rates with
      respect to the Mortgage Loans in the aggregate;

            (xx) the Basis Risk  Shortfall,  Basis Risk Shortfall  Carry Forward
      Amount, and Prepayment Interest Shortfalls;

            (xxi)   the   Overcollateralization    Amount   and   the   Required
      Overcollateralization Amount following such Distribution Date;

            (xxii)  the number and Stated  Principal  Balances  of the  Mortgage
      Loans in the aggregate repurchased under Section 4.07;

            (xxiii)  the  aggregate  amount  of  any  recoveries  on  previously
      foreclosed  loans with respect to the Mortgage Loans in the aggregate from
      Residential Funding;

            (xxiv)  the  weighted  average  remaining  term to  maturity  of the
      Mortgage  Loans  in the  aggregate  after  giving  effect  to the  amounts
      distributed on such Distribution Date;

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<PAGE>

            (xxv) the weighted  average  Mortgage Rates of the Mortgage Loans in
      the  aggregate  after  giving  effect to the amounts  distributed  on such
      Distribution Date;

            (xxvi) [Reserved];

            (xxvii)  the  amount  of  any  Net  Swap  Payment   payable  to  the
      Supplemental  Interest  Trust  Trustee,  on  behalf  of  the  Supplemental
      Interest Trust, any Net Swap Payment payable to the Swap Counterparty, any
      Swap  Termination  Payment  payable  to the  Supplemental  Interest  Trust
      Trustee,  on  behalf  of the  Supplemental  Interest  Trust,  and any Swap
      Termination Payment payable to the Swap Counterparty; and

            (xxviii) the occurrence of the Stepdown Date.

      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. In addition to the statement provided to the Trustee as set
forth in this Section 4.03(a),  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 S 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 such requesting 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) 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 and Trustee pursuant to any requirements of the Code.

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

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<PAGE>

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 Depositor 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  Depositor  or the Master  Servicer,  and (IV) notice of any
failure of the Trustee to make any  distribution  to the  Certificateholders  as
required pursuant to this Agreement. 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 R-1 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 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.

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<PAGE>

            (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 R-2.

      (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 Depositor
under the Exchange Act, upon delivery of such report to the Trustee.

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

      (a) Prior to the close of business  on the  Business  Day next  succeeding
each  Determination  Date, the Master Servicer shall furnish a written statement
(which may be in a mutually  agreeable  electronic  format) to the Trustee,  any
Paying Agent and the Depositor  (the  information  in such  statement to be made
available to  Certificateholders  by the Master  Servicer on request)  (provided
that the Master  Servicer  shall use its best  efforts to deliver  such  written
statement  not later than 12:00 P.M.  New York time on the second  Business  Day
prior to the  Distribution  Date) setting  forth (i) the Available  Distribution
Amounts,  (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),
(iii)  the  amount  of  Prepayment  Interest  Shortfalls,  Class  A  Basis  Risk
Shortfall,  Class M Basis Risk Shortfall,  Class B Basis Risk Shortfall, Class A
Basis  Risk  Shortfall  Carry-Forward  Amounts,  Class  M Basis  Risk  Shortfall
Carry-Forward  Amounts, and Class B Basis Risk Shortfall  Carry-Forward  Amounts
and (iv) any Net Swap Payments paid by the Swap Counterparty to the Supplemental
Interest Trust Trustee,  on behalf of the  Supplemental  Interest Trust, if any,
for such  Distribution  Date. 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) remit to the Trustee for
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 sum of (A) the aggregate  amount of Monthly
Payments  other than  Balloon  Payments  (with  each  interest  portion  thereof
adjusted to a per annum rate equal 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 Relief Act
or  similar  legislation  or  regulations  then in  effect,  on the  Outstanding
Mortgage  Loans as of the related  Due Date in the  related  Due  Period,  which
Monthly  Payments  were due during the related Due Period and not received as of
the close of

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business as of the related Determination Date; provided that no Advance shall be
made if it would  be a  Nonrecoverable  Advance  and (B)  with  respect  to each
Balloon  Loan  delinquent  in respect of its Balloon  Payment as of the close of
business  on the  related  Determination  Date,  an amount  equal to the assumed
Monthly Payment (with each interest portion thereof adjusted to a per annum rate
equal to the Net Mortgage Rate) that would have been due on the related Due Date
based on the  original  amortization  schedule  for such Balloon Loan until such
Balloon Loan is finally  liquidated,  over any payments of interest or principal
(with each interest  portion thereof adjusted to per annum rate equal to the Net
Mortgage Rate)  received from the related  Mortgagor as of the close of business
on the  related  Determination  Date and  allocable  to the Due Date  during the
related Due Period for each month until such Balloon Loan is finally liquidated,
(ii) 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 clauses (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 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 a certificate
of a Servicing Officer delivered to the Depositor and the Trustee.  In the event
that 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 as
successor Master Servicer hereunder,  including the obligation to deposit in the
Certificate  Account  an  amount  equal  to  the  Advance  for  the  immediately
succeeding  Distribution  Date. In connection with the preceding  sentence,  the
Trustee  shall  deposit all funds it receives  pursuant to this Section  4.04(b)
into the Certificate Account.

      Section 4.05. Allocation of Realized Losses

      (a) 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

                                      102
<PAGE>

Modifications,  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 in the month in which such  Distribution  Date occurs.  The
amount of each Realized Loss shall be evidenced by an Officers' Certificate.

      (b) All Realized Losses on the Mortgage Loans, on any  Distribution  Date,
shall be allocated or covered as follows:

            first,  to Excess  Cash  Flow as  provided  in clause  (b)(v) of the
            definition of "Principal  Distribution Amount", to the extent of the
            Excess Cash Flow for such Distribution Date;

            second,  by any amounts  available  from the Swap Agreement for such
            Distribution Date pursuant to Section 4.09(c);

            third, in reduction of the Overcollateralization  Amount, until such
            amount has been reduced to zero;

            fourth, to the Class B Certificates, until the Certificate Principal
            Balance thereof has been reduced to zero;

            fifth,  to  the  Class  M  9  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            sixth,  to  the  Class  M  8  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            seventh,  to the  Class  M 7  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            eighth,  to  the  Class  M 6  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            ninth,  to  the  Class  M  5  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            tenth,  to  the  Class  M  4  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            eleventh,  to the  Class M 3  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            twelfth,  to the  Class  M 2  Certificates,  until  the  Certificate
            Principal Balance thereof has been reduced to zero;

            thirteenth,  to the Class M 1  Certificates,  until the  Certificate
            Principal Balance thereof has been reduced to zero; and

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            fourteenth,  to the Class A-1,  Class  A-2,  Class A-3 and Class A-4
            Certificates on a pro rata basis,  until the  Certificate  Principal
            Balances thereof have been reduced to zero.

      (c) All  allocations of a Realized Loss on a "pro rata basis" among two or
more specified Classes of Certificates  means an allocation on a pro rata basis,
among the various  Classes so specified,  to each such Class of  Certificates on
the basis of their then  outstanding  Certificate  Principal  Balances  prior to
giving effect to distributions to be made on such  Distribution Date in the case
of the principal portion of a Realized Loss or based on the Accrued  Certificate
Interest  thereon payable on such  Distribution  Date in the case of an interest
portion of a Realized Loss. Any allocation of the principal  portion of Realized
Losses (other than Debt Service  Reductions)  to the Class A, Class M or Class B
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;  provided  that no such  reduction  shall  reduce  the
Certificate  Principal  Balance  of  the  Class  A,  Class  M and  the  Class  B
Certificates below the aggregate Stated Principal Balance of the Mortgage Loans,
as applicable.  Allocations of the interest  portions of Realized  Losses (other
than any interest rate reduction resulting from a Servicing  Modification) shall
be made by operation of the definition of "Accrued Certificate  Interest" and by
operation of the  provisions  of Section  4.02(c).  Allocations  of the interest
portion  of a  Realized  Loss  resulting  from an  interest  rate  reduction  in
connection  with a  Servicing  Modification  shall be made by  operation  of the
provisions  of  Section  4.02(c).  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.

      (d) All Realized  Losses on the Mortgage  Loans shall be allocated on each
Distribution  Date to the REMIC I  Regular  Interests,  as  follows:  first,  to
Uncertificated  Accrued Interest payable to the REMIC I Regular Interests AA and
ZZ up to an  aggregate  amount  equal to the  excess of (a) the REMIC I Interest
Loss Allocation  Amount over (b) Prepayment  Interest  Shortfalls (to the extent
not covered by Eligible Master Servicing  Compensation) relating to the Mortgage
Loans for such  Distribution  Date,  98% and 2%,  respectively;  second,  to the
Uncertificated  Principal Balances of the REMIC I Regular Interests AA and ZZ up
to an aggregate  amount equal to the REMIC I Principal Loss  Allocation  Amount,
98% and 2%,  respectively;  third, to the  Uncertificated  Principal Balances of
REMIC I Regular Interests AA, 98%, B-1, 1% and ZZ, 1%, until the  Uncertificated
Principal  Balance  of REMIC I Regular  Interest  B-1 has been  reduced to zero;
fourth, to the  Uncertificated  Principal  Balances of REMIC I Regular Interests
AA, 98%, M-9, 1% and ZZ. 1%, until the Uncertificated Principal Balance of REMIC
I Regular  Interest M-9 has been reduced to zero;  fifth, to the  Uncertificated
Principal  Balances of REMIC I Regular  Interests  AA, 98%,  M-8, 1% and ZZ, 1%,
until the  Uncertificated  Principal Balance of REMIC I Regular Interest M-8 has
been reduced to zero; sixth, to the Uncertificated Principal Balances of REMIC I
Regular  Interests  AA,  98%,  M-7,  1% and ZZ,  1%,  until  the  Uncertificated
Principal  Balance  of REMIC I Regular  Interest  M-7 has been  reduced to zero;
seventh,  to the Uncertificated  Principal Balances of REMIC I Regular Interests
AA, 98%, M-6, 1% and ZZ, 1%, until the Uncertificated Principal Balance of REMIC
I Regular Interest M-6 has been reduced to zero;  eighth, to the  Uncertificated
Principal  Balances of REMIC I Regular  Interests  AA, 98%,  M-5, 1% and ZZ, 1%,
until the  Uncertificated  Principal Balance of REMIC I Regular Interest M-5 has
been reduced to zero; ninth, to the Uncertificated Principal Balances of REMIC I
Regular  Interests  AA,  98%,  M-4,  1% and ZZ,  1%,  until  the  Uncertificated
Principal

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<PAGE>

Balance of REMIC I Regular Interest M 4 has been reduced to zero;  tenth, to the
Uncertificated  Principal Balances of REMIC I Regular Interests AA, 98%, M-3, 1%
and ZZ,  1%,  until  the  Uncertificated  Principal  Balance  of REMIC I Regular
Interest M-3 has been reduced to zero; eleventh, to the Uncertificated Principal
Balances of REMIC I Regular  Interests  AA, 98%,  M-2, 1% and ZZ, 1%,  until the
Uncertificated  Principal  Balance  of  REMIC I  Regular  Interest  M-2 has been
reduced to zero;  twelfth,  to the Uncertificated  Principal Balances of REMIC I
Regular  Interests  AA,  98%,  M-1,  1% and ZZ,  1%,  until  the  Uncertificated
Principal  Balance of REMIC I Regular Interest M-1 has been reduced to zero; and
thirteenth,  to  the  Uncertificated  Principal  Balances  of  REMIC  I  Regular
Interests AA, 98% and ZZ, 1%, pro rata, based upon the Uncertificated  Principal
Balance  of the  REMIC I  Regular  Interests  A-4,  A-3,  A-2 and A-1  until the
Uncertificated Principal Balances of REMIC I Regular Interests A-4, A-3, A-2 and
A-1 have been reduced to zero.

      (e)   Realized   Losses   allocated   to  the  Excess  Cash  Flow  or  the
Overcollateralization  Amount  pursuant to  paragraphs  (a),  (b) or (c) of this
Section,  the  definition of Accrued  Certificate  Interest and the operation of
Section 4.02(c) shall be deemed allocated to the Class SB Certificates. Realized
Losses allocated to the Class SB Certificates shall, to the extent such Realized
Losses  represent  Realized Losses on an interest  portion,  be allocated to the
REMIC II Regular  Interest SB-IO.  Realized Losses  allocated to the Excess Cash
Flow pursuant to paragraph (b) of this Section shall be deemed to reduce Accrued
Certificate  Interest on the REMIC I Regular  Interest  SB-IO.  Realized  Losses
allocated to the Overcollateralization  Amount pursuant to paragraph (b) of this
Section  shall be deemed first to reduce the  principal  balance of the REMIC II
Regular  Interest SB-PO until such principal  balance shall have been reduced to
zero and  thereafter  to reduce  accrued  and  unpaid  interest  on the REMIC II
Regular Interest SB-IO.

      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  interest  received  in a trade  or
business, the reports of foreclosures and abandonments of any Mortgaged Property
and the  informational  returns relating to cancellation of indebtedness  income
with respect to any Mortgaged  Property  required by Sections  6050H,  6050J and
6050P of the  Code,  respectively,  and  deliver  to the  Trustee  an  Officers'
Certificate  on or before March 31 of each year,  beginning with the first March
31 that occurs at least six months  after the Cut-Off  Date,  stating  that such
reports have been filed. Such reports shall be in form and substance  sufficient
to meet the reporting  requirements  imposed by such Sections  6050H,  6050J and
6050P of the Code.

      Section 4.07. Optional Purchase of Defaulted Mortgage Loans

      (a) With respect to any Mortgage Loan which 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

                                      105
<PAGE>

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

      Section 4.08. [Reserved]

      Section 4.09. The Swap Agreement

      (a) On the Closing Date,  the  Supplemental  Interest  Trust  Trustee,  on
behalf of the Supplemental  Interest Trust,  shall (i) establish and maintain in
its name,  in trust for the  benefit  of Class A,  Class M, Class B and Class SB
Certificates,  the Supplemental  Interest Trust Account and (ii) for the benefit
of the Class A, Class M, Class B and Class SB Certificates,  enter into the Swap
Agreement.

      (b) The Supplemental Interest Trust Trustee, on behalf of the Supplemental
Interest  Trust,  shall deposit in the  Supplemental  Interest Trust Account all
payments that are payable to the Supplemental  Interest Trust Trustee, on behalf
of the Supplemental Interest Trust, under the Swap Agreement.  Net Swap Payments
and Swap Termination  Payments (other than Swap Termination  Payments  resulting
from a Swap  Counterparty  Trigger Event) payable by the  Supplemental  Interest
Trust  Trustee,  on  behalf  of the  Supplemental  Interest  Trust,  to the Swap
Counterparty pursuant to the Swap Agreement shall be excluded from the Available
Distribution   Amount  and  payable  to  the  Swap  Counterparty  prior  to  any
distributions to the Certificateholders. On each Distribution Date, such amounts
will be remitted by the  Supplemental  Interest Trust Trustee,  on behalf of the
Supplemental  Interest  Trust,  to the  Supplemental  Interest Trust Account for
payment to the Swap Counterparty, first to make any Net Swap Payment owed to the
Swap Counterparty pursuant to the Swap Agreement for such Distribution Date, and
second  to make any Swap  Termination  Payment  (not due to a Swap  Counterparty
Trigger Event) owed to the Swap Counterparty  pursuant to the Swap Agreement for
such  Distribution  Date. For federal income tax purposes,  such amounts paid to
the Supplemental Interest Trust Account on each Distribution Date shall first be
deemed paid to the  Supplemental  Interest  Trust Account in respect of REMIC II
Regular  Interest SB-IO to the extent of the amount  distributable on such REMIC
II Regular  Interest SB-IO on such  Distribution  Date, and any remaining amount
shall be deemed paid to the  Supplemental  Interest Trust Account from the Class
IO  Distribution  Amount  (as  defined  below).  Any  Swap  Termination  Payment
triggered by a Swap  Counterparty  Trigger  Event owed to the Swap  Counterparty
pursuant to the

                                      106
<PAGE>

Swap Agreement will be subordinated to distributions to the Holders of the Class
A, Class M and Class B Certificates and shall be paid as set forth under Section
4.02.

      (c) Net Swap Payments payable by the Swap Counterparty to the Supplemental
Interest Trust Trustee, on behalf of the Supplemental  Interest Trust,  pursuant
to the Swap  Agreement  will be deposited  by the  Supplemental  Interest  Trust
Trustee,  on behalf of the  Supplemental  Interest Trust,  into the Supplemental
Interest Trust Account.  On each Distribution Date, to the extent required,  the
Supplemental  Interest Trust  Trustee,  on behalf of the  Supplemental  Interest
Trust, shall withdraw such amounts from the Supplemental  Interest Trust Account
to distribute to the Certificates in the following order of priority:

            (i) first, as part of the Principal  Distribution  Amount to pay the
      holders of the Class A Certificates,  Class M Certificates and then to the
      Class B Certificates in reduction of their Certificate Principal Balances,
      the  principal  portion of any  Realized  Losses  incurred on the Mortgage
      Loans for the preceding calendar month;

            (ii) second,  to pay any  Overcollateralization  Increase Amount, as
      part of the Principal  Distribution Amount, to the holders of the Class A,
      Class M and Class B Certificates;

            (iii)  third,  to pay the  holders  of Class A,  Class M and Class B
      Certificates,  the amount of any Prepayment Interest Shortfalls  allocated
      thereto  on such  Distribution  Date,  on a pro rata  basis,  based on the
      amount of Prepayment  Interest  Shortfalls  previously  allocated  thereto
      pursuant to Section  4.02(f) that remain  unreimbursed,  to the extent not
      covered by the Eligible Master Servicing Compensation on such Distribution
      Date;

            (iv) fourth, to pay to the holders of the Class A, Class M and Class
      B Certificates,  any Prepayment Interest Shortfalls  remaining unpaid from
      prior  Distribution Dates together with interest thereon at the applicable
      Pass-Through  Rate, on a pro rata basis, based on the amount of Prepayment
      Interest Shortfalls previously allocated thereto that remain unreimbursed;

            (v) fifth, to pay the holders of the Class A Certificates,  on a pro
      rata  basis,   based  on  the  amount  of  Basis  Risk   Shortfall   Carry
      Forward-Amounts  previously  allocated thereto remaining unpaid as of such
      Distribution  Date  the  applicable  Basis  Risk  Shortfall  Carry-Forward
      Amounts,  and then to the Class M Certificates,  in order of their payment
      priority,  and then to the Class B  Certificates,  the amount of any Basis
      Risk  Shortfall   Carry-Forward   Amounts  remaining  unpaid  as  of  such
      Distribution Date;

            (vi) sixth,  to pay to the holders of the Class A, Class M and Class
      B Certificates,  the amount of any Relief Act Shortfalls allocated thereto
      that  remain  unreimbursed,  on a pro rata  basis,  based on the amount of
      Relief Act Shortfalls previously allocated thereto;

            (vii) seventh, to pay to the holders of the Class A Certificates, on
      a pro rata  basis,  based on the  amount  of  Realized  Losses  previously
      allocated  thereto  that  remain  unreimbursed,  and  then to the  Class M
      Certificates in their order of payment  priority,  and

                                      107
<PAGE>

      then to the Class B  Certificates  the  principal  portion of any Realized
      Losses previously allocated thereto that remain unreimbursed; and

            (viii) eighth, to the Class SB Certificates.

On any Distribution  Date, the amounts described in 4.09(c)(i) through (c)(viii)
above will be paid first from  Excess Cash Flow for that  Distribution  Date and
second from amounts  received by the  Supplemental  Interest Trust  Trustee,  on
behalf of the Supplemental Interest Trust, under the Swap Agreement.

      (d) Subject to Sections 8.01 and 8.02 hereof,  the  Supplemental  Interest
Trust Trustee,  on behalf of the Supplemental  Interest Trust,  agrees to comply
with the terms of the Swap  Agreement  and to enforce  the terms and  provisions
thereof against the Swap Counterparty at the written direction of the Holders of
Class A, Class M and Class B Certificates entitled to at least 51% of the Voting
Rights of such Classes of Certificates,  or if the Trustee does not receive such
direction  from  such  Certificateholders,  then  at the  written  direction  of
Residential Funding.

      (e) The Supplemental  Interest Trust Account shall be an Eligible Account.
Amounts held in the Supplemental  Interest Trust Account from time to time shall
continue to constitute assets of the Supplemental Interest Trust, but not of any
REMIC,  until released from the Supplemental  Interest Trust Account pursuant to
this Section  4.09.  The  Supplemental  Interest  Trust Account  constitutes  an
"outside  reserve  fund"  within the  meaning  of  Treasury  Regulation  Section
1.860G-2(h)  and is not an asset of any REMIC.  The Class SB  Certificateholders
shall be the owners of the Supplemental Interest Trust Account. The Supplemental
Interest Trust Trustee, on behalf of the Supplemental Interest Trust, shall keep
records  that  accurately  reflect  the  funds on  deposit  in the  Supplemental
Interest Trust Account.  The Supplemental  Interest Trust Trustee,  on behalf of
the Supplemental Interest Trust, shall, at the direction of the Master Servicer,
invest  amounts  on  deposit  in the  Supplemental  Interest  Trust  Account  in
Permitted  Investments.  In the absence of written direction to the Supplemental
Interest Trust Trustee,  on behalf of the  Supplemental  Interest Trust from the
Master  Servicer,  all funds in the  Supplemental  Interest  Trust Account shall
remain uninvested.

      (f) The Supplemental Interest Trust Trustee, on behalf of the Supplemental
Interest Trust, and the Master Servicer shall treat the holders of each Class of
Certificates  (other than the Class SB Certificates and Class R Certificates) as
having entered into a notional  principal contract with the holders of the Class
SB Certificates.  Pursuant to each such notional principal contract, all holders
of Certificates  (other than the Class SB Certificates and Class R Certificates)
shall be treated as having  agreed to pay,  on each  Distribution  Date,  to the
holder of the Class SB Certificates an aggregate amount equal to the excess,  if
any, of (i) the amount payable on such Distribution Date on the REMIC II Regular
Interest  corresponding  to such  Class of  Certificates  over  (ii) the  amount
payable on such Class of Certificates on such  Distribution Date (such excess, a
"Class  IO  Distribution  Amount").  In  addition,  pursuant  to  such  notional
principal contract,  the holder of the Class SB Certificates shall be treated as
having agreed to pay the related Basis Risk Shortfall  Carry-Forward  Amounts to
the holders of the Certificates  (other than the Class SB Certificates and Class
R Certificates) in accordance with the terms of this Agreement.  Any payments to
the  Certificates  from  amounts  deemed  received  in respect of this  notional
principal contract shall not be payments with respect to a "regular interest" in
a REMIC

                                      108
<PAGE>

within the meaning of Code  Section  860G(a)(1).  However,  any payment from the
Certificates  (other than the Class SB Certificates and Class R Certificates) of
a Class IO Distribution  Amount shall be treated for tax purposes as having been
received by the holders of such  Certificates in respect of the REMIC II Regular
Interest  corresponding to such Class of Certificates and as having been paid by
such holders to the Supplemental Interest Trust Account pursuant to the notional
principal contract. Thus, each Certificate (other than the Class R Certificates)
shall be treated as  representing  not only  ownership  of regular  interests in
REMIC II, but also ownership of an interest in, and obligations with respect to,
a notional principal contract.

      (g) In the event that the Supplemental  Interest Trust Trustee,  on behalf
of the Supplemental  Interest Trust,  receives a Swap Termination Payment, and a
successor  swap  counterparty  cannot be  obtained,  then such Swap  Termination
Payment will be deposited into the  Supplemental  Interest Trust Account and the
Supplemental  Interest Trust  Trustee,  on behalf of the  Supplemental  Interest
Trust, on each subsequent  Distribution  Date (until the termination date of the
original Swap  Agreement),  will withdraw the amount of any Net Swap Payment due
to the  Supplemental  Interest  Trust  Trustee,  on behalf  of the  Supplemental
Interest  Trust  (calculated  in accordance  with the terms of the original Swap
Agreement), and administer such Net Swap Payment in accordance with the order of
priority for  distribution  of Net Swap  Payments by the  Supplemental  Interest
Trust Trustee,  on behalf of the  Supplemental  Interest  Trust, as described in
Section 4.09(c) hereof.

      (h) The  Supplemental  Interest  Trust  Account shall be terminated on the
termination date of the Swap Agreement.

      Section 4.10. Posted Collateral Account.

      (a) On the Closing Date,  the  Supplemental  Interest  Trust  Trustee,  on
behalf of the Supplemental Interest Trust, shall establish and maintain a Posted
Collateral Account pursuant to the terms of the Swap Agreement.

      (b) The Supplemental Interest Trust Trustee, on behalf of the Supplemental
Interest Trust,  shall deposit in the Posted  Collateral  Account all collateral
posted by the Swap  Counterparty  pursuant to  Paragraph  13(g)(i) of the credit
support annex to the Swap Agreement and held by the Supplemental  Interest Trust
Trustee,  on behalf of the Supplemental  Interest Trust,  pursuant to the credit
support annex to the Swap Agreement. Assets deposited into the Posted Collateral
Account  (i) shall not be  commingled  or used with any other  asset held by the
Supplemental  Interest  Trust Trustee and (ii) shall not be  transferred  to any
other person or entity except as may be provided in the Swap Agreement.

      (c) The Posted Collateral Account shall be an Eligible Account.

      (d) The Posted  Collateral  Account shall be terminated on the termination
date of the Swap Agreement.

      Section 4.11. [Rreserved]

      Section  4.12.  Tax  Treatment  of  Swap  Payments  and  Swap  Termination
                      Payments.

                                      109
<PAGE>

      (a) For federal income tax purposes,  each holder of a Class A, Class M or
Class B Certificate is deemed to own an undivided  beneficial ownership interest
in a  REMIC  regular  interest  and the  right  to  receive  payments  from  the
Supplemental  Interest  Trust  Account  in  respect  of the  related  Basis Risk
Shortfall  Carry-Forward  Amount,  and the  obligation  to make  payments to the
Supplemental  Interest  Trust  Account.  For federal  income tax  purposes,  the
Supplemental  Interest Trust  Trustee,  on behalf of the  Supplemental  Interest
Trust,  will  account  for  payments  to  each  Class  A,  Class  M and  Class B
Certificates as follows:  each Class A, Class M and Class B Certificate  will be
treated as receiving  their entire payment from REMIC II (regardless of any Swap
Termination  Payment or obligation  under the Swap  Agreement) and  subsequently
paying  their  portion of any Swap  Termination  Payment in respect of each such
Class' obligation under the Swap Agreement.  In the event that any such Class is
resecuritized  in a REMIC,  the  obligation  under the Swap Agreement to pay any
such Swap Termination Payment (or any Net Swap Payment),  will be made by one or
more  of the  REMIC  Regular  Interests  issued  by the  resecuritization  REMIC
subsequent  to such REMIC Regular  Interest  receiving its full payment from any
such Class A, Class M or Class B Certificate.  Resecuritization  of any Class A,
Class  M or  Class B  Certificate  in a REMIC  will be  permissible  only if the
Supplemental  Interest Trust  Trustee,  on behalf of the  Supplemental  Interest
Trust, hereunder is the trustee in such resecuritization.

      (b) The REMIC  regular  interest  corresponding  to a Class A,  Class M or
Class B Certificate will be entitled to receive interest and principal  payments
at the times and in the amounts equal to those made on the  certificate to which
it corresponds,  except that (i) the maximum interest rate of that REMIC regular
interest will equal the applicable Net WAC Cap Rate computed for this purpose by
limiting  the base  calculation  amount  of the  Swap  Agreement  to the  Stated
Principal  Balance of the Mortgage Loans and (ii) any Swap  Termination  Payment
will be treated as being  payable  solely from Excess Cash Flow.  As a result of
the  foregoing,  the amount of  distributions  and  taxable  income on the REMIC
regular interest  corresponding to a Class A, Class M or Class B Certificate may
exceed the  actual  amount of  distributions  on the Class A, Class M or Class B
Certificate.

                                   ARTICLE V
                                THE CERTIFICATES

      Section 5.01. The Certificates

      (a) The Class A Certificates  shall be substantially in the form set forth
in Exhibit A, the Class M Certificates  shall be  substantially  in the form set
forth in Exhibit B, the Class B Certificates shall be substantially in the forms
set forth in Exhibits C-1, C-2 or C-3, as set forth in Section  5.02(e)  hereof,
the  Class SB  Certificates  shall be  substantially  in the  forms set forth in
Exhibits D-1, D-2 or D-3, as set forth in Section 5.02(e) hereof and the Class R
Certificates  shall be  substantially  in the forms set forth in Exhibits E. The
Certificates  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 Depositor upon receipt by the Trustee or one or more  Custodians of
the documents specified in Section 2.01. The Class A, Class M-1S, Class M-2S and
Class M-3S  Certificates  shall be issuable in minimum dollar  denominations  of
$100,000 and integral  multiples of $1 in excess  thereof.  The Class M-4, Class
M-5, Class M-6,  Class M-7, Class M-8, Class M-9 and Class B Certificates  shall
be issuable in minimum dollar  denominations of

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$250,000  and  integral  multiples  of  $1  in  excess  thereof.  The  Class  SB
Certificates  shall  be  issuable  in  minimum   denominations  of  $100,000,000
representing a portion of the Notional Amount of the Class SB  Certificates  and
integral  multiples of $1 in excess  thereof.  On the Closing Date,  one Class B
Certificate  shall be  registered  as a Temporary  Regulation  S Global  Class B
Certificate  with a  Certificate  Principal  Balance  of $0.00  and one  Class B
Certificate shall be registered as a Rule 144A Global Offered Certificate with a
Certificate  Principal  Balance of $[___].  On the  Closing  Date,  one Class SB
Certificate  shall be  registered  as a Temporary  Regulation  S Global  Offered
Certificate  with a Notional Amount of $0.00 and one Class SB Certificate  shall
be registered as a Rule 144A Global Offered  Certificate  with a Notional Amount
of $[___].  Each Class of Class R  Certificates  shall be issued in  registered,
certificated  form in  minimum  percentage  interests  of  20.00%  and  integral
multiples  of 0.01% in  excess  thereof;  provided,  however,  that one  Class R
Certificate  of each Class will be issuable to the REMIC  Administrator  as "tax
matters  person"  pursuant  to  Section  10.01(c)  in  a  minimum   denomination
representing  a  Percentage  Interest of not less than 0.01%.  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) The  Class A  Certificates,  Class M and  Class B  Certificates  shall
initially be issued as one or more  Certificates  registered  in the name of the
Depository or its nominee and,  except as provided  below,  registration of such
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 Certificate Owners shall hold their respective
Ownership Interests in and to each such Class A, Class M and Class B Certificate
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  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  Depositor 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

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<PAGE>

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.

      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 request,
such  Certificate  Owner  shall,  subject  to the  rules and  procedures  of the
Depository,  provide the Depository or the related  Depository  Participant with
directions for the Trustee to exchange or cause the exchange of the  Certificate
Owner's  interest in such Class of  Certificates  for an  equivalent  Percentage
Interest in fully  registered  definitive  form.  Upon receipt by the Trustee of
instruction  from the  Depository  directing the Trustee to effect such exchange
(such  instructions to contain  information  regarding the Class of Certificates
and  the  Certificate   Principal   Balance  being  exchanged,   the  Depository
Participant  account to be debited with the decrease,  the registered  holder of
and  delivery  instructions  for  the  Definitive  Certificates  and  any  other
information  reasonably required by the Trustee), (i) the Trustee shall instruct
the  Depository to reduce the related  Depository  Participant's  account by the
aggregate Certificate Principal Balance of the Definitive Certificates, (ii) the
Trustee  shall  execute,  authenticate  and  deliver,  in  accordance  with  the
registration and delivery instructions provided by the Depository,  a Definitive
Certificate  evidencing such  Certificate  Owner's  Percentage  Interest in such
Class of Certificates and (iii) the Trustee shall execute and authenticate a new
Book-Entry  Certificate  reflecting  the reduction in the aggregate  Certificate
Principal  Balance of such Class of Certificates by the amount of the Definitive
Certificates.

      If (i)(A) the Depositor advises the Trustee in writing that the Depository
is no longer  willing or able to  properly  discharge  its  responsibilities  as
Depository  and (B) the  Depositor is unable to locate a qualified  successor or
(ii) the  Depositor  notifies  the  Depository  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  interest in the
Book-Entry  Certificates  agree to initiate such termination,  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 issue the
Definitive  Certificates.  Neither the  Depositor,  the Master  Servicer nor the
Trustee shall be liable for any actions taken by the  Depository or its nominee,
including, without limitation, any delay in delivery of any instruction required
under this  section  and may  conclusively  rely on, and shall be  protected  in
relying on, such instructions. Upon the issuance of Definitive Certificates, the
Trustee and the Master  Servicer  shall  recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.

      No  Ownership  Interest  in  a  Temporary   Regulation  S  Global  Offered
Certificate or Permanent Regulation S Global Offered Certificate may at any time
be transferred  to a transferee  that takes delivery in the form of a Definitive
Certificate.

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<PAGE>

      (c) Each of the  Certificates  is intended to be a "security"  governed by
Article 8 of the Uniform  Commercial  Code as in effect in the State of New York
and any other applicable  jurisdiction,  to the extent that any of such laws may
be applicable.

      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.

      (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 B,  Class SB 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 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 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, Class SB
or Class R 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 (the "Securities  Act"), and any applicable state securities
laws or is made in  accordance  with  said Act and  laws.  Except  as  otherwise
provided in this Section 5.02(d) or in Section 5.02(e) hereof, in the event that
a transfer  of a Class B,  Class SB or Class R  Certificate  is to be made,  (i)
unless the Depositor directs the Trustee otherwise,  the Trustee shall require a
written  Opinion  of  Counsel  addressed  to and  acceptable  to and in form and
substance  satisfactory  to the Trustee and the Depositor that such transfer may
be made pursuant to an exemption,  describing the  applicable  exemption and the
basis therefor, from 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 Trust
Fund, the Depositor or the Master  Servicer,  and (ii) the Trustee shall require
the Transferee to execute a representation letter,  substantially in the form of
Exhibit J hereto,  and the Trustee  shall  require the  transferor  to execute a
representation  letter,  substantially  in the form of  Exhibit K  hereto,  each
acceptable  to

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and in  form  and  substance  satisfactory  to the  Depositor  and  the  Trustee
certifying to the Depositor and the Trustee the facts surrounding such transfer,
which  representation  letters shall not be an expense of the Trustee, the Trust
Fund,  the Depositor or the Master  Servicer.  In lieu of the  requirements  set
forth in the  preceding  sentence,  transfers  of a Class B, Class SB or Class R
Certificates  may be  made  in  accordance  with  this  Section  5.02(d)  if the
prospective Transferee of such a Certificate provides the Trustee and the Master
Servicer  with an  investment  letter  substantially  in the form of  Exhibit  O
attached hereto, which investment letter shall not be an expense of the Trustee,
the Depositor,  or the Master Servicer, and which investment letter states that,
among other things, such Transferee (i) is a "qualified  institutional buyer" as
defined  under Rule 144A,  acting for its own  account or the  accounts of other
"qualified  institutional  buyers" as defined under Rule 144A, and (ii) is aware
that the proposed  transferor intends to rely on the exemption from registration
requirements  under the Securities Act provided by Rule 144A. If any transfer of
a  Class  B  Certificate  that is a  Book-Entry  Certificate  is to be made to a
transferee in book-entry  form, the transferor and the transferee will be deemed
to have made each of the respective  certifications set forth in Exhibit O as of
the transfer date, in each case as if such Class B, Certificate were in physical
form.  The  Holder of a Class B,  Class SB or Class R  Certificate  desiring  to
effect any transfer,  sale, pledge or other  disposition  shall, and does hereby
agree to,  indemnify the Trustee,  the  Depositor,  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 and this Agreement.

            (e) Provisions Regarding Rule 144A and Regulation S Transfers.

            (i) Private Offered  Certificates  sold to "qualified  institutional
      buyers"  as  defined  in and in  reliance  on Rule 144A under the 1933 Act
      shall be represented by one or more Rule 144A Global Offered Certificates.
      Private Offered Certificates sold in offshore  transactions in reliance on
      Regulation S under the Securities  Act shall be  represented  initially by
      Temporary Regulation S Global Offered Certificates.

            (ii) The Temporary Regulation S Global Offered Certificates shall be
      exchanged  on the later of (a) 40 days after the later of the Closing Date
      (b) the date on which the requisite certifications are due to and provided
      to the Trustee (the later of clauses (a) and (b), the "Exchange Date") for
      Permanent  Regulation S Global Offered  Certificates.  Regulation S Global
      Offered  Certificates shall be issued in registered form, without coupons,
      and  deposited  upon the  order of the  Transferor  with  the  Trustee  as
      custodian for and  registered  in the name of a nominee of the  Depository
      for  credit  to  the  account  of  the   depositaries  for  Euroclear  and
      Clearstream.

            (iii)  A  Certificate  Owner  holding  an  interest  in a  Temporary
      Regulation S Global Offered Certificate may receive payments in respect of
      the Certificates on the Temporary  Regulation S Global Offered Certificate
      only after the delivery, to Euroclear or Clearstream,  as the case may be,
      of a written certification  substantially in the form set forth in Exhibit
      W-1, and upon delivery by Euroclear or Clearstream, as the case may be, to
      the Trustee and Certificate Registrar of a certification or certifications
      substantially  in the form set forth in Exhibit W-2 (the "Clearing  System
      Certificate").  The delivery by a Certificate  Owner of the  certification
      referred  to  above  shall  constitute  its  irrevocable   instruction  to
      Euroclear or Clearstream,  as the case may be, to arrange for the exchange

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      of the Certificate  Owner's interest in the Temporary  Regulation S Global
      Offered Certificate for a beneficial interest in the Permanent  Regulation
      S Global Offered  Certificate  after the Exchange Date in accordance  with
      paragraph (iv) below.

            (iv) After (i) the Exchange Date and (ii) receipt by the Certificate
      Registrar of written  instructions  from Euroclear or Clearstream,  as the
      case may be, directing the Certificate  Registrar to credit or cause to be
      credited  to  either  Euroclear's  or  Clearstream's,  as the case may be,
      Depository's  account a beneficial interest in the Permanent  Regulation S
      Global Offered  Certificate in a principal amount not greater than that of
      the  beneficial  interest in the  Temporary  Regulation  S Global  Offered
      Certificate,  the  Certificate  Registrar shall instruct the Depository to
      reduce the principal  amount of the Temporary  Regulation S Global Offered
      Certificate and increase the principal amount of the Permanent  Regulation
      S Global Offered  Certificate,  by the principal  amount of the beneficial
      interest in the Temporary Regulation S Global Offered Certificate to be so
      transferred,  and to  credit or cause to be  credited  to the  account  of
      Euroclear,  Clearstream or a Person who has an account with the Depository
      as the case may be, a beneficial  interest in the  Permanent  Regulation S
      Global Offered  Certificate having a Certificate  Principal Balance of the
      Temporary  Regulation S Global Class B that was reduced upon the transfer.
      Upon return of the entire principal  amount of the Temporary  Regulation S
      Global  Offered  Certificate  to the  Trustee in exchange  for  beneficial
      interests  in the  Permanent  Regulation  S  Global  Offered  Certificate,
      Trustee shall cancel the Temporary Regulation S Global Offered Certificate
      by perforation and shall forthwith destroy it.

            (v) For  transfer of an interest in a Permanent  Regulation S Global
      Offered  Certificate  for an  interest  in the Rule  144A  Global  Offered
      Certificate,  if  the  Certificateholder  of a  beneficial  interest  in a
      Permanent  Regulation  S Global  Offered  Certificate  deposited  with the
      Depository  wishes at any time to exchange its  interest in the  Permanent
      Regulation S Global  Offered  Certificate,  or to transfer its interest in
      the  Permanent  Regulation S Global  Offered  Certificate  to a Person who
      wishes to take  delivery  thereof in the form of an  interest  in the Rule
      144A Global Offered Certificate, the Certificateholder may, subject to the
      rules and procedures of Euroclear or Clearstream  and the  Depository,  as
      the case may be, give directions for the Certificate Registrar to exchange
      or cause the  exchange or transfer or cause the  transfer of the  interest
      for an  equivalent  beneficial  interest in the Rule 144A  Global  Offered
      Certificate.  Upon receipt by the  Certificate  Registrar of  instructions
      from   Euroclear  or   Clearstream,   from  the  Depository  or  from  the
      Certificateholder, as the case may be, directing the Certificate Registrar
      to credit or cause to be credited a  beneficial  interest in the Rule 144A
      Global  Offered  Certificate  equal  to  the  Percentage  Interest  in the
      Permanent  Regulation  S Global  Offered  Certificate  to be  exchanged or
      transferred  (such  instructions  to  contain  information  regarding  the
      Depository Participant account to be credited with the increase, and, with
      respect  to an  exchange  or  transfer  of an  interest  in the  Permanent
      Regulation  S  Global  Offered  Certificate,   information  regarding  the
      Depository  Participant  account to be  debited  with the  decrease),  the
      Certificate   Registrar  shall  instruct  the  Depository  to  reduce  the
      Permanent  Regulation  S  Global  Offered  Certificate  by  the  aggregate
      principal amount of the beneficial interest in the Permanent  Regulation S
      Global  Offered  Certificate  to be so exchanged or  transferred,  and the
      Certificate Registrar shall instruct the Depository, concurrently with the
      reduction,  to  increase  the  principal  amount of the

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      Rule  144A  Global  Offered  Certificate  by  the  aggregate   Certificate
      Principal Balance of the beneficial interest in the Permanent Regulation S
      Global  Offered  Certificate  to be so  exchanged or  transferred,  and to
      credit or cause to be credited to the account of the Person  specified  in
      the  instructions  a beneficial  interest in the Rule 144A Global  Offered
      Certificate equal to the reduction in the Certificate Principal Balance of
      the Permanent Regulation S Global Offered Certificate.

            (vi) For  transfers  of an interest in the Rule 144A Global  Offered
      Certificate for an interest in a Regulation S Global Offered  Certificate,
      if a  Certificate  Owner  holding a  beneficial  interest in the Rule 144A
      Global Offered  Certificate wishes at any time to exchange its interest in
      the Rule 144A Global Offered Certificate for an interest in a Regulation S
      Global  Offered  Certificate,  or to  transfer  its  interest  in the 144A
      Book-Entry  Certificate to a Person who wishes to take delivery thereof in
      the form of an interest in the  Regulation S Global  Offered  Certificate,
      the  Certificateholder  may,  subject to the rules and  procedures  of the
      Depository,  give directions for the Certificate  Registrar to exchange or
      cause the  exchange or transfer or cause the  transfer of the interest for
      an  equivalent  beneficial  interest in the  Regulation  S Global  Offered
      Certificate. Upon receipt by the Certificate Registrar of (A) instructions
      given in accordance  with the  Depository's  procedures  from a Depository
      Participant or from the  Certificateholder,  as the case may be, directing
      the  Certificate  Registrar to credit or cause to be credited a beneficial
      interest in the Regulation S Global Offered Certificate in an amount equal
      to the beneficial  interest in the Rule 144A Global Offered Certificate to
      be exchanged or transferred,  (B) a written order given in accordance with
      the Depository's  procedures containing  information regarding the account
      of the  depositaries  for Euroclear or Clearstream  or another  Depository
      Participant,  as the case may be, to be credited with the increase and the
      name of the account and (C) certificates in the forms of Exhibits X and Y,
      respectively,  given by the proposed  transferee and the Certificate Owner
      of the interest,  the Certificate  Registrar shall instruct the Depository
      to reduce  the Rule  144A  Global  Offered  Certificate  by the  aggregate
      principal  amount  of the  beneficial  interest  in the Rule  144A  Global
      Offered  Certificate to be so exchanged or transferred and the Certificate
      Registrar shall instruct the Depository,  concurrently with the reduction,
      to  increase  the  principal  amount of the  Regulation  S Global  Offered
      Certificate  by  the  aggregate   Certificate  Principal  Balance  of  the
      beneficial  interest in the Rule 144A Global Offered  Certificate to be so
      exchanged  or  transferred,  and to credit or cause to be  credited to the
      account of the Person specified in the instructions a beneficial  interest
      in the Regulation S Global Offered  Certificate  equal to the reduction in
      the  Certificate  Principal  Balance  of  the  Rule  144A  Global  Offered
      Certificate.

            (vii)  Notwithstanding any other provisions of this Section 5.02(e),
      the Initial Purchaser may exchange  beneficial  interests in the Temporary
      Regulation S Global Offered  Certificates  held by it for interests in the
      Rule 144A Global Offered  Certificates  only after delivery by the Initial
      Purchaser of instructions  for the exchange  substantially  in the form of
      Exhibit Z. Upon  receipt of the  instructions  provided  in the  preceding
      sentence,  the  Certificate  Registrar  shall  instruct the  Depository to
      reduce the principal  amount of the Temporary  Regulation S Global Offered
      Certificate  to be so  transferred  and shall  instruct the  Depository to
      increase the principal amount of the Rule 144A Global Offered  Certificate
      and credit or cause to be credited to the account of the

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      placement  agent a  beneficial  interest in the Rule 144A  Global  Offered
      Certificate  having a  principal  amount  equal to the amount by which the
      principal amount of the Temporary  Regulation S Global Offered Certificate
      was reduced upon the transfer pursuant to the instructions provided in the
      first sentence of this clause (vii).

            (viii)  If a  transfer  of a  Class  B  Certificate  or a  Class  SB
      Certificate  which is a Definitive  Certificate is to be made, 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 the 1933 Act,  which  Opinion of Counsel shall not be an expense of the
      Trustee, the Trust Fund, the Company or the Master Servicer.

            (ix) The Holder of a Class B Certificate  or a Class SB  Certificate
      desiring to effect any 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 the provisions of this Agreement.

            (f) (i) In the case of any Class B Certificate, Class SB Certificate
      or  Class R  Certificate  presented  for  registration  in the name of any
      Person,  either  (A) the  Trustee  shall  require  an  Opinion  of Counsel
      acceptable to and in form and substance  satisfactory to the Trustee,  the
      Depositor  and the Master  Servicer  to the effect that the  purchase  and
      holding of such Class B, Class SB or Class R  Certificate  is  permissible
      under  applicable  law, will not  constitute  or result in any  non-exempt
      prohibited  transaction  under Section 406 of ERISA or Section 4975 of the
      Code (or comparable provisions of any subsequent enactments), and will not
      subject  the  Trustee,  the  Depositor  or  the  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  Depositor or the Master  Servicer,  or (B) the  prospective
      Transferee shall be required to provide the Trustee, the Depositor and the
      Master  Servicer with a  certification  to the effect set forth in Exhibit
      Q-1 (with respect to a Class B Certificate,  Exhibit J and Exhibit O (with
      respect to a Class SB Certificate) or in paragraph  fifteen of Exhibit I-1
      (with respect to a Class R  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
      (each,  a  "Plan"),  or any  Person  (including,  without  limitation,  an
      insurance company investing its general account,  an investment manager, a
      named  fiduciary  or a trustee  of any Plan) who is using  "plan  assets,"
      within the meaning of the U.S. Department of Labor regulation  promulgated
      at 29 C.F.R. ss. 2510.3-101, as modified by Section 3(42) of ERISA, of any
      Plan (each,  a "Plan  Investor") to effect such  acquisition 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 any  interest  therein) is an
      "insurance  company  general  account" (as defined in U.S.

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      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) As of any date prior to the  termination of the Swap Agreement,
      any Transferee of a Class A Certificate  or a Class M Certificate  will be
      deemed to have  represented  by virtue of its purchase and holding of such
      Certificate  (or any interest  therein) that either (a) such Transferee is
      not a Plan or a Plan Investor or (b) its  acquisition of such  Certificate
      and  the  right  to  receive  (and  its  receipt  of)  payments  from  the
      Supplemental  Interest Trust are eligible for exemptive  relief  available
      under at least one of PTCE 84-14,  PTCE 90-1,  PTCE  91-38,  PTCE 95-60 or
      PTCE 96-23 or other applicable exemption,  including Section 408(b)(17) of
      ERISA.

            (iii) As of any date after the  termination  of the Swap  Agreement,
      any Transferee of a Class A Certificate  or a Class M Certificate  will be
      deemed to have  represented  by virtue of its  purchase or holding of such
      Certificate  (or any interest  therein) that either (a) such Transferee is
      not a Plan or a Plan  Investor,  (b) it has  acquired  and is holding such
      Certificate in reliance on U.S. Department of Labor Prohibited Transaction
      Exemption  ("PTE")  94-29,  59 Fed. Reg.  14674 (March 29, 1994),  as most
      recently amended by 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 or Moody's or (c) such Transferee
      is a Complying Insurance Company.

            (iv) If any  Class A  Certificate  or  Class M  Certificate  (or any
      interest  therein) is acquired or held by any Person that does not satisfy
      the conditions described in paragraphs (ii) and (iii) above, then the last
      preceding Transferee that either (x) is not a Plan or a Plan Investor, (y)
      after the termination of the Swap Agreement,  acquired such Certificate in
      compliance with the RFC Exemption or (z) 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  Certificate.  The Trustee shall be under no liability to
      any  Person  for  making  any  payments  due on such  Certificate  to such
      preceding Transferee.

            (v) Any purported  Certificate Owner whose acquisition or holding of
      any Class A Certificate or Class M Certificate  (or any interest  therein)
      was  effected in  violation of the  restrictions  in this Section  5.02(f)
      shall indemnify and hold harmless the Depositor,  the Trustee,  the Master
      Servicer,  any  Subservicer,  any  underwriter 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.

      (g) (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

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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 I-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 endeavor
                  to remain a Permitted Transferee, and that it has reviewed the
                  provisions  of this Section  5.02(g) and agrees to be bound by
                  them, and

                        (II) a  certificate,  in the  form  attached  hereto  as
                  Exhibit I-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
            I-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

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            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 I-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.

                  (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 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(g) 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(g) and to the extent that the  retroactive  restoration  of the
            rights of the Holder of such Class R  Certificate  as  described  in
            clause  (ii)(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, will 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.

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            (iii) 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.

            (iv) The provisions of this Section  5.02(g) set forth prior to this
      clause (iv) 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  the  Class  A  Certificates   and  Class  M
            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) a  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 REMIC created hereunder to cease to qualify as a REMIC
            and will not cause (x) any REMIC created  hereunder 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.

      (h) 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.

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

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      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 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 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
Depositor,  the Master Servicer,  the Trustee, the Certificate Registrar nor any
agent of the  Depositor,  the Master  Servicer,  the Trustee or the  Certificate
Registrar  shall be  affected  by notice to the  contrary  except as provided in
Section 5.02(g).

      Section 5.05. Appointment of Paying Agent

      The  Trustee  may  appoint  a  Paying  Agent  for the  purpose  of  making
distributions  to  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 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 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 will hold all sums held by
it for the  payment  to  Certificateholders  in  trust  for the  benefit  of the
Certificateholders  entitled  thereto  until  such  sums  shall  be paid 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.

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                                   ARTICLE VI
                      THE DEPOSITOR AND THE MASTER SERVICER

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

      The Depositor 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 Depositor and the Master Servicer herein.  By
way of  illustration  and not  limitation,  the  Depositor is not liable for the
servicing  and  administration  of the  Mortgage  Loans,  nor is it obligated by
Section  7.01 or 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  Depositor  or the Master
                      Servicer; Assignment of Rights and Delegation of Duties by
                      Master Servicer

      (a) The Depositor and the Master  Servicer  shall each keep in full effect
its  existence,  rights  and  franchises  as a  corporation,  in the case of the
Depositor  and as a  limited  liability  company,  in  the  case  of the  Master
Servicer, under the laws of the state of its organization,  and will each obtain
and preserve its qualification to do business as a foreign  corporation,  in the
case of the Depositor,  and as a foreign limited liability company,  in the case
of the Master Servicer,  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  Depositor  or the Master  Servicer  may be
merged  or  consolidated,  or any  corporation  resulting  from  any  merger  or
consolidation to which the Depositor or the Master Servicer shall be a party, or
any Person  succeeding to the business of the Depositor or the Master  Servicer,
shall be the successor of the Depositor 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  herein  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 each  Rating  Agency's
ratings,  if any, of the Class A Certificates and Class M Certificates in effect
immediately prior to such merger or consolidation will not be qualified, reduced
or withdrawn as a result  thereof (as  evidenced by a letter to such effect from
each Rating Agency).

      (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  Depositor,  is willing  to  service  the
Mortgage  Loans and executes and  delivers to the  Depositor  and the Trustee an
agreement,  in form and substance  reasonably  satisfactory to the Depositor 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 each
Rating Agency's  rating of the Classes of  Certificates  that have been rated in
effect

                                      123
<PAGE>

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. This Section 6.02 shall not
apply to any sale, transfer,  pledge or assignment by Residential Funding of the
Call Rights.

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

      None  of the  Depositor,  the  Master  Servicer  or any of the  directors,
officers,  employees or agents of the Depositor 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  Depositor,  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  Depositor,  the Master
Servicer and any  director,  officer,  employee or agent of the Depositor 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  Depositor,  the  Master  Servicer  and any  director,  officer,
employee or agent of the Depositor 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 Depositor 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
Depositor  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 Depositor and the Master  Servicer shall 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.

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      Section 6.04. Depositor and Master Servicer Not to Resign

      Subject to the  provisions of Section 6.02,  neither the Depositor 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  Depositor or the Master  Servicer  shall be evidenced by an
Opinion  of  Counsel  (at the  expense of the  resigning  party) 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.

                                  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  distribute  or cause to be
      distributed  to  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 either 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  Depositor  or to the Master
      Servicer,  the Depositor 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
      Depositor, or to the Master Servicer, the Depositor and the Trustee by the
      Holders  of  Certificates  of any  Class  evidencing,  as to  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

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            (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 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 Depositor or the Trustee shall at the
direction  of Holders  of  Certificates  entitled  to at least 51% of the Voting
Rights,  by notice in writing to the Master  Servicer  (and to the  Depositor if
given by the Trustee or to the Trustee if given by the Depositor), 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;  provided, however, that a successor to the Master
Servicer  is  appointed  pursuant  to  Section  7.02 and such  successor  Master
Servicer  shall have accepted the duties of Master  Servicer  effective upon the
resignation of the Master Servicer.  If an Event of Default  described in clause
(vi) hereof shall occur, the Trustee shall, by notice to the Master Servicer and
the Depositor,  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

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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 Depositor shall deliver to
the Trustee as successor Master Servicer a copy of the Program Guide.

      Section 7.02. Trustee or Depositor 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  Depositor and with the  Depositor'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 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(c) 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  successor  Master
Servicer.  As compensation  therefor,  the Trustee as successor  Master Servicer
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 Depositor,  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 0.50% 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 0.50%  per  annum in order to hire a  Subservicer

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with  respect  to  such  Mortgage  Loans.  The  Master  Servicer  shall  pay the
reasonable  expenses of the Trustee in connection  with any  servicing  transfer
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 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 as provided in Section 7.04 hereof.

      Section 7.04. Waiver of Events of Default

      The Holders representing at least 66% of the Voting Rights of Certificates
affected  by a default or Event of Default  hereunder  may waive any  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),  (ii) or (iii). Upon any such waiver of
a  default  or  Event of  Default  by the  Holders  representing  the  requisite
percentage of Voting Rights of Certificates 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

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subsequent or other  default or Event of Default or impair any right  consequent
thereon except to the extent expressly so waived.

                                  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 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  in a timely
fashion.  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,  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 each REMIC created  hereunder as a REMIC under the REMIC Provisions  (subject
to Section  10.01(f))  and to prevent the  imposition  of any federal,  state or
local  income,  prohibited  transaction  (except as  provided  in  Section  2.04
herein),  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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      to the Trustee by the Depositor 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  the   Certificateholders   holding
      Certificates  which evidence,  Percentage  Interests  aggregating not less
      than 25% of the  affected  Classes  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 Depositor 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  or  Supplemental  Interest  Trust  Trustee,  as
      applicable,  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 or the Swap 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),  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 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 to do so by the 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  provided  that the Trustee  shall remain liable for any acts of
      such 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

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      determined by the Master Servicer pursuant to applicable federal, state or
      local tax laws,  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 (and except as provided for
in Section 2.04), 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 REMIC  created  hereunder 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 Depositor 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 Depositor 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  Depositor  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  Depositor  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 shall 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 its part,  arising out of, or in connection
with,  the  acceptance  and  administration  of the Trust  Fund,  including  its
obligation to execute the DTC Letter in its individual  capacity,  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 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(a)  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 such 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  pertain  to 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 Certificateholders pursuant to the terms of this Agreement.

      Section 8.06. Eligibility Requirements for Trustee

      The Trustee hereunder shall at all times be a national banking association
or a New York banking  corporation  having its  principal  office in a state and
city acceptable to the Depositor 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 and subject to supervision or examination by federal or state
authority. 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 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.

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      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 Depositor and the Master
Servicer.  Upon  receiving  such  notice of  resignation,  the  Depositor  shall
promptly appoint a successor trustee by written  instrument,  in duplicate,  one
copy of which  instrument  shall be delivered to the  resigning  Trustee and one
copy to the  successor  trustee.  If no  successor  trustee  shall  have been so
appointed and have accepted  appointment within 30 days after the giving of such
notice of  resignation  then 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  Depositor,  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 Depositor
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 Depositor  determines that the Trustee has failed (i) to distribute or cause
to be distributed to  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  Depositor)  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  Depositor,  then the Depositor 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 Depositor 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 Depositor,  one complete set to the Trustee so removed
and one complete set to the successor so appointed.

      (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.

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      Section 8.08. Successor Trustee

      (a) Any successor trustee appointed as provided in this Section 8.08 shall
execute, acknowledge and deliver to the Depositor 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 Mortgage  Files and related
documents and statements held by it hereunder  (other than any Mortgage Files at
the time held by a  Custodian,  which  shall  become the agent of any  successor
trustee hereunder),  and the Depositor,  the Master Servicer and the predecessor
trustee shall execute and deliver such  instruments  and do such other things as
may  reasonably be required for 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 (a) at the time of such acceptance  such successor  trustee shall
be eligible  under the  provisions of Section 8.06 and (b) such  appointment  of
such  successor  trustee will not result in the  reduction of the ratings on any
class of the Certificates  below the then-current  ratings on such Certificates,
as evidenced by a letter from each Rating Agency to such effect.

      (c) Upon  acceptance of appointment by a successor  trustee as provided in
this Section,  the Depositor 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 Depositor 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 Depositor.

      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 more Persons  approved by
the Trustee to act as co-trustee or  co-trustees,  jointly with the Trustee,

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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
Depositor,  or shall, at the direction of the Master Servicer and the Depositor,
appoint  custodians  who are  not  Affiliates  of the  Depositor  or the  Master
Servicer  to hold all or a  portion  of the  Custodial  Files  as agent  for the
Trustee, by entering into a Custodial Agreement.  The Trustee is hereby directed
to enter into a Custodial Agreement with [__________].  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 the benefit of the

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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 City of St.  Paul,
Minnesota where  Certificates may be surrendered for registration of transfer or
exchange.  The Trustee initially designates its offices located at the Corporate
Trust Office for the purpose of keeping the  Certificate  Register.  The Trustee
will  maintain an office at the address  stated in Section  11.05  hereof  where
notices and demands to or upon the Trustee in respect of this  Agreement  may be
served.

      Section 8.13. DTC Letter of Representations.

      The  Trustee is hereby  authorized  and  directed  to, and agrees  that it
shall,  enter  into  the DTC  Letter  on  behalf  of the  Trust  Fund and in its
individual capacity as agent thereunder.

      Section 8.14. Swap Agreement

      The Supplemental  Interest Trust Trustee is hereby authorized and directed
to, and agrees  that it shall,  enter into the Swap  Agreement  on behalf of the
Supplemental  Interest Trust. The  Supplemental  Interest Trust Trustee shall be
afforded all the rights and protections  provided to the Trustee as described in
this Article VIII.

                                   ARTICLE IX
                                   TERMINATION

      Section  9.01.   Termination  Upon  Purchase  by  Residential  Funding  or
                       Liquidation of All Mortgage Loans

      (a)   Subject  to   Section   9.02,   the   respective   obligations   and
responsibilities  of the Depositor,  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 Depositor 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

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            (ii) the  purchase  by the Master  Servicer  or its  designee 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  unreimbursed   Advances   attributable  to
      principal) on the day of repurchase,  plus unpaid accrued interest thereon
      at the Mortgage  Rate (or  Modified  Net Mortgage  Rate in the case of any
      Modified  Mortgage Loan) from the Due Date to which interest was last paid
      by the  Mortgagor  to,  but not  including,  the first day of the month in
      which  such  repurchase  price is  distributed  plus any Swap  Termination
      Payment payable to the Swap Counterparty then remaining unpaid or which is
      due to the  exercise  of such  option,  plus the amount of any accrued and
      unpaid Servicing Fees,  unreimbursed  advances and Servicing Advances,  in
      each case through the date of such option;  provided,  however, that in no
      event shall the trust created  hereby  continue  beyond the earlier of (i)
      the Maturity Date or (ii) the expiration of 21 years from the death of the
      last survivor of the descendants of Joseph P. Kennedy, the late ambassador
      of the United States to the Court of St. James, 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 REMIC created  hereunder as a REMIC. The purchase
      price paid by the Master  Servicer or its designee  shall also include any
      amounts owed by the Master  Servicer or its designee  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
      representation and warranty set forth in clause (bb) of such Section, that
      remain unpaid on the date of such purchase.

      The right of the Master  Servicer  or its  designee  to  purchase  all the
assets of the Trust Fund relating to the Mortgage Loans, pursuant to clause (ii)
above is  conditioned  upon the date of such purchase  occurring on or after the
Optional  Termination Date. If such right is exercised by the Master Servicer or
its designee,  the Master  Servicer shall be entitled to  reimbursement  for the
full amount of any unreimbursed  Advances theretofore made by it with respect to
the Mortgage Loans being purchased,  pursuant to Section 3.10. 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  or its  designee  the
Custodial Files pertaining to the Mortgage Loans being purchased.

      In addition, on any Distribution Date on or after the Optional Termination
Date, the Master Servicer or its designee shall have the right, at its option or
at the option of its designee, respectively, to purchase all of the Certificates
in  whole,  but not in  part,  at a price  equal  to the  aggregate  outstanding
Certificate  Principal  Balance of the  Certificates,  plus one month's  Accrued
Certificate  Interest  on  the  Certificates,   any  previously  unpaid  Accrued
Certificate  Interest,  and any unpaid Prepayment Interest Shortfalls previously
allocated thereto.

      (b) The  Master  Servicer  shall give the  Trustee  not less than 60 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 or its  designee of its right to
purchase the assets of the Trust Fund or otherwise).  Notice of any

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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 for payment
of the final  distribution  and  cancellation,  shall be given  promptly  by the
Master  Servicer (if the Master Servicer or its designee is exercising its right
to purchase the assets of the Trust Fund), or by the Trustee (in any other case)
by letter to  Certificateholders  mailed not  earlier  than the 15th day and not
later  than the 25th day of the month  next  preceding  the month of such  final
distribution specifying:

            (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,

            (ii) the amount of any such final payment, if known, and

            (iii) that the Record Date otherwise applicable to such Distribution
      Date  is  not  applicable,  and  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  or the  Trustee 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.  In the event
such notice is given by the Master Servicer, the Master Servicer or its designee
shall deposit in the Custodial  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 above provided.  The Master Servicer shall provide
to the  Trustee  written  notification  of any change to the  anticipated  Final
Distribution Date as soon as practicable. If the Trust Fund is not terminated on
the  anticipated  Final  Distribution  Date,  for any reason,  the Trustee shall
promptly mail notice thereof to each affected Certificateholder.

      (c) Upon  presentation and surrender of the Class A Certificates,  Class M
Certificates,   Class  B  Certificates   and  Class  SB   Certificates   by  the
Certificateholders  thereof,  the Trustee and the  Supplemental  Interest  Trust
Trustee,  as applicable,  shall  distribute to such  Certificateholders  (A) the
amount otherwise  distributable on such Distribution  Date, if not in connection
with the Master  Servicer's  election to  repurchase  the Mortgage  Loans or the
outstanding Class A Certificates, Class M Certificates, Class B Certificates and
Class SB  Certificates,  or (B) if the Master Servicer  elected to so repurchase
the  Mortgage  Loans  or  the  outstanding   Class  A   Certificates,   Class  M
Certificates, Class B Certificates and Class SB Certificates, an amount equal to
the price paid pursuant to Section 9.01(a) as follows:

            (i)  first,  payment  of any  accrued  and  unpaid  Servicing  Fees,
      unreimbursed  advances and  Servicing  Advances,  in each case through the
      date of such option, to the Master Servicer

            (ii) second,  with respect to the Class A Certificates,  pari passu,
      the  outstanding  Certificate  Principal  Balance  thereof,  plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

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            (iii)  third,  with  respect  to the Class  M-1S  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (iv)  fourth,  with  respect  to the Class  M-2S  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (v)  fifth,  with  respect  to  the  Class  M-3S  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (vi)  sixth,  with  respect  to  the  Class  M-4  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate Interest,

            (vii)  seventh,  with  respect  to the Class M-5  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (viii)  eighth,  with  respect  to the Class M-6  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (ix)  ninth,  with  respect  to  the  Class  M-7  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (x)  tenth,  with  respect  to  the  Class  M-8  Certificates,   the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (xi)  eleventh,  with  respect  to the Class M-9  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest,

            (xii)  twelfth,  with  respect  to the  Class  B  Certificates,  the
      outstanding   Certificate   Principal   Balance   thereof,   plus  Accrued
      Certificate  Interest  thereon for the related Interest Accrual Period and
      any previously unpaid Accrued Certificate Interest.

            (xiii)  thirteenth,   to  the  Class  A  Certificates  and  Class  M
      Certificates,  the amount of any Prepayment Interest Shortfalls  allocated
      thereto  for  such  Distribution  Date  or  remaining  unpaid  from  prior
      Distribution  Dates and accrued  interest  thereon at the applicable  Pass
      Through Rate, on a pro rata basis based on Prepayment  Interest Shortfalls
      allocated  thereto for such  Distribution  Date or  remaining  unpaid from
      prior Distribution Dates,

            (xiv) fourteenth,  to the Swap Counterparty  (without duplication of
      amounts  payable to the Swap  Counterparty on such date in accordance with
      Section  4.02)  any

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      Swap Termination  Payment payable to the Swap  Counterparty then remaining
      unpaid or which is due to the  exercise  of any early  termination  of the
      Trust Fund pursuant to this Section 9.01, and

            (xv) fifteenth, to the Class SB Certificates.

      (d) In the event that any  Certificateholders  shall not  surrender  their
Certificates  for  final  payment  and  cancellation  on  or  before  the  Final
Distribution  Date,  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  for the  benefit of such
Certificateholders,  and the  Master  Servicer  (if the Master  Servicer  or its
designee exercised its right to purchase the Mortgage Loans), or the Trustee (in
any  other  case)  shall  give  a  second   written   notice  to  the  remaining
Certificateholders  to surrender their Certificates for cancellation and receive
the final  distribution  with  respect  thereto.  If within 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 and the  Certificateholders  shall
look only to the Master Servicer for such payment.

      (e) All rights of the Master  Servicer or its  designee  to  purchase  the
assets of the Trust Fund, or to purchase  specified classes of Certificates,  as
set forth in Section  9.01(a)  are  referred to in this  Agreement  as the "Call
Rights".  Notwithstanding  any other  provision  of this  Agreement,  the Master
Servicer  or its  designee  shall  have the right to sell,  transfer,  pledge or
otherwise assign the Call Rights at any time to any Person.  Upon written notice
by the Master Servicer or its designee to the Trustee and the Master Servicer of
any such  assignment  of the Call  Rights to any  assignee,  the Trustee and the
Master  Servicer  shall be obligated to recognize such assignee as the holder of
the Call Rights.  Such entity,  if not the Master Servicer or its designee or an
affiliate,  shall be deemed to  represent,  at the time of such sale,  transfer,
pledge or other  assignment,  that one of the following will be, and at the time
the Call Right is exercised is, true and correct:  (i) the exercise of such Call
Right shall not result in a non-exempt prohibited  transaction under Section 406
of ERISA or Section 4975 of the Code (including by reason of U.S.  Department of
Labor ("DOL")  Prohibited  Transaction  Class Exemption  ("PTCE") 75-1 (Part I),
84-14, 90-1, 91-38,  95-60 or 96-23 or other applicable  exemption) or (ii) such
entity  is (A) not a party  in  interest  under  Section  3(14)  of  ERISA  or a
disqualified  person under  Section  4975(e)(2)  of the Code with respect to any
employee  benefit  plan  subject to Section 3(3) of ERISA or any plan subject to
Section 4975 of the Code (other than an employee  benefit plan or plan sponsored
or  maintained by the entity,  provided that no assets of such employee  benefit
plan or plan are invested or deemed to be invested in the  Certificates) and (B)
not  a  "benefit  plan  investor"  as  described  in  DOL   regulation   Section
2510.3-101(f)(2) and as modified by Section

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3(42) of ERISA.  If any such  assignee  of the Call Right is unable to  exercise
such Call Right by reason of the preceding  sentence,  then the Call Right shall
revert to the immediately  preceding  assignor of such Call Right subject to the
rights of any secured party therein.

      Section 9.02. Additional Termination Requirements

      (a) Each of REMIC I and REMIC II as the case may be,  shall be  terminated
in accordance with the following additional requirements, unless 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 any  REMIC  created  hereunder,  as the  case  may be,  to  comply  with  the
requirements  of this Section 9.02 will not (i) result in the  imposition on the
Trust Fund of taxes on "prohibited  transactions,"  as described in Section 860F
of the Code, or (ii) cause any REMIC  created  hereunder 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 of REMIC I and REMIC II, 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 each of
      REMIC I and REMIC II under  Section  860F of the Code and the  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 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 of REMIC I and REMIC II at the expense of
the Trust Fund in accordance with the terms and conditions of this Agreement.

                                   ARTICLE X
                                REMIC PROVISIONS

      Section 10.01. REMIC Administration

      (a) The REMIC  Administrator shall make an election to treat each of REMIC
I and REMIC II as a REMIC under the Code and,  if  necessary,  under  applicable
state law. 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.  The REMIC I Regular  Interests shall be designated as
the "regular  interests" and the Class R Certificates shall be designated as the
sole class of "residual  interests"  in REMIC I. The REMIC II Regular  Interests
shall be  designated  as

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the "regular  interests" and the Class R Certificates shall be designated as the
sole class of "residual  interests" in REMIC II. The REMIC Administrator and the
Trustee shall not permit the creation of any "interests"  (within the meaning of
Section 860G of the Code) in REMIC I and REMIC II other than the REMIC I Regular
Interests, the REMIC II Regular Interests and the Certificates.

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

      (c) The REMIC Administrator shall hold a Class R Certificate in each REMIC
representing a 0.01%  Percentage  Interest of the Class R  Certificates  in each
REMIC and shall be designated  as the "tax matters  person" with respect to each
of REMIC I and  REMIC  II 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 of REMIC I
and REMIC II 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 the REMICs
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 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,  if  any,  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 created hereunder.

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<PAGE>

      (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  thereof  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). In performing their duties as more  specifically
set forth  herein,  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 and the scope of duties more  specifically set
forth herein,  that, under the REMIC  Provisions,  if taken or not taken, as the
case may be, could (i) endanger the status of any REMIC  created  hereunder as a
REMIC or (ii) result in the imposition of a tax upon any REMIC created hereunder
(including but not limited to the tax on prohibited  transactions  as defined in
Section  860F(a)(2) of the Code (except as provided in Section 2.04) 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 the Trust Fund created hereunder,  endanger such status or,
unless the Master  Servicer or 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 or inaction,
as the case may be. In addition,  prior to taking any action with respect to the
Trust Fund or its assets, or causing the Trust Fund to take any action, which is
not expressly  permitted  under the terms of this  Agreement,  the Trustee shall
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 the Trust Fund and the  Trustee
shall not take any such  action or cause the Trust Fund 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

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Master Servicer or the REMIC  Administrator,  as applicable,  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 the REMIC 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 REMIC as  defined  in Section
860G(c) of the Code,  on any  contributions  to any REMIC after the Startup Date
therefor  pursuant to Section  860G(d) of the Code,  or any other tax 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  in its  role as  Master  Servicer  or REMIC
Administrator  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 on a calendar
year and on an  accrual  basis or as  otherwise  may be  required  by the  REMIC
Provisions.

      (i)  Following  the  Startup  Date,  neither the Master  Servicer  nor the
Trustee shall accept any contributions of assets to any REMIC 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 any REMIC will
not cause any REMIC created  hereunder to fail to qualify as a REMIC at any time
that any Certificates are outstanding or subject any such 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 REMIC  created
hereunder 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.

      (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 principal balance
of  each  regular  interest  in  each  REMIC  would  be  reduced  to zero is the
Distribution  Date in[____] 20[__],  which is the Distribution Date in the month
following the last scheduled payment on any Mortgage Loan.

      (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

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<PAGE>

Mortgage   Investment  Conduits  (REMIC)  and  Issuers  of  Collateralized  Debt
Obligations" for the Trust Fund.

      (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 any
REMIC  pursuant to Article IX of this  Agreement  or (ii) a purchase of Mortgage
Loans pursuant to Article II or III of this Agreement) or acquire any assets for
any REMIC or sell or dispose of any investments in the Custodial  Account or the
Certificate Account for gain, or accept any contributions to any 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 any REMIC  created  hereunder  as a REMIC or (b)  unless  the  Master
Servicer has  determined  in its sole  discretion  to  indemnify  the Trust Fund
against  such  tax,  cause  any  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  Depositor,  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 Depositor or the Master Servicer, as a result of a breach of the
Trustee's  covenants  set forth in Article  VIII or this Article X. In the event
that  Residential  Funding is no longer the Master  Servicer,  the Trustee shall
indemnify  Residential  Funding  for any  taxes  and  costs  including,  without
limitation, any reasonable attorneys' fees imposed on or incurred by Residential
Funding 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
Depositor,  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 Depositor,  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.

      (c) The Master Servicer agrees to indemnify the Trust Fund, the Depositor,
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 Depositor,  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.

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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 Depositor,  the Master Servicer and the Trustee, without the consent
of any of the Certificateholders  (but with the consent of the Swap Counterparty
if such  amendment  is with respect to Section  4.09,  Section  4.02(c)(xxi)  or
Section 11.10):

            (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
      any REMIC created  hereunder 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
      then-current  rating  assigned to such  Certificates,  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(g)
      or  any  other  provision  hereof  restricting  transfer  of the  Class  R
      Certificates  by virtue of their  being the  "residual  interests"  in the
      Trust Fund  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, as evidenced by a letter from each Rating Agency to such
      effect,  and (B) such  change  shall not,  as  evidenced  by an Opinion of
      Counsel (at the expense of the party  seeking so to modify,  eliminate  or
      add   such   provisions),   cause   the   Trust   Fund   or   any  of  the
      Certificateholders  (other than the transferor) to be subject to a federal
      tax caused by a transfer to a Person  that is not a Permitted  Transferee,
      or

            (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

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<PAGE>

      evidenced  by an  Opinion of  Counsel,  adversely  affect in any  material
      respect the interests of any Certificateholder.

      (b) This  Agreement or any  Custodial  Agreement  may also be amended from
time to time by the Depositor,  the Master Servicer, the Trustee and 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  and, if such  amendment is with respect to
Section 4.09,  Section  4.02(c)(xxi)  or Section 11.10,  with the consent of the
Swap  Counterparty,  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)  adversely  affect in any material  respect the interest of the
      Holders of  Certificates  of any Class in a manner other than as described
      in clause (i) hereof  without  the consent of Holders of  Certificates  of
      such Class evidencing,  as to such Class, Percentage Interests aggregating
      not less than 66%, or

            (iii) 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  (at the  expense  of the party  seeking  such
amendment) to the effect that such  amendment is permitted  under this Agreement
and that such  amendment  or the  exercise  of any power  granted  to the Master
Servicer,  the Depositor or the Trustee in accordance  with such  amendment will
not  result in the  imposition  of a federal  tax on the Trust Fund or cause any
REMIC  created  hereunder  to fail to  qualify  as a REMIC at any time  that any
Certificate is outstanding.  The Trustee may but shall not be obligated to enter
into any amendment pursuant to this Section that affects its rights,  duties and
immunities and this Agreement or otherwise; provided however, such consent shall
not be unreasonably withheld.

      (d) Promptly  after the execution of any such  amendment the Trustee shall
furnish  written  notification  of the  substance  of  such  amendment  to  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 Depositor 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,

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<PAGE>

insurance policy or similar  instrument or a reserve fund, or any combination of
the  foregoing,  for the  purpose  of  protecting  the  Holders  of the  Class R
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 R
Certificateholders,  but  shall  not be and  shall not be deemed to be under any
circumstances  included in any REMIC.  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 such
REMIC,  (ii) any such  reserve fund shall be owned by the  Depositor,  and (iii)
amounts  transferred  by such REMIC to any such reserve fund shall be treated as
amounts distributed by such REMIC to the Depositor or any successor,  all within
the meaning of Treasury regulations Section 1.860G-2(h).  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  Depositor  and such  related  insurer  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
Certificateholders,  the Master Servicer or the Trustee, as applicable; provided
that the Depositor  obtains 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 Depositor
elects to provide such  coverage in the form of a limited  guaranty  provided by
GMAC LLC,  the  Depositor  may  elect  that the text of such  amendment  to this
Agreement  shall be  substantially  in the form attached hereto as Exhibit L (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 M, with such changes as the Depositor  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 the  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, without regard to the conflict of laws principles thereof, other than
Sections 5-1401 and 5-1402 of the New York General Obligations Law.

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<PAGE>

      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 (a) in the case of the Depositor,  8400
Normandale Lake Boulevard,  Suite 250, Minneapolis,  Minnesota 55437, Attention:
President  (RFMSII),  or such other address as may hereafter be furnished to the
Master Servicer and the Trustee in writing by the Depositor;  (b) in the case of
the Master Servicer, 2255 North Ontario Street, Burbank,  California 91504-3120,
Attention:  Bond  Administration  or  such  other  address  as may be  hereafter
furnished to the  Depositor  and the Trustee by the Master  Servicer in writing;
(c) in the  case  of the  Trustee,  [_______],[_______],  Attention:  Structured
Finance/RFMSII  Series  20[__]-[___]  or such other  address as may hereafter be
furnished to the  Depositor  and the Master  Servicer in writing by the Trustee;
(d) in the case of  Moody's,  99  Church  Street,  New  York,  New  York  10007,
Attention:  ABS Monitoring  Department or such other address as may be hereafter
furnished to the Depositor,  the Trustee and the Master  Servicer by Moody's and
(e) in the case of Standard & Poor's, 55 Water Street,  New York, New York 10041
Attention; Mortgage Surveillance.  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. Notices to Rating Agencies

      The Depositor,  the Master  Servicer or the Trustee,  as  applicable,  (a)
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,  (b)
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 (c) 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 152 any such instrument,

      (e) the statement required to be delivered to the Holders of each Class of
Certificates pursuant to Section 4.03,

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<PAGE>

      (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 of any
such event known to the Master Servicer.

      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

      (a) 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 Depositor or any of
its  Affiliates  (or  any  designee  thereof)  is  the  registered  Holder  (the
"Resecuritized  Certificates"),  the  Depositor  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 Depositor,  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 to the
purposes thereof.  In connection with each Supplemental  Article,  the Depositor
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 any

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<PAGE>

REMIC created hereunder as a REMIC or result in the imposition of a tax upon the
Trust Fund  (including  but not limited to the tax on prohibited  transaction 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. [Reserved]

      Section 11.10. Third Party Beneficiaries

      The  Swap  Counterparty  is an  express  third-party  beneficiary  of  the
Agreement,  and shall have the right to enforce  the related  provisions  of the
Agreement as if it were a party hereto.

                                  ARTICLE XII
                          COMPLIANCE WITH REGULATION AB

      Section 12.01. Intent of Parties; Reasonableness

      The Depositor,  the Trustee and the Master Servicer  acknowledge and agree
that  the  purpose  of  this  Article  XII is to  facilitate  compliance  by the
Depositor with the provisions of Regulation AB and related rules and regulations
of the  Commission.  The  Depositor  shall not  exercise  its  right to  request
delivery of information or other  performance  under these provisions other than
in good faith,  or for purposes other than  compliance  with the Securities Act,
the  Exchange  Act and the rules and  regulations  of the  Commission  under the
Securities Act and the Exchange Act. 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
requests made by the Depositor 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
Depositor  to  deliver  to the  Depositor  (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  Depositor  to permit the  Depositor  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  to the  Depositor as of the
Closing Date and on each date on which  information is provided to the Depositor
under Sections 12.01,  12.02(b) or 12.03 that, except as disclosed in writing to
the  Depositor  prior to such  date:  (i) it is not aware  and has not  received
notice that any default,  early  amortization  or other  performance  triggering
event has occurred as to any other Securitization Transaction due to any default
of the 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
relating to the Trustee  with respect to the  Depositor or any sponsor,  issuing
entity,  servicer,  trustee,  originator,  significant  obligor,  enhancement or
support provider or other material  transaction party (as such terms are used in
Regulation AB) relating to the  Securitization  Transaction  contemplated by the

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<PAGE>

Agreement,  as  identified  by the Depositor 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 of any Transaction Party.
The  Depositor  shall  notify the  Trustee of any  change in the  identity  of a
Transaction Party after the Closing Date.

      (b) If so requested by the  Depositor  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 Depositor.  Any such request from the Depositor shall not be
given more than once each calendar  quarter,  unless the Depositor  shall have a
reasonable  basis  for a  determination  that  any  of the  representations  and
warranties may not be accurate.

      Section 12.03. Information to be Provided by the Trustee

      For so long as the  Certificates  are  outstanding,  for  the  purpose  of
satisfying  the  Depositor's  reporting  obligation  under the Exchange Act with
respect to any Class of Certificates, the Trustee shall provide to the Depositor
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 date the Depositor or Master  Servicer files each Report on Form 10-D and
Report on Form 10-K with respect to the Certificates, the Trustee will be deemed
to represent that any information  previously provided 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 Depositor 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 Depositor
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  Depositor a report (in form and  substance  reasonably
satisfactory to the Depositor)  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 addressed  to

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<PAGE>

the  Depositor  and signed by an  authorized  officer of the Trustee,  and shall
address each of the Servicing Criteria specified on Exhibit V hereto; and

      (b) deliver to the  Depositor a report of a registered  public  accounting
firm reasonably acceptable to the Depositor that attests to, and reports on, the
assessment  of  compliance  made by the  Trustee and  delivered  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  Depositor,  each  affiliate of the
Depositor,  the Master  Servicer and each broker dealer  acting as  underwriter,
placement  agent or Initial  Purchaser  of the  Certificates  or each Person who
controls any of such parties (within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act);  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; provided, by way
      of  clarification,  that clause (B) of this  paragraph  shall be construed
      solely  by  reference  to the  Trustee  Information  and not to any  other
      information  communicated  in  connection  with  a  sale  or  purchase  of
      securities,  without  regard to whether  the  Trustee  Information  or any
      portion  thereof is presented  together with or separately from such other
      information; 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  the  accountants'
      attestation.

      (b) In the case of any failure of performance  described in clause (ii) of
Section 12.05(a), the Trustee shall (i) promptly reimburse the Depositor for all
costs  reasonably  incurred by the Depositor in order to obtain the information,
report, certification,  accountants' attestation or other material not delivered
as required by the Trustee and (ii) cooperate with the Depositor to mitigate any
damages that may result from such failure.

                                      155
<PAGE>

      (c) The Depositor  and the Master  Servicer  shall  indemnify the Trustee,
each  affiliate of the Trustee or each Person who  controls the Trustee  (within
the meaning of Section 15 of the  Securities  Act and Section 20 of the Exchange
Act), 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  Depositor  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;  provided,  by
way of  clarification,  that clause (ii) of this  paragraph  shall be  construed
solely by  reference  to the RFC  Information  and not to any other  information
communicated in connection with a sale or purchase of securities, without regard
to whether the RFC Information or any portion thereof is presented together with
or separately from such other information.

                            [SIGNATURE PAGES FOLLOW]

                                      156
<PAGE>

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

[Seal]                                  RESIDENTIAL FUNDING MORTGAGE
                                        SECURITIES II, INC.

Attest:                                 By:
        Name:                               Name:
        Title:                              Title:

[Seal]                                  RESIDENTIAL FUNDING COMPANY, LLC

Attest:                                 By:
        Name:                               Name:
        Title:                              Title:

[Seal]                                  [______]
                                        as Trustee and Supplemental Interest
                                        Trust Trustee

Attest: _____________________________   By:
        Name:                               Name:
        Title:                              Title:

                                                 Pooling and Servicing Agreement
                                                             Series 20[__]-[___]

<PAGE>

STATE OF MINNESOTA                      )
                                        ) ss.:
COUNTY OF HENNEPIN                      )

      On the [__] day of [______],  20[__] before me, a notary public in and for
said State, personally appeared [_________],  known to me to be a [_________] of
Residential  Funding Mortgage  Securities II, Inc., one of the corporations that
executed  the  within  instrument,  and also  known to me to be the  person  who
executed  it on behalf of said  corporation,  and  acknowledged  to me that such
corporation executed the within instrument.

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

                                  Notary Public

                                  _____________

[Notarial Seal]

                                                 Pooling and Servicing Agreement
                                                             Series 20[__]-[___]

<PAGE>

STATE OF MINNESOTA                      )
                                        ) ss.:
COUNTY OF HENNEPIN                      )

      On the [__] day of [______],  20[__] before me, a notary public in and for
said State,  personally  appeared [______],  known to me to be an [_________] of
Residential Funding Company,  LLC, one of the companies that executed the within
instrument,  and also known to me to be the person who  executed it on behalf of
said  company,  and  acknowledged  to me that such  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]

                                                 Pooling and Servicing Agreement
                                                             Series 20[__]-[___]

<PAGE>

STATE OF MINNESOTA                      )
                                        ) ss.:
COUNTY OF RAMSEY                        )

      On the [__] day of [______],  20[__] before me, a notary public in and for
said State,  personally  appeared  [______],  known to me to be a [_________] of
[______], a national banking  association,  that executed the within instrument,
and also known to me to be the person who executed it on behalf of said national
banking   association  and   acknowledged  to  me  that  such  national  banking
association executed the within instrument.

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

                                  Notary Public

                                  _____________

[Notarial Seal]

                                                 Pooling and Servicing Agreement
                                                             Series 20[__]-[___]

<PAGE>

                                             EXHIBIT 4.1 FORM OF EXHIBITS TO PSA

                                    EXHIBIT A

                        FORM OF CLASS [A-__] CERTIFICATE

SOLELY FOR U.S.  FEDERAL  INCOME TAX PURPOSES,  THIS  CERTIFICATE  IS A "REGULAR
INTEREST" IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (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.

AS OF ANY DATE PRIOR TO THE TERMINATION OF THE SWAP AGREEMENT, ANY TRANSFEREE OF
A CLASS A  CERTIFICATE  WILL BE  DEEMED  TO HAVE  REPRESENTED  BY  VIRTUE OF ITS
PURCHASE OR HOLDING OF SUCH CERTIFICATE (OR ANY INTEREST HEREIN) THAT EITHER (A)
SUCH  TRANSFEREE  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 (EACH, A "PLAN"),  OR
ANY PERSON  (INCLUDING,  WITHOUT  LIMITATION,  AN  INVESTMENT  MANAGER,  A NAMED
FIDUCIARY OR A TRUSTEE OF ANY PLAN) WHO IS USING PLAN ASSETS, WITHIN THE MEANING
OF THE  U.S.  DEPARTMENT  OF  LABOR  REGULATION  PROMULGATED  AT 29  C.F.R.  ss.
2510.3-101,  AS MODIFIED BY SECTION 3(42) OF ERISA,  OF ANY PLAN (EACH,  A "PLAN
INVESTOR") TO EFFECT SUCH ACQUISITION OR (B) ITS ACQUISITION OF SUCH CERTIFICATE
AND THE RIGHT TO RECEIVE  (AND ITS RECEIPT OF)  PAYMENTS  FROM THE  SUPPLEMENTAL
INTEREST TRUST ARE ELIGIBLE FOR EXEMPTIVE RELIEF AVAILABLE UNDER AT LEAST ONE OF
PROHIBITED  TRANSACTION  CLASS EXEMPTION  ("PTCE") 84-14, PTCE 90-1, PTCE 91-38,
PTCE  95-60 OR PTCE  96-23  OR OTHER  APPLICABLE  EXEMPTION,  INCLUDING  SECTION
408(b)(17) OF ERISA.

AS OF ANY DATE AFTER THE TERMINATION OF THE SWAP AGREEMENT,  ANY TRANSFEREE OF A
CLASS A CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY VIRTUE OF ITS PURCHASE
OR HOLDING OF SUCH  CERTIFICATE  (OR ANY  INTEREST  HEREIN) THAT EITHER (A) SUCH
TRANSFEREE IS NOT A PLAN OR A PLAN INVESTOR,  (B) IT HAS ACQUIRED AND IS HOLDING
SUCH CERTIFICATE IN RELIANCE ON U.S. DEPARTMENT OF LABOR PROHIBITED  TRANSACTION
EXEMPTION  ("PTE") 94-29,  59 FED. REG. 14674 (MARCH 29, 1994), AS MOST RECENTLY
AMENDED  BY PTE  2002-41,  67 FED.  REG.  54487  (AUGUST  22,  2002)

                                      A-1
<PAGE>

(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 OR MOODY'S OR (C) (I) THE TRANSFEREE IS AN INSURANCE  COMPANY,
(II) THE  SOURCE OF FUNDS  USED TO  PURCHASE  OR HOLD SUCH  CERTIFICATE  (OR ANY
INTEREST  HEREIN) IS AN "INSURANCE  COMPANY GENERAL ACCOUNT" (AS DEFINED IN U.S.
DEPARTMENT OF LABOR 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 IN VIOLATION OF
THE  PROVISIONS  OF THE  PRECEDING  TWO  PARAGRAPHS,  THEN  THE  LAST  PRECEDING
TRANSFEREE  THAT  EITHER  (A) IS NOT A PLAN OR A PLAN  INVESTOR,  (B)  AFTER THE
TERMINATION OF THE SWAP AGREEMENT,  ACQUIRED THIS CERTIFICATE IN COMPLIANCE WITH
THE RFC EXEMPTION OR (C) 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 ANY  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 DEPOSITOR,  THE TRUSTEE, THE MASTER SERVICER, ANY SUBSERVICER,  ANY
UNDERWRITER 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.

Class [A-__] Senior                    Certificate No. __

Date of Pooling and Servicing          [Adjustable] [Variable] Pass-Through Rate
Agreement and Cut-off Date:            Percentage Interest: ___%

[_____] 1, 20[__]                      Aggregate Initial Certificate Principal
                                       Balance of the Class [A-__]
First Distribution Date:               Certificates: $___________
[_____ __], 20[__]
                                       Initial Certificate Principal
Master Servicer:                       Balance of this Class [A-__] Certificate:

Residential Funding Company, LLC       $___________

Final Scheduled Distribution Date:
_________ __, 20__                     CUSIP ________

                                      A-2
<PAGE>

Maturity Date:

_________ __, 20__

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                    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 and adjustable interest rate first
                    lien mortgage  loans sold by RESIDENTIAL
                    FUNDING MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, 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  Funding Mortgage  Securities II, 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 ____________ 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  conventional
one- to four-family  fixed and adjustable  interest rate,  first and junior lien
mortgage loans (the "Mortgage  Loans"),  sold by  Residential  Funding  Mortgage
Securities II, Inc. (hereinafter called the "Depositor," 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  Depositor,  the Master  Servicer and [_____],  as
trustee and supplemental interest trust trustee (the "Trustee" and "Supplemental
Interest Trust  Trustee,"  respectively),  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  Business  Day prior to such  Distribution  Date (the
"Record  Date"),  from the related  Available  Distribution  Amount in an

                                      A-3
<PAGE>

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.

      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 in the City and State of St.  Paul,
Minnesota.  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.

      As described  above,  as of any date prior to the  termination of the Swap
Agreement,  any  transferee  of a Class A  Certificate  will be  deemed  to have
represented  by virtue of its purchase and holding of such  Certificate  (or any
interest  therein)  that  either  (a)  such  transferee  is not a Plan or a Plan
Investor or (b) its  acquisition  of such  Certificate  and the right to receive
(and its receipt of) payments from the Supplemental  Interest Trust are eligible
for exemptive relief available under at least one of PTCE 84-14, PTCE 90-1, PTCE
91-38, PTCE 95-60 or PTCE 96-23 or other applicable exemption, including Section
408(b)(17) of ERISA.

      As  described  above,  as of any date  after the  termination  of the Swap
Agreement,  any  transferee  of a Class A  Certificate  will be  deemed  to have
represented  by virtue of its  purchase or holding of such  Certificate  (or any
interest  herein)  that  either  (a)  such  transferee  is not a Plan  or a Plan
Investor, (b) it has acquired and is holding such Certificate in reliance on 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 or Moody's or (c) the  transferee is a Complying  Insurance  Company.  In
addition,  any purported  Certificate Owner whose acquisition or holding of this
Certificate  (or  any  interest   herein)  was  effected  in  violation  of  the
restrictions  in  Section  5.02(e) of the  Agreement  shall  indemnify  and hold
harmless the Depositor,  the Trustee, the Master Servicer, any Subservicer,  any
Underwriter 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.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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

                                      A-4
<PAGE>

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 in the City and State of St. Paul,
Minnesota,  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  Depositor,  the Master  Servicer,  the Trustee,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

                                      A-5
<PAGE>

      This Certificate shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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 Residential  Funding
Company, LLC or its designee 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 related  Certificates.  The Agreement permits,  but does
not require,  Residential Funding Company,  LLC or its designee (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) subject to the
terms of the Agreement,  to purchase in whole, but not in part, all of the Class
A and Class M Certificates  from the Holders  thereof,  provided,  that any such
option may only be exercised if the aggregate  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.

                                      A-6
<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   A   Certificates   referred   to  in  the
within-mentioned Agreement.

                                       [_____],

                                           as Certificate Registrar

                                       By: _____________________________________
                                           Authorized Signatory

                                      A-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) 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 funds to _____________________________________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
account number _________________________________________________________________
or, if mailed by check, to ____________________________________________________.

      Applicable statements should be mailed to: _______________________________
________________________________________________________________________________
_______________________________________________________________________________.

      This information is provided by  ___________________________________,  the
assignee named above, or ______________________________, as its agent.

                                      A-8
<PAGE>

                                    EXHIBIT B

                         FORM OF CLASS [M-_] CERTIFICATE

THIS  CERTIFICATE IS SUBORDINATED  IN RIGHT OF PAYMENT TO THE CLASS  [A-__][M-_]
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, AS AMENDED (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.

AS OF ANY DATE PRIOR TO THE TERMINATION OF THE SWAP AGREEMENT, ANY TRANSFEREE OF
A CLASS M  CERTIFICATE  WILL BE  DEEMED  TO HAVE  REPRESENTED  BY  VIRTUE OF ITS
PURCHASE OR HOLDING OF SUCH CERTIFICATE (OR ANY INTEREST HEREIN) THAT EITHER (A)
SUCH  TRANSFEREE  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 (EACH, A "PLAN"),  OR
ANY PERSON  (INCLUDING,  WITHOUT  LIMITATION,  AN  INVESTMENT  MANAGER,  A NAMED
FIDUCIARY OR A TRUSTEE OF ANY PLAN) WHO IS USING PLAN ASSETS, WITHIN THE MEANING
OF THE  U.S.  DEPARTMENT  OF  LABOR  REGULATION  PROMULGATED  AT 29  C.F.R.  ss.
2510.3-101,  AS MODIFIED BY SECTION 3(42) OF ERISA,  OF ANY PLAN (EACH,  A "PLAN
INVESTOR") TO EFFECT SUCH ACQUISITION OR (B) ITS ACQUISITION OF SUCH CERTIFICATE
AND THE RIGHT TO RECEIVE  (AND ITS RECEIPT OF)  PAYMENTS  FROM THE  SUPPLEMENTAL
INTEREST TRUST ARE ELIGIBLE FOR EXEMPTIVE RELIEF AVAILABLE UNDER AT LEAST ONE OF
PROHIBITED  TRANSACTION  CLASS EXEMPTION  ("PTCE") 84-14, PTCE 90-1, PTCE 91-38,
PTCE  95-60 OR PTCE  96-23  OR OTHER  APPLICABLE  EXEMPTION,  INCLUDING  SECTION
408(b)(17) OF ERISA.

AS OF ANY DATE AFTER THE TERMINATION OF THE SWAP AGREEMENT,  ANY TRANSFEREE OF A
CLASS M CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY VIRTUE OF ITS PURCHASE
OR HOLDING OF SUCH  CERTIFICATE  (OR ANY  INTEREST  HEREIN) THAT EITHER (A) SUCH
TRANSFEREE IS NOT A PLAN

                                      B-1
<PAGE>

OR A PLAN  INVESTOR,  (B) IT HAS  ACQUIRED AND IS HOLDING  SUCH  CERTIFICATE  IN
RELIANCE ON U.S.  DEPARTMENT OF LABOR PROHIBITED  TRANSACTION  EXEMPTION ("PTE")
94-29,  59 FED.  REG.  14674 (MARCH 29, 1994),  AS MOST RECENTLY  AMENDED BY 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 OR
MOODY'S OR (C) (I) THE  TRANSFEREE IS AN INSURANCE  COMPANY,  (II) THE SOURCE OF
FUNDS USED TO PURCHASE OR HOLD SUCH  CERTIFICATE (OR ANY INTEREST  HEREIN) IS AN
"INSURANCE COMPANY GENERAL ACCOUNT" (AS DEFINED IN U.S. DEPARTMENT OF LABOR 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 IN VIOLATION OF
THE  PROVISIONS  OF THE  PRECEDING  TWO  PARAGRAPHS,  THEN  THE  LAST  PRECEDING
TRANSFEREE  THAT  EITHER  (A) IS NOT A PLAN OR A PLAN  INVESTOR,  (B)  AFTER THE
TERMINATION OF THE SWAP AGREEMENT,  ACQUIRED THIS CERTIFICATE IN COMPLIANCE WITH
THE RFC EXEMPTION OR (C) 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 ANY  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 DEPOSITOR,  THE TRUSTEE, THE MASTER SERVICER, ANY SUBSERVICER,  ANY
UNDERWRITER 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.

Class M-__Mezzanine                    Certificate No. 1

Date of Pooling and Servicing          Adjustable Pass-Through Rate
Agreement and Cut-off Date:            Percentage Interest: ___%

[_____] 1, 20[__]                      Aggregate Initial Certificate Principal
                                       Balance of the Class M-__
First Distribution Date:               Certificates: $___________

[_____ __], 20[__]

Master Servicer:

Residential Funding Company, LLC

                                      B-2
<PAGE>

Final Scheduled Distribution Date:     Initial Certificate Principal
                                       Balance of this Class M-__ Certificate:
_________ __, 20__
                                       $___________
Maturity Date:
                                       CUSIP ________
_________ __, 20__

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  evidencing  a  percentage  interest in the
                  distributions  allocable  to the Class M-_
                  Certificates  with respect to a Trust Fund
                  consisting   primarily   of  a   pool   of
                  conventional one- to four-family fixed and
                  adjustable interest rate, first and junior
                  lien  mortgage  loans sold by  RESIDENTIAL
                  FUNDING MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, 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  Funding Mortgage  Securities II, 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  _________ 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  conventional
one- to four-family  fixed and adjustable  interest rate,  first and junior lien
mortgage loans (the "Mortgage  Loans"),  sold by  Residential  Funding  Mortgage
Securities II, Inc. (hereinafter called the "Depositor," 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  Depositor,  the Master  Servicer and [_____],  as
trustee and supplemental interest trust trustee (the "Trustee" and "Supplemental
Interest Trust  Trustee,"  respectively),  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  Business  Day prior to such  Distribution  Date (the
"Record  Date"),  from the related  Available  Distribution  Amount in an amount
equal to the product of the Percentage  Interest  evidenced by this  Certificate
and the

                                      B-3
<PAGE>

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 in the City and State of St.  Paul,  Minnesota.
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.

      As described  above,  as of any date prior to the  termination of the Swap
Agreement,  any  transferee  of a Class M  Certificate  will be  deemed  to have
represented  by virtue of its purchase and holding of such  Certificate  (or any
interest  therein)  that  either  (a)  such  transferee  is not a Plan or a Plan
Investor or (b) its  acquisition  of such  Certificate  and the right to receive
(and its receipt of) payments from the Supplemental  Interest Trust are eligible
for exemptive relief available under at least one of PTCE 84-14, PTCE 90-1, PTCE
91-38, PTCE 95-60 or PTCE 96-23 or other applicable exemption, including Section
408(b)(17) of ERISA.

      As  described  above,  as of any date  after the  termination  of the Swap
Agreement,  any  transferee  of a Class M  Certificate  will be  deemed  to have
represented  by virtue of its  purchase or holding of such  Certificate  (or any
interest  herein)  that  either  (a)  such  transferee  is not a Plan  or a Plan
Investor, (b) it has acquired and is holding such Certificate in reliance on 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 or Moody's or (c) the  transferee is a Complying  Insurance  Company.  In
addition,  any purported  Certificate Owner whose acquisition or holding of this
Certificate  (or  any  interest   herein)  was  effected  in  violation  of  the
restrictions  in  Section  5.02(e) of the  Agreement  shall  indemnify  and hold
harmless the Depositor,  the Trustee, the Master Servicer, any Subservicer,  any
underwriter 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.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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

                                      B-4
<PAGE>

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 at any 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 in the City and State of St. Paul,
Minnesota,  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  Depositor,  the Master  Servicer,  the  Trustee  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

                                      B-5
<PAGE>

      This Certificate shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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 Residential  Funding
Company, LLC or its designee 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 related  Certificates.  The Agreement permits,  but does
not require,  Residential Funding Company,  LLC or its designee (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) subject to the
terms of the Agreement,  to purchase in whole, but not in part, all of the Class
A and Class M Certificates  from the Holders  thereof,  provided,  that any such
option may only be exercised if the aggregate  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.

                                       [_____],
                                           as Trustee

                                       By: _____________________________________
                                           Authorized Signatory

Dated: _________________________

                          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) 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 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.

                                      B-8
<PAGE>

                                   EXHIBIT C-1

                  FORM OF RULE 144A GLOBAL CLASS B CERTIFICATE

      THIS  CERTIFICATE IS  SUBORDINATED  IN RIGHT OF PAYMENT TO THE CLASS A AND
CLASS M CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

      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.

      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, AS AMENDED (THE "CODE").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE  PROVIDES THE TRUSTEE,  THE DEPOSITOR AND THE
MASTER SERVICER WITH EITHER (A) A  CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF
THE  AGREEMENT  OR (B) AN  OPINION  OF  COUNSEL  ACCEPTABLE  TO AND IN FORM  AND
SUBSTANCE  SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO
THE EFFECT THAT THE  PURCHASE  AND HOLDING OF THIS  CERTIFICATE  IS  PERMISSIBLE
UNDER  APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE  UNDERTAKEN IN THE AGREEMENT,  WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.

      NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER
OF THIS  CERTIFICATE  UNLESS  THAT  TRANSFER IS MADE  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER  THE 1933  ACT,  AND  EFFECTIVE  REGISTRATION  OR
QUALIFICATION   UNDER  APPLICABLE  STATE

                                     C-1-1
<PAGE>

SECURITIES  LAWS,  OR IS  MADE IN A  TRANSACTION  THAT  DOES  NOT  REQUIRE  SUCH
REGISTRATION  OR  QUALIFICATION.  FURTHERMORE,  THE  AGREEMENT  PROVIDES THAT NO
TRANSFER OF THIS  CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS
CERTIFICATE  EXCEPT (I) OUTSIDE THE UNITED STATES TO ENTITIES WHICH ARE NOT U.S.
PERSONS  WITHIN  THE  MEANING  OF  REGULATION  S UNDER  THE  1933 ACT OR (II) IN
RELIANCE  ON  RULE  144A  UNDER  THE  1933  ACT  ("RULE  144A")  TO A  QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT IS ACQUIRING THIS CERTIFICATE
OR INTEREST  HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER  QUALIFIED
INSTITUTIONAL BUYER.

      EACH HOLDER OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE  ACKNOWLEDGED AND
AGREED THAT (I) IT IS (A) A QUALIFIED  INSTITUTIONAL BUYER AND IS ACQUIRING THIS
CERTIFICATE FOR ITS OWN INSTITUTIONAL  ACCOUNT OR FOR THE ACCOUNT OR ACCOUNTS OF
A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT
UNDERSTANDS  THAT THIS  CERTIFICATE IS BEING  TRANSFERRED TO IT IN A TRANSACTION
NOT INVOLVING ANY PUBLIC  OFFERING WITHIN THE MEANING OF THE 1933 ACT, AND THAT,
IF IN THE  FUTURE IT  DECIDES  TO  RESELL,  PLEDGE OR  OTHERWISE  TRANSFER  THIS
CERTIFICATE,  THIS  CERTIFICATE  MAY BE RESOLD,  PLEDGED OR TRANSFERRED  ONLY IN
ACCORDANCE  WITH  APPLICABLE  STATE  SECURITIES  LAWS  AND (A) IN A  TRANSACTION
MEETING THE  REQUIREMENTS  OF RULE 144A, TO A PERSON THAT THE SELLER  REASONABLY
BELIEVES IS A QUALIFIED  INSTITUTIONAL  BUYER THAT PURCHASES FOR ITS OWN ACCOUNT
(OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED  INSTITUTIONAL BUYER) AND TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF REGULATION S.

      THE HOLDER OF THIS  CERTIFICATE  DESIRING  TO EFFECT ANY  TRANSFER,  SALE,
PLEDGE OR OTHER DISPOSITION SHALL, AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE
DEEMED TO HAVE AGREED TO,  INDEMNIFY  THE  TRUSTEE,  THE  DEPOSITOR,  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 AND THE AGREEMENT.

CUSIP: _____________________             Certificate No. B-__

Date of Pooling and Servicing Agreement  [Adjustable Pass-Through Rate]
and Cut-off Date: [_____] 1, 20[__]      [Fixed Pass-Through Rate]

First Distribution Date:                 Aggregate Initial Certificate Principal
[_____ __], 20[__]                       Balance of the Class B Certificates:

                                     C-1-2
<PAGE>

                                         $___________________________

Master Servicer:                         Initial Certificate Principal Balance
                                         of this Class B Certificate:
Residential Funding Company LLC
                                         $___________________________
Final Scheduled Distribution Date:

__________ __, 20__

CUSIP:                                   Certificate No. B

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  evidencing  a  percentage  interest in the
                  distributions  allocable  to the  Class  B
                  Certificates  with respect to a Trust Fund
                  consisting   primarily   of  a   pool   of
                  conventional  one to four family fixed and
                  adjustable interest rate, first and junior
                  lien  mortgage  loans sold by  RESIDENTIAL
                  FUNDING MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, 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  Funding Mortgage  Securities II, 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 Cede & 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 conventional one
to four  family  fixed and  adjustable  interest  rate,  first and  junior  lien
mortgage  loans (the  "Mortgage  Loans") sold by  Residential  Funding  Mortgage
Securities II, Inc. (hereinafter called the "Depositor," 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  Depositor,  the Master  Servicer and [_____],  as
trustee and supplemental interest trust trustee (the "Trustee" and "Supplemental
Interest Trust  Trustee,"  respectively),  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.

                                     C-1-3
<PAGE>

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business  Day, the Business
Day immediately following (the "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  Business  Day prior to such  Distribution  Date (the
"Record  Date"),  from the related  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 in St.  Paul,  Minnesota.  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e)  of the  Agreement  stating  that  either (i) the  transferee  is not an
employee benefit or other plan subject to the prohibited  transaction provisions
of ERISA or Section 4975 of the Code (each, a "Plan"), or any Person (including,
without limitation, an investment manager, a named fiduciary or a trustee of any
Plan) who is using plan  assets,  within the meaning of the U.S.  Department  of
Labor regulation promulgated at 29 C.F.R. ss. 2510.3-101, as modified by Section
3(42) of ERISA, of any Plan (each, a "Plan Investor") to effect such acquisition
or (ii) such  transferee  is an insurance  company,  the source of funds used to
purchase or hold this  Certificate  (or any  interest  herein) is an  "insurance
company  general  account" (as defined in U.S.  Department  of Labor  Prohibited
Transaction  Class  Exemption  ("PTCE")  95-60) and the  conditions set forth in
Sections  I and III of PTCE  95-60  have been  satisfied  or (b) an  opinion  of
counsel acceptable to and in form and substance satisfactory to the Trustee, the
Depositor and the Master Servicer to the effect that the purchase and holding of
this  Certificate is permissible  under  applicable  law, will not constitute or
result in a  non-exempt  prohibited  transaction  under  Section 406 of ERISA or
Section  4975  of  the  Code  (or   comparable   provisions  of  any  subsequent
enactments),  and will not  subject the  Trustee,  the  Depositor  or the Master
Servicer to any  obligation or liability  (including  obligations or liabilities
under ERISA or Section 4975 of the Code) in addition to those  undertaken in the
Agreement,  which opinion of counsel shall not be an expense of the Trustee, the
Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan Pass-Through  Certificates of
the Series specified hereon (herein collectively called the "Certificates").

                                     C-1-4
<PAGE>

      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 66.6% 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 in the City and State of St. Paul,
Minnesota,  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.

                                     C-1-5
<PAGE>

      The  Depositor,  the Master  Servicer,  the Trustee,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor,  the
Master  Servicer,  the Trustee 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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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
or its  designee  from the Trust Fund of all  remaining  Mortgage  Loans and all
property  acquired in respect of such  Mortgage  Loans or the  Certificates,  in
either  case  thereby  effecting  early  retirement  of  the  Certificates.  The
Agreement permits, but does not require, the Master Servicer or its designee (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 Balance.

      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-1-6
<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   B   Certificates   referred   to  in  the
within-mentioned Agreement.

                                       [_____],
                                       as Certificate Registrar

                                       By: _____________________________________
                                           Authorized Signatory

                                     C-1-7
<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) 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.

                                     C-1-8
<PAGE>

                                   EXHIBIT C-2

            FORM OF TEMPORARY REGULATION S GLOBAL CLASS B CERTIFICATE

      THIS  CERTIFICATE  IS A  TEMPORARY  REGULATION  S GLOBAL  CERTIFICATE  FOR
PURPOSES OF  REGULATION S UNDER THE UNITED  STATES  SECURITIES  ACT OF 1933,  AS
AMENDED (THE "1933 ACT").  NEITHER  THIS  TEMPORARY  REGULATION S GLOBAL CLASS B
CERTIFICATE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS
PERMITTED UNDER THE AGREEMENT (AS DEFINED BELOW).

      THIS  CERTIFICATE IS  SUBORDINATED  IN RIGHT OF PAYMENT TO THE CLASS A AND
CLASS M CERTIFICATES AS DESCRIBED IN THE AGREEMENT.

      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.

      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 AS AMENDED (THE "CODE").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE  PROVIDES THE TRUSTEE,  THE DEPOSITOR AND THE
MASTER SERVICER WITH EITHER (A) A  CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF
THE  AGREEMENT  OR (B) AN  OPINION  OF  COUNSEL  ACCEPTABLE  TO AND IN FORM  AND
SUBSTANCE  SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO
THE EFFECT THAT THE  PURCHASE  AND HOLDING OF THIS  CERTIFICATE  IS  PERMISSIBLE
UNDER  APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE  UNDERTAKEN IN THE AGREEMENT,  WHICH

                                     C-2-1
<PAGE>

OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE,  THE DEPOSITOR OR THE
MASTER SERVICER.

      NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER
OF THIS  CERTIFICATE  UNLESS  THAT  TRANSFER IS MADE  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER  THE 1933  ACT,  AND  EFFECTIVE  REGISTRATION  OR
QUALIFICATION   UNDER  APPLICABLE  STATE  SECURITIES  LAWS,  OR  IS  MADE  IN  A
TRANSACTION   THAT  DOES  NOT  REQUIRE  SUCH   REGISTRATION  OR   QUALIFICATION.
FURTHERMORE,  THE  AGREEMENT  PROVIDES THAT NO TRANSFER OF THIS  CERTIFICATE  OR
INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS  CERTIFICATE  EXCEPT (I) OUTSIDE
THE UNITED STATES TO ENTITIES  WHICH ARE NOT U.S.  PERSONS WITHIN THE MEANING OF
REGULATION  S UNDER THE 1933 ACT OR (II) IN RELIANCE ON RULE 144A UNDER THE 1933
ACT ("RULE 144A") TO A QUALIFIED  INSTITUTIONAL  BUYER (AS DEFINED IN RULE 144A)
THAT IS ACQUIRING THIS CERTIFICATE OR INTEREST HEREIN FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF ANOTHER QUALIFIED INSTITUTIONAL BUYER.

      EACH HOLDER OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE  ACKNOWLEDGED AND
AGREED THAT (I) IT IS (A) A QUALIFIED  INSTITUTIONAL BUYER AND IS ACQUIRING THIS
CERTIFICATE FOR ITS OWN INSTITUTIONAL  ACCOUNT OR FOR THE ACCOUNT OR ACCOUNTS OF
A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT
UNDERSTANDS  THAT THIS  CERTIFICATE IS BEING  TRANSFERRED TO IT IN A TRANSACTION
NOT INVOLVING ANY PUBLIC  OFFERING WITHIN THE MEANING OF THE 1933 ACT, AND THAT,
IF IN THE  FUTURE IT  DECIDES  TO  RESELL,  PLEDGE OR  OTHERWISE  TRANSFER  THIS
CERTIFICATE,  THIS  CERTIFICATE  MAY BE RESOLD,  PLEDGED OR TRANSFERRED  ONLY IN
ACCORDANCE  WITH  APPLICABLE  STATE  SECURITIES  LAWS  AND (A) IN A  TRANSACTION
MEETING THE  REQUIREMENTS  OF RULE 144A, TO A PERSON THAT THE SELLER  REASONABLY
BELIEVES IS A QUALIFIED  INSTITUTIONAL  BUYER THAT PURCHASES FOR ITS OWN ACCOUNT
(OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED  INSTITUTIONAL BUYER) AND TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF  REGULATION  S; AND (III) IF THE HOLDER IS A REGULATION  S PURCHASER,  IT
UNDERSTANDS  THAT THIS  CERTIFICATE HAS NOT AND WILL NOT BE REGISTERED UNDER THE
1933 ACT, THAT ANY OFFERS, SALES OR DELIVERIES OF THIS CERTIFICATE IN THE UNITED
STATES OR TO U.S.  PERSONS  PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE  CLOSING
DATE MAY CONSTITUTE A VIOLATION OF UNITED STATES LAW, AND THAT  DISTRIBUTIONS OF
PRINCIPAL  AND  INTEREST  WILL BE  MADE IN  RESPECT  OF SUCH  CERTIFICATES  ONLY
FOLLOWING THE DELIVERY BY THE HOLDER OF A CERTIFICATION  OF NON-U.S.  BENEFICIAL
OWNERSHIP  OR THE  EXCHANGE OF  BENEFICIAL  INTEREST IN  TEMPORARY  REGULATION S
GLOBAL OFFERED  CERTIFICATES FOR BENEFICIAL  INTERESTS IN THE RELATED  PERMANENT
REGULATION S GLOBAL OFFERED

                                     C-2-2
<PAGE>

CERTIFICATES (WHICH IN EACH CASE WILL ITSELF REQUIRE A CERTIFICATION OF NON-U.S.
BENEFICIAL  OWNERSHIP),  AT THE  TIMES  AND  IN  THE  MANNER  SET  FORTH  IN THE
AGREEMENT.

      THE HOLDER OF THIS  CERTIFICATE  DESIRING  TO EFFECT ANY  TRANSFER,  SALE,
PLEDGE OR OTHER DISPOSITION SHALL, AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE
DEEMED TO HAVE AGREED TO,  INDEMNIFY  THE  TRUSTEE,  THE  DEPOSITOR,  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 AND THE AGREEMENT.

CUSIP: _____________________             Certificate No. B-__

Date of Pooling and Servicing Agreement  [Adjustable Pass-Through Rate]
and Cut-off Date: [_____] 1, 20[__]      [Fixed Pass-Through Rate]
First Distribution Date:
                                         Aggregate Initial Certificate Principal
[_____ __], 20[__]                       Balance of the Class B Certificates:
                                         $___________________________
Master Servicer:
                                         Initial Certificate Principal Balance
Residential Funding Company, LLC         of this Class B Certificate:

Final Scheduled Distribution Date:       $___________________________

__________ __, 20__

CUSIP:                                   Certificate No. B

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  evidencing  a  percentage  interest in the
                  distributions  allocable  to the  Class  B
                  Certificates  with respect to a Trust Fund
                  consisting   primarily   of  a   pool   of
                  Conventional  one-to-four family fixed and
                  adjustable interest rate, first and junior
                  lien  mortgage  loans sold by  RESIDENTIAL
                  FUNDING MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, 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  Funding Mortgage  Securities II, Inc., the
Master  Servicer,  the  Trustee  or GMAC  Mortgage  Group,  LLC or any of

                                     C-2-3
<PAGE>

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 Cede & 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 conventional one
to four  family  fixed and  adjustable  interest  rate,  first and  junior  lien
mortgage  loans (the  "Mortgage  Loans") sold by  Residential  Funding  Mortgage
Securities II, Inc. (hereinafter called the "Depositor," 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  Depositor,  the Master  Servicer and [_____],  as
trustee and supplemental interest trust trustee (the "Trustee" and "Supplemental
Interest Trust  Trustee,"  respectively),  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  Business  Day prior to such  Distribution  Date (the
"Record  Date"),  from the related  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 in St.  Paul,  Minnesota.  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e)  of the  Agreement  stating  that  either (i) the  transferee  is not an
employee benefit or other plan subject to the prohibited  transaction provisions
of ERISA or Section 4975 of the Code (each, a "Plan"), or any Person (including,
without limitation, an investment manager, a named fiduciary or a trustee of any
Plan) who is using plan  assets,  within

                                     C-2-4
<PAGE>

the meaning of the U.S. Department of Labor regulation  promulgated at 29 C.F.R.
ss.  2510.3-101,  as modified by Section  3(42) of ERISA,  of any Plan (each,  a
"Plan  Investor")  to effect  such  acquisition  or (ii) such  transferee  is an
insurance company, the source of funds used to purchase or hold this Certificate
(or any interest  herein) is an "insurance  company general account" (as defined
in U.S.  Department of Labor  Prohibited  Transaction  Class Exemption  ("PTCE")
95-60)  and the  conditions  set forth in  Sections I and III of PTCE 95-60 have
been  satisfied  or (b) an  opinion  of  counsel  acceptable  to and in form and
substance  satisfactory to the Trustee, the Depositor and the Master Servicer to
the effect that the  purchase  and holding of this  Certificate  is  permissible
under  applicable law, will not constitute or result in a non-exempt  prohibited
transaction  under  Section  406 of  ERISA  or  Section  4975  of the  Code  (or
comparable  provisions of any subsequent  enactments),  and will not subject the
Trustee,  the  Depositor or the Master  Servicer to any  obligation or liability
(including  obligations or liabilities  under ERISA or Section 4975 of the Code)
in addition to those undertaken in the Agreement, which opinion of counsel shall
not be an expense of the Trustee, the Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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 66.6% 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 in the

                                     C-2-5
<PAGE>

City and State of St. Paul,  Minnesota,  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  Depositor,  the Master  Servicer,  the Trustee,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor,  the
Master  Servicer,  the Trustee 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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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
or its  designee  from the Trust Fund of all  remaining  Mortgage  Loans and all
property  acquired in respect of such  Mortgage  Loans or the  Certificates,  in
either  case  thereby  effecting  early  retirement  of  the  Certificates.  The
Agreement permits, but does not require, the Master Servicer or its designee (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 Balance.

      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-2-6
<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   B   Certificates   referred   to  in  the
within-mentioned Agreement.

                                       [_____],
                                       as Certificate Registrar

                                       By: _____________________________________
                                           Authorized Signatory

                                     C-2-7
<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) 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 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.

                                     C-2-8
<PAGE>

                                   EXHIBIT C-3

      FORM OF PERMANENT REGULATION S GLOBAL CLASS B CERTIFICATE

      THIS  CERTIFICATE IS  SUBORDINATED  IN RIGHT OF PAYMENT TO THE CLASS A AND
CLASS M CERTIFICATES [AND CLASS B CERTIFICATE] AS DESCRIBED IN THE AGREEMENT (AS
DEFINED BELOW).

      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.

      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, AS AMENDED (THE "CODE").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE  PROVIDES THE TRUSTEE,  THE DEPOSITOR AND THE
MASTER SERVICER WITH EITHER (A) A  CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF
THE  AGREEMENT  OR (B) AN  OPINION  OF  COUNSEL  ACCEPTABLE  TO AND IN FORM  AND
SUBSTANCE  SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO
THE EFFECT THAT THE  PURCHASE  AND HOLDING OF THIS  CERTIFICATE  IS  PERMISSIBLE
UNDER  APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE  UNDERTAKEN IN THE AGREEMENT,  WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.

      NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER
OF THIS  CERTIFICATE  UNLESS  THAT  TRANSFER IS MADE  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER  THE 1933  ACT,  AND  EFFECTIVE  REGISTRATION  OR
QUALIFICATION   UNDER  APPLICABLE  STATE

                                     C-3-1
<PAGE>

SECURITIES  LAWS,  OR IS  MADE IN A  TRANSACTION  THAT  DOES  NOT  REQUIRE  SUCH
REGISTRATION  OR  QUALIFICATION.  FURTHERMORE,  THE  AGREEMENT  PROVIDES THAT NO
TRANSFER OF THIS  CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS
CERTIFICATE  EXCEPT (I) OUTSIDE THE UNITED STATES TO ENTITIES WHICH ARE NOT U.S.
PERSONS  WITHIN  THE  MEANING  OF  REGULATION  S UNDER  THE  1933 ACT OR (II) IN
RELIANCE  ON  RULE  144A  UNDER  THE  1933  ACT  ("RULE  144A")  TO A  QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT IS ACQUIRING THIS CERTIFICATE
OR INTEREST  HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER  QUALIFIED
INSTITUTIONAL BUYER.

      EACH HOLDER OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE  ACKNOWLEDGED AND
AGREED THAT (I) IT IS (A) A QUALIFIED  INSTITUTIONAL BUYER AND IS ACQUIRING THIS
CERTIFICATE FOR ITS OWN INSTITUTIONAL  ACCOUNT OR FOR THE ACCOUNT OR ACCOUNTS OF
A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT
UNDERSTANDS  THAT THIS  CERTIFICATE IS BEING  TRANSFERRED TO IT IN A TRANSACTION
NOT INVOLVING ANY PUBLIC  OFFERING WITHIN THE MEANING OF THE 1933 ACT, AND THAT,
IF IN THE  FUTURE IT  DECIDES  TO  RESELL,  PLEDGE OR  OTHERWISE  TRANSFER  THIS
CERTIFICATE,  THIS  CERTIFICATE  MAY BE RESOLD,  PLEDGED OR TRANSFERRED  ONLY IN
ACCORDANCE  WITH  APPLICABLE  STATE  SECURITIES  LAWS  AND (A) IN A  TRANSACTION
MEETING THE  REQUIREMENTS  OF RULE 144A, TO A PERSON THAT THE SELLER  REASONABLY
BELIEVES IS A QUALIFIED  INSTITUTIONAL  BUYER THAT PURCHASES FOR ITS OWN ACCOUNT
(OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED  INSTITUTIONAL BUYER) AND TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF  REGULATION  S; AND (III) IF THE HOLDER IS A REGULATION  S PURCHASER,  IT
UNDERSTANDS  THAT THIS  CERTIFICATE HAS NOT AND WILL NOT BE REGISTERED UNDER THE
1933 ACT, THAT ANY OFFERS, SALES OR DELIVERIES OF THIS CERTIFICATE IN THE UNITED
STATES OR TO U.S.  PERSONS  PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE  CLOSING
DATE MAY CONSTITUTE A VIOLATION OF UNITED STATES LAW, AND THAT  DISTRIBUTIONS OF
PRINCIPAL  AND  INTEREST  WILL BE  MADE IN  RESPECT  OF SUCH  CERTIFICATES  ONLY
FOLLOWING THE DELIVERY BY THE HOLDER OF A CERTIFICATION  OF NON-U.S.  BENEFICIAL
OWNERSHIP  OR THE  EXCHANGE OF  BENEFICIAL  INTEREST IN  TEMPORARY  REGULATION S
GLOBAL OFFERED  CERTIFICATES FOR BENEFICIAL  INTERESTS IN THE RELATED  PERMANENT
REGULATION S GLOBAL OFFERED CERTIFICATES (WHICH IN EACH CASE WILL ITSELF REQUIRE
A  CERTIFICATION  OF  NON-U.S.  BENEFICIAL  OWNERSHIP),  AT THE TIMES AND IN THE
MANNER SET FORTH IN THE AGREEMENT.

      THE HOLDER OF THIS  CERTIFICATE  DESIRING  TO EFFECT ANY  TRANSFER,  SALE,
PLEDGE OR OTHER DISPOSITION SHALL, AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE
DEEMED TO HAVE AGREED TO,  INDEMNIFY  THE  TRUSTEE,

                                     C-3-2
<PAGE>

THE DEPOSITOR,  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 AND
THE AGREEMENT.

CUSIP: _____________________             Certificate No. B-__

Date of Pooling and Servicing Agreement  [Adjustable Pass-Through Rate]
and Cut-off Date: [_____] 1, 20[__]      [Fixed Pass-Through Rate]

First Distribution Date:                 Aggregate Initial Certificate Principal
                                         Balance of the Class B Certificates:
[_____ __], 20[__]                       $___________________________

Master Servicer:                         Initial Certificate Principal Balance
                                         of this Class B Certificate:
Residential Funding Company, LLC
                                         $___________________________
Final Scheduled Distribution Date:

__________ __, 20__

CUSIP:                                   Certificate No. B

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  evidencing  a  percentage  interest in the
                  distributions  allocable  to the  Class  B
                  Certificates  with respect to a Trust Fund
                  consisting   primarily   of  a   pool   of
                  one-to-four  family  fixed and  adjustable
                  interest  rate,   first  and  junior  lien
                  mortgage loans sold by RESIDENTIAL FUNDING
                  MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, 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  Funding Mortgage  Securities II, 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 Cede & 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 conventional one
to four  family  fixed and  adjustable  interest

                                     C-3-3
<PAGE>

rate,  first and junior  lien  mortgage  loans (the  "Mortgage  Loans")  sold by
Residential  Funding  Mortgage  Securities  II,  Inc.  (hereinafter  called  the
"Depositor,"  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
Depositor, the Master Servicer and [_____], as trustee and supplemental interest
trust  trustee  (the  "Trustee"  and  "Supplemental   Interest  Trust  Trustee,"
respectively),  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  Business  Day prior to such  Distribution  Date (the
"Record  Date"),  from the related  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 in St.  Paul,  Minnesota.  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e)  of the  Agreement  stating  that  either (i) the  transferee  is not an
employee benefit or other plan subject to the prohibited  transaction provisions
of ERISA or Section 4975 of the Code (each, a "Plan"), or any Person (including,
without limitation, an investment manager, a named fiduciary or a trustee of any
Plan) who is using plan  assets,  within the meaning of the U.S.  Department  of
Labor regulation promulgated at 29 C.F.R. ss. 2510.3-101, as modified by Section
3(42) of ERISA, of any Plan (each, a "Plan Investor") to effect such acquisition
or (ii) such  transferee  is an insurance  company,  the source of funds used to
purchase or hold this  Certificate  (or any  interest  herein) is an  "insurance
company  general  account" (as defined in U.S.  Department  of Labor  Prohibited
Transaction  Class  Exemption  ("PTCE")  95-60) and the  conditions set forth in
Sections  I and III of PTCE  95-60  have been  satisfied  or (b) an

                                     C-3-4
<PAGE>

opinion of counsel  acceptable to and in form and substance  satisfactory to the
Trustee,  the Depositor and the Master  Servicer to the effect that the purchase
and holding of this  Certificate is permissible  under  applicable law, will not
constitute or result in a non-exempt prohibited transaction under Section 406 of
ERISA or Section 4975 of the Code (or  comparable  provisions of any  subsequent
enactments),  and will not  subject the  Trustee,  the  Depositor  or the Master
Servicer to any  obligation or liability  (including  obligations or liabilities
under ERISA or Section 4975 of the Code) in addition to those  undertaken in the
Agreement,  which opinion of counsel shall not be an expense of the Trustee, the
Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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 66.6% 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 in the City and State of St. Paul,
Minnesota,  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

                                     C-3-5
<PAGE>

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,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor,  the
Master  Servicer,  the Trustee 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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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
or its  designee  from the Trust Fund of all  remaining  Mortgage  Loans and all
property  acquired in respect of such  Mortgage  Loans or the  Certificates,  in
either  case  thereby  effecting  early  retirement  of  the  Certificates.  The
Agreement permits, but does not require, the Master Servicer or its designee (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 Balance.

      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-3-6
<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   B   Certificates   referred   to  in  the
within-mentioned Agreement.

                                       [_____],
                                       as Certificate Registrar

                                       By: _____________________________________
                                           Authorized Signatory

                                     C-3-7
<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) 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 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.

                                     C-3-8
<PAGE>

                                   EXHIBIT D-1

                  FORM OF RULE 144A GLOBAL CLASS SB CERTIFICATE

      THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M AND CLASS B CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

      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 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 AS AMENDED (THE "CODE").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE  PROVIDES THE TRUSTEE,  THE DEPOSITOR AND THE
MASTER SERVICER WITH EITHER (A) A  CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF
THE  AGREEMENT  OR (B) AN  OPINION  OF  COUNSEL  ACCEPTABLE  TO AND IN FORM  AND
SUBSTANCE  SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO
THE EFFECT THAT THE  PURCHASE  AND HOLDING OF THIS  CERTIFICATE  IS  PERMISSIBLE
UNDER  APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE  UNDERTAKEN IN THE AGREEMENT,  WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.

      NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER
OF THIS  CERTIFICATE  UNLESS  THAT  TRANSFER IS MADE  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER  THE 1933  ACT,  AND  EFFECTIVE  REGISTRATION  OR
QUALIFICATION UNDER APPLICABLE STATE

                                      D-1-1
<PAGE>

SECURITIES  LAWS,  OR IS  MADE IN A  TRANSACTION  THAT  DOES  NOT  REQUIRE  SUCH
REGISTRATION  OR  QUALIFICATION.  FURTHERMORE,  THE  AGREEMENT  PROVIDES THAT NO
TRANSFER OF THIS  CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS
CERTIFICATE  EXCEPT (I) OUTSIDE THE UNITED STATES TO ENTITIES WHICH ARE NOT U.S.
PERSONS  WITHIN  THE  MEANING  OF  REGULATION  S UNDER  THE  1933 ACT OR (II) IN
RELIANCE  ON  RULE  144A  UNDER  THE  1933  ACT  ("RULE  144A")  TO A  QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT IS ACQUIRING THIS CERTIFICATE
OR INTEREST  HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER  QUALIFIED
INSTITUTIONAL BUYER.

      EACH HOLDER OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE  ACKNOWLEDGED AND
AGREED THAT (I) IT IS (A) A QUALIFIED  INSTITUTIONAL BUYER AND IS ACQUIRING THIS
CERTIFICATE FOR ITS OWN INSTITUTIONAL  ACCOUNT OR FOR THE ACCOUNT OR ACCOUNTS OF
A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS  CERTIFICATE  OUTSIDE THE UNITED STATES (A "REGULATION S  PURCHASER");  AND
(II) IT  UNDERSTANDS  THAT  THIS  CERTIFICATE  IS BEING  TRANSFERRED  TO IT IN A
TRANSACTION  NOT  INVOLVING ANY PUBLIC  OFFERING  WITHIN THE MEANING OF THE 1933
ACT,  AND THAT,  IF IN THE  FUTURE IT DECIDES  TO  RESELL,  PLEDGE OR  OTHERWISE
TRANSFER  THIS  CERTIFICATE,   THIS  CERTIFICATE  MAY  BE  RESOLD,   PLEDGED  OR
TRANSFERRED  ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND (A) IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, TO A PERSON THAT THE SELLER
REASONABLY  BELIEVES IS A QUALIFIED  INSTITUTIONAL  BUYER THAT PURCHASES FOR ITS
OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED  INSTITUTIONAL BUYER)
AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE
903 OR RULE 904 OF REGULATION S.

      THE HOLDER OF THIS  CERTIFICATE  DESIRING  TO EFFECT ANY  TRANSFER,  SALE,
PLEDGE OR OTHER DISPOSITION SHALL, AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE
DEEMED TO HAVE AGREED TO,  INDEMNIFY  THE  TRUSTEE,  THE  DEPOSITOR,  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 AND THE AGREEMENT.

CUSIP: _____________________                       Certificate No. SB

Date of Pooling and Servicing Agreement            Percentage Interest: 100.00%
and Cut-off Date:  [_____] 1, 20[__]

First Distribution Date:  [_____ __], 20[__]       Notional Amount
                                                   of the Class SB Certificates:
                                                   $___________________________

                                      D-1-2
<PAGE>

Master Servicer:                                   Notional Amount
Residential Funding Company LLC                    of this Class SB Certificate:
                                                   $___________________________
Maturity Date:
__________ __, 20__

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

           evidencing  a percentage  interest in the  distributions
           allocable to the Class SB Certificates with respect to a
           Trust   Fund   consisting   primarily   of  a  pool   of
           conventional  one-to-four  family  fixed and  adjustable
           interest rate, first and junior lien mortgage loans sold
           by RESIDENTIAL FUNDING MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, Inc., the Master  Servicer,  the Trustee referred to below 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  Funding  Mortgage  Securities  II, Inc., the Master  Servicer,  the
Trustee or any of their affiliates.  None of the Depositor,  the Master Servicer
or any of  their  affiliates  will  have  any  obligation  with  respect  to any
certificate  or other  obligation  secured by or payable  from  payments  on the
Certificates.

      This certifies  that Cede & Co. is the registered  owner of the Percentage
Interest evidenced by this Certificate in certain  distributions with respect to
the Trust Fund consisting primarily of an interest in a pool of conventional one
to four  family  fixed and  adjustable  interest  rate,  first and  junior  lien
mortgage  loans (the  "Mortgage  Loans") sold by  Residential  Funding  Mortgage
Securities II, Inc. (hereinafter called the "Depositor," 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  Depositor,  the Master  Servicer and [_____],  as
trustee and supplemental interest trust trustee (the "Trustee" and "Supplemental
Interest Trust  Trustee,"  respectively),  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 Business Day prior to such

                                      D-1-3
<PAGE>

Distribution Date (the "Record Date"),  from the related 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 in St. Paul,  Minnesota.  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  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e) of 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 (each,  a "Plan"),  or any Person  (including,  without
limitation,  an insurance company  investing its general account,  an investment
manager,  a named  fiduciary or a trustee of any Plan) who is using plan assets,
within the meaning of the U.S. Department of Labor regulation  promulgated at 29
C.F.R. ss. 2510.3-101, as modified by Section 3(42) of ERISA, of any Plan (each,
a "Plan  Investor")  to effect  such  acquisition,  or (b) an opinion of counsel
acceptable  to and in  form  and  substance  satisfactory  to the  Trustee,  the
Depositor and the Master Servicer to the effect that the purchase and holding of
this  Certificate is permissible  under  applicable  law, will not constitute or
result in a  non-exempt  prohibited  transaction  under  Section 406 of ERISA or
Section  4975  of  the  Code  (or   comparable   provisions  of  any  subsequent
enactments),  and will not  subject the  Trustee,  the  Depositor  or the Master
Servicer to any  obligation or liability  (including  obligations or liabilities
under ERISA or Section 4975 of the Code) in addition to those  undertaken in the
Agreement,  which opinion of counsel shall not be an expense of the Trustee, the
Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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

                                      D-1-4
<PAGE>

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 66.6% 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 in the City and State of St. Paul,
Minnesota,  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  Depositor,  the Master  Servicer,  the Trustee,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none

                                      D-1-5
<PAGE>

of 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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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
or its  designee  from the Trust Fund of all  remaining  Mortgage  Loans and all
property  acquired in respect of such  Mortgage  Loans or the  Certificates,  in
either  case  thereby  effecting  early  retirement  of  the  Certificates.  The
Agreement permits, but does not require, the Master Servicer or its designee (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 Balance.

      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.

                                      D-1-6
<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

                                      D-1-7
<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) 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.

                                      D-1-8
<PAGE>

                                   EXHIBIT D-2

           FORM OF TEMPORARY REGULATION S GLOBAL CLASS SB CERTIFICATE

      THIS  CERTIFICATE  IS A  TEMPORARY  REGULATION  S GLOBAL  CERTIFICATE  FOR
PURPOSES OF  REGULATION S UNDER THE UNITED  STATES  SECURITIES  ACT OF 1933,  AS
AMENDED (THE "1933 ACT").  NEITHER  THIS  TEMPORARY  REGULATION S GLOBAL CLASS B
CERTIFICATE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS
PERMITTED UNDER THE POOLING AND SERVICING AGREEMENT.

      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 BELOW.

      THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M AND CLASS B 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, AS AMENDED (THE "CODE").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE  PROVIDES THE TRUSTEE,  THE DEPOSITOR AND THE
MASTER SERVICER WITH EITHER (A) A  CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF
THE  AGREEMENT  OR (B) AN  OPINION  OF  COUNSEL  ACCEPTABLE  TO AND IN FORM  AND
SUBSTANCE  SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO
THE EFFECT THAT THE  PURCHASE  AND HOLDING OF THIS  CERTIFICATE  IS  PERMISSIBLE
UNDER  APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE UNDERTAKEN IN THE AGREEMENT, WHICH

                                      D-1-9
<PAGE>

OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE,  THE DEPOSITOR OR THE
MASTER SERVICER.

      NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER
OF THIS  CERTIFICATE  UNLESS  THAT  TRANSFER IS MADE  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER  THE 1933  ACT,  AND  EFFECTIVE  REGISTRATION  OR
QUALIFICATION   UNDER  APPLICABLE  STATE  SECURITIES  LAWS,  OR  IS  MADE  IN  A
TRANSACTION   THAT  DOES  NOT  REQUIRE  SUCH   REGISTRATION  OR   QUALIFICATION.
FURTHERMORE,  THE  AGREEMENT  PROVIDES THAT NO TRANSFER OF THIS  CERTIFICATE  OR
INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS  CERTIFICATE  EXCEPT (I) OUTSIDE
THE UNITED STATES TO ENTITIES  WHICH ARE NOT U.S.  PERSONS WITHIN THE MEANING OF
REGULATION  S UNDER THE 1933 ACT OR (II) IN RELIANCE ON RULE 144A UNDER THE 1933
ACT ("RULE 144A") TO A QUALIFIED  INSTITUTIONAL  BUYER (AS DEFINED IN RULE 144A)
THAT IS ACQUIRING THIS CERTIFICATE OR INTEREST HEREIN FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF ANOTHER QUALIFIED INSTITUTIONAL BUYER.

      EACH HOLDER OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE  ACKNOWLEDGED AND
AGREED THAT (I) IT IS (A) A QUALIFIED  INSTITUTIONAL BUYER AND IS ACQUIRING THIS
CERTIFICATE FOR ITS OWN INSTITUTIONAL  ACCOUNT OR FOR THE ACCOUNT OR ACCOUNTS OF
A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT
UNDERSTANDS  THAT THIS  CERTIFICATE IS BEING  TRANSFERRED TO IT IN A TRANSACTION
NOT INVOLVING ANY PUBLIC  OFFERING WITHIN THE MEANING OF THE 1933 ACT, AND THAT,
IF IN THE  FUTURE IT  DECIDES  TO  RESELL,  PLEDGE OR  OTHERWISE  TRANSFER  THIS
CERTIFICATE,  THIS  CERTIFICATE  MAY BE RESOLD,  PLEDGED OR TRANSFERRED  ONLY IN
ACCORDANCE  WITH  APPLICABLE  STATE  SECURITIES  LAWS  AND (A) IN A  TRANSACTION
MEETING THE  REQUIREMENTS  OF RULE 144A, TO A PERSON THAT THE SELLER  REASONABLY
BELIEVES IS A QUALIFIED  INSTITUTIONAL  BUYER THAT PURCHASES FOR ITS OWN ACCOUNT
(OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED  INSTITUTIONAL BUYER) AND TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF  REGULATION  S; AND (III) IF THE HOLDER IS A REGULATION  S PURCHASER,  IT
UNDERSTANDS  THAT THIS  CERTIFICATE HAS NOT AND WILL NOT BE REGISTERED UNDER THE
1933 ACT, THAT ANY OFFERS, SALES OR DELIVERIES OF THIS CERTIFICATE IN THE UNITED
STATES OR TO U.S.  PERSONS  PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE  CLOSING
DATE MAY CONSTITUTE A VIOLATION OF UNITED STATES LAW, AND THAT  DISTRIBUTIONS OF
PRINCIPAL  AND  INTEREST  WILL BE  MADE IN  RESPECT  OF SUCH  CERTIFICATES  ONLY
FOLLOWING THE DELIVERY BY THE HOLDER OF A CERTIFICATION  OF NON-U.S.  BENEFICIAL
OWNERSHIP  OR THE  EXCHANGE OF  BENEFICIAL  INTEREST IN  TEMPORARY  REGULATION S
GLOBAL OFFERED

                                      D-1-10
<PAGE>

CERTIFICATES  FOR  BENEFICIAL  INTERESTS IN THE RELATED  PERMANENT  REGULATION S
GLOBAL  OFFERED   CERTIFICATES  (WHICH  IN  EACH  CASE  WILL  ITSELF  REQUIRE  A
CERTIFICATION OF NON-U.S.  BENEFICIAL OWNERSHIP), AT THE TIMES AND IN THE MANNER
SET FORTH IN THE AGREEMENT.

      THE HOLDER OF THIS  CERTIFICATE  DESIRING  TO EFFECT ANY  TRANSFER,  SALE,
PLEDGE OR OTHER DISPOSITION SHALL, AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE
DEEMED TO HAVE AGREED TO,  INDEMNIFY  THE  TRUSTEE,  THE  DEPOSITOR,  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 AND THE AGREEMENT.

CUSIP: _____________________                       Certificate No. SB

Date of Pooling and Servicing Agreement            Percentage Interest: 100.00%
and Cut-off Date:  [_____] 1, 20[__]

First Distribution Date:  [_____ __], 20[__]       Notional Amount
                                                   of the Class SB Certificates:
                                                   $___________________________
Master Servicer:                                   Notional Amount
Residential Funding Company, LLC                   of this Class SB Certificate:
                                                   $___________________________
Maturity Date:
__________ __, 20__

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  evidencing  a  percentage  interest in the
                  distributions  allocable  to the  Class SB
                  Certificates  with respect to a Trust Fund
                  consisting   primarily   of  a   pool   of
                  one-to-four  family  fixed and  adjustable
                  interest  rate,   first  and  junior  lien
                  mortgage loans sold by RESIDENTIAL FUNDING
                  MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, Inc., the Master  Servicer,  the Trustee referred to below 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  Funding  Mortgage  Securities  II, Inc., the Master  Servicer,  the
Trustee or any of their affiliates.  None of the Depositor,  the Master Servicer
or any of  their  affiliates  will  have  any  obligation  with  respect  to any
certificate  or other  obligation  secured by or payable  from  payments  on the
Certificates.

                                      D-1-11
<PAGE>

      This certifies  that Cede & 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 conventional one
to four  family  fixed and  adjustable  interest  rate,  first and  junior  lien
mortgage  loans (the  "Mortgage  Loans") sold by  Residential  Funding  Mortgage
Securities II, Inc. (hereinafter called the "Depositor," 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  Depositor,  the Master  Servicer and [_____],  as
trustee and supplemental interest trust trustee (the "Trustee" and "Supplemental
Interest Trust  Trustee,"  respectively),  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 prior to such 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  Business  Day  prior  to  such
Distribution Date (the "Record Date"),  from the related 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 in St. Paul,  Minnesota.  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e) of 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 (each,  a "Plan"),  or any Person  (including,  without
limitation,  an insurance company  investing its general account,  an investment
manager,  a named  fiduciary or a trustee of any Plan) who is using plan assets,
within the meaning of the U.S. Department of

                                      D-1-12
<PAGE>

Labor regulation promulgated at 29 C.F.R. ss. 2510.3-101, as modified by Section
3(42)  of  ERISA,  of  any  Plan  (each,  a  "Plan  Investor")  to  effect  such
acquisition,  or (b) an  opinion  of  counsel  acceptable  to  and in  form  and
substance  satisfactory to the Trustee, the Depositor and the Master Servicer to
the effect that the  purchase  and holding of this  Certificate  is  permissible
under  applicable law, will not constitute or result in a non-exempt  prohibited
transaction  under  Section  406 of  ERISA  or  Section  4975  of the  Code  (or
comparable  provisions of any subsequent  enactments),  and will not subject the
Trustee,  the  Depositor or the Master  Servicer to any  obligation or liability
(including  obligations or liabilities  under ERISA or Section 4975 of the Code)
in addition to those undertaken in the Agreement, which opinion of counsel shall
not be an expense of the Trustee, the Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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 66.6% 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 in the City and State of St. Paul,
Minnesota,  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

                                      D-1-13
<PAGE>

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,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor,  the
Master  Servicer,  the Trustee 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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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
or its  designee  from the Trust Fund of all  remaining  Mortgage  Loans and all
property  acquired in respect of such  Mortgage  Loans or the  Certificates,  in
either  case  thereby  effecting  early  retirement  of  the  Certificates.  The
Agreement permits, but does not require, the Master Servicer or its designee (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 Balance.

      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.

                                      D-1-14
<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

                                      D-1-15
<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.

                                      D-1-16
<PAGE>

                                   EXHIBIT D-3

           FORM OF PERMANENT REGULATION S GLOBAL CLASS SB CERTIFICATE

      THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M AND CLASS B CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

      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.

      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, AS AMENDED (THE "CODE").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE  PROVIDES THE TRUSTEE,  THE DEPOSITOR AND THE
MASTER SERVICER WITH EITHER (A) A  CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF
THE  AGREEMENT  OR (B) AN  OPINION  OF  COUNSEL  ACCEPTABLE  TO AND IN FORM  AND
SUBSTANCE  SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO
THE EFFECT THAT THE  PURCHASE  AND HOLDING OF THIS  CERTIFICATE  IS  PERMISSIBLE
UNDER  APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE  UNDERTAKEN IN THE AGREEMENT,  WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.

      NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER
OF THIS  CERTIFICATE  UNLESS  THAT  TRANSFER IS MADE  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT  UNDER  THE 1933  ACT,  AND  EFFECTIVE  REGISTRATION  OR
QUALIFICATION UNDER APPLICABLE STATE

                                     D-3-1
<PAGE>

SECURITIES  LAWS,  OR IS  MADE IN A  TRANSACTION  THAT  DOES  NOT  REQUIRE  SUCH
REGISTRATION  OR  QUALIFICATION.  FURTHERMORE,  THE  AGREEMENT  PROVIDES THAT NO
TRANSFER OF THIS  CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS
CERTIFICATE  EXCEPT (I) OUTSIDE THE UNITED STATES TO ENTITIES WHICH ARE NOT U.S.
PERSONS  WITHIN  THE  MEANING  OF  REGULATION  S UNDER  THE  1933 ACT OR (II) IN
RELIANCE  ON  RULE  144A  UNDER  THE  1933  ACT  ("RULE  144A")  TO A  QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT IS ACQUIRING THIS CERTIFICATE
OR INTEREST  HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER  QUALIFIED
INSTITUTIONAL BUYER.

      EACH HOLDER OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE  ACKNOWLEDGED AND
AGREED THAT (I) IT IS (A) A QUALIFIED  INSTITUTIONAL BUYER AND IS ACQUIRING THIS
CERTIFICATE FOR ITS OWN INSTITUTIONAL  ACCOUNT OR FOR THE ACCOUNT OR ACCOUNTS OF
A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT
UNDERSTANDS  THAT THIS  CERTIFICATE IS BEING  TRANSFERRED TO IT IN A TRANSACTION
NOT INVOLVING ANY PUBLIC  OFFERING WITHIN THE MEANING OF THE 1933 ACT, AND THAT,
IF IN THE  FUTURE IT  DECIDES  TO  RESELL,  PLEDGE OR  OTHERWISE  TRANSFER  THIS
CERTIFICATE,  THIS  CERTIFICATE  MAY BE RESOLD,  PLEDGED OR TRANSFERRED  ONLY IN
ACCORDANCE  WITH  APPLICABLE  STATE  SECURITIES  LAWS  AND (A) IN A  TRANSACTION
MEETING THE  REQUIREMENTS  OF RULE 144A, TO A PERSON THAT THE SELLER  REASONABLY
BELIEVES IS A QUALIFIED  INSTITUTIONAL  BUYER THAT PURCHASES FOR ITS OWN ACCOUNT
(OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED  INSTITUTIONAL BUYER) AND TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF  REGULATION  S; AND (III) IF THE HOLDER IS A REGULATION  S PURCHASER,  IT
UNDERSTANDS  THAT THIS  CERTIFICATE HAS NOT AND WILL NOT BE REGISTERED UNDER THE
1933 ACT, THAT ANY OFFERS, SALES OR DELIVERIES OF THIS CERTIFICATE IN THE UNITED
STATES OR TO U.S.  PERSONS  PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE  CLOSING
DATE MAY CONSTITUTE A VIOLATION OF UNITED STATES LAW, AND THAT  DISTRIBUTIONS OF
PRINCIPAL  AND  INTEREST  WILL BE  MADE IN  RESPECT  OF SUCH  CERTIFICATES  ONLY
FOLLOWING THE DELIVERY BY THE HOLDER OF A CERTIFICATION  OF NON-U.S.  BENEFICIAL
OWNERSHIP  OR THE  EXCHANGE OF  BENEFICIAL  INTEREST IN  TEMPORARY  REGULATION S
GLOBAL OFFERED  CERTIFICATES FOR BENEFICIAL  INTERESTS IN THE RELATED  PERMANENT
REGULATION S GLOBAL OFFERED CERTIFICATES (WHICH IN EACH CASE WILL ITSELF REQUIRE
A  CERTIFICATION  OF  NON-U.S.  BENEFICIAL  OWNERSHIP),  AT THE TIMES AND IN THE
MANNER SET FORTH IN THE AGREEMENT.

      THE HOLDER OF THIS  CERTIFICATE  DESIRING  TO EFFECT ANY  TRANSFER,  SALE,
PLEDGE OR OTHER DISPOSITION SHALL, AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE
DEEMED TO HAVE AGREED TO, INDEMNIFY THE TRUSTEE,

                                     D-3-2
<PAGE>

THE DEPOSITOR,  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 AND
THE AGREEMENT.

CUSIP: _____________________                       Certificate No. SB

Date of Pooling and Servicing Agreement            Percentage Interest: [__]%
and Cut-off Date:  [_____] 1, 20[__]

First Distribution Date:  [_____ __], 20[__]       Notional Amount
                                                   of the Class SB Certificates:
                                                   $___________________________

Master Servicer:                                   Notional Amount
Residential Funding Company, LLC                   of this Class SB Certificate:
                                                   $___________________________
Maturity Date:
__________ __, 20__

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  evidencing  a  percentage  interest in the
                  distributions  allocable  to the  Class SB
                  Certificates  with respect to a Trust Fund
                  consisting   primarily   of  a   pool   of
                  one-to-four  family  fixed and  adjustable
                  interest  rate,   first  and  junior  lien
                  mortgage loans sold by RESIDENTIAL FUNDING
                  MORTGAGE SECURITIES II, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, Inc., the Master  Servicer,  the Trustee referred to below 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  Funding  Mortgage  Securities  II, Inc., the Master  Servicer,  the
Trustee or any of their affiliates.  None of the Depositor,  the Master Servicer
or any of  their  affiliates  will  have  any  obligation  with  respect  to any
certificate  or other  obligation  secured by or payable  from  payments  on the
Certificates.

      This certifies  that Cede & Co. is the registered  owner of the Percentage
Interest evidenced by this Certificate in certain  distributions with respect to
the Trust Fund consisting primarily of an interest in a pool of conventional one
to four  family  fixed and  adjustable  interest  rate,  first and  junior  lien
mortgage loans (the "Mortgage Loans") sold by Residential Funding

                                     D-3-3
<PAGE>

Mortgage  Securities II, Inc.  (hereinafter  called the "Depositor,"  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 Depositor,  the Master Servicer and
[_____],  as trustee and supplemental  interest trust trustee (the "Trustee" and
"Supplemental  Interest Trust Trustee,"  respectively),  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  Business  Day prior to such  Distribution  Date (the
"Record  Date"),  from the related  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 in St. Paul,  Minnesota.  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e) of 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 (each,  a "Plan"),  or any Person  (including,  without
limitation,  an insurance company  investing its general account,  an investment
manager,  a named  fiduciary or a trustee of any Plan) who is using plan assets,
within the meaning of the U.S. Department of Labor regulation  promulgated at 29
C.F.R. ss. 2510.3-101, as modified by Section 3(42) of ERISA, of any Plan (each,
a "Plan  Investor")  to effect  such  acquisition,  or (b) an opinion of counsel
acceptable  to and in  form  and  substance  satisfactory  to the  Trustee,  the
Depositor and the Master Servicer to the effect that the purchase and holding of
this Certificate is permissible under

                                     D-3-4
<PAGE>

applicable  law,  will not  constitute  or  result  in a  non-exempt  prohibited
transaction  under  Section  406 of  ERISA  or  Section  4975  of the  Code  (or
comparable  provisions of any subsequent  enactments),  and will not subject the
Trustee,  the  Depositor or the Master  Servicer to any  obligation or liability
(including  obligations or liabilities  under ERISA or Section 4975 of the Code)
in addition to those undertaken in the Agreement, which opinion of counsel shall
not be an expense of the Trustee, the Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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 66.6% 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 in the City and State of St. Paul,
Minnesota,  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.

                                     D-3-5
<PAGE>

      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,  and the  Certificate
Registrar and any agent of the Depositor,  the Master  Servicer,  the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor,  the
Master  Servicer,  the Trustee 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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      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
or its  designee  from the Trust Fund of all  remaining  Mortgage  Loans and all
property  acquired in respect of such  Mortgage  Loans or the  Certificates,  in
either  case  thereby  effecting  early  retirement  of  the  Certificates.  The
Agreement permits, but does not require, the Master Servicer or its designee (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 Balance.

      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.

                                     D-3-6
<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

                                     D-3-7
<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) 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.

                                     D-3-8
<PAGE>

                                                             E-8

                                    EXHIBIT E

                         FORM OF CLASS R-__ CERTIFICATE

THE CLASS R-__  CERTIFICATE  WILL NOT BE ENTITLED TO PAYMENTS  CONSTITUTING  THE
AVAILABLE  DISTRIBUTION  AMOUNT  UNTIL SUCH TIME AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN (THE "AGREEMENT").

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, AS AMENDED (THE "CODE").

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) MAY BE MADE TO ANY
PERSON, UNLESS THE TRANSFEREE PROVIDES THE TRUSTEE, THE DEPOSITOR AND THE MASTER
SERVICER  WITH EITHER (A) A  CERTIFICATION  PURSUANT  TO SECTION  5.02(e) OF THE
AGREEMENT OR (B) AN OPINION OF COUNSEL  ACCEPTABLE  TO AND IN FORM AND SUBSTANCE
SATISFACTORY TO THE MASTER SERVICER, THE DEPOSITOR AND THE TRUSTEE TO THE EFFECT
THAT  THE  PURCHASE  AND  HOLDING  OF  THIS  CERTIFICATE  IS  PERMISSIBLE  UNDER
APPLICABLE  LAW,  WILL NOT  CONSTITUTE  OR  RESULT  IN A  NON-EXEMPT  PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF
1974,  AS  AMENDED  ("ERISA"),  OR  SECTION  4975  OF THE  CODE  (OR  COMPARABLE
PROVISIONS  OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL  NOT  SUBJECT  THE  MASTER
SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES  UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE  UNDERTAKEN IN THE AGREEMENT,  WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.

                                      E-1
<PAGE>

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 FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY
ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE)
WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE, (C) ANY
ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE CODE, (ANY SUCH PERSON
DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C) BEING HEREIN REFERRED TO AS A
"DISQUALIFIED ORGANIZATION") OR (D) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2)
NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND
(3) SUCH TRANSFEREE SATISFIES

CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.

Class R-__                                   Certificate No. __
Date of Pooling and Servicing                Percentage Interest: __%

Agreement and Cut-off Date:

[_____] 1, 20[__]
First Distribution Date:                     Initial Certificate Principal

[_____ __], 20[__]                           Balance of this Certificate: $_____
Master Servicer:
Residential Funding Company, LLC

                   HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
                               SERIES 20[__]-[___]

                  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

                                      E-2
<PAGE>

                  fixed and  adjustable  interest rate first
                  and  junior  lien  mortgage  loans sold by
                  RESIDENTIAL  FUNDING  MORTGAGE  SECURITIES
                  II, INC.

      This  Certificate  is payable solely from the assets of the Trust Fund and
does not represent an obligation of or interest in Residential  Funding Mortgage
Securities II, Inc., the Master  Servicer,  the Trustee referred to below 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  Funding  Mortgage  Securities  II, Inc., the Master  Servicer,  the
Trustee or any of their affiliates.  None of the Depositor,  the Master Servicer
or any of  their  affiliates  will  have  any  obligation  with  respect  to any
certificate  or other  obligation  secured by or payable  from  payments  on the
Certificates.

      This certifies that  ___________ is the registered owner of the Percentage
Interest evidenced by this Certificate in certain  distributions with respect to
the  Trust  Fund  consisting  primarily  of  a  pool  of  conventional  one-  to
four-family  fixed and  adjustable  interest rate first and junior lien mortgage
loans (the "Mortgage Loans"),  sold by Residential  Funding Mortgage  Securities
II, Inc.  (hereinafter called the "Depositor," 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 Depositor, the Master Servicer and [_____], as trustee and
supplemental  interest trust trustee (the "Trustee" and  "Supplemental  Interest
Trust Trustee," respectively),  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 next preceding the month
in which the related  Distribution  Date occurs (the  "Record  Date"),  from the
related 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 Master Servicer 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

                                      E-3
<PAGE>

Master Servicer, which purchaser may be the Master Servicer, or any affiliate of
the Master  Servicer,  on such terms and  conditions as the Master  Servicer 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 in the City and State of St.  Paul,  Minnesota.
The Holder of this  Certificate may have additional  obligations with respect to
this Certificate, including tax liabilities.

      No  transfer  of this  Class R-__  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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein) shall be made unless the transferee provides the Trustee,  the Depositor
and the Master  Servicer  with  either (a) a  certification  pursuant to Section
5.02(e) of 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 (each,  a "Plan"),  or any Person  (including,  without
limitation,  an insurance company  investing its general account,  an investment
manager,  a named  fiduciary or a trustee of any Plan) who is using plan assets,
within the meaning of the U.S. Department of Labor regulation  promulgated at 29
C.F.R. ss. 2510.3-101, as modified by Section 3(42) of ERISA, of any Plan (each,
a "Plan  Investor")  to effect  such  acquisition,  or (b) an opinion of counsel
acceptable  to and in  form  and  substance  satisfactory  to the  Trustee,  the
Depositor and the Master Servicer to the effect that the purchase and holding of
this  Certificate is permissible  under  applicable  law, will not constitute or
result in a  non-exempt  prohibited  transaction  under  Section 406 of ERISA or
Section  4975  of  the  Code  (or   comparable   provisions  of  any  subsequent
enactments),  and will not  subject the  Trustee,  the  Depositor  or the Master
Servicer to any  obligation or liability  (including  obligations or liabilities
under ERISA or Section 4975 of the Code) in addition to those  undertaken in the
Agreement,  which opinion of counsel shall not be an expense of the Trustee, the
Depositor or the Master Servicer.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes  designated as Home Equity Loan 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

                                      E-4
<PAGE>

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 in the City and State of St. Paul,
Minnesota,  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 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.

                                      E-5
<PAGE>

      This Certificate shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

      The obligations  created by the Agreement in respect of these 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 Residential  Funding
Company, LLC or its designee 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 related  Certificates.  The Agreement permits,  but does
not require,  Residential Funding Company,  LLC or its designee (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) subject to the
terms of the  Agreement,  to  purchase  in  whole,  but not in part,  all of the
related  Certificates from the Holders thereof;  provided,  that any such option
may only be exercised if the aggregate Stated  Principal  Balance of the related
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 related 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.

                                      E-6
<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   R   Certificates   referred   to  in  the
within-mentioned Agreement.

                                             [_____],
                                                      as Certificate Registrar

                                             By: _______________________________
                                                        Authorized Signatory

                                      E-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) 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 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.

                                      E-8
<PAGE>

                                    EXHIBIT F

                           FORM OF CUSTODIAL AGREEMENT

                               CUSTODIAL AGREEMENT

      THIS CUSTODIAL  AGREEMENT (as amended and supplemented  from time to time,
the  "Agreement"),  dated as of [_____ __],  20[__],  by and among  [_____],  as
trustee and supplemental  interest trust trustee (including its successors under
the Pooling Agreement  defined below, the "Trustee" and  "Supplemental  Interest
Trust Trustee," respectively), RESIDENTIAL FUNDING MORTGAGE SECURITIES II, INC.,
as company (together with any successor in interest, the "Company"), RESIDENTIAL
FUNDING  COMPANY,  LLC,  as master  servicer  (together  with any  successor  in
interest or successor under the Pooling Agreement referred to below, the "Master
Servicer") and [_______],  as custodian (together with any successor in interest
or any successor appointed hereunder, the "Custodian").

                            W I T N E S S E T H T H A T:

      WHEREAS,  the  Company,  the Master  Servicer and the Trustee have entered
into a Pooling and Servicing Agreement,  dated as of [_____] 1, 20[__], relating
to the issuance of Residential Funding Mortgage Securities II, Inc., Home Equity
Loan Pass-Through Certificates, Series 20[__]-[___] (as in effect on the date of
this  Agreement,   the  "Original   Pooling   Agreement,"  and  as  amended  and
supplemented from time to time, the "Pooling Agreement");

      WHEREAS, the Company and the Master Servicer, hereby direct the Trustee to
appoint Wells Fargo Bank,, N.A. as Custodian, and

      WHEREAS,  the Custodian has agreed to act as agent for the Trustee for the
purposes  of  receiving  and holding  certain  documents  and other  instruments
delivered by the Company and the Master  Servicer  under the Pooling  Agreement,
all upon the terms and conditions and subject to the limitations hereinafter set
forth;

      NOW, THEREFORE,  in consideration of the premises and the mutual covenants
and  agreements  hereinafter  set forth,  the Trustee,  the Company,  the Master
Servicer and the Custodian hereby agree as follows:

                                   ARTICLE I

                                   Definitions

      Capitalized terms used in this Agreement and not defined herein shall have
the  meanings  assigned in the  Original  Pooling  Agreement,  unless  otherwise
required by the context herein.

                                   ARTICLE II

                          Custody of Mortgage Documents

      Section 2.1 Custodian to Act as Agent:  Acceptance of Custodial Files. The
Company and the Master Servicer,  hereby direct the Trustee to appoint [_______]
as Custodian.  The  Custodian,  as the duly  appointed  agent of the Trustee for
these purposes, acknowledges receipt

                                      F-1
<PAGE>

of the Custodial Files relating to the Mortgage Loans identified on the schedule
attached hereto (the "Custodial Files") and declares that it holds and will hold
the Custodial Files as agent for the Trustee,  in trust, for the use and benefit
of all present and future Certificateholders.

      Section 2.2 Recordation of Assignments. If any Custodial File includes one
or more  assignments of the related  Mortgage Loans to the Trustee that have not
been recorded,  each such assignment  shall be delivered by the Custodian to the
Company for the purpose of recording  it in the  appropriate  public  office for
real property records,  and the Company,  at no expense to the Custodian,  shall
promptly cause to be recorded in the appropriate public office for real property
records each such  assignment and, upon receipt thereof from such public office,
shall return each such assignment to the Custodian.

      Section 2.3 Review of Custodial Files.

                  (a) On or prior  to the  Closing  Date,  the  Custodian  shall
deliver to the Trustee an Initial  Certification  in the form annexed  hereto as
Exhibit One evidencing receipt of a Custodial File for each Mortgage Loan listed
on the Schedule  attached  hereto (the  "Mortgage Loan  Schedule").  The parties
hereto acknowledge that certain documents  referred to in Subsection  2.01(b)(i)
of the Pooling Agreement may be missing on or prior to the Closing Date and such
missing documents shall be listed as a Schedule to Exhibit One.

                  (b)  Within 45 days  after the  Closing  Date,  the  Custodian
agrees, for the benefit of Certificateholders, to review each Custodial File and
to deliver to the Trustee an Interim Certification in the form annexed hereto as
Exhibit Two to the effect that all documents  required to be delivered  pursuant
to Section 2.01(b) of the Pooling  Agreement 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.  For purposes of such review, the Custodian shall compare
the  following   information  in  each  Custodial  File  to  the   corresponding
information  in the  Mortgage  Loan  Schedule:  (i) the  loan  number,  (ii) the
borrower name and (iii) the original  principal  balance.  In the event that any
Mortgage Note or  Assignment of Mortgage has been  delivered to the Custodian by
the Company in blank,  the Custodian,  upon the direction of the Company,  shall
cause  each such  Mortgage  Note to be  endorsed  to the  Trustee  and each such
Assignment  of Mortgage to be completed in the name of the Trustee  prior to the
date on which such Interim Certification is delivered to the Trustee.  Within 45
days of receipt of the  documents  required to be delivered  pursuant to Section
2.01(b) of the Pooling  Agreement,  the Custodian agrees, for the benefit of the
Certificateholders,  to review each such document,  and upon the written request
of the  Trustee to deliver to the  Trustee an updated  Schedule A to the Interim
Certification.  The  Custodian  shall be under no duty or obligation to inspect,
review or examine said documents,  instruments,  certificates or other papers to
determine  that  the same  are  genuine,  enforceable,  or  appropriate  for the
represented  purpose or that they have  actually  been recorded or that they are
other than what they  purport to be on their face,  or that the MIN is accurate.
If in performing the review required by this Section 2.3 the Custodian finds any
document or documents  constituting  a part of a Custodial File to be missing or
defective in respect of the items reviewed as described in this Section  2.3(b),
the Custodian shall promptly so notify the Company, the Master Servicer, and the
Trustee.

                                      F-2
<PAGE>

                  (c)  Upon  receipt  of  all  documents  required  to be in the
Custodial Files the Custodian shall deliver to the Trustee a Final Certification
in the form annexed hereto as Exhibit Three  evidencing the  completeness of the
Custodial Files.

      Upon  receipt of written  request  from the  Trustee,  the  Company or the
Master Servicer,  the Custodian shall as soon as practicable  supply the Trustee
with a list of all of the documents  relating to the Mortgage  Loans required to
be  delivered  pursuant  to Section  2.01(b) of the Pooling  Agreement  not then
contained in the Custodial Files.

      Section 2.4 Notification of Breaches of Representations and Warranties. If
the Custodian discovers,  in the course of performing its custodial functions, a
breach of a  representation  or  warranty  made by the  Master  Servicer  or the
Company as set forth in the Pooling  Agreement  with respect to a Mortgage  Loan
relating to a Custodial  File, the Custodian shall give prompt written notice to
the Company, the Master Servicer, and the Trustee.

      Section 2.5 Custodian to Cooperate:  Release of Custodial Files.  Upon the
repurchase  or  substitution  of any Mortgage Loan pursuant to Article II of the
Pooling Agreement or payment in full of any Mortgage Loan, or 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 shall immediately notify
the  Custodian by delivering to the Custodian a Request for Release (in the form
of Exhibit Four attached hereto or a mutually  acceptable  electronic  form) and
shall request delivery to it of the Custodial File. The Custodian  agrees,  upon
receipt of such Request for Release,  promptly to release to the Master Servicer
the related  Custodial  File. Upon written  notification of a substitution,  the
Master  Servicer  shall deliver to the  Custodian  and the  Custodian  agrees to
accept the Mortgage Note and other  documents  constituting  the Custodial  File
with respect to any Qualified  Substitute  Mortgage Loan, upon receiving written
notification from the Master Servicer of such substitution.

      Upon receipt of a Request for Release from the Master Servicer,  signed by
a Servicing Officer,  stating that (i) the Master Servicer or a Subservicer,  as
the case may be, has made a deposit into the Certificate  Account in payment for
the  purchase of the related  Mortgage  Loan in an amount  equal to the Purchase
Price for such  Mortgage  Loan or (ii) the  Company has chosen to  substitute  a
Qualified  Substitute  Mortgage Loan for such Mortgage Loan, the Custodian shall
release to the Master Servicer the related Custodial File.

      From time to time as is appropriate  for the servicing or  foreclosures of
any Mortgage Loan,  including,  for this purpose,  collection  under any Primary
Insurance  Policy or any Mortgage Pool  Insurance  Policy,  the Master  Servicer
shall deliver to the Custodian a Request for Release certifying as to the reason
for such release. Upon receipt of the foregoing, the Custodian shall deliver the
Custodial File or such document to the Master  Servicer.  All Custodial Files so
released to the Master Servicer shall be held by it in trust for the Trustee for
the use and  benefit of all present  and future  Certificateholders.  The Master
Servicer shall cause each Custodial File or any document  therein so released to
be returned to the Custodian  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
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

                                      F-3
<PAGE>

or  non-judicially,  and the Master  Servicer has  delivered to the Custodian an
updated Request for Release signed by 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. Immediately upon receipt
of any  Custodial  File returned to the  Custodian by the Master  Servicer,  the
Custodian  shall  deliver  a  signed  acknowledgment  to  the  Master  Servicer,
confirming receipt of such Custodial File.

      Upon the written request of the Master  Servicer,  the Custodian will send
to the Master Servicer copies of any documents contained in the Custodial File.

      Section  2.6  Assumption  Agreements.  In the  event  that any  assumption
agreement or substitution of liability agreement is entered into with respect to
any Mortgage  Loan subject to this  Agreement in  accordance  with the terms and
provisions  of the  Pooling  Agreement,  the Master  Servicer  shall  notify the
Custodian that such assumption or  substitution  agreement has been completed by
forwarding  to the Custodian  the original of such  assumption  or  substitution
agreement,  which  shall be added to the  related  Custodial  File and,  for all
purposes,  shall be considered a part of such  Custodial File to the same extent
as all other documents and instruments constituting parts thereof.

                                  ARTICLE III

                            Concerning the Custodian

      Section 3.1  Custodian a Bailee and Agent of the Trustee.  With respect to
each Mortgage Note,  Mortgage and other  documents  constituting  each Custodial
File which are  delivered to the  Custodian,  the Custodian is  exclusively  the
bailee and agent of the Trustee  and has no  instructions  to hold any  Mortgage
Note or Mortgage  for the benefit of any person  other than the  Trustee,  holds
such  documents  for the benefit of the  Certificateholders  and  undertakes  to
perform such duties and only such duties as are  specifically  set forth in this
Agreement.  Except upon  compliance  with the  provisions of Section 2.5 of this
Agreement, no Mortgage Note, Mortgage or other document constituting a part of a
Custodial  File shall be delivered by the Custodian to the Company or the Master
Servicer or otherwise released from the possession of the Custodian.

      The Master  Servicer shall promptly  notify the Custodian in writing if it
shall no  longer  be a member  of MERS,  or if it  otherwise  shall no longer be
capable of registering and recording Mortgage Loans using MERS. In addition, the
Master  Servicer shall (i) promptly  notify the Custodian in writing when a MERS
Mortgage  Loan is no longer  registered  with and  recorded  under MERS and (ii)
concurrently  with any such  deregistration  of a MERS Mortgage  Loan,  prepare,
execute and record an original  assignment  from MERS to the Trustee and deliver
such assignment to the Custodian.

      Section 3.2  Indemnification.  The Company  hereby agrees to indemnify and
hold the Custodian  harmless from and against all claims,  liabilities,  losses,
actions,  suits or proceedings at law or in equity, or any other expenses,  fees
or charges of any  character or nature,  which the  Custodian  may incur or with
which the Custodian may be threatened by reason of its acting as custodian under
this Agreement,  including  indemnification of the Custodian against any and all
expenses,  including  attorney's  fees if  counsel  for the  Custodian  has been
approved  by the  Company,  and  the  cost  of  defending  any  action,  suit or
proceedings or resisting any claim.

                                      F-4
<PAGE>

Notwithstanding the foregoing,  it is specifically understood and agreed that in
the event any such claim,  liability,  loss, action, suit or proceeding or other
expense,  fee or charge shall have been caused by reason of any  negligent  act,
negligent failure to act or willful misconduct on the part of the Custodian,  or
which  shall  constitute  a  willful  breach  of  its  duties   hereunder,   the
indemnification provisions of this Agreement shall not apply.

      Section  3.3  Custodian  May  Own  Certificates.   The  Custodian  in  its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Custodian.

      Section 3.4 Master  Servicer to Pay  Custodian's  Fees and  Expenses.  The
Master Servicer  covenants and agrees to pay to the Custodian from time to time,
and the Custodian shall be entitled to, reasonable compensation for all services
rendered by it in the exercise and  performance  of any of the powers and duties
hereunder of the  Custodian,  and the Master  Servicer will pay or reimburse the
Custodian  upon its  request  for all  reasonable  expenses,  disbursements  and
advances  incurred  or made  by the  Custodian  in  accordance  with  any of the
provisions of this  Agreement  (including the  reasonable  compensation  and the
expenses and  disbursements  of its counsel and of all persons not  regularly in
its employ), except any such expense,  disbursement or advance as may arise from
its negligence or bad faith.

      Section 3.5  Custodian  May  Resign:  Trustee  May Remove  Custodian.  The
Custodian may resign from the  obligations  and duties hereby imposed upon it as
such  obligations  and duties  relate to its acting as Custodian of the Mortgage
Loans. Upon receiving such notice of resignation,  the Trustee shall either take
custody of the  Custodial  Files  itself and give prompt  notice  thereof to the
Company, the Master Servicer and the Custodian,  or promptly appoint a successor
Custodian by written  instrument,  in  duplicate,  one copy of which  instrument
shall be  delivered to the  resigning  Custodian  and one copy to the  successor
Custodian.  If the Trustee shall not have taken  custody of the Custodial  Files
and no  successor  Custodian  shall  have been so  appointed  and have  accepted
appointment  within 30 days after the giving of such notice of resignation,  the
resigning  Custodian  may petition any court of competent  jurisdiction  for the
appointment of a successor Custodian.

      The Trustee, at the direction of the Master Servicer and the Company,  may
remove the  Custodian at any time,  with or without  cause.  In such event,  the
Trustee shall appoint, or petition a court of competent jurisdiction to appoint,
a successor Custodian  hereunder.  Any successor Custodian shall be a depository
institution  subject to supervision or examination by federal or state authority
and shall be able to satisfy the other requirements contained in Section 3.7 and
shall be unaffiliated with the Master Servicer or the Company.

      Any resignation or removal of the Custodian and appointment of a successor
Custodian  pursuant to any of the  provisions  of this  Section 3.5 shall become
effective upon acceptance of appointment by the successor Custodian. The Trustee
shall  give  prompt  notice  to the  Company  and  the  Master  Servicer  of the
appointment  of  any  successor  Custodian.  No  successor  Custodian  shall  be
appointed  by the  Trustee  without  the prior  approval  of the Company and the
Master Servicer.

                                      F-5
<PAGE>

      Section 3.6 Merger or  Consolidation  of Custodian.  Any Person into which
the Custodian  may be merged or converted or with which it may be  consolidated,
or any Person  resulting from any merger,  conversion or  consolidation to which
the Custodian shall be a party, or any Person  succeeding to the business of the
Custodian,  shall be the  successor  of the  Custodian  hereunder,  without  the
execution  or filing of any paper or any  further  act on the part of any of the
parties hereto, anything herein to the contrary  notwithstanding;  provided that
such successor is a depository institution subject to supervision or examination
by federal or state  authority  and is able to  satisfy  the other  requirements
contained  in Section 3.7 and is  unaffiliated  with the Master  Servicer or the
Company.

      Section  3.7  Representations  of  the  Custodian.  The  Custodian  hereby
represents  that  it is a  depository  institution  subject  to  supervision  or
examination by a federal or state authority,  has a combined capital and surplus
of at least  $15,000,000 and is qualified to do business in the jurisdictions in
which it will hold any Custodial File.

                                   ARTICLE IV

                          COMPLIANCE with Regulation AB

      Section 4.1 Intent of the  Parties;  Reasonableness.  The  parties  hereto
acknowledge  and agree  that the  purpose of this  Article  IV 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  parties  hereto
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
requests  made by the Company in good faith for  delivery of  information  under
these provisions on the basis of evolving  interpretations of Regulation AB. The
Custodian 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 4.2 Additional Representations and Warranties of the Custodian.

                  (a) The  Custodian  hereby  represents  and warrants  that the
information    set   forth   under   the   caption    "Pooling   and   Servicing
Agreement--General--Custodial  Arrangements" (the "Custodian Disclosure") in the
Preliminary Prospectus Supplement dated [_______ __], 20[__], as supplemented by
the Preliminary Supplement to Preliminary Prospectus Supplement,  dated [_______
__], 20[__],  and the Final Prospectus  Supplement dated,  [_______ __], 20[__],
relating to the Certificates does not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.

                                      F-6
<PAGE>

                  (b) The Custodian  shall be deemed to represent to the Company
as of the date hereof and on each date on which  information  is provided to the
Company  under  Section 4.3 that,  except as disclosed in writing to the Company
prior to such date:  (i) there are no aspects of its  financial  condition  that
could have a material  adverse effect on the  performance by it of its Custodian
obligations under this Agreement or any other  Securitization  Transaction as to
which it is the  custodian;  (ii) there are no  material  legal or  governmental
proceedings  pending (or known to be  contemplated)  against it; and (iii) there
are no  affiliations,  relationships  or transactions  relating to the Custodian
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 such terms are used in Regulation AB) relating to
the Securitization  Transaction  contemplated by the Agreement, as identified by
the  Company to the  Custodian  in  writing  as of the  Closing  Date  (each,  a
"Transaction Party").

                  (c) If so requested by the Company on any date  following  the
Closing Date,  the Custodian  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 reasonably
adequate disclosure of the pertinent facts, in writing, to the requesting party.
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 a
determination  that  any  of  the  representations  and  warranties  may  not be
accurate.

      Section 4.3 Additional Information to Be Provided by the Custodian. 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 Custodian  shall (a) notify the Company in writing of any
material  litigation or governmental  proceedings  pending against the Custodian
that would be material to  Certificateholders,  and (b) provide to the Company a
written description of such proceedings.  Any notices and descriptions  required
under this Section 4.3 shall be given no later than five  Business Days prior to
the Determination  Date following the month in which the Custodian has knowledge
of the  occurrence of the relevant  event.  As of the date the Company or Master
Servicer  files  each  Report  on Form 10-D or Form  10-K  with  respect  to the
Certificates,  the Custodian  will be deemed to represent  that any  information
previously  provided  under this Section 4.3, if any, is materially  correct and
does not have any material omissions unless the Custodian has provided an update
to such information.

      Section 4.4 Report on  Assessment  of Compliance  and  Attestation.  On or
before March 15 of each calendar year commencing in 20[__], the Custodian shall:

                  (a)  deliver to the  Company a report  (in form and  substance
reasonably  satisfactory to the Company) regarding the Custodian's assessment of
compliance with the 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 addressed to the Company and signed
by an  authorized  officer  of the  Custodian,  and  shall  address  each of the
Servicing  Criteria  specified on a certification  substantially  in the form of
Exhibit Five hereto; and

                                      F-7
<PAGE>

                  (b)  deliver to the  Company a report of a  registered  public
accounting  firm  reasonably  acceptable  to the  Company  that  attests to, and
reports on, the  assessment  of  compliance  made by the Custodian and delivered
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 4.5 Indemnification; Remedies.

                  (a) The Custodian shall indemnify the Company,  each affiliate
of  the  Company,   the  Master  Servicer  and  each  broker  dealer  acting  as
underwriter,  placement agent or initial  purchaser of the  Certificates or each
Person who controls any of such parties (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange  Act); 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 the  Custodian  Disclosure  and  any  information,  report,
certification,  accountants'  attestation or other material  provided under this
Article  IV by or on  behalf  of the  Custodian  (collectively,  the  "Custodian
Information"), or (B) the omission or alleged omission to state in the Custodian
Information a material  fact required to be stated in the Custodian  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  Custodian  to deliver any  information,  report,
certification,  accountants'  attestation or other material when and as required
under this Article IV.

                  (b) In the case of any  failure of  performance  described  in
clause (ii) of Section  4.5(a),  the  Custodian  shall  promptly  reimburse  the
Company for all costs reasonably  incurred by the Company in order to obtain the
information,  report,  certification,  accountants' letter or other material not
delivered as required by the Custodian.

                                   ARTICLE V

                            Miscellaneous Provisions

      Section 5.1 Notices. All notices, requests, consents and demands and other
communications required under this Agreement or pursuant to any other instrument
or  document  delivered  hereunder  shall be in writing  and,  unless  otherwise
specifically provided, may be delivered personally,  by telegram or telex, or by
registered or certified mail, postage prepaid,  return receipt requested, at the
addresses  specified  on  the  signature  page  hereof  (unless  changed  by the
particular  party whose address is stated herein by similar  notice in writing),
in which case the notice will be deemed delivered when received.

                                      F-8
<PAGE>

      Section 5.2  Amendments.  No modification or amendment of or supplement to
this  Agreement  shall be valid or  effective  unless the same is in writing and
signed by all parties  hereto,  and none of the Company,  the Master Servicer or
the Trustee  shall enter into any  amendment  hereof  except as permitted by the
Pooling Agreement.  The Trustee shall give prompt notice to the Custodian of any
amendment or supplement to the Pooling  Agreement and furnish the Custodian with
written copies thereof.

      Section 5.3 GOVERNING LAW. THIS AGREEMENT  SHALL BE DEEMED A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE  CONSTRUED  AND ENFORCED IN
ACCORDANCE  WITH  AND  GOVERNED  BY THE LAWS OF THE  STATE OF NEW YORK  (WITHOUT
REGARD TO THE CONFLICTS OF LAW PRINCIPLES  THEREOF,  OTHER THAN SECTIONS  5-1401
AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

      Section  5.4  Recordation  of  Agreement.   To  the  extent  permitted  by
applicable  law, this  Agreement is subject to  recordation  in all  appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated,  and in any other  appropriate  public  recording office or elsewhere,
such  recordation  to be effected by the Master  Servicer  and at its expense on
direction  by the Trustee  (pursuant  to the request of holders of  Certificates
evidencing  undivided  interests  in the  aggregate  of not less than 25% of the
Trust  Fund),  but only upon  direction  accompanied  by an  Opinion  of Counsel
reasonably satisfactory to the Master Servicer to the effect that the failure to
effect  such  recordation  is likely to  materially  and  adversely  affect  the
interests of the Certificateholders.

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

      Section  5.5  Severability  of  Provisions.  If  any  one or  more  of the
covenants,  agreements,  provisions or terms of this Agreement  shall be for any
reason whatsoever held invalid, then such covenants,  agreements,  provisions or
terms  shall be  deemed  severable  from the  remaining  covenants,  agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability  of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.

                            [SIGNATURE PAGES FOLLOW]

                                      F-9
<PAGE>

      IN WITNESS WHEREOF,  this Agreement is executed as of the date first above
written.

Address:                                     [_____],
                                                      as Trustee

[_____]
EP-MN-WS3D
60 Livingston Avenue
St. Paul, MN 55107                           By: _______________________________
                                                 Name:
Attn: Structured Finance/RFMSII Series 20[__]-   Title:

Address:                                     RESIDENTIAL FUNDING MORTGAGE
                                             SECURITIES II, INC.

8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota 55437

                                             By: _______________________________
                                                 Name:
                                                 Title:

Address:                                     RESIDENTIAL FUNDING COMPANY,
                                             LLC, a Master Servicer
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota 55437                 By: _______________________________
                                                 Name:
                                                 Title:

Address:                                     [_______]

Mortgage Document Custody
[_________]
[_________]
                                             By: _______________________________
                                                 Name:
                                                 Title:

                                      F-10
<PAGE>

                                )
                                )ss.:
                                )

            On the _____ day of ___________________, 20[__], before me, a notary
public in and for said State, personally appeared  ____________________________,
known to me to be a _____________________________  of [_____], that executed the
within  instrument,  and also known to me to be the person  who  executed  it on
behalf of said national  banking  association  and  acknowledged to me that such
national banking association executed the within instrument.

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

                                                    ____________________________
                                                                 Notary Public

[Notarial Seal]

                                      F-11
<PAGE>

STATE OF MINNESOTA   )
                     ) ss.:
COUNTY OF HENNEPIN   )

            On the _____ day of  ________________,  20[__],  before me, a notary
public in and for said State, personally appeared _____________________________,
known to me to be a ____________ of Residential  Funding Mortgage Securities II,
Inc.,  one of the  corporations  that executed the within  instrument,  and also
known to me to be the person who executed it on behalf of said corporation,  and
acknowledged to me that such corporation executed the within instrument.

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

                                                  ______________________________
                                                                 Notary Public

[Notarial Seal]

                                      F-12
<PAGE>

STATE OF MINNESOTA   )
                     ) ss.:
COUNTY OF HENNEPIN   )

            On the _____ day of  _______________,  20[__],  before  me, a notary
public     in     and     for     said     State,      personally      appeared,
_____________________________, known to me to be a ______________ of Residential
Funding Company,  LLC, one of the companies that executed the within instrument,
and also known to me to be the person who executed it on behalf of said company,
and acknowledged to me that such 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]

                                      F-13
<PAGE>

STATE OF _____________   )
                         ) ss.:
COUNTY OF ____________   )

            On the _____ day of __________________,  20[__], before me, a notary
public     in     and     for     said      State,      personally      appeared
______________________________,  known  to  me  to  be a  __________________  of
[__________],  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  national
banking  association,   and  acknowledged  to  me  that  such  national  banking
association executed the within instrument.

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

                                                  ______________________________
                                                  Notary Public

[Notarial Seal]

STATE OF _____________  )
                        ) ss.:

                                             COUNTY OF ___________          )

            On the _____ day of __________________,  20[__], before me, a notary
public     in     and     for     said      State,      personally      appeared
______________________________,  known  to  me  to  be a  __________________  of
[__________],   a  national   banking   association  that  executed  the  within
instrument,  and also known to me to be the person who  executed it on behalf of
said national  banking  association,  and  acknowledged to me that such national
banking association executed the within instrument.

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

                                                  ______________________________
                                                  Notary Public

                                      F-14
<PAGE>

                                   EXHIBIT ONE

                                FORM OF CUSTODIAN
                              INITIAL CERTIFICATION

                                                 _______________________, 20__

[____________]
[____________]
[____________]

Attention: Structured Finance/RFMSII Series 20[__]-[___]

                        Re:   Custodial  Agreement,  dated  as  of  [_____  __],
                              20[__], by and among [_____],  Residential Funding
                              Mortgage Securities II, Inc.,  Residential Funding
                              Company,  LLC  and  [_______],  relating  to  Home
                              Equity  Loan  Pass-Through  Certificates,   Series
                              20[__]-[___]

Ladies and Gentlemen:

            In  accordance  with  Section 2.3 of the  above-captioned  Custodial
Agreement,   and  subject  to  Section  2.02  of  the  Pooling  Agreement,   the
undersigned,  as Custodian,  hereby  certifies  that it has received a Custodial
File  (which  contains  an  original  Mortgage  Note or an  original  Lost  Note
Affidavit with a copy of the related  Mortgage  Note) to the extent  required in
Section  2.01(b) of the Pooling  Agreement  with respect to each  Mortgage  Loan
listed in the Mortgage Loan Schedule,  with any exceptions  listed on Schedule A
attached hereto.

            Capitalized  words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Custodial Agreement.

                                             [_______]

                                             By:    ____________________________
                                             Name:  ____________________________
                                             Title: ____________________________

                                      F-15
<PAGE>

                                   EXHIBIT TWO

                     FORM OF CUSTODIAN INTERIM CERTIFICATION

                                                 _______________________, 20__

[____________]
[____________]
[____________]

Attention: Structured Finance/RFMSII Series 20[__]-[___]

                        Re:   Custodial  Agreement,  dated  as  of  [_____  __],
                              20[__], by and among [_____],  Residential Funding
                              Mortgage Securities II, Inc.,  Residential Funding
                              Company,  LLC  and  [_______],  relating  to  Home
                              Equity  Loan  Pass-Through  Certificates,   Series
                              20[__]-[___]

Ladies and Gentlemen:

            In  accordance  with  Section 2.3 of the  above-captioned  Custodial
Agreement, the undersigned,  as Custodian, hereby certifies that it has received
a  Custodial  File to the extent  required  pursuant  to Section  2.01(b) of the
Pooling Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule,  and it has reviewed the Custodial File and the Mortgage Loan Schedule
and has determined that: all required  documents have been executed and received
and that such documents  relate to the Mortgage Loans identified on the Mortgage
Loan Schedule, with any exceptions listed on Schedule A attached hereto.

            Capitalized  words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Custodial Agreement.

                                             [___________________________]

                                             By:    ____________________________
                                             Name:  ____________________________
                                             Title: ____________________________

                                      F-16
<PAGE>

                                  EXHIBIT THREE

                      FORM OF CUSTODIAN FINAL CERTIFICATION

                                                 _______________________, 20__

[_____________]
[_____________]
[_____________]
Attention: Structured Finance/RFMSII Series 20[__]-[___]

                        Re:   Custodial  Agreement,  dated  as  of  [_____  __],
                              20[__], by and among [_____],  Residential Funding
                              Mortgage Securities II, Inc.,  Residential Funding
                              Company,  LLC  and  [_______],  relating  to  Home
                              Equity  Loan  Pass-Through  Certificates,   Series
                              20[__]-[___]

Ladies and Gentlemen:

            In  accordance  with  Section 2.3 of the  above-captioned  Custodial
Agreement, the undersigned,  as Custodian, hereby certifies that it has received
a Custodial  File with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule and it has reviewed the  Custodial  File and the Mortgage Loan Schedule
and has determined that: all required  documents  referred to in Section 2.01(b)
of the Pooling Agreement have been executed and received and that such documents
relate to the Mortgage Loans identified on the Mortgage Loan Schedule.

            Capitalized  words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Custodial Agreement.

                                             [_______]

                                             By:    ____________________________
                                             Name:  ____________________________
                                             Title: ____________________________

                                      F-17
<PAGE>

                                  EXHIBIT FOUR

                           FORM 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

                                      F-18
<PAGE>

                                  EXHIBIT FIVE

         SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

      The  assessment  of  compliance  to be  delivered by the  Custodian  shall
address, at a minimum,  the criteria  identified below as "Applicable  Servicing
Criteria":

--------------------------------------------------------------------------------
               Servicing Criteria                              Applicable
                                                           Servicing Criteria
--------------------------------------------------------------------------------
Reference                         Criteria
--------------------------------------------------------------------------------
                       General Servicing Considerations
--------------------------------------------------------------------------------
                  Policies and procedures are instituted
                  to monitor  any  performance  or other
                  triggers  and  events  of  default  in
                  accordance    with   the   transaction
1122(d)(1)(i)     agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(1)(ii)    servicing activities.
--------------------------------------------------------------------------------
                  Any  requirements  in the  transaction
                  agreements   to   maintain  a  back-up
                  servicer   for  the  pool  assets  are
1122(d)(1)(iii)   maintained.
--------------------------------------------------------------------------------
                  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
1122(d)(1)(iv)    transaction agreements.
--------------------------------------------------------------------------------
                     Cash Collection and Administration
--------------------------------------------------------------------------------
                  Payments on pool assets are  deposited
                  into the  appropriate  custodial  bank
                  accounts  and  related  bank  clearing
                  accounts  no more  than  two  business
                  days following receipt,  or such other
                  number  of  days   specified   in  the
1122(d)(2)(i)     transaction agreements.
--------------------------------------------------------------------------------
                  Disbursements  made via wire  transfer
                  on  behalf  of  an  obligor  or  to an
                  investor  are made only by  authorized
1122(d)(2)(ii)    personnel.
--------------------------------------------------------------------------------
                  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
1122(d)(2)(iii)   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
                  respect to commingling of cash) as set
1122(d)(2)(iv)    forth in the transaction agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(2)(v)     Act.
--------------------------------------------------------------------------------
                  Unissued  checks are safeguarded so as
1122(d)(2)(vi)    to prevent unauthorized access.
--------------------------------------------------------------------------------
                  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
1122(d)(2)(vii)   transaction agreements.
--------------------------------------------------------------------------------

                                      F-19
<PAGE>

--------------------------------------------------------------------------------
               Servicing Criteria                              Applicable
                                                           Servicing Criteria
--------------------------------------------------------------------------------
Reference                         Criteria
--------------------------------------------------------------------------------
                    Investor Remittances and Reporting
--------------------------------------------------------------------------------
                  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
1122(d)(3)(i)     the servicer.
--------------------------------------------------------------------------------
                  Amounts due to investors are allocated
                  and   remitted  in   accordance   with
                  timeframes,  distribution priority and
                  other   terms   set   forth   in   the
1122(d)(3)(ii)    transaction agreements.
--------------------------------------------------------------------------------
                  Disbursements  made to an investor are
                  posted within two business days to the
                  servicer's  investor records,  or such
                  other number of days  specified in the
1122(d)(3)(iii)   transaction agreements.
--------------------------------------------------------------------------------
                  Amounts  remitted to investors per the
                  investor  reports agree with cancelled
                  checks,  or other form of payment,  or
1122(d)(3)(iv)    custodial bank statements.
--------------------------------------------------------------------------------
                       Pool Asset Administration
--------------------------------------------------------------------------------
                  Collateral  or security on pool assets
                  is   maintained  as  required  by  the            |X|
                  transaction   agreements   or  related
1122(d)(4)(i)     asset pool documents.
--------------------------------------------------------------------------------
                  Pool assets and related  documents are
                  safeguarded   as   required   by   the            |X|
1122(d)(4)(ii)    transaction agreements
--------------------------------------------------------------------------------
                  Any     additions,     removals     or
                  substitutions  to the  asset  pool are
                  made,   reviewed   and   approved   in
                  accordance   with  any  conditions  or
                  requirements    in   the   transaction
1122(d)(4)(iii)   agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(iv)    related pool asset documents.
--------------------------------------------------------------------------------
                  The servicer's  records  regarding the
                  pool assets agree with the  servicer's
                  records  with  respect to an obligor's
1122(d)(4)(v)     unpaid principal balance.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(vi)    documents.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(vii)   transaction agreements.
--------------------------------------------------------------------------------
                  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.,
1122(d)(4)(viii)  illness or unemployment).
--------------------------------------------------------------------------------
                  Adjustments to interest rates or rates
                  of  return   for  pool   assets   with
                  variable  rates are computed  based on
1122(d)(4)(ix)    the related pool asset documents.
--------------------------------------------------------------------------------

                                      F-20
<PAGE>

--------------------------------------------------------------------------------
               Servicing Criteria                              Applicable
                                                           Servicing Criteria
--------------------------------------------------------------------------------
Reference                         Criteria
--------------------------------------------------------------------------------
                  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
1122(d)(4)(x)     transaction agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(xi)    transaction agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(xii)   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
1122(d)(4)(xiii)  transaction agreements.
--------------------------------------------------------------------------------
                  Delinquencies,     charge-offs     and
                  uncollectible  accounts are recognized
                  and  recorded in  accordance  with the
1122(d)(4)(xiv)   transaction agreements.
--------------------------------------------------------------------------------
                  Any  external   enhancement  or  other
                  support, identified in Item 1114(a)(1)
                  through (3) or Item 1115 of Regulation
                  AB, is  maintained as set forth in the
1122(d)(4)(xv)    transaction agreements.
--------------------------------------------------------------------------------

                                      F-21
<PAGE>

                                    EXHIBIT G

                             MORTGAGE LOAN SCHEDULE

                               [On file with RFC]

                                       G-1
<PAGE>

                                    EXHIBIT H

                          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#:
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

                                      H-1
<PAGE>

                                   EXHIBIT I-1

                    FORM OF TRANSFER AFFIDAVIT AND AGREEMENT

STATE OF             )
                     ) ss.:
COUNTY OF            )

      [NAME OF  OFFICER],  being  first  duly  sworn,  deposes,  represents  and
warrants as follows:

      1. That he is [Title of Officer] of [Name of Owner]  (record or beneficial
owner of the Home Equity Loan 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 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.

                                     I-1-1
<PAGE>

      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
of 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,  clauses  (iii)(A) and (iii)(B) of Section 5.02(g) 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(e)).  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.

                                     I-1-2
<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. (a) The Owner is not an employee benefit plan or other plan subject to
the prohibited transaction provisions of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or Section 4975 of the Code (each, a "Plan"),
or any Person (including, without limitation, an insurance company investing its
general account,  an investment  manager,  a named fiduciary or a trustee of any
Plan) who is using "plan assets,"  within the meaning of the U.S.  Department of
Labor regulation promulgated at 29 C.F.R. ss. 2510.3-101, as modified by Section
3(42)  of  ERISA,  of  any  Plan  (each,  a  "Plan  Investor")  to  effect  such
acquisition; or

            (b) The Owner has provided the Trustee, the Depositor and the Master
Servicer  with an  opinion of counsel  acceptable  to and in form and  substance
satisfactory  to the Trustee,  the Depositor,  the Master Servicer to the effect
that the purchase and holding of Class R[-__]  Certificates is permissible under
applicable  law,  will not  constitute  or result in any  non-exempt  prohibited
transaction  under  Section  406 of  ERISA  or  Section  4975  of the  Code  (or
comparable  provisions of any  subsequent  enactments)  and will not subject the
Trustee,  the  Depositor or the Master  Servicer to any  obligation or liability
(including  obligations or liabilities  under ERISA or Section 4975 of the Code)
in addition to those  undertaken in the Pooling and Servicing  Agreement,  which
opinion of counsel shall not be an expense of the Trustee,  the Depositor or the
Master Servicer.

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

      Capitalized  terms used but not  defined  herein  shall have the  meanings
assigned in the Pooling and Servicing Agreement.

                                     I-1-3
<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___.

                                     I-1-4
<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.

                                     I-1-5
<PAGE>

      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
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 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.

                                     I-1-6
<PAGE>

      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 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.

      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.

                                     I-1-7
<PAGE>

      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
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)(1)  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.

      Effect on Other  Documents.  Rev. Proc.  2001-12  (2001-3  I.R.B.  335) is
obsolete for transfers of noneconomic  residual interests in REMICs occurring on
or after August 19, 2002.

                                     I-1-8
<PAGE>

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

                                      * * *

                                     I-1-9
<PAGE>

                                   EXHIBIT I-2

                         FORM OF TRANSFEROR CERTIFICATE

                                                     __________________, 200__

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

[_____]
[_____]
[_____]
[_____]

Attn: Structured Finance/RFMSII Series 20[__]-[___]

                  Re:   Home  Equity  Loan  Pass-Through  Certificates,   Series
                        20[__]-[___], 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 Home Equity Loan  Pass-Through  Certificates,
Series 20[__]-[___], Class R-[__] (the "Certificates"), pursuant to Section 5.02
of the Pooling and Servicing Agreement (the "Pooling and Servicing  Agreement"),
dated as of [_____] 1, 20[__] among Residential  Funding Mortgage Securities II,
Inc., as seller (the "Company"),  Residential  Funding  Company,  LLC, as master
servicer,  and [_____], as trustee and supplemental  interest trust trustee (the
"Trustee" and "Supplemental  Interest Trust Trustee,"  respectively).  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 I-1. The Seller does
not know or believe that any representation contained therein is false.

                                     I-2-1
<PAGE>

            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 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 Purchaser is
not both a United States Person and a Permitted Transferee.

                                             Very truly yours,

                                             ___________________________________
                                             (Seller)

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                     I-2-2
<PAGE>

                                    EXHIBIT J

                     FORM OF INVESTOR REPRESENTATION LETTER

                              ______________, 20__

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

[_____]
[_____]
[_____]
[_____]

Attn: Structured Finance/RFMSII Series 20[__]-[___]

Residential Funding Company, LLC
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, MN  55437

            Re:   Home   Equity   Loan   Pass-Through    Certificates,    Series
                  20[__]-[___], [Class SB]

Ladies and Gentlemen:

            _________________________ (the "Purchaser") intends to purchase from
___________________________  (the "Seller")  $_____________  Initial Certificate
Principal  Balance  of  Home  Equity  Loan  Pass-Through  Certificates,   Series
20[__]-[___], Class SB (the "Certificates"),  issued pursuant to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of [_____]
1, 20[__] among Residential Funding Mortgage Securities II, Inc., as seller (the
"Company"),  Residential  Funding Company,  LLC, as master servicer (the "Master
Servicer"), and [_____], as trustee and supplemental interest trust trustee (the
"Trustee" and "Supplemental  Interest Trust Trustee,"  respectively).  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  the  transfer  of  the
            Certificates  and (e) the  Certificates  will  bear a legend  to the
            foregoing effect.

                                      J-1
<PAGE>

                  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 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

                                      J-2
<PAGE>

            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 hereby certifies, represents and warrants to,
            and covenants with the Trustee,  the Company and the Master Servicer
            that the following statements in (a) or (b) are correct:

                        (a) 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  Internal  Revenue
                  Code of 1986, as amended (the "Code") (each, a "Plan"), or any
                  Person (including,  without  limitation,  an insurance company
                  investing its general account,  an investment manager, a named
                  fiduciary  or a  trustee  of  any  Plan)  who is  using  "plan
                  assets,"  within the meaning of the U.S.  Department  of Labor
                  regulation  promulgated  at  29  C.F.R.  ss.  2510.3-101,   as
                  modified by Section 3(42) of ERISA, of any Plan (each, a "Plan
                  Investor"), to effect such acquisition; or

                        (b) The Purchaser has provided the Trustee,  the Company
                  and the Master Servicer with an opinion of counsel  acceptable
                  to and in form and substance  satisfactory to the Trustee, the
                  Company  and  the  Master  Servicer  to the  effect  that  the
                  purchase and holding of the Certificates is permissible  under
                  applicable   law,  will  not   constitute  or  result  in  any
                  non-exempt  prohibited  transaction under Section 406 of ERISA
                  or Section 4975 of the Code (or  comparable  provisions of any
                  subsequent  enactments) and will not subject the Trustee,  the
                  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 the
                  Pooling  and  Servicing  Agreement,  which  opinion of counsel
                  shall not be an expense  of the  Trustee,  the  Company or the
                  Master Servicer.

      In addition,  the Purchaser hereby certifies,  represents and warrants to,
and covenants  with, the Trustee,  the Company and the Master  Servicer that the
Purchaser  will not  transfer the  Certificates  to any  transferee  unless such
transferee meets the requirements set forth in either (a) or (b) above.

                                             Very truly yours,

                                             (Purchaser)

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                      J-3
<PAGE>

                                    EXHIBIT K

                    FORM OF TRANSFEROR REPRESENTATION LETTER

                                   _____________________________, 20____

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

[_____]
[_____]

Attn: Structured Finance/RFMSII Series 20[__]-[___]

                  Re:   Home  Equity  Loan  Pass-Through  Certificates,   Series
                        20[__]-[___], [Class SB]

Ladies and Gentlemen:

            In connection  with the sale by (the "Seller") to (the  "Purchaser")
of $ Initial  Certificate  Principal  Balance of Home Equity  Loan  Pass-Through
Certificates,  Series  20[__]-[___],  Class  SB  (the  "Certificates"),   issued
pursuant to the Pooling and  Servicing  Agreement  (the  "Pooling and  Servicing
Agreement"),  dated as of [_____] 1, 20[__] among  Residential  Funding Mortgage
Securities II, Inc., as seller (the  "Company"),  Residential  Funding  Company,
LLC, as master servicer, and [_____], as trustee and supplemental interest trust
trustee (the "Trustee" and "Supplemental Interest Trust Trustee," respectively).
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.

                                      K-1
<PAGE>

                                             Very truly yours,

                                             ___________________________________
                                             (Seller)

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                      K-2
<PAGE>

                                    EXHIBIT L

                   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  Subservicer  will be
entitled to any  reimbursement  pursuant to Section 4.02(a) on such Distribution
Date for Advances or Subservicer  Advances  previously made,  (which will not be
Advances or  Subservicer  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  Subservicer  Advances  reimbursed  pursuant to
Section  4.02(a),  to the extent such Advances or Subservicer  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 SB  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 SB  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 SB  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 SB 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 SB 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  SB
Certificates will not be covered by the Subordinate Certificate Loss Obligation.

                                      L-1
<PAGE>

            (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 (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 SB 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 SB 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

                                      L-2
<PAGE>

rated  the  Class SB  Certificates  at the  request  of the  Company  that  such
substitution  shall not lower the rating on the Class SB Certificates  below the
lesser of (a) the  then-current  rating assigned to the Class SB Certificates by
such  rating  agency  and (b) the  original  rating  assigned  to the  Class  SB
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  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 SB 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 SB  Certificates  below  the  lesser of (a) the
then-current  rating assigned to the Class SB Certificates by such rating agency
and (b) the original rating assigned to the Class SB Certificates by such rating
agency,  unless  (A)  the  Holder  of  100%  of the  Class  SB  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 supersession (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 supersession  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.

                                      L-3
<PAGE>

                                    EXHIBIT M

                            FORM OF LIMITED GUARANTY

                RESIDENTIAL FUNDING MORTGAGE SECURITIES II, INC.

                   Home Equity Loan Pass-Through Certificates
                               Series 20[__]-[___]

                                                          ____________, 200__

[____________]
[____________]
[____________]
Attn: Structured Finance/RFMSII Series 20[__]-[___]

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, 20[__] (the "Servicing  Agreement"),
among  Residential   Funding  Mortgage  Securities  II,  Inc.  (the  "Company"),
Residential Funding and [_____] (the "Trustee" and "Supplemental  Interest Trust
Trustee,"  respectively)  as amended by Amendment  No. ___ thereto,  dated as of
________, with respect to the Home Equity Loan Pass-Through Certificates, Series
20[__]-[___] (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 SB
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 Residential Funding
to perform its Subordinate Certificate Loss Obligation when and

                                      M-1
<PAGE>

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, without regard to the conflicts of law principles
thereof,  other  than  Sections  5-1401  and  5-1402  of the  New  York  General
Obligations Law.

            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.

                                      M-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 FUNDING MORTGAGE
  SECURITIES II, INC.

By: ______________________
Name: ____________________
Title: ___________________

                                      M-3
<PAGE>

                                    EXHIBIT N

          FORM OF LENDER CERTIFICATION FOR ASSIGNMENT OF MORTGAGE LOAN

                                                    __________________, 20____

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

[_____]
[_____]

Attn: Structured Finance/RFMSII Series 20[__]-[___]

                  Re:   Home  Equity  Loan  Pass-Through  Certificates,   Series
                        20[__]-[___] 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, 20[__] among  Residential  Funding  Mortgage  Securities II, 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.

                                      N-1
<PAGE>

                                             Very truly yours,

                                             ___________________________________
                                             (Lender)

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                      N-2
<PAGE>

                                    EXHIBIT O

                   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,  20[__]  among
Residential  Funding  Company,  LLC as Master Servicer (the "Master  Servicer"),
Residential  Funding  Mortgage  Securities  II,  Inc. as  depositor  pursuant to
Section 5.02 of the Agreement and [_____], as trustee and supplemental  interest
trust  trustee  (the  "Trustee"  and  "Supplemental   Interest  Trust  Trustee,"
respectively), 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.

                                      O-1
<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 Master Servicer.

                  d.  Neither  the Buyer nor  anyone  acting on its  behalf  has
            offered,  transferred,  pledged,  sold or otherwise  disposed of the
            Rule 144A  Securities,  any interest in the 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  plan or other plan subject to
            the  prohibited  transaction  provisions of the Employee  Retirement
            Income Security Act of 1974, as amended  ("ERISA"),  or Section 4975
            of the Internal Revenue Code of 1986, as amended (the "Code") (each,
            a  "Plan"),  or  any  Person  (including,   without  limitation,  an
            insurance  company  investing  its general  account,  an  investment
            manager,  a named  fiduciary  or a trustee of any Plan) who is using
            "plan  assets,"  within the meaning of the U.S.  Department of Labor
            regulation  promulgated at 29 C.F.R. ss. 2510.3-101,  as modified by
            Section 3(42) of ERISA,  of any Plan (each, a "Plan  Investor"),  to
            effect such acquisition; or

                  (b.) has provided the Trustee,  the  Depositor  and the Master
            Servicer  with an opinion of counsel  acceptable  to and in form and
            substance  satisfactory to the Trustee, the Depositor and the Master
            Servicer  to the effect  that the  purchase  and holding of Class SB
            Certificates   is  permissible   under   applicable  law,  will  not
            constitute or result in any non-exempt prohibited  transaction under
            Section  406 of ERISA  or  Section  4975 of the Code (or  comparable
            provisions of any subsequent enactments) and will not subject

                                      O-2
<PAGE>

            the Trustee,  the Depositor or the Master Servicer to any obligation
            or liability  (including  obligations or liabilities  under ERISA or
            Section  4975 of the Code) in  addition to those  undertaken  in the
            Pooling and Servicing Agreement,  which opinion of counsel shall not
            be an expense of the Trustee, the Depositor or the Master Servicer.

                  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.

                            [SIGNATURE PAGE FOLLOWS]

                                      O-3
<PAGE>

            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: _____________________________

                                      O-4
<PAGE>

                              ANNEX 1 TO EXHIBIT O

            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.

                                      O-5
<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 1are 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.

                                      O-6
<PAGE>

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

  ___           ___     Will the Buyer be purchasing the Rule 144A
  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: _____________________________

                                      O-7
<PAGE>

                              ANNEX 2 TO EXHIBIT O

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

              [For Buyers That Are Registered Investment Companies]

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

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

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

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

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

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

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

                                      O-8
<PAGE>

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

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

                                             ___________________________________
                                             Print Name of Buyer

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                             IF AN ADVISER:

                                             ___________________________________
                                             Print Name of Buyer

                                             Date: _____________________________

                                      O-9
<PAGE>

                                    EXHIBIT P

                                   [RESERVED]

                                      P-1
<PAGE>

                                   EXHIBIT Q-1

                       FORM OF ERISA REPRESENTATION LETTER

                           [For Class B Certificates]

                                                          ______________, 20__

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

[_____]
[_____]
Attn: Structured Finance/RFMSII Series 20[__]-[___]

Residential Funding Company, LLC
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, MN  55437

      Re:   Home Equity Loan  Pass-Through  Certificates,  Series  20[__]-[___],
            Class [A-__], Class M-[_]

Ladies and Gentlemen:

            _________________________ (the "Purchaser") intends to purchase from
___________________________  (the "Seller")  $_____________  Initial Certificate
Principal  Balance  of  Home  Equity  Loan  Pass-Through  Certificates,   Series
20[__]-[___], Class __ (the "Certificates"),  issued pursuant to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of [_____]
1, 20[__] among Residential Funding Mortgage Securities II, Inc., as seller (the
"Depositor"),  Residential Funding Company, LLC, as master servicer (the "Master
Servicer"), and [_____], as trustee and supplemental interest trust trustee (the
"Trustee" and "Supplemental  Interest Trust Trustee,"  respectively).  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  Depositor,  the Trustee and the Master
Servicer that:

            (a) 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
Internal Revenue Code of 1986, as amended (the "Code") (each, a "Plan"),  or any
Person (including,  an investment manager, a named fiduciary or a trustee of any
Plan) who is using "plan assets," within the meaning of the U.S. Department of

                                     Q-1-1
<PAGE>

Labor regulation promulgated at 29 C.F.R. ss. 2510.3-101, as modified by Section
3(42)  of  ERISA,  of any  Plan  (each,  a  "Plan  Investor"),  to  effect  such
acquisition; or

            (b) The Purchaser is an insurance company,  the source of funds used
to purchase or hold the Certificates (or any interest  therein) is an "insurance
company  general  account" (as defined in U.S.  Department  of Labor  Prohibited
Transaction  Class Exemption  ("PTCE")  95-60),  and the conditions set forth in
Sections I and III of PTCE 95-60 have been satisfied.

            In addition, the Purchaser hereby certifies, represents and warrants
to, and covenants with, the Trustee,  the Depositor and the Master Servicer that
the Purchaser will not transfer the  Certificates to any transferee  unless such
transferee meets the requirements set forth in either (a) or (b) above.

                                             Very truly yours,

                                             ___________________________________
                                             (Purchaser)

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                     Q-1-2
<PAGE>

                                   EXHIBIT Q-2

                       FORM OF ERISA REPRESENTATION LETTER
               [for Class A Certificates and Class M Certificates]

                                                                          [date]

Residential Funding Company, LLC
8400 Normandale Lake Boulevard, Suite 250
Minneapolis, Minnesota 55437

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

[_____]
[_____]
Attention:  Structured Finance/RFMSII Series 20[__]-[___]

      Re:   Residential  Funding  Mortgage  Securities II, Inc. Home Equity Loan
            Pass-Through Certificates, Series 20[__]-[___] Class __

Ladies and Gentlemen:

      _________________________  (the  "Purchaser")  intends  to  purchase  from
___________________________  (the "Seller")  $_____________  Initial Certificate
Principal  Balance  of  Home  Equity  Loan  Pass-Through  Certificates,   Series
20[__]-[___], Class __ (the "Certificates"),  issued pursuant to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of [_____]
1, 20[__] among Residential Funding Mortgage Securities II, Inc., as seller (the
"Depositor"),  Residential Funding Company, LLC, as master servicer (the "Master
Servicer"), and [_____], as trustee and supplemental interest trust trustee (the
"Trustee" and "Supplemental  Interest Trust Trustee,"  respectively).  All terms
used herein and not  otherwise  defined shall have the meanings set forth in the
Pooling and Servicing Agreement.

      (1) As of any date prior to the  termination  of the Swap  Agreement,  the
Purchaser hereby  certifies,  represents and warrants to, and covenants with the
Depositor, the Trustee and the Master Servicer that:

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

                                     Q-2-1
<PAGE>

      (b)   The Purchaser's acquisition of the above referenced certificates and
            the  right  to  receive  (and  its  receipt  of)  payments  from the
            supplemental  interest  trust  are  eligible  for  exemptive  relief
            available under at least one of the following exemptions:

            (i)   Prohibited   Transaction   Class  Exemption   ("PTCE")  84-14,
                  regarding  transactions  negotiated by independent  "qualified
                  professional asset managers";

            (ii)  PTCE 90-1,  regarding  investments by insurance company pooled
                  separate accounts;

            (iii) PTCE  91-38,   regarding   investments   by  bank   collective
                  investment funds;

            (iv)  PTCE 95-60, regarding investments by insurance company general
                  accounts;

            (v)   PTCE  96-23,  regarding  transactions  negotiated  by  certain
                  in-house asset managers; or

            (vi)  Section 408(b)(17) of ERISA,  regarding transactions between a
                  Plan and a person or an entity  that is a party in interest to
                  such Plan (other than a party in interest that is a fiduciary,
                  or  its  affiliate,   that  has  or  exercises   discretionary
                  authority or control or renders investment advice with respect
                  to the assets of the Plan involved in the transaction)  solely
                  by reason of providing  services to the Plan,  but only if the
                  Plan  pays  no  more,  or  receives  no  less,  than  adequate
                  consideration.

      In addition,  the Purchaser hereby certifies,  represents and warrants to,
and covenants  with,  the  Depositor,  the Trustee and the Master  Servicer that
prior to the termination of the Swap Agreement,  the Purchaser will not transfer
the Certificates to any transferee unless that transferee meets the requirements
in either (a) or (b) above.

      (2) As of any  date  after  the  termination  of the Swap  Agreement,  the
Purchaser hereby  certifies,  represents and warrants to, and covenants with the
Depositor, the Trustee and the Master Servicer that:

      (a)   The Purchaser is not a Plan or a Plan Investor;

      (b)   The  Purchaser  has  acquired  and is holding  the  Certificates  in
            reliance  on  U.S.   Department  of  Labor  Prohibited   Transaction
            Exemption  ("PTE") 94-29,  59 Fed. Reg.  14674 (March 29, 1994),  as
            most recently amended by 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 or Moody's; or

                                     Q-2-2
<PAGE>

      (c)   The Purchaser is an insurance  company,  the source of funds used to
            purchase or hold the  Certificates  (or any interest  therein) is an
            "insurance  company general account" (as defined in U.S.  Department
            of Labor Prohibited Transaction Class Exemption ("PTCE") 95-60), and
            the  conditions  set forth in  Sections I and III of PTCE 95-60 have
            been satisfied.

      In addition,  the Purchaser hereby certifies,  represents and warrants to,
and covenants  with,  the  Depositor,  the Trustee and the Master  Servicer that
after the termination of the Swap Agreement, the Purchaser will not transfer the
Certificates to any transferee  unless that transferee meets the requirements in
either (a), (b) or (c) above.

                                             Very truly yours,

                                             By: _______________________________
                                             Name: _____________________________
                                             Title: ____________________________

                                     Q-2-3
<PAGE>

                                   EXHIBIT R-1

                         FORM OF FORM 10-K CERTIFICATION

      I, [identify the certifying individual], certify that:

      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
Pooling and Servicing  Agreement  dated  ____________  (the  "Agreement")  among
Residential Funding Mortgage  Securities II, Inc.,  Residential Funding Company,
LLC (the "Master Servicer") and [Name of Trustee] (the "Trustee");

      (1) Based on my  knowledge,  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;

      (2) 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;

      (3) I am responsible for reviewing the activities  performed by the Master
Servicer  and based on my  knowledge  and the  compliance  review  conducted  in
preparing the servicer  compliance  statement required in this report under Item
1123 of  Regulation  AB and except as  disclosed  in the  Exchange  Act periodic
reports,  the Master Servicer has fulfilled its obligations under the Agreement;
and

      (4) All of the reports on assessment of compliance with servicing criteria
for asset-backed  securities and their related attestation reports on assessment
of compliance with servicing criteria for asset-backed securities required to be
included  in this  report in  accordance  with Item  1122 of  Regulation  AB and
Exchange  Act Rules  13a-18 and 15d-18 have been  included as an exhibit to this
report,  except as otherwise disclosed in this report. Any material instances of
noncompliance  described in such  reports have been  disclosed in this report on
Form 10-K.

      In  giving  the  certifications  above,  I have  reasonably  relied on the
information provided to me by the following unaffiliated parties: [the Trustee].

Date: ____________

_________________________________*
[Signature]
Name:
Title:

* - to be signed by the senior  officer in charge of the servicing  functions of
the Master Servicer

                                     R-1-1
<PAGE>

                                   EXHIBIT R-2

             FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE

      The  undersigned,  a  Responsible  Officer of [_____] (the  "Trustee"  and
"Supplemental Interest Trust Trustee," respectively) certifies that:

      1. 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  [_____]  1,  20[__]  (the  "Agreement")  by  and  among
Residential Funding Mortgage Securities II, Inc. (the "Depositor"),  Residential
Funding Company,  LLC (the "Master Servicer") and the Trustee in accordance with
the standards set forth therein.

      2. 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 Section  4.03(f)(I)  of 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  THEREOF,   I  have  duly  executed  this  certificate  as  of
____________, 20___.

                                             _________________________________
                                             [Signature]
                                             Name:
                                             Title:

                                     R-2-1
<PAGE>

                                    EXHIBIT S

         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 Terms (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

                                      S-1
<PAGE>

                                    EXHIBIT T

                  SCHEDULE OF SWAP AGREEMENT NOTIONAL BALANCES

                                      T-1
<PAGE>

                                    EXHIBIT U

                                 SWAP AGREEMENT

                                      U-1
<PAGE>

                                    EXHIBIT V

         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 below as "Applicable  Servicing
Criteria":

--------------------------------------------------------------------------------
               Servicing Criteria                              Applicable
                                                           Servicing Criteria
--------------------------------------------------------------------------------
Reference                         Criteria
--------------------------------------------------------------------------------
                       General Servicing Considerations
--------------------------------------------------------------------------------
                  Policies and procedures are instituted
                  to monitor  any  performance  or other
                  triggers  and  events  of  default  in
                  accordance    with   the   transaction
1122(d)(1)(i)     agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(1)(ii)    servicing activities.
--------------------------------------------------------------------------------
                  Any  requirements  in the  transaction
                  agreements   to   maintain  a  back-up
                  servicer   for  the  pool  assets  are
1122(d)(1)(iii)   maintained.
--------------------------------------------------------------------------------
                  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
1122(d)(1)(iv)    transaction agreements.
--------------------------------------------------------------------------------
                    Cash Collection and Administration
--------------------------------------------------------------------------------
                  Payments on pool assets are  deposited
                  into the  appropriate  custodial  bank
                  accounts  and  related  bank  clearing   |X| (as to accounts
                  accounts  no more  than  two  business        held by Trustee)
                  days following receipt,  or such other
                  number  of  days   specified   in  the
1122(d)(2)(i)     transaction agreements.
--------------------------------------------------------------------------------
                  Disbursements  made via wire  transfer
                  on  behalf  of  an  obligor  or  to an   |X| (as to investors
                  investor  are made only by  authorized              only)
1122(d)(2)(ii)    personnel.
--------------------------------------------------------------------------------
                  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
1122(d)(2)(iii)   agreements.
--------------------------------------------------------------------------------
                  The   related    accounts    for   the
                  transaction,   such  as  cash  reserve
                  accounts or accounts  established as a   |X| (as to accounts
                  form  of  overcollateralization,   are        held by Trustee)
                  separately   maintained   (e.g.,  with
                  respect to commingling of cash) as set
1122(d)(2)(iv)    forth in the transaction agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(2)(v)     Act.
--------------------------------------------------------------------------------
                  Unissued  checks are safeguarded so as
1122(d)(2)(vi)    to prevent unauthorized access.
--------------------------------------------------------------------------------
                  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
1122(d)(2)(vii)   transaction agreements.
--------------------------------------------------------------------------------

                                       V-1
<PAGE>

--------------------------------------------------------------------------------
               Servicing Criteria                              Applicable
                                                           Servicing Criteria
--------------------------------------------------------------------------------
Reference                         Criteria
--------------------------------------------------------------------------------
                   Investor Remittances and Reporting
--------------------------------------------------------------------------------
                  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
1122(d)(3)(i)     the servicer.
--------------------------------------------------------------------------------
                  Amounts due to investors are allocated
                  and   remitted  in   accordance   with
                  timeframes,  distribution priority and          |X|
                  other   terms   set   forth   in   the
1122(d)(3)(ii)    transaction agreements.
--------------------------------------------------------------------------------
                  Disbursements  made to an investor are
                  posted within two business days to the
                  servicer's  investor records,  or such          |X|
                  other number of days  specified in the
1122(d)(3)(iii)   transaction agreements.
--------------------------------------------------------------------------------
                  Amounts  remitted to investors per the
                  investor  reports agree with cancelled
                  checks,  or other form of payment,  or          |X|
1122(d)(3)(iv)    custodial bank statements.
--------------------------------------------------------------------------------
                        Pool Asset Administration
--------------------------------------------------------------------------------
                  Collateral  or security on pool assets
                  is   maintained  as  required  by  the
                  transaction   agreements   or  related
1122(d)(4)(i)     asset pool documents.
--------------------------------------------------------------------------------
                  Pool assets and related  documents are
                  safeguarded   as   required   by   the
1122(d)(4)(ii)    transaction agreements
--------------------------------------------------------------------------------
                  Any     additions,     removals     or
                  substitutions  to the  asset  pool are
                  made,   reviewed   and   approved   in
                  accordance   with  any  conditions  or
                  requirements    in   the   transaction
1122(d)(4)(iii)   agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(iv)    related pool asset documents.
--------------------------------------------------------------------------------
                  The servicer's  records  regarding the
                  pool assets agree with the  servicer's
                  records  with  respect to an obligor's
1122(d)(4)(v)     unpaid principal balance.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(vi)    documents.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(vii)   transaction agreements.
--------------------------------------------------------------------------------
                  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.,
1122(d)(4)(viii)  illness or unemployment).
--------------------------------------------------------------------------------
                  Adjustments to interest rates or rates
                  of  return   for  pool   assets   with
                  variable  rates are computed  based on
1122(d)(4)(ix)    the related pool asset documents.
--------------------------------------------------------------------------------

                                       V-2
<PAGE>

--------------------------------------------------------------------------------
               Servicing Criteria                              Applicable
                                                           Servicing Criteria
--------------------------------------------------------------------------------
Reference                         Criteria
--------------------------------------------------------------------------------
                  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
1122(d)(4)(x)     transaction agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(xi)    transaction agreements.
--------------------------------------------------------------------------------
                  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
1122(d)(4)(xii)   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
1122(d)(4)(xiii)  transaction agreements.
--------------------------------------------------------------------------------
                  Delinquencies,     charge-offs     and
                  uncollectible  accounts are recognized
                  and  recorded in  accordance  with the
1122(d)(4)(xiv)   transaction agreements.
--------------------------------------------------------------------------------
                  Any  external   enhancement  or  other
                  support, identified in Item 1114(a)(1)
                  through (3) or Item 1115 of Regulation          |X|
                  AB, is  maintained as set forth in the
1122(d)(4)(xv)    transaction agreements.
--------------------------------------------------------------------------------

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

                                       V-3
<PAGE>

                                   EXHIBIT W-1

              FORM OF CERTIFICATE TO BE GIVEN BY CERTIFICATE OWNER

    [Euroclear                         Cedel, societe anonyme
    151 Boulevard Jacqmain             67 Boulevard Grand-Duchesse Charlotte
    B-1210 Brussels, Belgium           L-1331 Luxembourg]

            Re:  Residential  Funding Mortgage  Securities II, Inc., Home Equity
            Loan Pass-Through Certificates,  Series 20[__]-[___], Class [B][SB],
            issued  pursuant to the Pooling and Servicing  Agreement dated as of
            [_____] 1, 20[__] among Residential  Funding Mortgage Securities II,
            Inc.,  Residential Funding Company, LLC, and [_____], as Trustee and
            Supplemental Interest Trust Trustee (the "Certificates").

      This is to  certify  that as of the date  hereof  and  except as set forth
below, the beneficial  interest in the Certificates  held by you for our account
is owned by persons that are not U.S.  persons (as defined in Rule 901 under the
Securities Act of 1933, as amended).

      The  undersigned  undertakes  to advise you promptly by tested telex on or
prior to the date on which you intend to submit your  certification  relating to
the Certificates  held by you in which the undersigned has acquired,  or intends
to acquire, a beneficial  interest in accordance with your operating  procedures
if any applicable  statement  herein is not correct on such date. In the absence
of any such notification,  it may be assumed that this certification  applies as
of such date.

      [This certification excepts beneficial interests in and does not relate to
U.S. $_________ principal amount of the Certificates  appearing in your books as
being held for our  account  but that we have sold or as to which we are not yet
able to certify.]

      We  understand  that this  certification  is required in  connection  with
certain  securities laws in the United States of America.  If  administrative or
legal  proceedings  are commenced or  threatened  in connection  with which this
certification is or would be relevant,  we irrevocably  authorize you to produce
this   certification  or  a  copy  thereof  to  any  interested  party  in  such
proceedings.

Dated:_________________________,*/     By:________________________,
                                               Account Holder

----------
*     Certification  must be dated on or after the 15th day  before  the date of
      the Euroclear or Cedel certificate to which this certification releases.

                                     W-1-1
<PAGE>

                                   EXHIBIT W-2

              FORM OF CERTIFICATE TO BE GIVEN BY EUROCLEAR OR CEDEL

      [_____]

      Re:   Residential  Funding Mortgage  Securities II, Inc., Home Equity Loan
            Pass-Through  Certificates,   Series  20[__]-[___],  Class  [B][SB],
            issued  pursuant to the Pooling and Servicing  Agreement dated as of
            [_____] 1, 20[__] among Residential  Funding Mortgage Securities II,
            Inc.,  Residential Funding Company, LLC, and [_____], as Trustee and
            Supplemental Interest Trust Trustee (the "Certificates").

      This is to certify that, based solely on  certifications  we have received
in  writing,  by  tested  telex  or  by  electronic   transmission  from  member
organizations appearing in our records as persons being entitled to a portion of
the principal amount set forth below (our "Member Organizations") as of the date
hereof,  $____________  principal amount of the Certificates is owned by persons
(a) that are not U.S.  persons (as defined in Rule 901 under the  Securities Act
of  1933.  as  amended  (the  "Securities  Act"))  or (b)  who  purchased  their
Certificates  (or interests  therein) in a transaction or transactions  that did
not require registration under the Securities Act.

      We further  certify  (a) that we are not  making  available  herewith  for
exchange any portion of the related Temporary  Regulation S Global Class [B][SB]
Certificate  excepted in such  certifications and (b) that as of the date hereof
we have not received any  notification  from any of our Member  Organizations to
the effect that the  statements  made by them with respect to any portion of the
part  submitted  herewith  for  exchange are no longer true and cannot be relied
upon as of the date hereof

      We  understand  that this  certification  is required in  connection  with
certain  securities laws of the United States of America.  If  administrative or
legal  proceedings  are commenced or  threatened  in connection  with which this
certification is or would be relevant,  we irrevocably  authorize you to produce
this certification or a copy hereof to any interested party in such proceedings.

Date:___________________*               Yours faithfully,

* To be dated no earlier                By: _______________________________
than the Effective Date.                [Morgan  Guaranty  Trust  Company of New
                                        York,  Brussels  Office,  as Operator of
                                        the  Euroclear  Clearance  System Cedel,
                                        Societe anonyme]

                                     W-2-1
<PAGE>

                                    EXHIBIT X

                                     FORM OF
                      CERTIFICATE TO BE GIVEN BY TRANSFEREE
                    OF BENEFICIAL INTEREST IN A REGULATION S
                             BOOK-ENTRY CERTIFICATE

     Euroclear                             Cedel, societe anonyme
     151 Boulevard Jacqmain                67 Boulevard Grand-Duchesse Charlotte
     B- 1210 Brussels, Belgium             L- 1331 Luxembourg

            Re:   Residential  Funding Mortgage Securities II, Inc., Home Equity
                  Loan Pass-Through  Certificates,  Series  20[__]-[___],  Class
                  [B][SB],   issued   pursuant  to  the  Pooling  and  Servicing
                  Agreement  dated as of [_____]  1,  20[__]  among  Residential
                  Funding  Mortgage  Securities  II, Inc.,  Residential  Funding
                  Company,   LLC,  and  [_____],  as  Trustee  and  Supplemental
                  Interest Trust Trustee (the "Certificates").

      This is to  certify  that as of the date  hereof,  and except as set forth
below, for purposes of acquiring a beneficial interest in the Certificates,  the
undersigned certifies that it is not a U.S. person (as defined in Rule 901 under
the Securities Act of 1933, as amended).

      The  undersigned  undertakes  to advise you promptly by tested telex on or
prior to the date on which you intend to submit your  certification  relating to
the  Certificates  held by you in which the  undersigned  intends  to  acquire a
beneficial  interest  in  accordance  with  your  operating  procedures  if  any
applicable  statement  herein is not correct on such date. In the absence of any
such notification,  it may be assumed that this certification applies as of such
date.

      We  understand  that this  certification  is required in  connection  with
certain  securities laws in the United States of America.  If  administrative or
legal  proceedings  are commenced or  threatened  in connection  with which this
certification is or would be relevant,  we irrevocably  authorize you to produce
this   certification  or  a  copy  thereof  to  any  interested  party  in  such
proceedings.

Dated: ________________________                  By:____________________________

                                      X-1
<PAGE>

                                    EXHIBIT Y

                                     FORM OF
                      TRANSFER CERTIFICATE FOR EXCHANGE OR
                    TRANSFER FROM 144A BOOK-ENTRY CERTIFICATE
                     TO REGULATION S BOOK-ENTRY CERTIFICATE

                                     [_____]

            Re:   Residential  Funding Mortgage Securities II, Inc., Home Equity
                  Loan Pass-Through  Certificates,  Series  20[__]-[___],  Class
                  [B][SB],   issued   pursuant  to  the  Pooling  and  Servicing
                  Agreement  dated as of [_____] 1,  20[__]  (the  "Agreement"),
                  among  Residential   Funding  Mortgage  Securities  II,  Inc.,
                  Residential  Funding Company,  LLC and [_____], as Trustee and
                  Supplemental Interest Trust Trustee (the "Certificates").

      Capitalized  terms used but not  defined  herein  shall have the  meanings
given to them in the Agreement.

      This letter relates to U.S. $____________ principal amount of Certificates
that are held as a beneficial interest in the 144A Book-Entry Certificate (CUSIP
No.  ________)  with  DTC in the  name  of  [insert  name  of  transferor]  (the
"Transferor").  The  Transferor  has  requested  an  exchange or transfer of the
beneficial  interest for an interest in the Permanent  Regulation S Global Class
[B][SB]  Certificate  (CUSIP No. ________) to be held with  [Euroclear]  [Cedel]
through DTC.

      In  connection  with the request and in receipt of the  Certificates,  the
Transferor  does hereby  certify that the exchange or transfer has been effected
in accordance with the transfer  restrictions set forth in the Agreement and the
Certificates and:

            (a)  pursuant  to and in  accordance  with  Regulation  S under  the
      Securities Act of 1933, as amended (the "Securities Act"), and accordingly
      the Transferor does hereby certify that:

                  (i) the offer of the  Certificates was not made to a person in
            the United States of America,

                  (ii) at the time the buy order was originated,  the transferee
            was outside the United States of America or the  Transferor  and any
            person acting on its behalf reasonably  believed that the transferee
            was outside the United States of America,

                  (ii) the  transaction  was  executed  in,  on or  through  the
            facilities of a designated  offshore  securities  market and neither
            the Transferor nor any person

                                      Y-1
<PAGE>

            acting on its behalf  knows that the  transaction  was  pre-arranged
            with a buyer in the United States of America,**

                  (iii)  no  directed   selling   efforts   have  been  made  in
            contravention  of the  requirements  of Rule  903(b)  or  904(b)  of
            Regulation 5, as applicable,

                  (iv) the  transaction is not part of a plan or scheme to evade
            the registration requirements of the Securities Act, and

            (b) with respect to transfers made in reliance on Rule 144 under the
      Securities Act, the Transferor  does hereby certify that the  Certificates
      are being  transferred  in a  transaction  permitted by Rule 144 under the
      Securities Act.

      This  certification and the statements  contained herein are made for your
benefit and the benefit of the issuer and the [placement agent].

                                             [Insert name of Transferor]

Date: ________________            By: _______________________________
                                  Title: ____________________________

----------
**    Insert  one of these two  provisions,  which come from the  definition  of
      "offshore transactions" in Regulation S.

                                      Y-2
<PAGE>

                                    EXHIBIT Z

                                     FORM OF
                     INITIAL PURCHASER EXCHANGE INSTRUCTIONS

Depository Trust Company
55 Water Street
50th Floor
New York, New York 10041

            Re:   Residential  Funding Mortgage Securities II, Inc., Home Equity
                  Loan Pass-Through  Certificates,  Series  20[__]-[___],  Class
                  [B][SB],   issued   pursuant  to  the  Pooling  and  Servicing
                  Agreement  dated as of [_____]  1,  20[__]  (the  "Agreement")
                  among  Residential   Funding  Mortgage  Securities  II,  Inc.,
                  Residential Funding Company,  LLC, and [_____], as Trustee and
                  Supplemental Interest Trust Trustee (the "Certificates").

      Pursuant  to Section  5.02(e) of the  Agreement,  ________________________
(the  "Initial  Purchaser")  hereby  requests  that  $______________   aggregate
principal amount of the Certificates held by you for our account and represented
by the  Temporary  Regulation  S Global  Class  [B][SB]  Certificate  (CUSIP No.
________)  (as defined in the  Agreement)  be exchanged  for an equal  principal
amount represented by the Rule 144A Global Class [B][SB]  Certificate (CUSIP No.
_______) to be held by you for our account.

Date: _____________________________          [Initial Purchaser]

                                             By: _____________________
                                             Title: __________________

                                      AA-1EXHIBIT 4.2

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

                           FORM OF SERVICING AGREEMENT

                        RESIDENTIAL FUNDING COMPANY, LLC,
                               as Master Servicer

                          HOME LOAN TRUST 20[__]-[___],
                                    as Issuer

                                       and

                       [________________________________],
                              as Indenture Trustee

                             ______________________
                               SERVICING AGREEMENT
                     Dated as of [_______________], 200[___]

                             ______________________

                                   Home Loans

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

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

ARTICLE I DEFINITIONS .....................................................    1

    Section 1.01. Definitions .............................................    1

    Section 1.02. Other Definitional Provisions ...........................    1

    Section 1.03. Interest Calculations ...................................    2

ARTICLE II REPRESENTATIONS AND WARRANTIES .................................    2

    Section 2.01. Representations and Warranties Regarding
                  the Master Servicer .....................................    2

    Section 2.02. Representations and Warranties of the Issuer ............    4

    Section 2.03. Enforcement of Representations and Warranties ...........    4

ARTICLE III ADMINISTRATION AND SERVICING OF HOME LOANS ....................    5

    Section 3.01. The Master Servicer .....................................    5

    Section 3.02. Collection of Certain Home Loan Payments ................    8

    Section 3.03. Withdrawals from the Custodial Account ..................   11

    Section 3.04. Maintenance of Hazard Insurance; Property
                  Protection Expenses .....................................   12

    Section 3.05. Modification Agreements; Release or
                  Substitution of Lien ....................................   13

    Section 3.06. Trust Estate; Related Documents .........................   15

    Section 3.07. Realization Upon Defaulted Home Loans; Loss Mitigation ..   15

    Section 3.08. Issuer and Indenture Trustee to Cooperate ...............   17

    Section 3.09. Servicing Compensation; Payment of Certain Expenses
                  by Master Servicer ......................................   18

    Section 3.10. Annual Statement as to Compliance .......................   19

    Section 3.11. Annual Independent Public Accountants'
                  Servicing Report ........................................   19

    Section 3.12. Access to Certain Documentation and Information
                  Regarding the Home Loans ................................   20

    Section 3.13. Maintenance of Certain Servicing Insurance Policies .....   20

    Section 3.14. Information Required by the Internal Revenue
                  Service and Reports of Foreclosures and Abandonments
                  of Mortgaged Property ...................................   20

    Section 3.15. Optional Repurchase of Defaulted Home Loans .............   20

    Section 3.16. Limited Home Loan Repurchase Right ......................   20

ARTICLE IV SERVICING CERTIFICATE ..........................................   21

    Section 4.01. Statements to Securityholders ...........................   21

                                      -i-
<PAGE>

                                TABLE OF CONTENTS
                                  (continued)

                                                                            Page

    Section 4.02. Tax Reporting ...........................................   24

    Section 4.03. Calculation of Adjusted Issue Price .....................   24

    Section 4.04. Exchange Act Reporting ..................................   24

ARTICLE V PAYMENT ACCOUNT .................................................   26

    Section 5.01. Payment Account .........................................   26

ARTICLE VI THE MASTER SERVICER ............................................   26

    Section 6.01. Liability of the Master Servicer ........................   26

    Section 6.02. Merger or Consolidation of, or Assumption of
                  the Obligations of, the Master Servicer .................   26

    Section 6.03. Limitation on Liability of the Master Servicer and Others   27

    Section 6.04. Master Servicer Not to Resign ...........................   28

    Section 6.05. Delegation of Duties ....................................   28

    Section 6.06. Master Servicer to Pay Indenture Trustee's and
                  Owner Trustee's Fees and Expenses; Indemnification ......   29

ARTICLE VII DEFAULT .......................................................   30

    Section 7.01. Servicing Default .......................................   30

    Section 7.02. Indenture Trustee to Act; Appointment of Successor ......   32

    Section 7.03. Notification to Securityholders .........................   34

    Section 7.04. Servicing Trigger; Removal of Master Servicer ...........   34

ARTICLE VIII MISCELLANEOUS PROVISIONS .....................................   35

    Section 8.01. Amendment ...............................................   35

    Section 8.02. GOVERNING LAW ...........................................   35

    Section 8.03. Notices .................................................   35

    Section 8.04. Severability of Provisions ..............................   36

    Section 8.05. Third-Party Beneficiaries ...............................   36

    Section 8.06. Counterparts ............................................   36

    Section 8.07. Effect of Headings and Table of Contents ................   36

    Section 8.08. Termination Upon Purchase by the Master Servicer
                  or Liquidation of All Home Loans; Partial Redemption ....   36

    Section 8.09. Certain Matters Affecting the Indenture Trustee .........   37

    Section 8.10. Owner Trustee Not Liable for Related Documents ..........   37

ARTICLE IX COMPLIANCE WITH REGULATION AB ..................................   38

                                      -ii-
<PAGE>

                                TABLE OF CONTENTS
                                  (continued)

                                                                            Page

    Section 9.01. Intent of the Parties; Reasonableness ...................   38

    Section 9.02. Additional Representations and Warranties of
                  the Indenture Trustee ...................................   38

    Section 9.03. Information to Be Provided by the Indenture Trustee .....   39

    Section 9.04. Report on Assessment of Compliance and Attestation ......   39

    Section 9.05. Indemnification; Remedies ...............................   40

Exhibit A         Home Loans Schedule
Exhibit B         Power of Attorney
Exhibit C         Form of Request for Release
Exhibit D         Form of Form 10-K Certificate
Exhibit E         Form of Back-Up Certificate to Form 10-K Certificate
Exhibit F         Servicing Criteria to be Addressed in Assessment of Compliance

                                     -iii-

<PAGE>

      This is a Servicing Agreement,  dated as of  [________________],  200[___]
(the "Servicing Agreement"), among Residential Funding Company, LLC (the "Master
Servicer"), the Home Loan Trust 20[__]-[___] (the "Issuer") and
[______________________] (the "Indenture Trustee").

                          W I T N E S S E T H T H A T:

      WHEREAS,  pursuant  to the  terms of the  Home  Loan  Purchase  Agreement,
Residential  Funding  Company,  LLC (in its capacity as Seller) will sell to the
Depositor  the Home Loans  together  with the Related  Documents  on the Closing
Date;

      WHEREAS,  the  Depositor  will sell the Home  Loans and all of its  rights
under the Home Loan Purchase Agreement to the Issuer,  together with the Related
Documents on the Closing Date;

      WHEREAS,  pursuant  to the terms of the Trust  Agreement,  the Issuer will
issue and transfer to or at the direction of the Depositor, the Certificates;

      WHEREAS, pursuant to the terms of the Indenture, the Issuer will issue and
transfer to or at the direction of the Depositor, the Notes; and

      WHEREAS,  pursuant to the terms of this  Servicing  Agreement,  the Master
Servicer  will  service  the  Home  Loans   directly  or  through  one  or  more
Subservicers;

      NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

      Section 1.01.  Definitions.  For all purposes of this Servicing Agreement,
except as otherwise  expressly  provided herein or unless the context  otherwise
requires, capitalized terms not otherwise defined herein shall have the meanings
assigned  to such  terms  in the  Definitions  contained  in  Appendix  A to the
Indenture dated [______________],  200[__] (the "Indenture"),  between Home Loan
Trust  20[__]-[___],  as  issuer  and  [______________________],   as  indenture
trustee,  which is incorporated by reference herein. All other capitalized terms
used herein shall have the meanings specified herein.

      Section 1.02. Other Definitional Provisions. (a) All terms defined in this
Servicing Agreement shall have the defined meanings when used in any certificate
or other document made or delivered  pursuant  hereto unless  otherwise  defined
therein.

<PAGE>

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

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

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

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

      Section  1.03.  Interest   Calculations.   All  calculations  of  interest
hereunder  that are made in respect of the Loan  Balance of a Home Loan shall be
made in accordance  with the Mortgage Note. All  calculations of interest on the
Securities  (other  than the  Class A-1  Notes)  shall be made on the basis of a
30-day month and a year assumed to consist of 360 days.  Calculation of interest
on the Class A-1 Notes  shall be made on the basis of the actual  number of days
in the applicable  Interest  Accrual Period and a year assumed to consist of 360
days.  The  calculation  of the  Servicing  Fee  shall be made on the basis of a
30-day  month and a year  assumed  to consist  of 360 days.  All dollar  amounts
calculated  hereunder shall be rounded to the nearest penny with one-half of one
penny being rounded up.

                                   ARTICLE II

                         REPRESENTATIONS AND WARRANTIES

      Section  2.01.   Representations  and  Warranties   Regarding  the  Master
Servicer.  The Master Servicer represents and warrants to the Issuer and for the
benefit of the Indenture  Trustee,  as pledgee of the Home Loans, and the Credit
Enhancer, as of the Cut-off Date:

                                      -2-
<PAGE>

            (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  Master  Servicer  has the  power  and  authority  to make,
      execute,  deliver  and perform  this  Servicing  Agreement  and all of the
      transactions  contemplated under this Servicing  Agreement,  and has taken
      all necessary action to authorize the execution,  delivery and performance
      of this Servicing Agreement.  When executed and delivered,  this Servicing
      Agreement will constitute the legal,  valid and binding  obligation of the
      Master  Servicer  enforceable  in  accordance  with its  terms,  except as
      enforcement  of such  terms may be limited by  bankruptcy,  insolvency  or
      similar laws affecting the enforcement of creditors'  rights generally and
      by the availability of equitable remedies;

            (iii) The Master  Servicer is not  required to obtain the consent of
      any other Person or any consent,  license, approval or authorization from,
      or registration or declaration with, any governmental authority, bureau or
      agency in connection with the execution, delivery,  performance,  validity
      or  enforceability of this Servicing  Agreement,  except for such consent,
      license,  approval or  authorization,  or registration or declaration,  as
      shall have been obtained or filed, as the case may be;

            (iv) The execution and delivery of this Servicing  Agreement and the
      performance of the transactions contemplated hereby by the Master Servicer
      will not violate any  provision of any existing law or  regulation  or any
      order or decree of any court  applicable  to the  Master  Servicer  or any
      provision of the  certificate  of formation or limited  liability  company
      agreement of the Master  Servicer,  or constitute a material breach of any
      mortgage,  indenture,  contract  or other  agreement  to which the  Master
      Servicer is a party or by which the Master Servicer may be bound;

            (v) No  litigation  or  administrative  proceeding  of or before any
      court,  tribunal or  governmental  body is  currently  pending,  or to the
      knowledge of the Master Servicer  threatened,  against the Master Servicer
      or any of its  properties or with respect to this  Servicing  Agreement or
      the  Securities  which  in  the  opinion  of  the  Master  Servicer  has a
      reasonable  likelihood  of resulting in a material  adverse  effect on the
      transactions contemplated by this Servicing Agreement; and

            (vi) 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 Home Loans that are  registered
      with MERS.

      The foregoing representations and warranties shall survive any termination
of the Master Servicer hereunder.

      Section 2.02.  Representations  and  Warranties of the Issuer.  The Issuer
hereby represents and warrants to the Master Servicer and for the benefit of the
Indenture Trustee, as pledgee of the Home Loans, and the Credit Enhancer,  as of
the Cut-off Date:

                                      -3-
<PAGE>

            (i) The Issuer is a statutory trust duly formed and in good standing
      under the laws of the State of Delaware and has full power,  authority and
      legal right to execute and deliver this Servicing Agreement and to perform
      its  obligations  under  this  Servicing  Agreement,  and  has  taken  all
      necessary  action to authorize the execution,  delivery and performance by
      it of this Servicing Agreement; and

            (ii) The  execution  and  delivery  by the Issuer of this  Servicing
      Agreement and the performance by the Issuer of its obligations  under this
      Servicing  Agreement  will  not  violate  any  provision  of  any  law  or
      regulation  governing the Issuer or any order, writ, judgment or decree of
      any court,  arbitrator or governmental  authority or agency  applicable to
      the Issuer or any of its assets. Such execution, delivery,  authentication
      and performance  will not require the  authorization,  consent or approval
      of,  the giving of notice to,  the  filing or  registration  with,  or the
      taking of any other action with respect to, any governmental  authority or
      agency  regulating the  activities of statutory  trusts.  Such  execution,
      delivery, authentication and performance will not conflict with, or result
      in a breach or violation of, any mortgage,  deed of trust,  lease or other
      agreement or instrument to which the Issuer is bound.

      Section 2.03.  Enforcement of Representations  and Warranties.  The Master
Servicer, on behalf of and subject to the direction of the Indenture Trustee, as
pledgee of the Home Loans, or the Issuer or the Credit  Enhancer,  shall enforce
the  representations  and  warranties  of the Seller  pursuant  to the Home Loan
Purchase Agreement.  Upon the discovery by the Seller, the Depositor, the Master
Servicer,  the  Indenture  Trustee,  the  Issuer,  the  Credit  Enhancer  or any
Custodian of a breach of any of the  representations  and warranties made in the
Home Loan  Purchase  Agreement or of the  existence of a  Repurchase  Event,  in
respect of any Home Loan which materially and adversely affects the interests of
the Securityholders or the Credit Enhancer, the party discovering such breach or
existence  shall give prompt  written  notice to the other  parties.  The Master
Servicer  shall  promptly  notify the  Seller of such  breach or  existence  and
request  that,  pursuant to the terms of the Home Loan Purchase  Agreement,  the
Seller either (i) cure such breach or Repurchase Event in all material  respects
within 45 days (with respect to a breach of the  representations  and warranties
contained in Section  3.1(a) of the Home Loan  Purchase  Agreement or Repurchase
Event)  or 90  days  (with  respect  to a  breach  of  the  representations  and
warranties contained in Section 3.1(b) of the Home Loan Purchase Agreement) from
the date the Seller was  notified  of such  breach or  Repurchase  Event or (ii)
purchase such Home Loan from the Issuer at the price and in the manner set forth
in Section 3.1(c) of the Home Loan Purchase Agreement;  provided that the Seller
shall,  subject to compliance with all the conditions set forth in the Home Loan
Purchase Agreement, have the option to substitute an Eligible Substitute Loan or
Loans for such Home Loan. In the event that the Seller elects to substitute  one
or more Eligible  Substitute  Loans  pursuant to Section 3.1(c) of the Home Loan
Purchase Agreement,  the Seller shall deliver to the Issuer with respect to such
Eligible  Substitute Loans, the original  Mortgage Note, the Mortgage,  and such
other  documents  and  agreements  as are  required  by the Home  Loan  Purchase
Agreement.  Payments due with respect to Eligible  Substitute Loans in the month
of  substitution  shall not be transferred to the Issuer and will be retained by
the Master  Servicer  and  remitted by the Master  Servicer to the Seller on the
next succeeding Payment Date provided a payment at least equal to the applicable
Monthly Payment has been received by the Issuer for such month in respect of the
Home Loan to be removed.  The Master Servicer shall amend or cause to be amended
the Home  Loan  Schedule

                                      -4-
<PAGE>

to reflect the removal of such Home Loan and the  substitution  of the  Eligible
Substitute Loans and the Master Servicer shall promptly deliver the amended Home
Loan Schedule to the Owner Trustee and the Indenture Trustee.

      It is understood and agreed that the obligation of the Seller to cure such
breach or  purchase or  substitute  for such Home Loan as to which such a breach
has occurred and is continuing shall constitute the sole remedy  respecting such
breach available to the Issuer and the Indenture Trustee, as pledgee of the Home
Loans,  against the Seller.  In connection  with the purchase of or substitution
for any such Home Loan by the Seller,  the Issuer shall assign to the Seller all
of its right,  title and interest in respect of the Home Loan Purchase Agreement
applicable  to such Home Loan.  Upon receipt of the  Repurchase  Price,  or upon
completion of such substitution,  the Master Servicer shall notify the Custodian
and then the Custodian shall deliver the Mortgage Files to the Master  Servicer,
together with all relevant  endorsements and assignments  prepared by the Master
Servicer which the Indenture  Trustee shall execute.  If the Master  Servicer is
Residential  Funding  Company,  LLC, then the Indenture  Trustee may, and at the
direction of the Credit Enhancer,  shall,  give the notification and require the
purchase or substitution  provided for in the first  preceding  paragraph in the
event of such a breach  of a  representation  or  warranty  made by  Residential
Funding Company, LLC in the Home Loan Purchase Agreement.

                                  ARTICLE III

                          ADMINISTRATION AND SERVICING
                                  OF HOME LOANS

      Section 3.01. The Master  Servicer.  (a) The Master Servicer shall service
and  administer  the Home Loans in accordance  with the terms of this  Servicing
Agreement,  following  such  procedures  as it would  employ  in its good  faith
business  judgment  and  which are  normal  and  usual in its  general  mortgage
servicing activities,  and shall have full power and authority,  acting alone or
through  a  Subservicer,  to do any and  all  things  in  connection  with  such
servicing and administration which it may deem necessary or desirable,  it being
understood,  however,  that  the  Master  Servicer  shall  at all  times  remain
responsible  to the Issuer  and the  Indenture  Trustee,  as pledgee of the Home
Loans, and the Credit Enhancer for the performance of its duties and obligations
hereunder  in  accordance  with the terms  hereof,  without  diminution  of such
obligation   or  liability  by  virtue  of  such   Subservicing   agreements  or
arrangements  or by virtue of  indemnification  from the  Subservicer and to the
same extent and under the same terms and  conditions  as if the Master  Servicer
alone were  servicing and  administering  the Home Loans.  Without  limiting the
generality of the foregoing,  the Master Servicer shall continue,  and is hereby
authorized and empowered by the Issuer and the Indenture Trustee,  as pledgee of
the Home Loans,  to execute and deliver,  on behalf of itself,  the Issuer,  the
Indenture  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
modification in connection with a proposed  conveyance,  or of assignment of any
Mortgage and Mortgage Note in connection  with the repurchase of a Home Loan and
all other comparable instruments with respect to the Home Loans and with respect
to the Mortgaged Properties, or with respect to the modification or re-recording
of a Mortgage for

                                      -5-
<PAGE>

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  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.  The  Issuer,  the
Indenture  Trustee and the Custodian,  as  applicable,  shall furnish the Master
Servicer  with  any  powers  of  attorney  and  other  documents   necessary  or
appropriate  to  enable  the  Master  Servicer  to carry out its  servicing  and
administrative  duties hereunder.  In addition,  the Master Servicer may, at its
own discretion and on behalf of the Indenture Trustee, obtain credit information
in the form of a Credit Score from a credit repository. On the Closing Date, the
Indenture Trustee is hereby directed to deliver to the Master Servicer a limited
power of  attorney  substantially  in the form of  Exhibit B hereto.  The Master
Servicer  further is  authorized  and  empowered by the Issuer and the Indenture
Trustee,  on behalf of the  Noteholders,  the Credit  Enhancer and the Indenture
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 is appropriate in
its best judgment to register any Home Loan on the MERS(R) System,  or cause the
removal from the registration of any Home Loan on the MERS(R) System, to execute
and deliver,  on behalf of the Indenture  Trustee and the  Noteholders 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  Indenture  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 3.09, 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(R)  System,  it  becomes  necessary  to  remove  any  Home  Loan  from
registration  on the  MERS(R)  System and to arrange for the  assignment  of the
related Mortgages to the Indenture  Trustee,  then any related expenses shall be
reimbursable to the Master Servicer as set forth in Section 3.03(ii).

      If the Mortgage  relating to a Home Loan did not have a lien senior to the
Home Loan on the related  Mortgaged  Property as of the Cut-off  Date,  then the
Master  Servicer,  in such  capacity,  may not  consent to the placing of a lien
senior  to  that of the  Mortgage  on the  related  Mortgaged  Property.  If the
Mortgage  relating  to a Home  Loan had a lien  senior  to the Home  Loan on the
related Mortgaged Property as of the Cut-off Date, then the Master Servicer,  in
such capacity, may consent to the refinancing of the prior senior lien, provided
that the following requirements are met:

            (i) (A) the  Mortgagor's  debt-to-income  ratio  resulting from such
      refinancing is less than the original debt-to-income ratio as set forth on
      the Mortgage Loan  Schedule and, in the event that the resulting  Combined
      Loan-to-Value Ratio of such Home Loan increases by more than 10% above the
      Combined  Loan-to-Value  Ratio  prior  to  such  refinancing,  the  Master
      Servicer shall obtain the prior consent of the Credit Enhancer (so long as
      no Credit Enhancer Default has occurred and is continuing),  which consent
      shall not be unreasonably withheld; provided, however, that in no instance
      shall  the  resulting  Combined  Loan-to-Value  Ratio of such Home Loan be
      higher than that permitted by the Program Guide; or

                                      -6-
<PAGE>

                (B) the resulting Combined Loan-to-Value Ratio of such Home Loan
      is  no  higher  than  the  Combined  Loan-to-Value  Ratio  prior  to  such
      refinancing; provided,  however,  if such  refinanced  mortgage  loan is a
      "rate and term"  mortgage loan  (meaning,  the Mortgagor does not  receive
      any  cash  from  the  refinancing),  the  Combined Loan-to-Value Ratio may
      increase to the extent of either (a) the reasonable  closing costs of such
      refinancing  or  (b)  any  decrease in the  value of the related Mortgaged
      Property,  if the Mortgagor is in good standing as defined  by the Program
      Guide;

            (ii)  the  interest  rate,  or,  in the case of an  adjustable  rate
      existing  senior lien, the maximum  interest rate, for the loan evidencing
      the  refinanced  senior lien is no more than 2.0% higher than the interest
      rate or the  maximum  interest  rate,  as the  case  may be,  on the  loan
      evidencing the existing senior lien immediately  prior to the date of such
      refinancing;  provided,  however (a) if the loan  evidencing  the existing
      senior lien prior to the date of  refinancing  has an adjustable  rate and
      the loan evidencing the refinanced  senior lien has a fixed rate, then the
      current  interest rate on the loan  evidencing the refinanced  senior lien
      may be up to 2.0%  higher  than  the  then-current  loan  rate of the loan
      evidencing  the existing  senior lien and (b) if the loan  evidencing  the
      existing senior lien prior to the date of refinancing has a fixed rate and
      the loan  evidencing  the refinanced  senior lien has an adjustable  rate,
      then the  maximum  interest  rate on the loan  evidencing  the  refinanced
      senior  lien shall be less than or equal to (x) the  interest  rate on the
      loan  evidencing the existing senior lien prior to the date of refinancing
      plus (y) 2.0%; and

            (iii) the loan evidencing the refinanced  senior lien is not subject
      to negative amortization.

      The  relationship  of the Master  Servicer  (and of any  successor  to the
Master Servicer as servicer under this Servicing  Agreement) to the Issuer under
this Servicing Agreement is intended by the parties to be that of an independent
contractor and not that of a joint venturer, partner or agent.

      (b) The Master  Servicer  may continue in effect  Subservicing  Agreements
entered into by Residential  Funding and Subservicers prior to the execution and
delivery of this Servicing Agreement, and may enter into Subservicing Agreements
with  Subservicers for the servicing and  administration  of certain of the Home
Loans.  Each Subservicer of a Home Loan shall be entitled to receive and retain,
as provided in the  related  Subservicing  Agreement  and in Section  3.02,  the
related  Subservicing  Fee from payments of interest  received on such Home Loan
after payment of all amounts  required to be remitted to the Master  Servicer in
respect  of such Home  Loan.  For any Home Loan not  subject  to a  Subservicing
Agreement, the Master Servicer shall be entitled to receive and retain an amount
equal to the  Subservicing  Fee from  payments of interest.  References  in this
Servicing  Agreement to actions  taken or to be taken by the Master  Servicer in
servicing the Home 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 not inconsistent  with this Servicing  Agreement and
as the Master Servicer and the Subservicer have agreed. With the approval of the
Master  Servicer,  a  Subservicer  may delegate  its  servicing  obligations  to
third-party  servicers,  but such  Subservicers  will remain obligated under the
related  Subservicing  Agreements.  The Master  Servicer and the Subservicer may
enter into amendments to the related Subservicing Agreements; provided, however,
that any such  amendments  shall not

                                      -7-
<PAGE>

cause  the  Home  Loans to be  serviced  in a manner  that  would be  materially
inconsistent  with the  standards  set forth in this  Servicing  Agreement.  The
Master  Servicer  shall be entitled to terminate any  Subservicing  Agreement in
accordance  with the terms and conditions  thereof and without any limitation by
virtue of this  Servicing  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
Home Loan or enter into a Subservicing  Agreement  with a successor  Subservicer
which  will be bound by the terms of the  related  Subservicing  Agreement.  The
Master Servicer shall be entitled to enter into any agreement with a Subservicer
for  indemnification  of the  Master  Servicer  and  nothing  contained  in this
Servicing Agreement shall be deemed to limit or modify such indemnification. The
Program  Guide and any other  Subservicing  Agreement  entered  into 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.

      In the  event  that the  rights,  duties  and  obligations  of the  Master
Servicer are terminated  hereunder,  any successor to the Master Servicer in its
sole  discretion may, to the extent  permitted by applicable law,  terminate the
existing  Subservicing  Agreement with any  Subservicer  in accordance  with the
terms of the applicable  Subservicing  Agreement or assume the terminated Master
Servicer's  rights and obligations under such  subservicing  arrangements  which
termination or assumption will not violate the terms of such arrangements.

      As part of its servicing activities  hereunder,  the Master Servicer,  for
the benefit of the Securityholders and the Credit Enhancer, shall use reasonable
efforts  to  enforce  the  obligations  of each  Subservicer  under the  related
Subservicing  Agreement,  to the  extent  that the  non-performance  of any such
obligation   would  have  a  material  adverse  effect  on  a  Home  Loan.  Such
enforcement,  including,  without  limitation,  the legal prosecution of claims,
termination  of  Subservicing  Agreements  and the pursuit of other  appropriate
remedies,  shall be in such form and  carried  out to such an extent and at such
time as the Master Servicer 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  Home Loan or (ii) from a  specific  recovery  of
costs,   expenses  or  attorneys  fees  against  the  party  against  whom  such
enforcement is directed.

      Section  3.02.  Collection of Certain Home Loan  Payments.  (a) The Master
Servicer shall make reasonable  efforts to collect all payments called for under
the terms and  provisions  of the Home  Loans,  and shall,  to the  extent  such
procedures  shall be  consistent  with this  Servicing  Agreement  and generally
consistent with any related insurance policy,  follow such collection procedures
as it would employ in its good faith business  judgment and which are normal and
usual  in  its  general  mortgage  servicing  activities.  Consistent  with  the
foregoing,  and without  limiting the  generality of the  foregoing,  the Master
Servicer may in its discretion waive any late payment charge,  prepayment charge
or penalty  interest or other fees which may be collected in the ordinary course
of servicing  such Home Loan.  The Master  Servicer may also extend the Due Date
for payment due on a Home 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  insurance  policy or
materially  adversely  affect  the  lien  of the

                                      -8-
<PAGE>

related   Mortgage   (except  as  described  below)  or  the  interests  of  the
Securityholders  and  the  Credit  Enhancer.  Notwithstanding  anything  in this
Section  to the  contrary,  the Master  Servicer  or any  Subservicer  shall not
enforce any prepayment  charge to the extent that such enforcement would violate
any applicable law. Consistent with the terms of this Servicing  Agreement,  the
Master Servicer may also:

            (i) waive, modify or vary any term of any Home Loan;

            (ii) consent to the postponement of strict  compliance with any such
      term or in any manner grant indulgence to any Mortgagor;

            (iii)  arrange  with a  Mortgagor  a  schedule  for the  payment  of
      principal and interest due and unpaid;

            (iv) forgive any portion of the amounts contractually owed under the
      Home Loan;

            (v)  capitalize  past due amounts owed under the Home Loan by adding
      any amounts in  arrearage to the  existing  principal  balance of the Home
      Loan (a  "Capitalization  Workout")  of which will result in an  increased
      Monthly  Payment  amount,  provided  that:  (A) the  amount  added  to the
      existing  principal  balance of the Home Loan (the  "Capitalized  Amount")
      shall be no  greater  than five  times  the  Mortgagor's  current  Monthly
      Payment  amount;  and (B) the  Master  Servicer  shall  not  enter  into a
      Capitalization Workout unless the Combined Loan-to-Value Ratio of the Home
      Loan prior to the  Capitalization  Workout  equals or exceeds  80% and the
      Mortgagor has qualified  for the  Capitalization  Workout under the Master
      Servicer's servicing guidelines; and

            (vi) reset the Due Date for the Home Loan, or any combination of the
      foregoing;

if  in  the  Master   Servicer's   determination   such  waiver,   modification,
postponement or indulgence, arrangement or other action referred to above is not
materially  adverse  to the  interests  of  the  Securityholders  or the  Credit
Enhancer and is generally  consistent with the Master  Servicer's  policies with
respect  to  mortgage  loans  similar  to those in the Home Loan Pool  (meaning,
mortgage  loans  used for home  improvement  or debt  consolidation);  provided,
however,  that the Master  Servicer may not modify or permit any  Subservicer to
modify any Home Loan (including  without  limitation any modification that would
change the Loan Rate,  forgive the payment of any principal or interest  (unless
in connection with the liquidation of the related Home Loan) or extend the final
maturity  date of such Home Loan) unless such Home Loan is in default or, in the
judgment of the Master  Servicer,  such default is reasonably  foreseeable.  The
general  terms  of  any  waiver,  modification,   forgiveness,  postponement  or
indulgence  with  respect  to any of the  Home  Loans  will be  included  in the
Servicing Certificate,  and such Home Loans will not be considered  "delinquent"
for the purposes of the Basic  Documents so long as the Mortgagor  complies with
the terms of such waiver, modification, forgiveness, postponement or indulgence.

      (b) The Master Servicer shall establish a Custodial  Account,  which shall
be an Eligible Account in which the Master Servicer shall deposit or cause to be
deposited any

                                      -9-
<PAGE>

amounts  representing  payments  and  collections  in  respect of the Home Loans
received  by it  subsequent  to the  Cut-off  Date (other than in respect of the
payments  referred  to in the  following  paragraph)  within  one  Business  Day
following  receipt  thereof  (or  otherwise  on or prior to the  Closing  Date),
including the following payments and collections received or made by it (without
duplication):

            (i) all payments of principal or interest on the Home Loans received
      by the Master Servicer from the respective Subservicer, net of any portion
      of the interest thereof retained by the Subservicer as Subservicing Fees;

            (ii) the aggregate  Repurchase  Price of the Home Loans purchased by
      the Master Servicer pursuant to Section 3.15 or by the Limited  Repurchase
      Price Holder pursuant to Section 3.16;

            (iii)  Net  Liquidation  Proceeds  net  of any  related  Foreclosure
      Profit;

            (iv)  all  proceeds  of any Home  Loans  repurchased  by the  Seller
      pursuant  to the  Home  Loan  Purchase  Agreement,  and  all  Substitution
      Adjustment  Amounts  required  to be  deposited  in  connection  with  the
      substitution  of an  Eligible  Substitute  Loan  pursuant to the Home Loan
      Purchase Agreement;

            (v)  Insurance  Proceeds,   other  than  Net  Liquidation  Proceeds,
      resulting from any insurance  policy  maintained on a Mortgaged  Property;
      and

            (vi) amounts required to be paid by the Master Servicer  pursuant to
      Sections 3.04 and 8.08.

provided,  however,  that with  respect to each  Collection  Period,  the Master
Servicer  shall be permitted  to retain from  payments in respect of interest on
the Home  Loans,  the  Master  Servicing  Fee for such  Collection  Period.  The
foregoing  requirements   respecting  deposits  to  the  Custodial  Account  are
exclusive,  it being  understood  that,  without  limiting the generality of the
foregoing, the Master Servicer need not deposit in the Custodial Account amounts
representing  Foreclosure  Profits,  fees (including  annual fees),  late charge
penalties  and  prepayment  charges  payable by  Mortgagors  (such amounts to be
retained as additional  servicing  compensation  in accordance with Section 3.09
hereof),  or  amounts  received  by the  Master  Servicer  for the  accounts  of
Mortgagors for  application  towards the payment of taxes,  insurance  premiums,
assessments  and  similar  items.  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 the notes or certificates of other
series and may contain other funds  respecting  payments on other 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 Home Loans
and shall hold all  collections  in the  Custodial  Account  to the extent  they
represent  collections  on the Home  Loans for the  benefit  of the  Trust,  the
Securityholders,  the  Credit  Enhancer  and the  Indenture  Trustee,  as  their
interests may appear.  The Master Servicer shall retain all Foreclosure  Profits
as additional servicing compensation.

                                      -10-
<PAGE>

      The Master  Servicer may cause the  institution  maintaining the Custodial
Account to invest any funds in the  Custodial  Account in Permitted  Investments
(including obligations of the Master Servicer or any of its Affiliates,  if such
obligations otherwise qualify as Permitted Investments), which investments shall
mature not later than the Business Day  preceding  the next  succeeding  Payment
Date and which  investments  shall not be sold or disposed of prior to maturity.
Except as provided above,  all income and gain realized from any such investment
shall  inure to 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 the principal  amount of any such  investments  shall be deposited in
the Custodial Account by the Master Servicer out of its own funds immediately as
realized.

      (c) The Master  Servicer shall require each  Subservicer to hold all funds
constituting  collections on the Home Loans,  pending  remittance thereof to the
Master Servicer, in one or more accounts meeting the requirements of an Eligible
Account, and invested in Permitted Investments.

      Section 3.03.  Withdrawals from the Custodial Account. The Master Servicer
shall, from time to time as provided herein, make withdrawals from the Custodial
Account  of  amounts  on  deposit  therein  pursuant  to  Section  3.02 that are
attributable to the Home Loans for the following purposes:

            (i) to remit to the Paying Agent for deposit in the Payment Account,
      on the  Business Day prior to each  Payment  Date,  an amount equal to the
      Interest Collections and Principal  Collections required to be distributed
      on such Payment Date;

            (ii) to the extent deposited to the Custodial Account,  to reimburse
      itself or the related  Subservicer for previously  unreimbursed  expenses,
      made  pursuant  to  Section  3.01,  incurred  in  maintaining   individual
      insurance policies pursuant to Section 3.04, or Liquidation Expenses, paid
      pursuant to Section 3.07 or otherwise  reimbursable  pursuant to the terms
      of this Servicing Agreement (to the extent not payable pursuant to Section
      3.09),  such  withdrawal  right  being  limited  to  amounts  received  on
      particular Home Loans (other than any Repurchase Price in respect thereof)
      which  represent  late  recoveries of the payments for which such advances
      were made, or from related Net Liquidation Proceeds or the proceeds of the
      purchase of such Home Loan;

            (iii) to pay to itself out of each  payment  received  on account of
      interest on a Home Loan as  contemplated  by Section 3.09, an amount equal
      to the related Master  Servicing Fee (to the extent not retained  pursuant
      to Section 3.02), and to pay to any Subservicer any Subservicing  Fees not
      previously withheld by the Subservicer;

            (iv) to the  extent  deposited  in the  Custodial  Account to pay to
      itself as  additional  servicing  compensation  any interest or investment
      income  earned on funds  deposited  in the  Custodial  Account and Payment
      Account that it is entitled to withdraw  pursuant to Sections  3.02(b) and
      5.01;

            (v) to the extent  deposited  in the  Custodial  Account,  to pay to
      itself as additional servicing compensation any Foreclosure Profits;

                                      -11-
<PAGE>

            (vi) to pay to itself or the Seller,  with  respect to any Home Loan
      or  property  acquired  in  respect  thereof  that has been  purchased  or
      otherwise  transferred  to the Seller,  the Master  Servicer,  the Limited
      Repurchase Right Holder or other entity,  all amounts received thereon and
      not required to be distributed to  Securityholders as of the date on which
      the related Purchase Price or Repurchase Price is determined;

            (vii)  to  clear  and  terminate  the  Custodial  Account  upon  the
      termination of this Agreement; and

            (viii) to  withdraw  any other  amount  deposited  in the  Custodial
      Account that was not required to be deposited  therein pursuant to Section
      3.02.

      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 Home Loan,  the Master  Servicer shall keep and
maintain separate accounting, on a Home Loan by Home Loan basis, for the purpose
of  justifying  any  withdrawal  from the  Custodial  Account  pursuant  to such
clauses.  Notwithstanding any other provision of this Servicing  Agreement,  the
Master  Servicer  shall be  entitled  to  reimburse  itself  for any  previously
unreimbursed   expenses   incurred   pursuant  to  Section   3.07  or  otherwise
reimbursable  pursuant to the terms of this Servicing  Agreement that the Master
Servicer determines to be otherwise  nonrecoverable  (except with respect to any
Home Loan as to which the Repurchase  Price has been paid),  by withdrawal  from
the Custodial  Account of amounts on deposit  therein  attributable  to the Home
Loans on any Business Day prior to the Payment Date  succeeding the date of such
determination.

      Section  3.04.  Maintenance  of  Hazard  Insurance;   Property  Protection
Expenses.  The Master  Servicer  shall cause to be maintained for each Home Loan
hazard insurance naming the Master Servicer or related Subservicer as loss payee
thereunder  providing  extended coverage in an amount which is at least equal to
at  least  100%  of  the  insurable  value  of  the   improvements   (guaranteed
replacement)  or the sum of the unpaid  principal  balance of the first mortgage
loan and the Home Loan  amount.  The  Master  Servicer  shall  also  cause to be
maintained  on  property  acquired  upon   foreclosure,   or  deed  in  lieu  of
foreclosure,  of any Home 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.
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 to the extent called for by Section 3.02. In
cases in which any Mortgaged  Property is located at any time during the life of
a Home Loan in a federally  designated  flood area,  the hazard  insurance to be
maintained  for the related  Home Loan shall  include  flood  insurance  (to the
extent  available).  All such flood  insurance  shall be in amounts equal to the
lesser of (i) the amount  required to  compensate  for any loss or damage to the
related  Mortgaged  Property  on a  replacement  cost basis and (ii) the maximum
amount  of such  insurance  available  for such  Mortgaged  Property  under  the
national flood insurance program (assuming that the area in which such Mortgaged
Property is located is participating in such program). The Master Servicer shall
be under no  obligation  to require that any  Mortgagor  maintain  earthquake or
other additional  insurance and shall be under no obligation  itself to maintain
any such  additional  insurance on property  acquired in respect of a Home Loan,
other than pursuant to such applicable laws and regulations as shall at any time
be in force  and as shall

                                      -12-
<PAGE>

require  such  additional  insurance.  If the Master  Servicer  shall obtain and
maintain  a  blanket  policy  consistent  with its  general  mortgage  servicing
activities  insuring  against  hazard losses on all of the Home Loans,  it shall
conclusively  be deemed to have  satisfied its  obligations  as set forth in the
first  sentence of this Section 3.04, it being  understood  and agreed that such
blanket  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  3.04 and there shall have been a loss which would have been  covered by
such policy,  deposit in the Custodial  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 last  Business Day of the  Collection
Period in the month in which  payments  under any such  policy  would  have been
deposited  in the  Custodial  Account.  In  connection  with its  activities  as
servicer of the Home Loans, the Master Servicer agrees to present,  on behalf of
itself,  the Issuer and the  Indenture  Trustee,  claims  under any such blanket
policy.

      Section 3.05.  Modification  Agreements;  Release or Substitution of Lien.
(a) The Master Servicer or the related Subservicer, as the case may be, shall be
entitled  to  (A)  execute  assumption  agreements,   modification   agreements,
substitution  agreements,  and instruments of satisfaction or cancellation or of
partial or full release or discharge, or any other document contemplated by this
Servicing  Agreement and other  comparable  instruments with respect to the Home
Loans and with respect to the Mortgaged Properties subject to the Mortgages (and
the Issuer  and the  Indenture  Trustee  each shall  promptly  execute  any such
documents  upon  written  request of the Master  Servicer)  and (B)  approve the
granting of an easement  thereon in favor of another  Person,  any alteration or
demolition of the related Mortgaged Properties or other similar matters, in each
case 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 Home Loans, that the
security for, and the timely and full  collectability  of, such Home Loans would
not be adversely  affected  thereby.  A partial release pursuant to this Section
3.05 shall be permitted only if the Combined  Loan-to-Value  Ratio for such Home
Loan after such partial release does not exceed the Combined Loan-to-Value Ratio
for such Home Loan as of the  Cut-off  Date.  Any fee  collected  by the  Master
Servicer or the related Subservicer for processing such request will be retained
by the Master Servicer or such Subservicer as additional servicing compensation.

      (b) The Master  Servicer may enter into an  agreement  with a Mortgagor to
release  the  lien  on the  Mortgaged  Property  relating  to a Home  Loan  (the
"Existing  Lien"),  if at the time of such agreement the Home Loan is current in
payment of principal and interest, under any of the following circumstances:

            (i) in any case in which,  simultaneously  with the  release  of the
      Existing Lien, the Mortgagor  executes and delivers to the Master Servicer
      a Mortgage on a substitute Mortgaged Property,  provided that the Combined
      Loan-to-Value  Ratio of the Home Loan  (calculated  based on the Appraised
      Value  of the  substitute  Mortgaged  Property)  is not  greater  than the
      Combined Loan-to-Value Ratio prior to releasing the Existing Lien;

            (ii) in any case in which,  simultaneously  with the  release of the
      Existing Lien, the Mortgagor  executes and delivers to the Master Servicer
      a Mortgage on a substitute  Mortgaged  Property,  provided  that:  (A) the
      Combined  Loan-to-Value  Ratio of the Home Loan  (calculated  based on the
      Appraised Value of the substitute  Mortgaged Property) is

                                      -13-
<PAGE>

      not  greater  than the  lesser  of (1)  125% and (2) 105% of the  Combined
      Loan-to-Value  Ratio prior to  releasing  the Existing  Lien;  and (B) the
      Master  Servicer  determines  that at least two  appropriate  compensating
      factors are present (compensating factors may include, without limitation,
      an increase in the Mortgagor's  monthly cash flow after debt service,  the
      Mortgagor's  debt-to-income ratio has not increased since origination,  or
      an increase in the Mortgagor's credit score); or

            (iii) in any case in which,  at the time of release of the  Existing
      Lien, the Mortgagor  does not provide the Master  Servicer with a Mortgage
      on a substitute Mortgaged Property (any Home Loan that becomes and remains
      unsecured  in  accordance  with this  subsection,  an  "Unsecured  Loan"),
      provided that: (A) the Mortgagor,  in addition to being current in payment
      of principal  and interest on the related Home Loan, is current in payment
      of  principal  and  interest on any loan senior to the Home Loan;  (B) the
      Mortgagor's Credit Score, as determined by the Master Servicer at the time
      of the  request  for  release  of lien,  is not  less  than  640;  (C) the
      Mortgagor  makes  a cash  contribution  in  reduction  of the  outstanding
      principal  balance of the Home Loan,  which may include  any net  proceeds
      from the sale of the original Mortgaged Property,  of not less than 20% of
      the unpaid principal balance of the Home Loan; and (D) the Mortgagor signs
      a reaffirmation  agreement acknowledging that they must continue to pay in
      accordance with the terms of the original Mortgage Note;

            (iv) If the above conditions  (iii)(A) through (iii)(D) are not met,
      the Master  Servicer  may still  enter into an  agreement  to release  the
      Existing Lien, provided that: (A) the Master Servicer shall not permit the
      release of an  Existing  Lien under this  clause  (iv) as to more than 200
      Home  Loans in any  calendar  year;  (B) at no time  shall  the  aggregate
      Principal  Balance of Unsecured  Loans exceed 5% of the then Pool Balance;
      (C) the Mortgagor  agrees to an automatic  debit payment plan; and (D) the
      Master  Servicer  shall  provide  notice to each  Rating  Agency  that has
      requested notice of such releases.

      In connection with any Unsecured Loan, the Master Servicer may require the
Mortgagor  to enter  into an  agreement  under  which:  (i) the Loan Rate may be
increased  effective until a substitute  Mortgage meeting the criteria under (i)
or (ii) above is  provided;  or (ii) any other  provision  may be made which the
Master  Servicer  considers to be appropriate.  Thereafter,  the Master Servicer
shall determine in its discretion whether to accept any proposed Mortgage on any
substitute  Mortgaged  Property  as security  for the Home Loan,  and the Master
Servicer may require the Mortgagor to agree to any further  conditions which the
Master  Servicer  considers  appropriate in connection  with such  substitution,
which may include a  reduction  of the Loan Rate (but not below the Loan Rate in
effect  at the  Closing  Date).  Any  Home  Loan  as to  which a  Mortgage  on a
substitute  Mortgaged  Property  is provided in  accordance  with the  preceding
sentence shall no longer be deemed to be an Unsecured Loan.

                                      -14-
<PAGE>

      Section 3.06. Trust Estate;  Related  Documents.  (a) When required by the
provisions of this  Servicing  Agreement,  the Issuer or the  Indenture  Trustee
shall  execute  instruments  to  release  property  from the  terms of the Trust
Agreement,  Indenture  or  Custodial  Agreement,  as  applicable,  or convey the
Issuer's or the Indenture  Trustee's interest in the same, in a manner and under
circumstances  which are not inconsistent  with the provisions of this Servicing
Agreement.  No party  relying upon an  instrument  executed by the Issuer or the
Indenture  Trustee as provided in this  Section 3.06 shall be bound to ascertain
the Issuer's or the Indenture Trustee's authority, inquire into the satisfaction
of any conditions precedent or see to the application of any monies.

      (b) If  from  time  to time  the  Master  Servicer  shall  deliver  to the
Custodian copies of any written assurance,  assumption agreement or substitution
agreement or other similar  agreement  pursuant to Section  3.05,  the Custodian
shall check that each of such documents purports to be an original executed copy
(or a copy of the original  executed  document if the original executed copy has
been  submitted for recording and has not yet been  returned)  and, if so, shall
file such  documents,  and upon receipt of the original  executed  copy from the
applicable  recording  office or  receipt  of a copy  thereof  certified  by the
applicable  recording  office shall file such originals or certified copies with
the Related Documents. If any such documents submitted by the Master Servicer do
not meet the above qualifications,  such documents shall promptly be returned by
the  Custodian  to  the  Master  Servicer  pursuant  to  the  related  Custodial
Agreement,  with a  direction  to the Master  Servicer  to forward  the  correct
documentation.

      (c) Upon  receipt  of a  Request  for  Release  from the  Master  Servicer
substantially  in the form of Exhibit C, to the effect that a Home Loan has been
the subject of a final payment or a prepayment in full and the related Home Loan
has been terminated or that  substantially  all Liquidation  Proceeds which have
been determined by the Master Servicer in its reasonable  judgment to be finally
recoverable  have been recovered,  and upon deposit to the Custodial  Account of
such final monthly payment,  prepayment in full together with accrued and unpaid
interest  to the date of such  payment  with  respect  to such  Home Loan or, if
applicable,  Net Liquidation Proceeds,  the Custodian shall promptly release the
Related  Documents  to the Master  Servicer  pursuant to the  related  Custodial
Agreement,  which the Indenture Trustee shall execute, along with such documents
as the  Master  Servicer  or the  related  Mortgagor  may  request  to  evidence
satisfaction  and  discharge  of such Home  Loan,  upon  request  of the  Master
Servicer.  If  from  time to  time  and as  appropriate  for  the  servicing  or
foreclosure  of any Home Loan,  the Master  Servicer  requests the  Custodian to
release the Related  Documents  and  delivers to the  Custodian a trust  receipt
reasonably  satisfactory to the Custodian and signed by a Responsible Officer of
the Master  Servicer,  the Custodian shall release the Related  Documents to the
Master Servicer pursuant to the related Custodial Agreement.  If such Home Loans
shall be  liquidated  and the Custodian  receives a certificate  from the Master
Servicer as provided  above,  then,  upon  request of the Master  Servicer,  the
Custodian shall release the trust receipt to the Master Servicer pursuant to the
related Custodial Agreement.

      Section 3.07. Realization Upon Defaulted Home Loans; Loss Mitigation. With
respect  to such of the Home Loans as come into and  continue  in  default,  the
Master  Servicer  shall  decide  whether  to (i)  foreclose  upon the  Mortgaged
Properties securing such Home Loans, (ii) write off the unpaid principal balance
of the Home Loans as bad debt,  (iii) take a deed in lieu of  foreclosure,  (iv)
accept a short sale (a payoff of the Home Loan for an amount less than the total
amount  contractually  owed in  order  to  facilitate  a sale  of the  Mortgaged
Property by the

                                      -15-
<PAGE>

Mortgagor)  or  permit a short  refinancing  (a  payoff  of the Home 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),  (v) arrange for a repayment  plan,  (vi) agree to a modification  in
accordance  with this Servicing  Agreement,  or (vii) take an unsecured note, in
connection  with a  negotiated  release of the lien of the  Mortgage in order to
facilitate a settlement  with the Mortgagor;  in each case subject to the rights
of any related first lien holder; provided that in connection with the foregoing
if the Master  Servicer  has actual  knowledge  that any  Mortgaged  Property is
affected by hazardous or toxic wastes or substances and that the  acquisition of
such Mortgaged  Property would not be commercially  reasonable,  then the Master
Servicer shall not cause the Issuer or the Indenture Trustee to acquire title to
such Mortgaged  Property in a foreclosure or similar  proceeding.  In connection
with such decision,  the Master Servicer shall follow such practices (including,
in the case of any default on a related  senior  mortgage loan, the advancing of
funds to  correct  such  default  if  deemed  to be  appropriate  by the  Master
Servicer) and procedures as it shall deem necessary or advisable and 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  attempted  foreclosure  which is not
completed or other conversion in a manner that is consistent with the provisions
of this  Servicing  Agreement.  The foregoing is subject to the proviso that the
Master Servicer shall not be required to expend its own funds in connection with
any foreclosure or attempted  foreclosure  which is not completed or towards the
correction of any default on a related  senior  mortgage loan or  restoration of
any property unless it shall determine that such  expenditure  will increase Net
Liquidation  Proceeds.  In the event of a  determination  by the Master Servicer
that any such expenditure previously made pursuant to this Section 3.07 will not
be  reimbursable  from Net  Liquidation  Proceeds,  the Master Servicer shall be
entitled to reimbursement of its funds so expended pursuant to Section 3.03.

      Notwithstanding any provision of this Servicing Agreement, a Home Loan may
be deemed to be finally  liquidated if substantially all amounts expected by the
Master  Servicer to be received in connection  with the related  defaulted  Home
Loan have been received;  provided, however, the Master Servicer shall treat any
Home Loan that is 180 days or more delinquent as having been finally liquidated.
Any subsequent collections with respect to any such Home Loan shall be deposited
to the  Custodial  Account.  For  purposes  of  determining  the  amount  of any
Liquidation  Proceeds or Insurance Proceeds,  or other unscheduled  collections,
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 Home Loan.

      In the  event  that  title  to  any  Mortgaged  Property  is  acquired  in
foreclosure or by deed in lieu of  foreclosure,  the deed or certificate of sale
shall be issued to the Indenture  Trustee,  who shall hold the same on behalf of
the Issuer in accordance with Section 3.13 of the Indenture. Notwithstanding any
such  acquisition  of title and  cancellation  of the  related  Home Loan,  such
Mortgaged  Property  shall (except as otherwise  expressly  provided  herein) be
considered to be an  outstanding  Home Loan held as an asset of the Issuer until
such time as such property shall be sold.

                                      -16-
<PAGE>

      Any proceeds from the purchase or repurchase that occurs prior to the Home
Loan  becoming a Liquidated  Home Loan of any Home Loan pursuant to the terms of
this Servicing  Agreement  (including without limitation Sections 2.03, 3.15 and
3.16) will be applied in the following  order of priority:  first, to the Master
Servicer or the related Subservicer, all Servicing Fees payable therefrom to the
Payment Date on which such  amounts are to be deposited in the Payment  Account;
second, as Interest Collections, accrued and unpaid interest on the related Home
Loan,  at the Net Loan Rate to the Payment  Date on which such amounts are to be
deposited in the Payment  Account;  and third,  as Principal  Collections,  as a
recovery of principal on the Home Loan.

      Liquidation  Proceeds  with  respect  to a  Liquidated  Home  Loan will be
applied in the  following  order of priority:  first,  to  reimburse  the Master
Servicer or the related Subservicer in accordance with this Section 3.07 for any
Liquidation Expenses; second, to the Master Servicer or the related Subservicer,
all unpaid  Servicing Fees through the date of receipt of the final  Liquidation
Proceeds;  third,  as Principal  Collections,  as a recovery of principal on the
Home Loan,  up to an amount  equal to the Loan  Balance of the related Home Loan
immediately  prior to the date it became a  Liquidated  Home  Loan;  fourth,  as
Interest  Collections,  accrued and unpaid  interest on the related Home Loan at
the Net Loan Rate through the date of receipt of the final Liquidation Proceeds;
and fifth, to Foreclosure Profits.

      Proceeds  and  other  recoveries  from a Home  Loan  after  it  becomes  a
Liquidated Home Loan will be applied in the following order of priority:  first,
to reimburse the Master  Servicer or the related  Subservicer in accordance with
this Section  3.07 for any expenses  previously  unreimbursed  from  Liquidation
Proceeds  or  otherwise;   second,   to  the  Master  Servicer  or  the  related
Subservicer,  all unpaid  Servicing  Fees  payable  thereto  through the date of
receipt of the proceeds  previously  unreimbursed  from Liquidation  Proceeds or
otherwise;  third, as Interest Collections,  up to an amount equal to the sum of
(a) the Loan Balance of the related Home Loan  immediately  prior to the date it
became a Liquidated  Home Loan,  less any Net  Liquidation  Proceeds  previously
received  with respect to such Home Loan and applied as a recovery of principal,
and (b)  accrued and unpaid  interest  on the related  Home Loan at the Net Loan
Rate  through  the date it  became a  Liquidation  Home  Loan;  and  fourth,  to
Foreclosure Profits.

      Section 3.08. Issuer and Indenture Trustee to Cooperate. On or before each
Payment  Date,  the Master  Servicer  will notify the  Indenture  Trustee or the
Custodian,  with a copy to the Issuer,  of the  termination of or the payment in
full and the  termination  of any Home  Loan  during  the  preceding  Collection
Period.  Upon receipt of payment in full,  the Master  Servicer is authorized to
execute,  pursuant  to the  authorization  contained  in  Section  3.01,  if the
assignments  of Mortgage  have been  recorded  if  required  under the Home Loan
Purchase  Agreement,   an  instrument  of  satisfaction  regarding  the  related
Mortgage,  which  instrument  of  satisfaction  shall be  recorded by the Master
Servicer if required by applicable  law and be delivered to the Person  entitled
thereto, and to cause the removal from the registration on the MERS(R) System of
such  Mortgage,  if  applicable.  It is understood  and agreed that any expenses
incurred in connection with such instrument of satisfaction or transfer shall be
reimbursed from amounts  deposited in the Custodial  Account.  From time to time
and as  appropriate  for the  servicing  or  foreclosure  of any Home Loan,  the
Indenture  Trustee or the Custodian  shall,  upon request of the Master Servicer
and delivery to the Indenture  Trustee or Custodian,  with a copy to the Issuer,
of a Request for Release, signed by a Servicing Officer,  release or cause to be
released  the related

                                      -17-
<PAGE>

Mortgage File to the Master  Servicer and the Issuer or Indenture  Trustee shall
promptly  execute such documents,  in the forms provided by the Master Servicer,
as shall be necessary for the prosecution of any such  proceedings or the taking
of other  servicing  actions.  Such  trust  receipt  shall  obligate  the Master
Servicer to return the Mortgage File to the  Indenture  Trustee or the Custodian
(as specified in such receipt) when the need therefor by the Master  Servicer no
longer  exists  unless the Home Loan shall be  liquidated,  in which case,  upon
receipt of a  certificate  of a Servicing  Officer  similar to that  hereinabove
specified, the trust receipt shall be released to the Master Servicer.

      In order to facilitate the  foreclosure of the Mortgage  securing any Home
Loan that is in default  following  recordation  of the  related  Assignment  of
Mortgage in accordance with the provisions of the Home Loan Purchase  Agreement,
the  Indenture  Trustee or the Issuer  shall,  if so requested in writing by the
Master Servicer, promptly execute an appropriate assignment in the form provided
by the Master Servicer to assign such Home Loan for the purpose of collection to
the Master Servicer (any such assignment shall  unambiguously  indicate that the
assignment is for the purpose of collection  only),  and, upon such  assignment,
such assignee for collection  will thereupon  bring all required  actions in its
own name and otherwise  enforce the terms of the Home Loan and deposit or credit
the Net Liquidation  Proceeds,  exclusive of Foreclosure Profits,  received with
respect  thereto in the  Custodial  Account.  In the event  that all  delinquent
payments  due under any such Home Loan are paid by the  Mortgagor  and any other
defaults are cured,  then the assignee for collection  shall  promptly  reassign
such Home Loan to the Indenture  Trustee and return all Related Documents to the
place where the related Mortgage File was being maintained.

      In  connection  with the Issuer's  obligation  to cooperate as provided in
this Section 3.08 and all other provisions of this Servicing Agreement requiring
the Issuer to  authorize  or permit any actions to be taken with  respect to the
Home Loans, the Indenture Trustee,  as pledgee of the Home Loans and as assignee
of record of the Home Loans on behalf of the Issuer  pursuant to Section 3.13 of
the  Indenture,  expressly  agrees,  on behalf of the  Issuer,  to take all such
actions  on  behalf  of the  Issuer  and to  promptly  execute  and  return  all
instruments  reasonably required by the Master Servicer in connection therewith;
provided that if the Master  Servicer shall request a signature of the Indenture
Trustee,  on behalf of the  Issuer,  the Master  Servicer  shall  deliver to the
Indenture  Trustee an  Officer's  Certificate  stating  that such  signature  is
necessary  or  appropriate  to  enable  the  Master  Servicer  to carry  out its
servicing and administrative duties under this Servicing Agreement.

      Section  3.09.  Servicing  Compensation;  Payment of Certain  Expenses  by
Master  Servicer.  The Master  Servicer  shall be entitled to receive the Master
Servicing Fee in accordance with Sections 3.02 and 3.03 as compensation  for its
services in  connection  with  servicing  the Home Loans.  Moreover,  additional
servicing compensation in the form of late payment charges,  prepayment charges,
investment income on amounts in the Custodial Account or the Payment Account and
other  receipts  not  required  to be  deposited  in the  Custodial  Account  as
specified in Section 3.02 shall be retained by the Master  Servicer.  The Master
Servicer shall be required to pay all expenses incurred by it in connection with
its activities  hereunder  (including payment of all other fees and expenses not
expressly  stated  hereunder  to be for  the  account  of  the  Securityholders,
including,  without  limitation,  the fees and  expenses  of the Owner  Trustee,
Indenture  Trustee and any Custodian) and shall not be entitled to reimbursement
therefor.

                                      -18-
<PAGE>

      Section 3.10.  Annual Statement as to Compliance.  (a) The Master Servicer
will deliver to the Depositor, the Issuer, the Credit Enhancer and the Indenture
Trustee  on or  before  the  earlier  of (a)  March 31 of each  year or (b) with
respect to any calendar year during which the Depositor's  annual report on Form
10-K is required to be filed in  accordance  with the Exchange Act and the rules
and regulations of the  Commission,  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, a servicer compliance certificate,  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:

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

            (ii) To the best of such officer's knowledge,  based on such review,
      the  Master  Servicer  has  fulfilled  all of its  obligations  under this
      Servicing  Agreement in all materials  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.

      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 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.

      (b) The Master  Servicer  shall  deliver  to the Issuer and the  Indenture
Trustee,  with a copy to the Credit  Enhancer,  promptly  after having  obtained
knowledge  thereof,  but in no event later than five Business  Days  thereafter,
written notice by means of an Officer's  Certificate of any event which with the
giving of notice or the lapse of time or both, would become a Servicing Default.

      Section 3.11. 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  Depositor's  annual  report  on Form 10-K is
required  to be filed in  accordance  with the  Exchange  Act and the  rules and
regulations of the  Commission,  the date on which the annual report 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 a report to the  Depositor,  the
Credit Enhancer and the Indenture  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 home 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.

                                      -19-
<PAGE>

      Section 3.12. Access to Certain  Documentation  and Information  Regarding
the Home Loans. Whenever required by statute or regulation,  the Master Servicer
shall  provide to the Credit  Enhancer and any  Securityholder  upon  reasonable
request  (or a  regulator  for  a  Securityholder)  or  the  Indenture  Trustee,
reasonable  access to the  documentation  regarding  the Home Loans such  access
shall be afforded  without  charge but only upon  reasonable  request and during
normal  business  hours at the offices of the Master  Servicer.  Nothing in this
Section  3.12 shall  derogate  from the  obligation  of the Master  Servicer  to
observe any applicable law prohibiting  disclosure of information  regarding the
Mortgagors and the failure of the Master  Servicer to provide access as provided
in this  Section  3.12 as a result of such  obligation  shall not  constitute  a
breach of this Section 3.12.

      Section 3.13.  Maintenance of Certain Servicing  Insurance  Policies.  The
Master  Servicer  shall  during the term of its service as servicer  maintain in
force (i) a policy or policies of insurance covering errors and omissions in the
performance of its obligations as master servicer  hereunder and (ii) a fidelity
bond in respect  of its  officers,  employees  or  agents.  Each such  policy or
policies and fidelity bond shall be at least equal to the coverage that would be
required  by FNMA  or  FHLMC,  whichever  is  greater,  for  Persons  performing
servicing for loans similar to the Home Loans purchased by such entity.

      Section 3.14.  Information  Required by the Internal  Revenue  Service and
Reports of  Foreclosures  and  Abandonments  of Mortgaged  Property.  The Master
Servicer  shall  prepare and deliver all federal and state  information  reports
when and as required by all  applicable  state and federal  income tax laws.  In
particular,  with respect to the requirement  under Section 6050J of the Code to
the effect  that the  Master  Servicer  or  Subservicer  shall  make  reports of
foreclosures and abandonments of any mortgaged  property for each year beginning
in 2006, the Master Servicer or Subservicer  shall file reports relating to each
instance  occurring  during  the  previous  calendar  year in which  the  Master
Servicer  (i) on behalf of the Issuer,  acquires  an  interest in any  Mortgaged
Property through  foreclosure or other comparable  conversion in full or partial
satisfaction  of a Home  Loan,  or (ii)  knows or has  reason  to know  that any
Mortgaged  Property has been abandoned.  The reports from the Master Servicer or
Subservicer  shall be in form and  substance  sufficient  to meet the  reporting
requirements  imposed by Section  6050J and Section 6050H  (reports  relating to
mortgage interest received) of the Code.

      Section 3.15. Optional Repurchase of Defaulted Home Loans. Notwithstanding
any  provision  in Section 3.07 to the  contrary,  the Master  Servicer,  at its
option and in its sole  discretion,  may repurchase any Home Loan  delinquent in
payment  for a period of 90 days or longer for a price  equal to the  Repurchase
Price.

      Section 3.16.  Limited Home Loan Repurchase Right. The Limited  Repurchase
Right Holder will have the irrevocable option at any time to purchase any of the
Home Loans at the Repurchase  Price,  up to a maximum of five Home Loans. In the
event that this option is exercised as to any five Home Loans in the  aggregate,
this  option will  thereupon  terminate.  If at any time the Limited  Repurchase
Right Holder makes a payment to the Custodial Account covering the amount of the
Repurchase  Price for such a Home Loan, and the Limited  Repurchase Right Holder
provides to the Indenture Trustee a certification  signed by a Servicing Officer
stating  that the amount of such  payment has been  deposited  in the  Custodial
Account,  then,  at the  request of the Limited  Repurchase  Right  Holder,  the
Indenture  Trustee  shall  execute  the  assignment  of such Home Loan,  without
recourse,  to the Limited Repurchase Right Holder

                                      -20-
<PAGE>

which shall succeed to all the Indenture  Trustee's right, title and interest in
and to such Home Loan,  and all security and documents  relative  thereto.  Such
assignment  shall be an assignment  outright and not for  security.  The Limited
Repurchase Right Holder will thereupon own such Mortgage,  and all such security
and  documents,  free of any further  obligation to the  Indenture  Trustee with
respect thereto.

                                   ARTICLE IV

                              SERVICING CERTIFICATE

      Section  4.01.  Statements  to  Securityholders.  (a) With respect to each
Payment Date, on the Business Day following the related  Determination  Date (or
with  respect to any Payment Date for which an Insured  Payment  will occur,  no
later than 12:00 P.M.  New York City time,  on the second  Business Day prior to
the applicable Payment Date), the Master Servicer shall forward to the Indenture
Trustee and the  Indenture  Trustee  pursuant to Section  3.26 of the  Indenture
shall  forward or cause to be  forwarded  by mail or  otherwise  make  available
electronically   at   www.[_______________].com   to   each   Certificateholder,
Noteholder,   the  Credit  Enhancer,  the  Depositor,  the  Owner  Trustee,  the
Certificate  Paying Agent and each Rating Agency, a statement  setting forth the
following  information  (the  "Servicing  Certificate")  as  to  the  Notes  and
Certificates, to the extent applicable:

            (i) the applicable Record Date, Determination Date and Payment Date;

            (ii) the aggregate  amount of payments  received with respect to the
      Home 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) the aggregate amount of (a) Interest Collections,  (b) Principal
      Collections and (c)  Substitution  Adjustment  Amounts for such Collection
      Period;

            (vi) (a) the amount of such distribution to the  Securityholders  of
      such Class  applied to reduce the Note  Balance or  Certificate  Principal
      Balance   thereof,   and  (b)  the  aggregate   amount  included   therein
      representing Principal Prepayments;

            (vii) the  amount of such  distribution  to Holders of such Class of
      Securities allocable to interest;

            (viii)  if  the  distribution  to  the  Holders  of  such  Class  of
      Securities  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;

                                      -21-
<PAGE>

            (ix) the aggregate Note Balance or Certificate  Principal Balance of
      each Class of  Securities,  before and after giving  effect to the amounts
      distributed  on such Payment Date,  separately  identifying  any reduction
      thereof due to  Liquidation  Loss Amounts other than pursuant to an actual
      distribution of principal;

            (x) the Note  Rate for each  Class of Notes for such  Payment  Date,
      separately identifying LIBOR for such Payment Date, if applicable.

            (xi) the  weighted  average  remaining  term to maturity of the Home
      Loans after giving effect to the amounts distributed on such Payment Date;

            (xii) the weighted average Loan Rates of the Home Loans after giving
      effect to the amounts distributed on such Payment Date;

            (xiii) the percentage of the outstanding  principal  balances of the
      Notes after giving effect to the distributions on that Payment Date;

            (xiv) the number and Pool  Balance  of the Home Loans  after  giving
      effect to the  distribution  of  principal  on such  Payment  Date and the
      number of Home Loans at the beginning and end of the preceding  Collection
      Period;

            (xv) on the  basis of the most  recent  reports  furnished  to it by
      Sub-Servicers, the number and aggregate Loan Balances of Home Loans (a) as
      to which the Monthly Payment is Delinquent  30-59 days,  60-89 days and 90
      or more days, respectively,  (b) that are foreclosed, (c) that have become
      REO and (d) that have  been  finally  liquidated  due to being 180 days or
      more  delinquent,  in each  case as of the end of the  related  Collection
      Period;  provided,  however, that such information will not be provided on
      the statements relating to the first Payment Date;

            (xvi) the  aggregate  Liquidation  Loss  Amounts with respect to the
      related  Collection  Period,  the amount of any  Liquidation  Loss Payment
      Amounts with respect to the Notes,  and the  aggregate of the  Liquidation
      Loss Amounts from all Collection  Periods to date expressed as dollars and
      as a percentage of the aggregate Cut-off Date Loan Balance;

            (xvii)  any  material  modifications,  extensions  or waivers to the
      terms  of the  Home  Loans  during  the  Collection  Period  or that  have
      cumulatively become material over time;

            (xviii)  any  material  breaches  of Home  Loan  representations  or
      warranties or covenants in the Home Loan Purchase Agreement.

            (xix) The amount of any Insured  Payment,  if any,  for such Payment
      Date  and  the  aggregate   amount  of  prior  draws  thereunder  not  yet
      reimbursed;

            (xx) the number,  aggregate  principal balance and book value of any
      REO properties;

                                      -22-
<PAGE>

            (xxi) the aggregate  accrued interest  remaining unpaid, if any, for
      each Class of Securities,  after giving effect to the distribution made on
      such Payment Date;

            (xxii)  (a) the number and  principal  amount of release  agreements
      pursuant to Section  3.05(b)(iv) entered into during the calendar year and
      since the Closing  Date,  stated  separately,  for the Home Loans and, the
      aggregate   outstanding   principal  amount  of  such  release  agreements
      expressed as a percentage  of the Pool Balance with  information  provided
      separately  with  respect  to all  Unsecured  Loans and (b) the number and
      principal amount of Capitalization Workouts pursuant to Section 3.02(a)(v)
      entered into since the Closing Date;

            (xxiii) the aggregate amount recovered during the related Collection
      Period  consisting of all subsequent  recoveries on any Home Loan that was
      180 days or more delinquent;

            (xxiv) [reserved];

            (xxv)  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;

            (xxvi) the amount,  if any, to be paid by a Derivative  Counterparty
      under a Derivative Contract;

            (xxvii)  the  related  Subordinate   Principal  Payment  Amount  and
      Prepayment Payment Percentage, if applicable;

            (xxviii) the weighted  average Pool Strip Rate for such Payment Date
      and the  Pass-Through  Rate with respect to the Class A-V Certificates and
      each Subclass, if any, thereof;

            (xxix) [the Pass-Through  Rates on the [Floater  Certificates]  [and
      Inverse   Floater   Certificates]   for  such  Payment  Date,   separately
      identifying LIBOR for such Payment Date;]

            (xxx) the  Notional  Amount  with  respect to each class of Interest
      Only Securities and each Subclass Notional Amount;

            (xxxi) [the occurrence of the Credit Support Depletion Date [and the
      Accretion Termination Date;]

            (xxxii)  [the related  Senior  Accelerated  Distribution  Percentage
      applicable to such distribution;]

            (xxxiii) [the related Senior Percentage for such Payment Date;]

            (xxxiv) whether or not a Servicing Trigger has occurred; and

            (xxxv) the Outstanding  Reserve Amount and the Reserve Amount Target
      immediately following such Payment Date.

                                      -23-
<PAGE>

      In the case of  information  furnished  pursuant to clauses (vi) and (vii)
above,  the amounts shall be expressed as an aggregate dollar amount per Note or
Certificate, as applicable, with a $1,000 denomination.

      (b) In addition,  with respect to each Payment  Date,  on the Business Day
following the related  Determination  Date, the Master Servicer shall forward to
the Credit Enhancer and the Rating  Agencies the following  information for each
Capitalization Workout entered into during the related Collection Period:

            (i) the original Home Loan amount;

            (ii) the Home Loan amount after the Capitalization Workout;

            (iii) the original Monthly Payment amount;

            (iv) the Monthly Payment amount after the Capitalization Workout;

            (v) the Capitalized Amount as defined in Section 3.02(a)(v) herein;

            (vi) the Combined  Loan-to-Value  Ratio prior to the  Capitalization
      Workout;

            (vii) the  Combined  Loan-to-Value  Ratio  after the  Capitalization
      Workout; and

            (viii)  if  an  appraisal  was  used  in  determining  the  Combined
      Loan-to-Value  Ratio  referred  to in  (vii)  above,  the type and date of
      appraisal.

      The Master Servicer shall also forward to the Indenture  Trustee any other
information  reasonably  requested by the  Indenture  Trustee  necessary to make
distributions  pursuant to Section 3.05 of the Indenture.  Prior to the close of
business on the Business Day next succeeding each Determination Date, the Master
Servicer shall furnish a written  statement to the Certificate  Paying Agent and
the  Indenture  Trustee  setting  forth the  aggregate  amounts  required  to be
withdrawn from the Custodial  Account and deposited into the Payment  Account on
the Business Day  preceding  the related  Payment Date pursuant to Section 3.03.
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 Owner  Trustee and  Indenture  Trustee  shall be protected in
relying  upon  the same  without  any  independent  check  or  verification.  In
addition,  upon the Issuer's written request, the Master Servicer shall promptly
furnish  information  reasonably  requested  by the  Issuer  that is  reasonably
available to the Master Servicer to enable the Issuer to perform its federal and
state income tax reporting obligations.

      The Master  Servicer shall also forward to the Credit  Enhancer and/or its
designees any additional  information,  including without  limitation,  loss and
delinquency  information  requested by the Credit Enhancer,  with respect to the
Home Loans.

      Section 4.02. Tax Reporting. So long as 100% of the Certificates are owned
by the same  person,  then no separate  federal and state income tax returns and
information returns or reports will be filed with respect to the Issuer, and the
Issuer will be treated as an entity disregarded from the 100% Certificateholder.

                                      -24-
<PAGE>

      Section 4.03.  Calculation  of Adjusted Issue Price.  The Master  Servicer
shall  calculate  the  Adjusted  Issue  Price for  purposes of  calculating  the
Termination Price.

      Section 4.04. Exchange Act Reporting.

      (a) The Master  Servicer  shall, on behalf of the Depositor and in respect
of the Trust Estate, 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 Indenture  Trustee shall
timely provide to the Master Servicer (I) a list of  Securityholders as shown on
the Register as of the end of each calendar year,  (II) copies of all pleadings,
other legal process and any other documents  relating to any claims,  charges or
complaints  involving the Indenture Trustee, as trustee hereunder,  or the Trust
Estate that are received by the Indenture  Trustee,  (III) notice of all matters
that, to the actual knowledge of a Responsible Officer of the Indenture Trustee,
have been submitted to a vote of the  Securityholders,  other than those matters
that have been submitted to a vote of the  Securityholders at the request of the
Depositor  or the  Master  Servicer,  and  (IV)  notice  of any  failure  of the
Indenture  Trustee to make any distribution to the  Securityholders  as required
pursuant  to this  Agreement.  Neither  the Master  Servicer  nor the  Indenture
Trustee shall have any liability with respect to the Master  Servicer's  failure
to properly prepare or file such periodic reports  resulting from or relating to
the  Master  Servicer's  inability  or failure  to obtain  any  information  not
resulting from the Master Servicer's own negligence or willful misconduct

      (b) Any Form  10-K  filed  with the  Commission  in  connection  with this
Section 4.04 shall include:

            (i) A  certification,  signed by the senior officer in charge of the
      servicing  functions  of the  Master  Servicer,  in the form  attached  as
      Exhibit D 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 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 certifications.

            (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 3.11.

                                      -25-
<PAGE>

            (iv) The servicer  compliance  certificate  required to be delivered
      pursuant Section 3.10.

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

      (d) This Section  4.04 may be amended in  accordance  with this  Servicing
Agreement without the consent of the Securityholders.

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

                                   ARTICLE V

                                 PAYMENT ACCOUNT

      Section 5.01.  Payment Account.  The Indenture Trustee shall establish and
maintain a Payment  Account  entitled  "[______________________],  as  Indenture
Trustee,  for the benefit of the  Securityholders,  the Credit  Enhancer and the
Certificate   Paying   Agent   pursuant   to   the   Indenture,   dated   as  of
[______________],   200[__],   between   Home  Loan   Trust   20[__]-[___]   and
[______________________]".  The Payment Account shall be an Eligible Account. On
each Payment Date, amounts on deposit in the Payment Account will be distributed
by the Indenture  Trustee in accordance with Section 3.05 of the Indenture.  The
Indenture Trustee shall,  upon written request from the Master Servicer,  invest
or cause the institution  maintaining the Payment Account to invest the funds in
the  Payment  Account in  Permitted  Investments  designated  in the name of the
Indenture  Trustee,  which  shall  mature not later than the  Business  Day next
preceding the Payment Date next  following the date of such  investment  (except
that (i) any  investment in the  institution  with which the Payment  Account is
maintained or a fund for which such  institution  serves as custodian may mature
on such  Payment Date and (ii) any other  investment  may mature on such Payment
Date if the  Indenture  Trustee  shall advance funds on such Payment Date to the
Payment  Account in the amount payable on such  investment on such Payment Date,
pending receipt  thereof to the extent  necessary to make  distributions  on the
Securities)  and shall not be sold or disposed of prior to maturity.  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 Payment  Account by the Master Servicer out of its own funds
immediately as realized.

                                      -26-
<PAGE>

                                   ARTICLE VI

                               THE MASTER SERVICER

      Section 6.01. Liability of the Master Servicer.  The Master Servicer shall
be  liable  in  accordance  herewith  only  to the  extent  of  the  obligations
specifically imposed upon and undertaken by the Master Servicer herein.

      Section 6.02. Merger or Consolidation of, or Assumption of the Obligations
of, the Master Servicer. Any Person into which 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 Master Servicer shall be a
party, or any Person succeeding to the business of the Master Servicer, shall be
the successor of the Master Servicer, hereunder, without the execution or filing
of any  paper  or any  further  act on the  part of any of the  parties  hereto,
anything herein to the contrary notwithstanding.

      The Master  Servicer  may assign  its rights and  delegate  its duties and
obligations under this Servicing  Agreement;  provided that the Person accepting
such  assignment or  delegation  shall be a Person which is qualified to service
Home Loans and is reasonably  satisfactory to the Indenture  Trustee (as pledgee
of the Home Loans),  the Credit  Enhancer and the Issuer,  is willing to service
the Home Loans and executes and delivers to the Indenture Trustee and the Issuer
an  agreement  in form  and  substance  reasonably  satisfactory  to the  Credit
Enhancer,  the Indenture Trustee and the Issuer, 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
Servicing  Agreement;  provided  further that each Rating Agency's rating of the
Securities 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), if
determined  without regard to the Credit  Enhancement  Instrument,  and provided
further that the Owner Trustee receives an Opinion of Counsel to the effect that
such  assignment  or  delegation  shall not cause the Trust to be  treated  as a
corporation for federal or state income tax purposes.

      Notwithstanding anything to the contrary set forth herein, any Person into
which 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  Master  Servicer  shall be a party,  or any  Person
succeeding to the business of the Master Servicer, shall be the successor of the
Master Servicer,  hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto.

      Section 6.03.  Limitation on Liability of the Master  Servicer and Others.
Neither the Master Servicer nor any of the directors or officers or employees or
agents of the Master  Servicer  shall be under any liability to the Issuer,  the
Owner Trustee, the Indenture Trustee or the Securityholders for any action taken
or for  refraining  from the taking of any action in good faith pursuant to this
Servicing Agreement,  provided,  however,  that this provision shall not protect
the Master  Servicer  or any such  Person  against  any  liability  which  would
otherwise  be imposed by reason of its willful  misfeasance,  bad faith or gross
negligence  in the  performance  of its  duties  hereunder  or by  reason of its
reckless disregard of its obligations and duties hereunder.  The Master Servicer
and any director or officer or employee or agent of the Master Servicer may rely

                                      -27-
<PAGE>

in good faith on any  document of any kind prima  facie  properly  executed  and
submitted by any Person  respecting any matters  arising  hereunder.  The Master
Servicer and any director or officer or employee or agent of the Master Servicer
shall be indemnified by the Issuer and held harmless against any loss, liability
or  expense  incurred  in  connection  with any legal  action  relating  to this
Servicing  Agreement or the  Securities,  including any amount paid to the Owner
Trustee or the Indenture  Trustee  pursuant to Section  6.06(b),  other than any
loss,  liability or expense incurred by reason of its willful  misfeasance,  bad
faith or gross  negligence  in the  performance  of its duties  hereunder  or by
reason of its reckless  disregard of its obligations and duties  hereunder.  The
Master  Servicer  shall not be under any  obligation to appear in,  prosecute or
defend any legal  action  which is not  incidental  to its duties to service the
Home Loans in accordance with this Servicing Agreement, and which in its opinion
may involve it in any expense or liability;  provided,  however, that the Master
Servicer may in its sole discretion  undertake any such action which it may deem
necessary or desirable in respect of this  Servicing  Agreement,  and the rights
and duties of the parties  hereto and the interests of the  Securityholders.  In
such  event,  the  reasonable  legal  expenses  and costs of such action and any
liability  resulting  therefrom shall be expenses,  costs and liabilities of the
Issuer, and the Master Servicer shall be entitled to be reimbursed therefor. The
Master  Servicer's right to indemnity or reimbursement  pursuant to this Section
6.03 shall  survive  any  resignation  or  termination  of the  Master  Servicer
pursuant to Section 6.04 or 7.01 with respect to any losses,  expenses, costs or
liabilities  arising prior to such  resignation or termination  (or arising from
events that occurred prior to such resignation or termination).

      Section 6.04. Master Servicer Not to Resign.  Subject to the provisions of
Section 6.02,  the Master  Servicer  shall not resign from the  obligations  and
duties hereby imposed on it except (i) upon  determination  that the performance
of  its  obligations  or  duties  hereunder  are  no  longer  permissible  under
applicable law or are in material  conflict by reason of applicable law with any
other activities  carried on by it or its subsidiaries or Affiliates,  the other
activities of the Master Servicer so causing such a conflict being of a type and
nature carried on by the Master  Servicer or its  subsidiaries  or Affiliates at
the date of this Servicing  Agreement or (ii) upon satisfaction of the following
conditions:  (a) the Master Servicer shall have proposed a successor servicer to
the Issuer and the  Indenture  Trustee in writing  and such  proposed  successor
servicer is  reasonably  acceptable to the Issuer,  the Credit  Enhancer and the
Indenture  Trustee;  (b) each Rating Agency shall have delivered a letter to the
Issuer,  the Credit Enhancer and the Indenture  Trustee prior to the appointment
of the  successor  servicer  stating  that  the  proposed  appointment  of  such
successor servicer as Master Servicer hereunder will not result in the reduction
or  withdrawal  of the then  current  rating of the  Securities,  if  determined
without  regard to the  Credit  Enhancement  Instrument;  and (c) such  proposed
successor servicer is reasonably acceptable to the Credit Enhancer, as evidenced
by a letter to the Issuer and the Indenture Trustee, provided,  however, that no
such  resignation  by the Master  Servicer  shall  become  effective  until such
successor  servicer  or, in the case of (i) above,  the  Indenture  Trustee,  as
pledgee  of  the  Home  Loans,   shall  have   assumed  the  Master   Servicer's
responsibilities and obligations  hereunder or the Indenture Trustee, as pledgee
of the Home Loans, shall have designated a successor servicer in accordance with
Section  7.02.  Any such  resignation  shall not relieve the Master  Servicer of
responsibility for any of the obligations specified in Sections 7.01 and 7.02 as
obligations  that survive the resignation or termination of the Master Servicer.
Any such  determination  permitting the resignation of the Master Servicer shall
be evidenced by an Opinion of Counsel to such effect  delivered to the Indenture
Trustee and the Credit  Enhancer.  The Master  Servicer shall pay the

                                      -28-
<PAGE>

reasonable  expenses of the Indenture  Trustee in connection  with any servicing
transition hereunder.

      Section 6.05.  Delegation of Duties.  In the ordinary  course of business,
the Master Servicer at any time may delegate any of its duties  hereunder to any
Person,  including any of its  Affiliates,  who agrees to conduct such duties in
accordance  with  standards  comparable to those with which the Master  Servicer
complies  pursuant to Section 3.01. Such delegation shall not relieve the Master
Servicer of its liabilities and responsibilities with respect to such duties and
shall not constitute a resignation within the meaning of Section 6.04.

      Section  6.06.  Master  Servicer  to Pay  Indenture  Trustee's  and  Owner
Trustee's Fees and Expenses; Indemnification.  (a) The Master Servicer covenants
and agrees to pay to the Owner Trustee, the Indenture Trustee and any co-trustee
of the Indenture  Trustee or the Owner Trustee from time to time,  and the Owner
Trustee,  the Indenture  Trustee and any such  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  created under the Trust
Agreement and the Indenture  and in the exercise and  performance  of any of the
powers and duties under the Trust  Agreement or the  Indenture,  as the case may
be, of the Owner  Trustee,  the Indenture  Trustee and any  co-trustee,  and the
Master  Servicer will pay or reimburse the Indenture  Trustee and any co-trustee
upon request for all reasonable expenses, disbursements and advances incurred or
made by the Indenture  Trustee or any  co-trustee in accordance  with any of the
provisions of this Servicing Agreement or the Indenture except any such expense,
disbursement or advance as may arise from its negligence, willful misfeasance or
bad faith.

      (b) The Master Servicer agrees to indemnify the Indenture  Trustee and the
Owner Trustee for, and to hold the Indenture  Trustee and the Owner Trustee,  as
the case may be,  harmless  against,  any loss,  liability  or expense  incurred
without negligence, bad faith or willful misconduct on the part of the Indenture
Trustee  or the  Owner  Trustee,  as the  case  may be,  arising  out of,  or in
connection with, the acceptance and  administration of the Issuer and the assets
thereof,  including the costs and expenses (including  reasonable legal fees and
expenses) of defending the Indenture  Trustee or the Owner Trustee,  as the case
may be, against any claim in connection  with the exercise or performance of any
of its powers or duties under any Basic Document (including, without limitation,
any claim  against  the  Indenture  Trustee  or the  Owner  Trustee  alleging  a
violation of the  Homeownership  and Equity Protection Act of 1994, as amended),
provided that:

            (i) with respect to any such claim,  the Indenture  Trustee or Owner
      Trustee,  as the case may be, shall have given the Master Servicer written
      notice thereof promptly after the Indenture  Trustee or Owner Trustee,  as
      the case may be, shall have actual knowledge thereof;

            (ii) while maintaining control over its own defense, the Issuer, the
      Indenture  Trustee or Owner Trustee,  as the case may be, shall  cooperate
      and consult fully with the Master Servicer in preparing such defense; and

            (iii)  notwithstanding  anything in this Servicing  Agreement to the
      contrary,  the Master  Servicer  shall not be liable for settlement of any
      claim by the Indenture  Trustee or

                                      -29-
<PAGE>

      the Owner  Trustee,  as the case may be,  entered  into  without the prior
      consent of the Master Servicer.

No termination of this Servicing  Agreement shall affect the obligations created
by this Section 6.06 of the Master  Servicer to indemnify the Indenture  Trustee
and the Owner Trustee under the conditions and to the extent set forth herein.

      Notwithstanding the foregoing,  the indemnification provided by the Master
Servicer  in this  Section  6.06(b)  shall  not be  available  (a) for any loss,
liability or expense of the Indenture  Trustee or the Owner  Trustee,  including
the costs and  expenses  of  defending  itself  against  any claim,  incurred in
connection with any actions taken by the Indenture  Trustee or the Owner Trustee
at the direction of the Noteholders or  Certificateholders,  as the case may be,
pursuant to the terms of this Servicing  Agreement or (b) where  indemnification
by the Indenture Trustee is required pursuant to Section 9.05(a).

                                  ARTICLE VII

                                     DEFAULT

      Section  7.01.  Servicing  Default.  If any  one of the  following  events
("Servicing Default") shall occur and be continuing:

            (i) Any failure by the Master  Servicer to deposit in the  Custodial
      Account or to remit to the Paying Agent for deposit in the Payment Account
      any  deposit  required  to be made  under  the  terms  of  this  Servicing
      Agreement  which  continues  unremedied for a period of five Business Days
      after the date upon which  written  notice of such failure shall have been
      given to the Master Servicer by the Issuer or the Indenture Trustee, or to
      the Master  Servicer,  the Issuer and the Indenture  Trustee by the Credit
      Enhancer; or

            (ii) Failure on the part of the Master  Servicer  duly to observe or
      perform in any material  respect any other  covenants or agreements of the
      Master  Servicer  set  forth  in  the  Securities  or  in  this  Servicing
      Agreement,  which failure, in each case,  materially and adversely affects
      the  interests  of  Securityholders  or  the  Credit  Enhancer  and  which
      continues  unremedied  for a  period  of 45 days  after  the date on which
      written  notice of such failure,  requiring  the same to be remedied,  and
      stating  that such notice is a "Notice of Default"  hereunder,  shall have
      been given to the Master Servicer by the Issuer or the Indenture  Trustee,
      or to the Master  Servicer,  the Issuer and the  Indenture  Trustee by the
      Credit Enhancer; or

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

                                      -30-
<PAGE>

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

Then, and in every such case, so long as a Servicing Default shall not have been
remedied by the Master  Servicer,  either the Issuer or the  Indenture  Trustee,
with the consent of the Credit Enhancer (so long as no Credit  Enhancer  Default
has occurred and is  continuing),  or the Credit  Enhancer (so long as no Credit
Enhancer  Default  has  occurred  and is  continuing),  by notice  then given in
writing to the Master  Servicer (and to the Issuer and the Indenture  Trustee if
given by the Credit Enhancer) may terminate all of the rights and obligations of
the Master  Servicer as servicer under this Servicing  Agreement  other than its
right to receive  servicing  compensation  and expenses for  servicing  the Home
Loans hereunder  during any period prior to the date of such termination and the
Issuer or the Indenture Trustee with the consent of the Credit Enhancer (so long
as no Credit  Enhancer  Default has occurred and is  continuing),  or the Credit
Enhancer (so long as no Credit Enhancer  Default has occurred and is continuing)
may exercise  any and all other  remedies  available at law or equity.  Any such
notice to the Master  Servicer  shall also be given to each Rating  Agency,  the
Indenture  Trustee,  the Credit Enhancer and the Issuer. On or after the receipt
by the Master  Servicer of such written  notice,  all authority and power of the
Master  Servicer  under this  Servicing  Agreement,  whether with respect to the
Securities  or the Home Loans or  otherwise,  shall pass to and be vested in the
Indenture  Trustee as  successor  Master  Servicer,  pursuant  to and under this
Section  7.01;  and,  without  limitation,   the  Indenture  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 of each Home Loan and related  documents,
or otherwise. The Master Servicer agrees to cooperate with the Indenture Trustee
in effecting the  termination of the  responsibilities  and rights of the Master
Servicer hereunder, including, without limitation, the transfer to the Indenture
Trustee for the  administration  by it of all cash amounts  relating to the Home
Loans that shall at the time be held by the Master  Servicer and to be deposited
by it in the  Custodial  Account,  or that have  been  deposited  by the  Master
Servicer in the Custodial Account or thereafter  received by the Master Servicer
with respect to the Home Loans.  All reasonable  costs and expenses  (including,
but not limited to,  attorneys'  fees) incurred in connection with amending this
Servicing  Agreement to reflect such succession as Master  Servicer  pursuant to
this Section 7.01 shall be paid by the  predecessor  Master  Servicer (or if the
predecessor  Master  Servicer  is the  Indenture  Trustee,  the

                                      -31-
<PAGE>

initial Master Servicer) upon  presentation of reasonable  documentation of such
costs and expenses.

      Notwithstanding  any  termination of the activities of the Master Servicer
hereunder,  the Master  Servicer  shall be entitled to receive,  out of any late
collection  of a  payment  on a Home  Loan  which  was due  prior to the  notice
terminating the Master Servicer's rights and obligations  hereunder and received
after such  notice,  that portion to which the Master  Servicer  would have been
entitled  pursuant to Sections 3.03 and 3.09 as well as its Master Servicing Fee
in  respect  thereof,  and any other  amounts  payable  to the  Master  Servicer
hereunder  the  entitlement  to  which  arose  prior to the  termination  of its
activities hereunder.

      Notwithstanding the foregoing,  a delay in or failure of performance under
Section  7.01(i) or under Section  7.01(ii) after the  applicable  grace periods
specified in such  Sections,  shall not  constitute a Servicing  Default if such
delay or failure could not be prevented by the exercise of reasonable  diligence
by the Master  Servicer and such delay or failure was caused by an act of God or
the public enemy, acts of declared or undeclared war, public disorder, rebellion
or sabotage, epidemics,  landslides,  lightning, fire, hurricanes,  earthquakes,
floods or similar  causes.  The preceding  sentence shall not relieve the Master
Servicer from using reasonable efforts to perform its respective  obligations in
a timely manner in accordance with the terms of this Servicing Agreement and the
Master Servicer shall provide the Indenture Trustee, the Credit Enhancer and the
Securityholders  with  notice of such  failure or delay by it,  together  with a
description of its efforts to so perform its  obligations.  The Master  Servicer
shall  immediately  notify the Indenture  Trustee,  the Credit  Enhancer and the
Issuer in writing of any Servicing Default.

      Section 7.02. Indenture Trustee 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 sends a notice  pursuant  to  Section  6.04,  the  Indenture
Trustee  shall be the  successor in all  respects to the Master  Servicer in its
capacity as servicer under this  Servicing  Agreement and the  transactions  set
forth or provided  for herein and shall be subject to all the  responsibilities,
duties and  liabilities  relating  thereto placed on the Master  Servicer by the
terms and provisions hereof. Nothing in this Servicing Agreement or in the Trust
Agreement  shall be construed to permit or require the Indenture  Trustee to (i)
succeed to the  responsibilities,  duties and  liabilities of the initial Master
Servicer in its capacity as Seller under the Home Loan Purchase Agreement,  (ii)
be  responsible or  accountable  for any act or omission of the Master  Servicer
prior to the issuance of a notice of  termination  hereunder,  (iii)  require or
obligate the Indenture Trustee, in its capacity as successor Master Servicer, to
purchase,  repurchase or substitute  any Home Loan,  (iv) fund any losses on any
Permitted Investment directed by any other Master Servicer or (v) be responsible
for the representations  and warranties of the Master Servicer.  As compensation
therefor,  the Indenture  Trustee shall be entitled to such  compensation as the
Master  Servicer  would have been  entitled  to  hereunder  if no such notice of
termination  had been given.  Notwithstanding  the above,  (i) if the  Indenture
Trustee  is  unwilling  to act as  successor  Master  Servicer,  or  (ii) if the
Indenture Trustee is legally unable so to act, the Indenture Trustee may (in the
situation  described  in clause  (i)) or shall (in the  situation  described  in
clause (ii))  appoint or petition a court of competent  jurisdiction  to appoint
any  established  housing and home finance  institution,  bank or other mortgage
loan  or  home  equity  loan  servicer  having  a net  worth  of not  less  than
$10,000,000 as the successor to the Master Servicer  hereunder in the assumption
of all or any

                                      -32-
<PAGE>

part of the  responsibilities,  duties or  liabilities  of the  Master  Servicer
hereunder;  provided that any such successor Master Servicer shall be acceptable
to the Credit  Enhancer,  as evidenced by the Credit  Enhancer's  prior  written
consent (so long as no Credit Enhancer  Default has occurred and is continuing),
which consent shall not be unreasonably  withheld, and provided further that the
appointment  of any  such  successor  Master  Servicer  will not  result  in the
qualification, reduction or withdrawal of the ratings assigned to the Securities
by the Rating Agencies,  if determined  without regard to the Credit Enhancement
Instrument. Pending appointment of a successor to the Master Servicer hereunder,
unless the Indenture Trustee is prohibited by law from so acting,  the Indenture
Trustee shall act in such capacity as herein above provided.  In connection with
such appointment and assumption, the successor Master Servicer shall be entitled
to receive  compensation out of payments on Home Loans in an amount equal to the
compensation which the Master Servicer would otherwise have received pursuant to
Section  3.09 (or such lesser  compensation  as the  Indenture  Trustee and such
successor shall agree). The appointment of a successor Master Servicer shall not
affect any liability of the  predecessor  Master  Servicer which may have arisen
under this  Servicing  Agreement  prior to its  termination  as Master  Servicer
(including,  without limitation,  the obligation to purchase Home Loans pursuant
to Section 3.01, to pay any  deductible  under an insurance  policy  pursuant to
Section 3.04 or to indemnify the Indenture  Trustee  pursuant to Section  6.06),
nor shall any successor  Master  Servicer be liable for any acts or omissions of
the predecessor Master Servicer or for any breach by such Master Servicer of any
of its representations or warranties contained herein or in any related document
or agreement.  The Indenture  Trustee and such successor shall take such action,
consistent  with this Servicing  Agreement,  as shall be necessary to effectuate
any such succession.

      (b) Any successor, including the Indenture Trustee, to the Master Servicer
as servicer  shall  during the term of its service as servicer  (i)  continue to
service and  administer  the Home Loans for the benefit of the  Securityholders,
(ii)  maintain in force a policy or policies of  insurance  covering  errors and
omissions in the performance of its obligations as Master Servicer hereunder and
a fidelity  bond in respect of its  officers,  employees  and agents to the same
extent as the Master Servicer is so required  pursuant to Section 3.13 and (iii)
be bound by the terms of the Insurance Agreement.

      (c) Any successor Master Servicer,  including the Indenture Trustee, shall
not be deemed  in  default  or to have  breached  its  duties  hereunder  if the
predecessor  Master  Servicer shall fail to deliver any required  deposit to the
Custodial Account or otherwise cooperate with any required servicing transfer or
succession hereunder.

      (d) In  connection  with the  termination  or  resignation  of the  Master
Servicer  hereunder,  either (i) the successor  Master  Servicer,  including the
Indenture  Trustee  if the  Indenture  Trustee  is  acting as  successor  Master
Servicer,  shall  represent  and  warrant  that it is a  member  of MERS in good
standing and shall agree to comply in all material  respects  with the rules and
procedures of MERS in  connection  with the servicing of the Home 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

                                      -33-
<PAGE>

the Mortgage from MERS to the Indenture  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 Home Loan or  servicing  of such Home Loan on the
MERS System to the successor  Master Servicer.  The predecessor  Master Servicer
shall file or cause to be filed any such assignment in the appropriate recording
office.  The  predecessor  Master  Servicer shall bear any and all fees of MERS,
costs of preparing any assignments of Mortgage, and fees and costs of filing any
assignments  of Mortgage  that may be required  under this  subsection  (d). The
successor  Master  Servicer  shall cause such  assignment to be delivered to the
Indenture  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 Securityholders.  Upon any termination of or
appointment of a successor to the Master  Servicer  pursuant to this Article VII
or Section 6.04, the Indenture  Trustee shall give prompt written notice thereof
to the Securityholders, the Credit Enhancer, the Issuer and each Rating Agency.

      Section 7.04.  Servicing  Trigger;  Removal of Master  Servicer.  (a) Upon
determination by the Credit Enhancer that a Servicing Trigger has occurred,  the
Credit  Enhancer  shall  give  notice of such  Servicing  Trigger  to the Master
Servicer, the Depositor, the Indenture Trustee and to each Rating Agency.

      (b) At any time after such  determination and while a Servicing Trigger is
continuing,  the Credit Enhancer may direct the Indenture  Trustee in writing to
remove the Master Servicer if the Credit Enhancer makes a determination that the
manner  of  master  servicing  was a  factor  contributing  to the  size  of the
delinquencies or losses incurred in the Trust Estate.

      (c) Upon receipt of directions to remove the Master  Servicer  pursuant to
the preceding clause (b), the Indenture Trustee shall notify the Master Servicer
that it has been  terminated and the Master  Servicer shall be terminated in the
same manner as specified in Sections 7.01 and 7.02.

      (d) After notice of occurrence  of a Servicing  Trigger has been given and
while a Servicing  Trigger is continuing,  until and unless the Master  Servicer
has been removed as provided in clause (b), the Master  Servicer  covenants  and
agrees  to act as the  Master  Servicer  for a term from the  occurrence  of the
Servicing  Trigger to the end of the  calendar  quarter in which such  Servicing
Trigger occurs,  which term may at the Credit Enhancer's  discretion be extended
by notice to the Indenture  Trustee for  successive  terms of three (3) calendar
months each,  until the  termination  of the Trust Estate.  The Master  Servicer
will,  upon the receipt of each such  notice of  extension  (a "Master  Servicer
Extension  Notice")  become  bound for the  duration of the term covered by such
Master Servicer  Extension  Notice to continue as Master Servicer subject to and
in accordance with this Agreement.  If, as of the fifteenth  (15th) day prior to
the last day of any term as the Master Servicer, the Indenture Trustee shall not
have received any Master Servicer Extension Notice from the Credit Enhancer, the
Indenture Trustee shall, within five (5) Business Days thereafter,  give written
notice of such no receipt to the Credit Enhancer and the Master Servicer. If any
such term expires without a Master Servicer  Extension Notice then the Indenture
Trustee shall act as successor Master Servicer as provided in Section 7.02.

                                      -34-
<PAGE>

      (e) No  provision  of this  Section 7.04 shall have the effect of limiting
the rights of the Depositor,  the Indenture Trustee,  the Securityholders or the
Credit Enhancer under Section 7.01.

                                  ARTICLE VIII

                            MISCELLANEOUS PROVISIONS

      Section 8.01. Amendment. This Servicing Agreement may be amended from time
to time by the parties  hereto,  provided that any amendment be accompanied by a
letter  from the  Rating  Agencies  that the  amendment  will not  result in the
downgrading  or  withdrawal of the rating then  assigned to the  Securities,  if
determined without regard to the Credit Enhancement Instrument,  and the consent
of the Credit Enhancer (so long as no Credit  Enhancer  Default has occurred and
is continuing)  and the Indenture  Trustee.  Promptly after the execution by the
Master Servicer,  the Issuer and the Indenture  Trustee of any amendment of this
Servicing  Agreement  pursuant to this Section 8.01, the Indenture Trustee shall
provide the Custodian with written copies thereof.  Any failure of the Indenture
Trustee to mail such notice, or any defect therein,  shall not, however,  in any
way impair or affect the validity of any such amendment.

      Section 8.02.  GOVERNING LAW. THIS SERVICING  AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,  WITHOUT  REFERENCE TO ITS
CONFLICTS OF LAW  PROVISIONS  (OTHER THAN SECTIONS  5-1401 AND 5-1402 OF THE NEW
YORK GENERAL  OBLIGATIONS LAW), AND THE OBLIGATIONS,  RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

      Section 8.03. Notices. All demands,  notices and communications  hereunder
shall be in writing  and shall be deemed to have been duly  given if  personally
delivered at or mailed by certified mail,  return receipt  requested,  to (a) in
the case of the Master Servicer,  2255 North Ontario Street, Suite 400, Burbank,
California 91504-3120,  Attention: Addition Director - Bond Administration,  (b)
in the case of Moody's,  Home Mortgage Loan Monitoring  Group, 99 Church Street,
4th Floor,  New York, New York 10007,  (c) in the case of Standard & Poor's,  55
Water  Street - 41st Floor,  New York,  New York 10041,  Attention:  Residential
Mortgage Surveillance Group, (d) in the case of the Owner Trustee,  [_________],
[Address],  Attention:  Corporate Trust  Administration,  (e) in the case of the
Issuer,  to Home  Loan  Trust  20[__]-[___],  c/o  Owner  Trustee,  [_________],
[Address],  Attention:  Corporate Trust  Administration,  (f) in the case of the
Indenture Trustee, [______________________] Attention: Structured Finance/RFMSII
Home  Loan  Trust  20[__]-[___],  (g)  in  the  case  of  the  Credit  Enhancer,
[_____________________],    (h)   in   the   case   of   the    Underwriter   to
[____________________________];  or, as to each party,  at such other address as
shall be designated by such party in a written  notice to each other party.  Any
notice required or permitted to be mailed to a Securityholder  shall be given by
first class mail,  postage  prepaid,  at the address of such  Securityholder  as
shown in the Register.  Any notice so mailed within the time  prescribed in this
Servicing  Agreement  shall be  conclusively  presumed  to have been duly given,
whether or not the  Securityholder  receives  such  notice.  Any notice or other
document

                                      -35-
<PAGE>

required to be delivered or mailed by the Indenture Trustee to any Rating Agency
shall be given on a  reasonable  efforts  basis and only as a matter of courtesy
and  accommodation and the Indenture Trustee shall have no liability for failure
to delivery such notice or document to any Rating Agency.

      Section  8.04.  Severability  of  Provisions.  If any  one or  more of the
covenants, agreements,  provisions or terms of this Servicing 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 Servicing Agreement and shall in no way
affect the validity or  enforceability of the other provisions of this Servicing
Agreement or of the Securities or the rights of the Securityholders thereof.

      Section 8.05.  Third-Party  Beneficiaries.  This Servicing Agreement shall
inure  to  the  benefit  of  and  be  binding  upon  the  parties  hereto,   the
Securityholders,  the Credit  Enhancer,  the Owner Trustee and their  respective
successors and permitted assigns. Except as otherwise provided in this Servicing
Agreement,  no other Person shall have any right or  obligation  hereunder.  The
Credit Enhancer is a third-party beneficiary of this Servicing Agreement.

      Section 8.06. Counterparts.  This instrument may be executed in any number
of  counterparts,  each of which so executed  shall be deemed to be an original,
but all  such  counterparts  shall  together  constitute  but  one and the  same
instrument.

      Section  8.07.  Effect of Headings and Table of Contents.  The Article and
Section  headings herein and the Table of Contents are for convenience  only and
shall not affect the construction hereof.

      Section  8.08.  Termination  Upon  Purchase  by  the  Master  Servicer  or
Liquidation  of  All  Home  Loans;   Partial  Redemption.   (a)  The  respective
obligations  and  responsibilities  of the Master  Servicer,  the Issuer and the
Indenture  Trustee  created hereby shall terminate upon the last action required
to be taken by the Issuer  pursuant to the Trust  Agreement and by the Indenture
Trustee pursuant to the Indenture following the earlier of:

            (i) the date on or before which the Indenture or Trust  Agreement is
      terminated, or

            (ii) the purchase by the Master Servicer from the Issuer of all Home
      Loans and all  property  acquired  in  respect of any Home Loan at a price
      equal to the Termination Price.

The right of the Master  Servicer to purchase the assets of the Issuer  pursuant
to clause (ii) above on any Payment  Date is  conditioned  upon the Pool Balance
(after applying payments received in the related  Collection  Period) as of such
Payment  Date being less than ten percent of the  aggregate  of the Cut-off Date
Loan Balances of the Home Loans;  provided,  however, that no such purchase will
be  permitted  if it  would  result  in a  draw  under  the  Credit  Enhancement
Instrument or will result in any amounts owing to the Credit Enhancer  remaining
unreimbursed,  unless,  in either case, the Credit Enhancer consents (so long as
no Credit  Enhancer  Default has occurred and is  continuing)  in writing to the
purchase. If such right is exercised by the Master Servicer, the Master Servicer
shall deposit the  Termination  Price  calculated  pursuant to clause

                                      -36-
<PAGE>

(ii) above with the Indenture  Trustee pursuant to Section 4.10 of the Indenture
and, upon the receipt of such deposit,  the Indenture Trustee or Custodian shall
release to the Master  Servicer,  the files  pertaining  to the Home Loans being
purchased.

      (b) The Master Servicer, at its expense,  shall prepare and deliver to the
Indenture  Trustee for execution,  at the time the Home Loans are to be released
to the Master Servicer, appropriate documents assigning each such Home Loan from
the Indenture  Trustee or the Issuer to the Master  Servicer or the  appropriate
party.

      (c) The Master  Servicer  shall give the  Indenture  Trustee not less than
seven  Business  Days' prior  written  notice of the  Payment  Date on which the
Master  Servicer  anticipates  that  the  final  distribution  will  be  made to
Noteholders. Notice of any termination, specifying the anticipated Final Insured
Payment Date or other  Payment Date (which shall be a date that would  otherwise
be a Payment Date) upon which the  Noteholders  may surrender their Notes to the
Indenture  Trustee (if so required by the terms hereof) for payment of the final
distribution and cancellation, shall be given promptly by the Master Servicer to
the Indenture Trustee specifying:

            (i) the anticipated Final Insured Payment Date or other Payment Date
      upon  which  final  payment  of the Notes is  anticipated  to be made upon
      presentation  and  surrender  of  Notes at the  office  or  agency  of the
      Indenture Trustee therein designated; and

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

      Section 8.09.  Certain Matters  Affecting the Indenture  Trustee.  For all
purposes of this Servicing Agreement, in the performance of any of its duties or
in the exercise of any of its powers  hereunder,  the Indenture Trustee shall be
subject to and entitled to the benefits of Article VI of the Indenture.

      Section 8.10. Owner Trustee Not Liable for Related Documents. The recitals
contained  herein shall be taken as the  statements  of the  Depositor,  and the
Owner Trustee assumes no responsibility for the correctness  thereof.  The Owner
Trustee  makes no  representations  as to the  validity or  sufficiency  of this
Servicing  Agreement,  of any Basic Document or of the Certificates  (other than
the signatures of the Owner Trustee on the Certificates) or the Notes, or of any
Related Documents,  or of MERS or the MERS(R) System. The Owner Trustee shall at
no time have any  responsibility or liability with respect to the sufficiency of
the Owner Trust Estate or its ability to generate the payments to be distributed
to  Certificateholders  under the Trust Agreement or the  Noteholders  under the
Indenture,  including,  the  compliance  by the Depositor or the Seller with any
warranty  or  representation  made under any Basic  Document  or in any  related
document or the accuracy of any such warranty or  representation,  or any action
of the  Certificate  Paying Agent,  the  Certificate  Registrar or the Indenture
Trustee taken in the name of the Owner Trustee.

                                      -37-
<PAGE>

                                   ARTICLE IX

                          COMPLIANCE WITH REGULATION AB

      Section 9.01. Intent of Parties; Reasonableness.

      The Depositor,  the Indenture Trustee and the Master Servicer  acknowledge
and agree that the purpose of this Article IX is to facilitate compliance by the
Depositor with the provisions of Regulation AB and related rules and regulations
of the  Commission.  The  Depositor  shall not  exercise  its  right to  request
delivery of information or other  performance  under these provisions other than
in good faith,  or for purposes other than  compliance  with the Securities Act,
the  Exchange  Act and the rules and  regulations  of the  Commission  under the
Securities  Act and  the  Exchange  Act.  Each of the  Master  Servicer  and the
Indenture  Trustee  acknowledges  that  interpretations  of the  requirements of
Regulation  AB may  change  over  time,  whether  due to  interpretive  guidance
provided by the Commission or its staff,  consensus  among  participants  in the
mortgage-backed  securities markets, advice of counsel, or otherwise, and agrees
to comply  with  reasonable  requests  made by the  Depositor  in good faith for
delivery  of  information  under  these  provisions  on the  basis  of  evolving
interpretations  of Regulation AB. Each of the Master Servicer and the Indenture
Trustee  shall  cooperate  reasonably  with  the  Depositor  to  deliver  to the
Depositor (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  Depositor  to permit the
Depositor to comply with the provisions of Regulation AB.

      Section 9.02.  Additional  Representations and Warranties of the Indenture
Trustee.

      (a) The Indenture Trustee shall be deemed to represent to the Depositor as
of the  Closing  Date and on each date on which  information  is provided to the
Depositor  under  Sections  9.01,  9.02(b) or 9.03 that,  except as disclosed in
writing to the  Depositor  prior to such  date:  (i) it is not aware and has not
received  notice  that any  default,  early  amortization  or other  performance
triggering event has occurred as to any other Securitization  Transaction due to
any default of the Indenture 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  Noteholders;   (iv)  there  are  no   relationships  or
transactions  relating to the Indenture Trustee with respect to the Depositor or
any sponsor, issuing entity, servicer, trustee, originator, significant obligor,
enhancement  or support  provider or other material  transaction  party (as such
terms are used in  Regulation  AB)  relating to the  Securitization  Transaction
contemplated by this Servicing Agreement,  as identified by the Depositor to the
Indenture  Trustee in writing  as of the  Closing  Date  (each,  a  "Transaction
Party") that are outside the ordinary  course of business or on terms other than
would be obtained in an arm's length  transaction with an unrelated third party,
apart  from  the  Securitization  Transaction,  and  that  are  material  to the
investors'  understanding of the Notes; and (v) the Indenture  Trustee is not an
affiliate of any  Transaction  Party.  The Depositor  shall notify the Indenture
Trustee of any change in the identity of a  Transaction  Party after the Closing
Date.

                                      -38-
<PAGE>

      (b) If so requested by the  Depositor  on any date  following  the Closing
Date,  the Indenture  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  Depositor.  Any such  request  from the
Depositor  shall not be given more than once each calendar  quarter,  unless the
Depositor  shall have a  reasonable  basis for a  determination  that any of the
representations and warranties may not be accurate.

      Section 9.03. Information to Be Provided by the Indenture Trustee.

      For so long as the Notes are  outstanding,  for the purpose of  satisfying
the Depositor's  reporting obligation under the Exchange Act with respect to any
Class of Notes,  the Indenture  Trustee shall provide to the Depositor a written
description of (a) any litigation or  governmental  proceedings  pending against
the Indenture  Trustee as of the last day of each  calendar  month that would be
material to Noteholders, and (b) any affiliations or relationships (as described
in Item 1119 of Regulation  AB) that develop  following the Closing Date between
the Indenture Trustee and any Transaction Party of the type described in Section
9.02(a)(iv)  or  9.02(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  9.03 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 9.03 shall be given no later than January 31 of
the calendar year following the year in which the relevant  event occurs.  As of
the date the  Depositor  or Master  Servicer  files each Report on Form 10-D and
Report on Form 10-K with  respect to the Notes,  the  Indenture  Trustee will be
deemed to represent that any information  previously provided under this Article
IX is  materially  correct and does not have any material  omissions  unless the
Indenture Trustee has provided an update to such information. The Depositor will
allow the  Indenture  Trustee  to review any  disclosure  relating  to  material
litigation  against the Indenture  Trustee prior to filing such  disclosure with
the Commission to the extent the Depositor  changes the information  provided by
the Indenture Trustee.

      Section 9.04. Report on Assessment of Compliance and Attestation.

      On or before March 15 of each calendar year, the Indenture Trustee shall:

      (a) deliver to the  Depositor a report (in form and  substance  reasonably
satisfactory to the Depositor)  regarding the Indenture 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 addressed to
the Depositor and signed by an authorized officer of the Indenture Trustee,  and
shall address each of the Servicing Criteria specified on Exhibit F hereto; and

      (b) deliver to the  Depositor a report of a registered  public  accounting
firm reasonably acceptable to the Depositor that attests to, and reports on, the
assessment of compliance made by the Indenture Trustee and delivered 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.

                                      -39-
<PAGE>

      Section 9.05. Indemnification; Remedies.

      (a) The Indenture Trustee shall indemnify the Depositor, each affiliate of
the Depositor, the Master Servicer and each broker dealer acting as underwriter,
placement  agent or Initial  Purchaser  of the Notes or each Person who controls
any of such parties  (within the meaning of Section 15 of the Securities Act and
Section  20 of  the  Exchange  Act);  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 IX by or on
      behalf of the Indenture  Trustee  (collectively,  the  "Indenture  Trustee
      Information"),  or (B) the  omission  or alleged  omission to state in the
      Indenture Trustee Information a material fact required to be stated in the
      Indenture Trustee Information or necessary in order to make the statements
      therein, in the light of the circumstances under which they were made, not
      misleading;  provided,  by way of  clarification,  that clause (B) of this
      paragraph shall be construed solely by reference to the Indenture  Trustee
      Information  and not to any other  information  communicated in connection
      with a sale or  purchase  of  securities,  without  regard to whether  the
      Indenture Trustee Information or any portion thereof is presented together
      with or separately from such other information; or

            (ii)  any   failure  by  the   Indenture   Trustee  to  deliver  any
      information,  report, certification or other material when and as required
      under this  Article IX, other than a failure by the  Indenture  Trustee to
      deliver the accountants' attestation.

      (b) In the case of any failure of performance  described in clause (ii) of
Section  9.05(a),  the  Indenture  Trustee  shall  (i)  promptly  reimburse  the
Depositor for all costs reasonably  incurred by the Depositor in order to obtain
the  information,  report,  certification,  accountants'  attestation  or  other
material not delivered as required by the Indenture  Trustee and (ii)  cooperate
with the Depositor to mitigate any damages that may result from such failure.

      (c) The Depositor and the Master  Servicer  shall  indemnify the Indenture
Trustee, each affiliate of the Indenture Trustee or each Person who controls the
Indenture  Trustee  (within the meaning of Section 15 of the  Securities Act and
Section  20 of  the  Exchange  Act),  and  the  respective  present  and  former
directors,  officers,  employees and agents of the Indenture 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 Servicing Agreement by or
on behalf of the Depositor 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;  provided,  by way of  clarification,  that clause (ii) of
this paragraph shall be construed solely by reference to the RFC

                                      -40-
<PAGE>

Information and not to any other  information  communicated in connection with a
sale or purchase of securities, without regard to whether the RFC Information or
any portion  thereof is presented  together with or  separately  from such other
information.

                                      -41-
<PAGE>

      IN WITNESS  WHEREOF,  the Master Servicer,  the Indenture  Trustee and the
Issuer  have  caused  this  Servicing  Agreement  to be duly  executed  by their
respective  officers or  representatives  all as of the day and year first above
written.

                                   RESIDENTIAL FUNDING COMPANY, LLC,
                                   as Master Servicer

                                   By: _________________________________________
                                   Name:
                                   Title:

                                   HOME LOAN TRUST 20[__]-[___]

                                        By: [_________] not in its individual
                                            capacity but solely as Owner Trustee

                                   By: _________________________________________
                                   Name:
                                   Title:

                                   [______________________]
                                   as Indenture Trustee

                                   By: _________________________________________
                                   Name:
                                   Title:

Acknowledged and Agreed
solely with respect to Article IX:

RESIDENTIAL FUNDING
MORTGAGE SECURITIES II, INC.

By: _________________________________________
Name:
Title:

<PAGE>

                                    EXHIBIT A

                               HOME LOAN SCHEDULE

                                      A-1
<PAGE>

                                    EXHIBIT B

                            LIMITED POWER OF ATTORNEY

KNOW ALL MEN BY THESE PREMISES:

That  [______________________],  as Indenture Trustee (the "Trustee"), under the
Indenture (the "Indenture") among  ________________________________________  and
the Indenture  Trustee,  a national banking  association  organized and existing
under the laws of the United States,  and having its principal office located at
60 Livingston  Avenue,  in the City of St. Paul in the State of Minnesota,  hath
made, constituted and appointed, and does by these presents make, constitute and
appoint Residential Funding Company,  LLC, a limited liability company organized
and  existing  under  the laws of the  State of  Delaware,  its true and  lawful
Attorney-in-Fact,  with full power and authority to sign, execute,  acknowledge,
deliver, file for record, and record any instrument on its behalf and to perform
such  other  act or acts as may be  customarily  and  reasonably  necessary  and
appropriate to effectuate the following  enumerated  transactions  in respect of
any of the  mortgages  or deeds of trust  (the  "Mortgages"  and the  "Deeds  of
Trust", respectively) creating a trust or second lien or an estate in fee simple
interest in real  property  securing a Home Loan and  promissory  notes  secured
thereby (the "Mortgage  Notes") for which the undersigned is acting as Indenture
Trustee for various Securityholders (whether the undersigned is named therein as
mortgagee or beneficiary or has become mortgagee by virtue of Endorsement of the
Mortgage  Note  secured  by any such  Mortgage  or Deed of Trust)  and for which
Residential  Funding  Company,  LLC is acting as master  servicer  pursuant to a
Servicing  Agreement,  dated as of  [______________],  200[__]  (the  "Servicing
Agreement"). This appointment shall apply only to transactions which the Trustee
is authorized to enter into under the Indenture,  but in no event shall apply to
any transactions other than the following enumerated transactions only:

      1.    The  modification  or  re-recording  of a Mortgage or Deed of Trust,
            where  said  modification  or  re-recording  is for the  purpose  of
            correcting  the  Mortgage  or Deed of Trust to  conform  same to the
            original  intent of the parties  thereto or to correct  title errors
            discovered   after  such  title   insurance   was  issued  and  said
            modification or re-recording, in either instance, does not adversely
            affect the lien of the Mortgage or Deed of Trust as insured.

      2.    The  subordination  of the lien of a Mortgage or Deed of Trust to an
            easement in favor of a public utility company or a government agency
            or unit with powers of eminent  domain;  this section shall include,
            without limitation, the execution of partial satisfactions/releases,
            partial  reconveyances  or the  execution of requests to trustees to
            accomplish same.

      3.    With respect to a Mortgage or Deed of Trust,  the  foreclosure,  the
            taking  of a deed in  lieu  of  foreclosure,  or the  completion  of
            judicial or non-judicial foreclosure or termination, cancellation or
            rescission of any such foreclosure,  including,  without limitation,
            any and all of the following acts:

            a.    The substitution of trustee(s)  serving under a Deed of Trust,
                  in accordance with state law and the Deed of Trust;

                                      B-1
<PAGE>

            b.    Statements of breach or non-performance;

            c.    Notices of default;

            d.    Cancellations/rescissions of notices of default and/or notices
                  of sale;

            e.    The taking of a deed in lieu of foreclosure; and

            f.    Such other documents and actions as may be necessary under the
                  terms  of  the  Mortgage,  Deed  of  Trust  or  state  law  to
                  expeditiously complete said transactions.

      4.    The  conveyance of the  properties to the mortgage  insurer,  or the
            closing of the title to the  property  to be acquired as real estate
            owned, or conveyance of title to real estate owned.

      5.    The completion of loan assumption agreements.

      6.    The full satisfaction/release of a Mortgage or Deed of Trust or full
            reconveyance upon payment and discharge of all sums secured thereby,
            including, without limitation,  cancellation of the related Mortgage
            Note.

      7.    The  assignment  of any  Mortgage  or Deed of Trust and the  related
            Mortgage  Note, in connection  with the  repurchase of the Home Loan
            secured and  evidenced  thereby  pursuant to the  requirements  of a
            Residential Funding Company, LLC Seller Contract,  or the removal of
            any Mortgage  from the MERS(R)  System or the  re-recording  of such
            Mortgage in the name of MERS.

      8.    The full  assignment of a Mortgage or Deed of Trust upon payment and
            discharge  of all  sums  secured  thereby  in  conjunction  with the
            refinancing thereof, including,  without limitation, the endorsement
            of the related Mortgage Note.

      9.    The  modification  or  re-recording  of a Mortgage or Deed of Trust,
            where said  modification  or  re-recording is for the purpose of any
            modification pursuant to Section 3.01 of the Servicing Agreement.

      10.   The subordination of the lien of a Mortgage or Deed of Trust,  where
            said  subordination is in connection with any modification  pursuant
            to Section 3.01 of the  Servicing  Agreement,  and the  execution of
            partial  satisfactions/releases in connection with such same Section
            3.01.

The undersigned gives said  Attorney-in-Fact full power and authority to execute
such instruments and to do and perform all and every act and thing necessary and
proper to carry into effect the power or powers granted by or under this Limited
Power of Attorney as fully as the undersigned might or could do, and hereby does
ratify and confirm to all that said Attorney-in-Fact  shall lawfully do or cause
to be done by authority hereof.

Capitalized  terms used herein  that are not  otherwise  defined  shall have the
meanings ascribed thereto in Appendix A to the Indenture.

                                      B-2
<PAGE>

Third  parties  without  actual  notice may rely upon the  exercise of the power
granted  under this Limited  Power of Attorney;  and may be satisfied  that this
Limited Power of Attorney  shall  continue in full force and effect has not been
revoked  unless an  instrument  of  revocation  has been made in  writing by the
undersigned.

                                           [______________________], not in its
                                           individual capacity, but solely as
                                           Indenture Trustee under the Servicing
                                           Agreement and the Indenture

______________________________                    ______________________________

Name: ________________________                    Name: ________________________

Title: _______________________                    Title: _______________________

                                      B-3
<PAGE>

STATE OF [____________])
                       ss.
COUNTY OF[____________])

      On this __ day of  [______________],  20[__],  before me the  undersigned,
Notary Public of said State, personally appeared _______________________________
personally    known    to   me   to   be    duly    authorized    officers    of
[______________________]  that  executed the within  instrument  and  personally
known to me to be the persons who  executed the within  instrument  on behalf of
[______________________]   therein   named,   and   acknowledged   to  me   such
[______________________] executed the within instrument pursuant to its by-laws.

                                              WITNESS my hand and official seal.

                                              _______________________________
                                              Notary Public in and for the
                                              State of ___________________

After recording, please mail to:

_____________________________
_____________________________
_____________________________
Attn:  ______________________

                                      B-4
<PAGE>

                                    EXHIBIT C

                           FORM OF REQUEST FOR RELEASE

DATE:

TO:

RE:   REQUEST FOR RELEASE OF DOCUMENTS

In connection with your administration of the Home Loans, we request the release
of the Mortgage File described below.

Servicing Agreement Dated:
Series #:
Account #:
Pool #:
Loan #:
Borrower Name(s):
Reason for Document Request: (circle one)     Home Loan       Prepaid in Full

                                                           Home 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 Servicing Agreement."

_____________________________________
Residential Funding Company, LLC
Authorized Signature

********************************************************************************

TO CUSTODIAN/INDENTURE  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 Servicing Agreement.

         Enclosed Documents: [ ]            Promissory Note
                                            [ ] Mortgage or Deed of Trust
                                            [ ] Assignment(s) of Mortgage or
                                                Deed of Trust
                                            [ ] Title Insurance Policy
                                            [ ] Other: _________________________

_________________
Name
_________________
Title
_________________
Date

                                      C-1
<PAGE>

                                    EXHIBIT D

                          FORM OF FORM 10-K CERTIFICATE

      I, [identify the certifying individual], certify that:

      1. I have  reviewed  this report on Form 10-K and all reports on Form 10-D
required  to be filed in respect of the  period  covered by this  report on Form
10-K of the trust (the Exchange Act periodic  reports) pursuant to the Servicing
Agreement dated  [______________],  200[__] (the "Agreement")  among Residential
Funding Company, LLC (the "Master Servicer"),  Home Loan Trust 20[__]-[___] (the
"Issuer")   and   [______________________]   (the   "Indenture   Trustee")   and
acknowledged and agreed to by Residential Funding Mortgage Securities II, Inc.

      2. Based on my knowledge, Exchange Act periodic reports, taken as a whole,
do not  contain  any  untrue  statement  of a  material  fact or omit to state a
material  fact  necessary  to  make  the  statements   made,  in  light  of  the
circumstances under which such statements were made, not misleading with respect
to the period covered by this report;

      3. Based on my  knowledge,  all of the  distribution,  servicing and other
information  required to be provided  under Form 10-D for the period  covered by
this report is included in the Exchange Act periodic reports;

      4. I am responsible  for reviewing the activities  performed by the Master
Servicer  and based on my  knowledge  and the  compliance  review  conducted  in
preparing the servicer  compliance  statement required in this report under Item
1123 of  Regulation  AB and except as  disclosed  in the  Exchange  Act periodic
reports,  the Master Servicer has fulfilled its obligations under the Agreement;
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 Indenture
Trustee].

Date:____________

_________________________________*
[Signature]
Name:
Title:

* - to be signed by the senior  officer in charge of the servicing  functions of
the Master Servicer

                                      D-1
<PAGE>

                                    EXHIBIT E

            [FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE]

      The  undersigned,  a Responsible  Officer of [_________]  (the  "Indenture
Trustee") certifies that:

                  (a) The  Indenture  Trustee  has  performed  all of the duties
      specifically  required to be performed by it pursuant to the provisions of
      the  Servicing  Agreement  dated  as  of  [______________],  200[__]  (the
      "Agreement")  by and among  Residential  Funding  Company,  LLC, as Master
      Servicer,  Home  Loan  Trust  20[__]-[___],  as Issuer  and the  Indenture
      Trustee in accordance with the standards set forth therein.

                  (b)  Based on my  knowledge,  the list of  Securityholders  as
      shown on the Register as of the end of each calendar year that is provided
      by the Indenture  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: ____________________

                                      E-1
<PAGE>

                                    EXHIBIT F

                               SERVICING CRITERIA

         SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

      The assessment of compliance to be delivered by the Indenture 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    |X| (as to accounts held
                               bank accounts and related bank clearing accounts no more than two              by Trustee)
                               business days following receipt, or such other number of days
                               specified in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(2)(ii)                 Disbursements made via wire transfer on behalf of an obligor or to     |X| (as to investors only)
                               an investor are made only by authorized personnel.
--------------------------------------------------------------------------------------------------------------------------------
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.
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-1
<PAGE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
                                                                                                        Applicable Servicing
                                         Servicing Criteria                                                   Criteria
--------------------------------------------------------------------------------------------------------------------------------
Reference                                                    Criteria
--------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>                                                                     <C>
1122(d)(2)(iv)                 The related accounts for the transaction, such as cash reserve          |X| (as to accounts held
                               accounts or accounts established as a form of overcollateralization,            by Trustee)
                               are separately maintained (e.g., with respect to commingling of
                               cash) as set forth in the transaction 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.
--------------------------------------------------------------------------------------------------------------------------------
                                                Investor Remittances and Reporting
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(3)(i)                  Reports to investors, including those to be filed
                               with the Commission, are maintained in accordance
                               with the transaction agreements and applicable
                               Commission requirements. Specifically, such
                               reports (A) are prepared in accordance with
                               timeframes and other terms set forth in the
                               transaction agreements; (B) provide information
                               calculated in accordance with the terms specified
                               in the transaction agreements; (C) are filed with
                               the Commission as required by its rules and
                               regulations; and (D) agree with investors' or the
                               trustee's records as to the total unpaid
                               principal balance and number of pool assets
                               serviced by the servicer.
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-2
<PAGE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
                                                                                                        Applicable Servicing
                                         Servicing Criteria                                                   Criteria
--------------------------------------------------------------------------------------------------------------------------------
Reference                                                    Criteria
--------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>                                                                     <C>
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.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(3)(iii)                Disbursements made to an investor are posted within two business
                               days to the servicer's investor records, or such other number of                 |X|
                               days specified in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(3)(iv)                 Amounts remitted to investors per the investor reports agree with
                               cancelled checks, or other form of payment, or custodial bank                    |X|
                               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.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(4)(ii)                 Pool assets and related documents are safeguarded as required by the
                               transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(4)(iii)                Any additions, removals or substitutions to the asset pool are made,
                               reviewed and approved in accordance with any conditions or
                               requirements in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(4)(iv)                 Payments on pool assets, including any payoffs, made in accordance
                               with the related pool assets 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 asset 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
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-3
<PAGE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
                                                                                                        Applicable Servicing
                                         Servicing Criteria                                                   Criteria
--------------------------------------------------------------------------------------------------------------------------------
Reference                                                    Criteria
--------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>                                                                     <C>
                               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.
--------------------------------------------------------------------------------------------------------------------------------
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.
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-4
<PAGE>

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
                                                                                                        Applicable Servicing
                                         Servicing Criteria                                                   Criteria
--------------------------------------------------------------------------------------------------------------------------------
Reference                                                    Criteria
--------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>                                                                     <C>
1122(d)(4)(xiii)               Disbursements made on behalf of an obligor are posted within two
                               business days to the obligor's records maintained by the servicer,
                               or such other number of days specified in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(4)(xiv)                Delinquencies, charge-offs and uncollectible accounts are recognized
                               and recorded in accordance with the transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
1122(d)(4)(xv)                 Any external enhancement or other support, identified in Item                      |X|
                               1114(a)(1) through (3) or Item 1115 of Regulation AB, is maintained
                               as set forth in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-5

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