Document:

Exhibit 4.1

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                                                                  EXECUTION COPY

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                        FINANCIAL ASSET SECURITIES CORP.
                                  as Depositor,

                              SAXON MORTGAGE, INC.,
                         as Seller and Master Servicer,

                        MERITECH MORTGAGE SERVICES, INC.,
                                   as Servicer

                                       and

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
                                   as Trustee

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

                         POOLING AND SERVICING AGREEMENT

                            Dated as of April 1, 2001

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

                   Home Equity Loan Asset-Backed Certificates

                                  Series 2001-1

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                                TABLE OF CONTENTS

                                                                            Page

ARTICLE I

   Definitions...............................................................-1-
   Section 1.01.  Definitions................................................-1-
   Section 1.02.  Interest Calculations.....................................-32-

ARTICLE II

   Conveyance of  Mortgage Loans; Original Issuance of Certificates
                  Tax Treatment.............................................-32-
   Section 2.01.  Conveyance of Mortgage Loans..............................-32-
   Section 2.02.  Acceptance by Trustee.....................................-35-
   Section 2.03.  Representations and Warranties Regarding the Seller,
           the Master Servicer, the Servicer and the Depositor..............-37-
   Section 2.04.  Representations and Warranties Regarding the
                  Mortgage Loans ...........................................-43-
   Section 2.05.  Opinion of Counsel........................................-52-
   Section 2.06.  Execution and Authentication of Certificates..............-52-
   Section 2.07.  Designation of Interests in REMICs........................-52-
   Section 2.08.  Designation of Startup Day of REMIC.......................-57-
   Section 2.09.  Remic Certificate Maturity Date...........................-57-
   Section 2.10.  Tax Returns and Reports to Certificateholders.............-57-
   Section 2.11.  Tax Matters Person........................................-58-
   Section 2.12.  Remic Related Covenants...................................-58-
   Section 2.13.  Intentionally Omitted.....................................-62-
   Section 2.14.  the Custodian.............................................-62-

ARTICLE III

   Administration and Servicing of Mortgage Loans...........................-62-
   Section 3.01.  The Servicer and the Master Servicer......................-62-
   Section 3.02.  Collection of Certain Mortgage Loan Payments..............-65-
   Section 3.03.  Withdrawals from the Collection Account...................-66-
   Section 3.04.  Maintenance of Hazard Insurance; Property
                  Protection Expenses.......................................-67-
   Section 3.05.  Maintenance of Mortgage Impairment Insurance Policy.......-68-
   Section 3.06.  Management and Realization Upon Defaulted Mortgage Loans..-68-
   Section 3.07.  Trustee to Cooperate......................................-70-
   Section 3.08.  Servicing Compensation; Payment of Certain Expenses
                  by Servicer...............................................-71-
   Section 3.09.  Annual Statement as to Compliance.........................-71-
   Section 3.10.  Annual Servicing Review...................................-71-
   Section 3.11.  Access to Certain Documentation and Information Regarding
           the Mortgage Loans...............................................-72-
   Section 3.12.     Maintenance of Certain Servicing Insurance Policies....-72-

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   Section 3.13.  Reports to the Securities and Exchange Commission.........-72-
   Section 3.14.  Reports of Foreclosures and Abandonments of Mortgaged
           Properties, Returns Relating to Mortgage Interest Received
           From Individuals and Returns Relating to Cancellation of
           Indebtedness.....................................................-72-
   Section 3.15.  Advances by the Servicer and Master Servicer..............-73-
   Section 3.16.  Optional Purchase of Defaulted Mortgage Loans.............-73-
   Section 3.17.  Superior Liens............................................-74-
   Section 3.18.  Assumption Agreements.....................................-74-
   Section 3.19.  Payment of Taxes, Insurance and Other Charges.............-75-
   Section 3.20.  Covenants of the Servicer and Representations of the
           Seller Regarding Prepayment Charges..............................-75-
   Section 3.21.  Master Servicer Custodial Account.........................-76-
   Section 3.22.  Withdrawals from the Custodial Account....................-76-
   Section 3.23.  Oversight of Servicing....................................-77-
   Section 3.24.  Master Servicing Compensation; Payment of Certain Expenses by
           the Master Servicer..............................................-77-

ARTICLE IV

   Certificate Insurance Policy.............................................-77-
   Section 4.01.  Certificate Insurance Policy..............................-77-
   Section 4.02.  Intentionally Omitted.....................................-78-
   Section 4.03.  Claims Upon the Certificate Insurance Policy..............-78-

Article V

   Payments and Statements to
   Certificateholders; Rights of Certificateholders.........................-79-
   Section 5.01.  Distributions.............................................-79-
   Section 5.02.  Compensating Interest.....................................-81-
   Section 5.03.  Statements................................................-82-
   Section 5.04.  Distribution Account......................................-85-
   Section 5.05.  Investment of Accounts....................................-85-
   Section 5.06.  Allocation of Losses......................................-87-
   Section 5.07  [Reserved].................................................-87-
   Section 5.08   Net Rate Cap Fund.........................................-87-

ARTICLE VI

   The Certificates.........................................................-88-
   Section 6.01.  The Certificates..........................................-88-
   Section 6.02.  Registration of Transfer and Exchange of Certificates.....-88-
   Section 6.03.  Mutilated, Destroyed, Lost or Stolen Certificates.........-93-
   Section 6.04.  Persons Deemed Owners.....................................-93-
   Section 6.05.  Appointment of Paying Agent...............................-93-

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ARTICLE VII

   The Seller, the Servicer and the Master Servicer.........................-94-
   Section 7.01.  Liability of the Depositor, the Seller, the Master Servicer
           and the Servicer ................................................-94-
   Section 7.02.  Merger or Consolidation of, or Assumption of the
           Obligations of, the Depositor, the Seller, the Master Servicer or
           the Servicer.....................................................-94-
   Section 7.03.  Limitation on Liability of the Servicer, the Master Servicer
           and Others ......................................................-94-
   Section 7.04.  Approved Servicer or Master Servicer Not to Resign........-95-
   Section 7.05.  Delegation of Duties......................................-95-
   Section 7.06.  Indemnification of the Trust by the Servicer and the
           Master Servicer..................................................-96-

ARTICLE VIII

   Default..................................................................-96-
   Section 8.01.  Events of Default.........................................-96-
   Section 8.02.  Appointment of Successor.................................-100-
   Section 8.03.  Waiver of Defaults.......................................-103-
   Section 8.04.  Notification to Certificateholders.......................-103-
   Section 8.05.  Rights of the Certificate Insurer........................-103-
   Section 8.06.  Certificate Insurer Default..............................-103-

ARTICLE IX

   The Trustee.............................................................-104-
   Section 9.01.  Duties of Trustee........................................-104-
   Section 9.02.  Certain Matters Affecting the Trustee....................-105-
   Section 9.03.  Trustee Not Liable for Certificates or Mortgage Loans....-107-
   Section 9.04.  Trustee May Own Certificates.............................-108-
   Section 9.05.  Trustee Fees and Expenses................................-108-
   Section 9.06.  Eligibility Requirements for Trustee.....................-108-
   Section 9.07.  Resignation or Removal of Trustee........................-108-
   Section 9.08.  Successor Trustee........................................-109-
   Section 9.09.  Merger or Consolidation of Trustee.......................-110-
   Section 9.10.  Appointment of Co-trustee or Separate Trustee............-110-
   Section 9.11.  Limitation of Liability..................................-111-
   Section 9.12.  Trustee May Enforce Claims Without Possession of
                  Certificates; Inspection ................................-111-
   Section 9.13.  Suits for Enforcement....................................-112-

ARTICLE X

   Termination
    .......................................................................-112-

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   Section 10.01. Termination..............................................-112-
   Section 10.02. Additional Termination Requirements......................-114-

ARTICLE XI

   Miscellaneous Provisions................................................-114-
   Section 11.01. AMENDMENT................................................-114-
   Section 11.02. RECORDATION OF AGREEMENT.................................-116-
   Section 11.03. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS...............-116-
   Section 11.04. GOVERNING LAW............................................-117-
   Section 11.05. NOTICES..................................................-117-
   Section 11.06. SEVERABILITY OF PROVISIONS...............................-119-
   Section 11.07. ASSIGNMENT...............................................-119-
   Section 11.08. CERTIFICATES NONASSESSABLE AND FULLY PAID................-119-
   Section 11.09. THIRD-PARTY BENEFICIARIES................................-119-
   Section 11.10. COUNTERPARTS.............................................-119-
   Section 11.11. EFFECT OF HEADINGS AND TABLE OF CONTENTS.................-119-
   Section 11.12. MORTGAGE LOANS AND ACCOUNTS HELD FOR BENEFIT OF THE
           CERTIFICATE INSURER ............................................-119-
   Section 11.13. EFFECT OF PAYMENTS BY THE CERTIFICATE INSURER;
           SUBROGATION.....................................................-120-
   Section 11.14. NOTICES TO THE CERTIFICATE INSURER.......................-120-

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EXHIBIT A    FORMS OF OFFERED CERTIFICATES...................................A-1
EXHIBIT B    FORM OF CLASS BIO CERTIFICATE...................................B-1
EXHIBIT B-1  FORM OF CLASS R CERTIFICATES..................................B-1-1
EXHIBIT B-2  FORM OF CLASS P CERTIFICATES..................................B-2-1
EXHIBIT C    MORTGAGE LOAN SCHEDULE..........................................C-1
EXHIBIT D    INTENTIONALLY OMITTED...........................................D-1
EXHIBIT E    FORM OF MORTGAGE NOTE...........................................E-1
EXHIBIT F    FORM OF MORTGAGE................................................F-1
EXHIBIT G    TRANSFER AFFIDAVITS.............................................G-1
EXHIBIT H    LETTER OF REPRESENTATIONS.......................................H-1
EXHIBIT I    FORM OF REQUEST FOR RELEASE FOR DOCUMENTS.......................I-1
EXHIBIT J    RESERVED........................................................J-1
EXHIBIT K    FORM OF CUSTODIAL AGREEMENT.....................................K-1
EXHIBIT L    DELINQUENCY AND LOSS INFORMATION................................L-1
EXHIBIT M    FORM OF TRANSFEROR CERTIFICATE.................................M -1
EXHIBIT N-1  FORM OF INVESTMENT LETTER (NON-RULE 144A).....................N-1-1
EXHIBIT N-2  FORM OF RULE 144A LETTER......................................N-2-1
EXHIBIT O    FORM OF INITIAL CERTIFICATION...................................O-1
EXHIBIT P    FORM OF CUSTODIAN FINAL CERTIFICATION...........................P-1
EXHIBIT Q    INTENTIONALLY OMITTED...........................................Q-1
EXHIBIT R    PREPAYMENT CHARGE SCHEDULE......................................R-1

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     This Pooling and Servicing Agreement, dated as of April 1, 2001, among
Financial Asset Securities Corp., as depositor (the "Depositor"), Saxon
Mortgage, Inc., as seller (the "Seller") and master servicer (the "Master
Servicer"), Meritech Mortgage Services, Inc., as servicer (the "Servicer") and
Wells Fargo Bank Minnesota, National Association, as Trustee (the "Trustee").

                         W I T N E S S E T H   T H A T:

     In consideration of the mutual agreements herein contained, the parties
hereto 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.

     ACCOUNTS: Collectively, the Collection Account, the Custodial Account and
the Distribution Account.

     ADJUSTMENT DATE: With respect to each adjustable-rate Mortgage Loan, the
date set forth in the related Mortgage Note on which the Loan Rate on the
Mortgage Loan is adjusted in accordance with the terms of the Mortgage Note.

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

     AGGREGATE PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date, the
sum of the Senior Principal Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal Distribution Amount and the Class B
Principal Distribution Amount.

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

     APPLIED REALIZED LOSS AMOUNTS: As to any Distribution Date, an amount equal
to the excess, if any, of (i) the aggregate of the Class Principal Balances of
the Offered Certificates, after giving effect to all distributions on such
Distribution Date over (ii) the Pool Balance as of the last day of the related
Due Period.

     APPRAISED VALUE: The appraised value of the Mortgaged Property based upon
the appraisal made by or for the originator at the time of the origination of
the related Mortgage Loan.

                                       -1-

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     APPROVED MASTER SERVICER: For purposes of Sections 7.04 and 8.02 hereof any
of the following:

          1. Wells Fargo Bank Minnesota, National Association or an affiliate
     that services or master services mortgage loans similar to the Mortgage
     Loans.

          2. If at the relevant time, the aggregate Class Principal Balance of
     the Class A Certificates is more than 50% of the aggregate Class Principal
     Balance of all the Certificates, the Person approved by Holders of
     Certificates evidencing greater than 50% of the Voting Rights in the Trust.

          3. If at the relevant time, the aggregate Class Principal Balance of
     the Class A Certificates is 50% or less of the aggregate Class Principal
     Balance of all the Certificates, a Person who is an approved servicer by
     S&P.

     APPROVED SERVICER: For purposes of Sections 3.01(b), 7.04 and 8.02 hereof,
a servicer appointed by the Master Servicer with the approval of the Rating
Agencies and, if the Senior Certificates have not been retired and a Certificate
Insurer Default does not exist, the Certificate Insurer.

     ASSIGNMENT OF MORTGAGE: With respect to any Mortgage, an assignment, notice
of transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction in which the related Mortgaged Property is located to
reflect the sale of the Mortgage to the Trustee.

     AUTHORIZED NEWSPAPER: A newspaper of general circulation in the Borough of
Manhattan, The City of New York, printed in the English language and customarily
published on each Business Day, whether or not published on Saturdays, Sundays
and holidays.

     AVAILABLE FUNDS: As to any Distribution Date, the sum, without duplication
of the following amounts with respect to the Mortgage Loans: (i) scheduled
payments of principal and interest on the Mortgage Loans due during the related
Due Period and received by the Servicer (net of amounts representing the
Servicing Fee, the Master Servicing Fee and the Trustee Fee with respect to each
Mortgage Loan and reimbursement for related Monthly Advances and Servicing
Advances); (ii) Net Liquidation Proceeds and Insurance Proceeds with respect to
the Mortgage Loans (net of amounts applied to the restoration or repair of a
Mortgaged Property) and unscheduled payments of principal and interest on the
Mortgage Loans received by the Servicer during the related Prepayment Period
(net of amounts representing the Servicing Fee, the Master Servicing Fee and the
Trustee Fee with respect to each Mortgage Loan and reimbursement for related
Monthly Advances and Servicing Advances); (iii) the Purchase Price for
repurchased Defective Mortgage Loans; and (iv) payments from the Servicer or the
Master Servicer in connection with (a) Monthly Advances, (b) Compensating
Interest and (c) the termination of the Trust with respect to the Mortgage Loans
as provided in this Agreement.

     AVAILABLE FUNDS CAP: For any Distribution Date a per annum rate equal to
(i) the weighted average Net Loan Rate of the Mortgage Loans minus (ii) the
product of (x) the applicable Certificate Rate on the Notional Amount
Certificates and (y) a fraction, the numerator of which is the Notional

                                       -2-

<PAGE>

Amount of such Notional Amount Certificates immediately prior to such
Distribution Date, and the denominator of which is the Pool Balance as of the
end of the second preceding Due Period and minus (iii) the Premium Amount,
expressed as a per annum rate.

     BASIC PRINCIPAL AMOUNT: As to any Distribution Date, an amount equal to the
sum of the following amounts (without duplication) with respect to the Mortgage
Loans: (i) each scheduled payment of principal on a Mortgage Loan due during
such Due Period and received by the Servicer on or prior to the Determination
Date; (ii) the Net Liquidation Proceeds allocable to principal and all full and
partial principal prepayments received by the Servicer during the related
Prepayment Period; (iii) the portion of the Purchase Price allocable to
principal of all repurchased Defective Mortgage Loans with respect to such
Distribution Date; and (iv) any Monthly Advances with respect to scheduled
payments of principal due during the related Due Period.

     BIF: The Bank Insurance Fund, as from time to time constituted, created
under the Financial Institutions Reform, Recovery and Enhancement Act of 1989,
or, if at any time after the execution of this Agreement the Bank Insurance Fund
is not existing and performing duties now assigned to it, the body performing
such duties on such date.

     BLANKET MORTGAGE: The mortgage or mortgages encumbering a Cooperative
Property.

     BOOK-ENTRY CERTIFICATE: Any Regular Certificate registered in the name of
the Depository or its nominee, ownership of which is reflected on the books of
the Depository or on the books of a Person maintaining an account with such
Depository (directly or as an indirect participant in accordance with the rules
of such Depository).

     BUSINESS DAY: Any day other than a Saturday, a Sunday or a day on which
banking institutions in the States of New York, Connecticut, Texas and Virginia
or the city or cities in which the Corporate Trust Office of the Trustee or the
executive office of the Certificate Insurer is located are authorized or
obligated by law or executive order to close.

     CERTIFICATE: Any Offered Certificate, Class P Certificate, Class BIO
Certificate or Residual Certificate.

     CERTIFICATE BALANCE: As of any date of determination, the aggregate of the
Class Principal Balances of the Certificates.

     CERTIFICATE INSURANCE POLICY: The Certificate Guaranty Insurance Policy
(No. 51074-N), and all endorsements thereto dated the Closing Date, issued by
the Certificate Insurer for the benefit of the Holders of each Class of Senior
Certificates, a copy of which is attached hereto as Exhibit J.

     CERTIFICATE INSURER: Financial Security Assurance Inc., a monoline
insurance company organized and created under the laws of the State of New York,
or any successor thereto.

     CERTIFICATE INSURER DEFAULT: One of the following events shall have
occurred and be continuing:

                                       -3-

<PAGE>

          (i) the Certificate Insurer fails to make a payment required under the
     Certificate Insurance Policy in accordance with its terms;

          (ii) the Certificate Insurer (A) files any petition or commences any
     case or proceeding under any provision or chapter of the United States
     Bankruptcy Code or any other similar federal or state law relating to
     insolvency, bankruptcy, rehabilitation, liquidation or reorganization, (B)
     makes a general assignment for the benefit of its creditors, or (C) has an
     order for relief entered against it under the United States Bankruptcy Code
     or any other similar federal or state law relating to insolvency,
     bankruptcy, rehabilitation, liquidation or reorganization which is final
     and nonappealable; or

          (iii) a court of competent jurisdiction, the New York Department of
     Insurance or other competent regulatory authority enters a final and
     nonappealable order, judgment or decree (1) appointing a custodian,
     trustee, agent or receiver for the Certificate Insurer or for all or any
     material portion of its property or (2) authorizing the taking of
     possession by a Custodian, trustee, agent or receiver of the Certificate
     Insurer (or the taking of possession of all or any material portion of the
     property of the Certificate Insurer).

     CERTIFICATE OWNER: The Person who is the beneficial owner of a Book-Entry
Certificate.

     CERTIFICATE RATE: As to any Class of Certificates, the respective per annum
rate set forth or described below:

          Class           Certificate Rate
          -----           ----------------

          A               6.265% (1)(2)
          IO              (3)
          M-1             7.100%(1)(2)
          M-2             7.100%(1)(2)
          B               7.100%(1)(2)
          P               0.00%
          BIO             (4)
          R-1             0.00%
          R-2             0.00%
          R-3             0.00%
----------------

(1)    As to any Distribution Date, the lesser of (x) the fixed rate set forth
and (y) the applicable Available Funds Cap.

(2)    On any Distribution Date after the Optional Termination Date, the
Certificate Rate shall increase by 50 basis points (0.50% per annum).

(3)    100% of the interest payable on REMIC II Regular Interest II-A-IO.

                                      -4-

<PAGE>

(4)    A per annum rate equal to the percentage equivalent of a fraction, the
numerator of which is the sum of the amounts calculated pursuant to clauses (A)
through (F) below, and the denominator of which is the aggregate of the REMIC II
Principal Balances of REMIC II Regular Interests IIA, IIB, IIC, IID, IIE and
IIF. For purposes of calculating the Certificate Rate for the Class B-IO
Certificates, the numerator is equal to the sum of the following components:

          (A) the REMIC II Pass-Through Rate for REMIC II Regular Interest IIA
     minus the Marker Rate, applied to an amount equal to the REMIC II Principal
     Balance of REMIC II Regular Interest IIA;

          (B) the REMIC II Pass-Through Rate for REMIC II Regular Interest IIB
     minus the Marker Rate, applied to an amount equal to the REMIC II Principal
     Balance of REMIC II Regular Interest IIB;

          (C) the REMIC II Pass-Through Rate for REMIC II Regular Interest IIC
     minus the Marker Rate, applied to an amount equal to the REMIC II Principal
     Balance of REMIC II Regular Interest IIC;

          (D) the REMIC II Pass-Through Rate for REMIC II Regular Interest IID
     minus the Marker Rate, applied to an amount equal to the REMIC II Principal
     Balance of REMIC II Regular Interest IID;

          (E) the REMIC II Pass-Through Rate for REMIC II Regular Interest IIE
     minus the Marker Rate, applied to an amount equal to the REMIC II Principal
     Balance of REMIC II Regular Interest IIE; and

          (F) the REMIC II Pass-Through Rate for REMIC II Regular Interest IIF
     minus the Marker Rate, applied to an amount equal to the REMIC II Principal
     Balance of REMIC II Regular Interest IIF.

     CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register maintained and
the registrar appointed pursuant to Section 6.02.

     CERTIFICATEHOLDER OR HOLDER: The Person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent, direction, waiver or request pursuant to this Agreement, (x)
any Offered Certificate registered in the name of the Depositor or the Seller or
any Person known to a Responsible Officer to be an Affiliate of the Depositor or
the Seller and (y) any Offered Certificate for which the Depositor or the Seller
or any Person known to a Responsible Officer to be an Affiliate of the Depositor
or the Seller is the Certificate Owner or Holder shall be deemed not to be
outstanding (unless to the knowledge of a Responsible Officer (i) the Depositor
or the Seller or such Affiliate is acting as trustee or nominee for a Person who
is not an Affiliate of such Depositor or the Seller and who makes the voting
decision with respect to such Offered Certificates or (ii) the Depositor or the
Seller or such Affiliate is the Certificate Owner or Holder of all the
Certificates of a Class, but only with respect to the Class as to which the
Depositor or the Seller or such Affiliate owns all the Certificates) and the
Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite

                                       -5-

<PAGE>

amount of Percentage Interests necessary to effect any such consent, direction,
waiver or request has been obtained.

     CIVIL RELIEF ACT: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.

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

     CLASS: All Certificates having the same designation.

     CLASS A CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit A and designated as
a Class A Certificate pursuant to Section 6.01.

     CLASS B CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit A and designated as
a Class B Certificate pursuant to Section 6.01.

     CLASS BIO CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit B and designated as
a Class BIO Certificate pursuant to Section 6.01.

     CLASS BIO PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date, the
lesser of (i) the Excess Overcollateralization Amount for such Distribution Date
and (ii) the Available Funds remaining after distributions pursuant to Sections
5.01(a)(1) through (12) and amounts distributed in respect of the Class Monthly
Interest Amount for the Class BIO Certificates under Sections 5.01(a)(13) and
(15).

     CLASS B PRINCIPAL DISTRIBUTION AMOUNT: On any Distribution Date on and
after the Stepdown Date and so long as a Delinquency Event is not in effect, an
amount equal to the lesser of (i) the Principal Distribution Amount, calculated
as if the Subordination Increase Amount for such Distribution Date is zero,
minus the sum of the Senior Principal Distribution Amount, the Class M-1
Principal Distribution Amount and the Class M-2 Principal Distribution Amount
for such Distribution Date, and (ii) the excess of (1) the sum of (A) the Class
Principal Balance of the Class A Certificates (after giving effect to the
distribution of the Senior Principal Distribution Amount on such Distribution
Date), (B) the Class Principal Balance of the Class M-1 Certificates (after
giving effect to the distribution of the Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the Class Principal Balance of the Class M-2
Certificates (after giving effect to the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date) and (D) the Class Principal
Balance of the Class B Certificates immediately prior to such Distribution Date,
over (2) the lesser of (A) 100% of the Pool Balance as of the last day of the
related Due Period minus the Subordination Required Overcollateralization Amount
for such Distribution Date and (B) the Pool

                                       -6-

<PAGE>

Balance as of the last day of the related Due Period minus the OC Floor,
provided, however, that after the Class Principal Balances of the Class A, Class
M-1 and Class M-2 Certificates are reduced to zero, the Class B Principal
Distribution Amount for such Distribution Date will equal 100% of the Principal
Distribution Amount.

     CLASS INTEREST CARRYOVER SHORTFALL: As to any Class of Regular Certificates
and any Distribution Date, an amount equal to the sum of (i) the excess of the
related Class Monthly Interest Amount for the preceding Distribution Date and
any outstanding Class Interest Carryover Shortfall with respect to such Class on
such preceding Distribution Date, over the amount in respect of interest that is
actually distributed to the Holders of such Class on such preceding Distribution
Date plus (ii) one month's interest on such excess, to the extent permitted by
law, at the related Certificate Rate.

     CLASS INTEREST DISTRIBUTION: As to any Class of Regular Certificates and
Distribution Date, an amount equal to the sum of (a) the related Class Monthly
Interest Amount and (b) any Class Interest Carryover Shortfall for such Class of
Certificates for such Distribution Date.

     CLASS IO CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit A and designated as
a Class IO Certificate pursuant to Section 6.01.

     CLASS M-1 CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit A and designated as
a Class M-1 Certificate pursuant to Section 6.01.

     CLASS M-1 PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date on or
after the Stepdown Date, (x) 100% of the Principal Distribution Amount,
calculated as if the Subordination Increase Amount for such Distribution Date is
zero, if the Class Principal Balance of Class A Certificates has been reduced to
zero and a Delinquency Event exists, or, (y) if a Delinquency Event is not in
effect, the lesser of (i) the Principal Distribution Amount, calculated as if
the Subordination Increase Amount for such Distribution Date is zero, minus the
Senior Principal Distribution Amount for such Distribution Date, and (ii) the
excess of (1) the sum of (A) the Class Principal Balance of the Class A
Certificates (after giving effect to distributions of the Senior Principal
Distribution Amount for such Distribution Date) and (B) the Class Principal
Balance of the Class M-1 Certificates immediately prior to such Distribution
Date over (2) the lesser of (A) 86.50% of the Pool Balance as of the last day of
the related Due Period minus the Subordination Required Overcollateralization
Amount for such Distribution Date and (B) the Pool Balance as of the last day of
the related Due Period minus the OC Floor.

     CLASS M-2 CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit A and designated as
a Class M-2 Certificate pursuant to Section 6.01.

     CLASS M-2 PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date on or
after the Stepdown Date, (x) 100% of the Principal Distribution Amount,
calculated as if the Subordination Increase Amount for such Distribution Date is
zero, if the aggregate Class Principal Balance of the Class A and Class M-1
Certificates has been reduced to zero and a Delinquency Event exists, or (y)

                                       -7-

<PAGE>

if a Delinquency Event is not in effect, the lesser of (i) the Principal
Distribution Amount, calculated as if the Subordination Increase Amount for such
Distribution Date is zero, minus the sum of the Senior Principal Distribution
Amount and the Class M-1 Principal Distribution Amount for such Distribution
Date, and (ii) the excess of (1) the sum of (A) the Class Principal Balance of
the Class A Certificates (after giving effect to distributions of the Senior
Principal Distribution Amount for such Distribution Date), (B) the Class
Principal Balance of the Class M-1 Certificates (after giving effect to
distribution of the Class M-1 Principal Distribution Amount for such
Distribution Date) and (C) the Class Principal Balance of the Class M-2
Certificates immediately prior to such Distribution Date over (2) the lesser of
(A) 94.51% of the Pool Balance as of the last day of the related Due Period
minus the Subordination Required Overcollateralization Amount for such
Distribution Date and (B) the Pool Balance as of the last day of the related Due
Period minus the OC Floor.

     CLASS MONTHLY INTEREST AMOUNT: As to any Distribution Date and Class of
Regular Certificates, interest (i) for the related Interest Period at the
related Certificate Rate on the related Class Principal Balance or Notional
Amount minus (ii) such Class' pro rata portion of any Civil Relief Act Interest
Shortfall during the related Due Period based on the amount of interest to which
each such Class would otherwise be entitled in the absence of such shortfall.

     CLASS P CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form attached hereto as Exhibit B-2 and designated
as a Class P Certificate pursuant to Section 6.01.

     CLASS P PRINCIPAL DISTRIBUTION DATE: The later to occur of (i) the
Distribution Date on which the aggregate Class Principal Balance of the Offered
Certificates is reduced to zero, or (ii) the Distribution Date immediately
following the Due Period in which the last Prepayment Charge expires by its
terms as shown on the Prepayment Charge Schedule.

     CLASS PRINCIPAL BALANCE: As of any date of determination and Class of
Certificates, other than the Notional Amount Certificates, the Original Class
Principal Balance for such Class reduced by the sum of all amounts previously
distributed to the Certificateholders of such Class in respect of principal from
the related Principal Distribution Amount on all previous Distribution Dates
and, in the case of any Class of Subordinate Certificates, reduced by any
Applied Realized Loss Amounts allocated to such Class on prior Distribution
Dates.

     CLASS PRINCIPAL CARRYOVER SHORTFALL: As to any Class of Subordinate
Certificates and any Distribution Date, the excess, if any, of (i) the sum of
(x) the amount of the reduction in the Class Principal Balance of that Class of
Subordinate Certificates on such Distribution Date in respect of Applied
Realized Losses and (y) the amount of such reductions on prior Distribution
Dates over (ii) the amount distributed in respect of the Class Principal
Carryover Shortfall for that Class of Subordinate Certificates on prior
Distribution Dates.

     CLASS R-1 CERTIFICATE: Any Certificate designated as such and executed and
authenticated by the Trustee substantially in the form set forth in Exhibit B-1
hereto.

     CLASS R-2 CERTIFICATE: Any Certificate designated as such and executed and
authenticated by the Trustee substantially in the form attached hereto as
Exhibit B-1 hereto.

                                       -8-

<PAGE>

     CLASS R-3 CERTIFICATE: Any Certificate designated as such and executed and
authenticated by the Trustee substantially in the form attached hereto as
Exhibit B-1 hereto.

     CLASS R CERTIFICATEHOLDER: The Holder of a Residual Certificate.

     CLOSING DATE: April 10, 2001.

     CODE: The Internal Revenue Code of 1986, as the same may be amended from
time to time (or any successor statute thereto).

     COLLECTION ACCOUNT: The custodial account or accounts created and
maintained for the benefit of the Certificateholders pursuant to Section
3.02(b). The Collection Account shall be an Eligible Account.

     COMBINED LOAN-TO-VALUE RATIO or CLTV: With respect to any Mortgage Loan,
the sum of the original principal balance of such Mortgage Loan and the
outstanding principal balance of the related First Lien, if any, as of the date
of origination of the Mortgage Loan, divided by the Appraised Value.

     COMPENSATING INTEREST: As to any Distribution Date, the amount calculated
pursuant to Section 5.02.

     COOPERATIVE CORPORATION: The entity that holds title (fee or an acceptable
leasehold estate) to the real property and improvements constituting the
Cooperative Property and which governs the Cooperative Property, which
Cooperative Corporation must qualify as a Cooperative Housing Corporation under
Section 216 of the Code.

     COOPERATIVE LOAN: Any Mortgage Loan secured by Cooperative Shares and a
Proprietary Lease.

     COOPERATIVE PROPERTY: The real property and improvements owned by the
Cooperative Corporation, including the allocation of individual dwelling units
to the holders of the Cooperative Shares of the Cooperative Corporation.

     COOPERATIVE SHARES: Shares issued by a Cooperative Corporation.

     COOPERATIVE UNIT: A single family dwelling located in a Cooperative
Property.

     CORPORATE TRUST OFFICE: The designated offices of the Trustee at which at
any particular time its corporate trust business with respect to this Agreement
shall be administered, which offices at the date of the execution of this
Agreement are located, for Certificate transfer services, at Wells Fargo Center,
Sixth Street and Marquette Avenue, Minneapolis, Minnesota 55479-0113, Attn:
Corporate Trust Services - Soundview Home Equity Loan Trust 2001-1, and for all
other purposes at 11000 Broken Land Parkway, Columbia, Maryland 21044-3562,
Attn: Corporate Trust Services - Soundview Home Equity Loan Trust 2001-1, and
which are the respective addresses to which notices to and correspondence with
the Trustee should be directed.

                                       -9-

<PAGE>

     CORRESPONDING CERTIFICATE: With respect to REMIC II Regular Interest (i)
IIB, (ii) IIC, (iii) IID and (iv) IIE, (i) the Class A Certificates, (ii) the
Class M-1 Certificates, (iii) the Class M-2 Certificates and (iv) the Class B
Certificates, respectively.

     CUMULATIVE LOSS EVENT: For any Distribution Date in the applicable period
below, if Cumulative Net Losses exceed the applicable percentage of the
aggregate Original Class Principal Balances of the Offered Certificates:

         Number of
         Distribution Dates              Percentages
         ------------------              -----------

         37-48                           2.50%
         49-60                           2.90%
         61-72                           3.40%
         73-84                           3.80%
         85 and thereafter               4.00%

     CUMULATIVE NET LOSSES: As of any date of determination, the aggregate of
the Liquidation Loan Losses incurred from the Cut-Off Date through the end of
the calendar month preceding such date of determination.

     CURTAILMENT: With respect to a Mortgage Loan, any payment of principal
received during a Due Period as part of a payment that is in excess of the
amount of the Monthly Payment due for such Due Period and which is not intended
to satisfy the Mortgage Loan in full, nor is intended to cure a delinquency.

     CUSTODIAL ACCOUNT: The custodial account created and maintained for the
benefit of the Certificateholders pursuant to Section 3.21. The Custodial
Account shall be an Eligible Account.

     CUSTODIAL AGREEMENT: The agreement, if any, for the retention of the
Mortgage Files in the form set forth as Exhibit K hereto.

     CUSTODIAN: The Person acting as custodian under the Custodial Agreement
from time to time, initially, Wells Fargo Bank Minnesota, National Association.

     CUT-OFF DATE: April 1, 2001.

     CUT-OFF DATE POOL PRINCIPAL BALANCE: $105,586,628.25.

     CUT-OFF DATE PRINCIPAL BALANCE: With respect to any Mortgage Loan, the
unpaid principal balance thereof as of the related Cut-Off Date after giving
effect to payments of principal due on or before the Cut-Off Date.

     DEFECTIVE MORTGAGE LOAN: Any Mortgage Loan subject to repurchase or
substitution pursuant to Section 2.02 or 2.04.

                                      -10-

<PAGE>

     DEFICIENCY AMOUNT: With respect to any Distribution Date, the amount, if
any, by which the Guaranteed Distributions for such Distribution Date exceeds
the Available Funds for such Distribution Date that will be available to make
payment of the Guaranteed Distributions on such Distribution Date pursuant to
Section 5.01.

     DEFINITIVE CERTIFICATES: As defined in Section 6.02(c).

     DELINQUENT: A Mortgage Loan is "Delinquent" if any payment due thereon is
not made by the close of business on the last day of the Prepayment Period
immediately following the day such payment is scheduled to be due. A Mortgage
Loan is "30 days Delinquent" if such payment has not been received by the close
of business on the last day of the Prepayment Period of the month immediately
succeeding the month in which such payment was due. Similarly for "60 days
Delinquent", "90 days Delinquent" and so on.

     DELINQUENCY EVENT: A Delinquency Event shall have occurred and be
continuing, if at any time the Three Month Delinquency Rate exceeds 40% of the
Senior Enhancement Percentage.

     DEPOSITOR: Financial Asset Securities Corp.

     DEPOSITORY: The initial Depository shall be The Depository Trust Company,
the nominee of which is Cede & Co., as the registered Holder of the Regular
Certificates. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(3) of the UCC of the State of New York.

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

     DETERMINATION DATE: With respect to any Distribution Date, the fifth
Business Day prior to such Distribution Date.

     DISTRIBUTION ACCOUNT: The account established and maintained by the Trustee
pursuant to Section 5.04. The Distribution Account shall be an Eligible Account.

     DISTRIBUTION DATE: The fifteenth day of each month, or, if such day is not
a Business Day, then the next Business Day, beginning in May 2001.

     DUE DATE: As to any Mortgage Loan, the day of the month on which the
Monthly Payment is due from the Mortgagor.

     DUE PERIOD: With respect to each Distribution Date for scheduled payments
of both interest and principal, the period from and including the second day of
the month preceding the month of such Distribution Date to and including the
first day of the month of such Distribution Date.

     ELECTRONIC LEDGER: The electronic master record of home equity mortgage
loans maintained by the Servicer.

                                      -11-

<PAGE>

     ELIGIBLE ACCOUNT: A segregated account that is (i) maintained with a
depository institution whose debt obligations at the time of any deposit therein
have the highest short-term debt rating by the Rating Agencies and whose
accounts are insured to the maximum extent provided by either the SAIF or BIF of
the Federal Deposit Insurance Corporation established by such fund with a
minimum long-term unsecured debt rating of A by S&P, A2 by Moody's and A by
Fitch, and which is any of (A) a federal savings and loan association duly
organized, validly existing and in good standing under the federal banking laws,
(B) an institution duly organized, validly existing and in good standing under
the applicable banking laws of any state, (C) a national banking association
duly organized, validly existing and in good standing under the federal banking
laws, (D) a principal subsidiary of a bank holding company; (ii) a segregated
trust account maintained with the corporate trust department of a federal or
state chartered depository institution or trust company, having capital and
surplus of not less than $50,000,000, acting in its fiduciary capacity; (iii)
maintained at Wells Fargo Bank Minnesota, National Association so long as its
debt obligations at the time of any deposit therein have a short-term debt
rating of at least A-1 for S&P, P-1 for Moody's and F-1+ for Fitch; or (iv)
otherwise acceptable to each Rating Agency as evidenced by a letter from each
Rating Agency to the Trustee, without reduction or withdrawal of the then
current ratings of the Certificates without giving effect to the Certificate
Insurance Policy.

     ELIGIBLE INVESTMENTS: One or more of the following (excluding any callable
investments purchased at a premium):

          (i) direct obligations of, or obligations fully guaranteed as to
     timely payment of principal and interest by, the United States or any
     agency or instrumentality thereof, provided that 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 three months from the date of acquisition thereof,
     provided that the short-term unsecured debt obligations of the party
     agreeing to repurchase such obligations are at the time rated by each
     Rating Agency in its highest short-term rating category (which is "A-1+"
     for S&P, "P-1" for Moody's and "F-1+" for Fitch);

          (iii) certificates of deposit, time deposits and bankers' acceptances
     of any U.S. depository institution or trust company incorporated under the
     laws of the United States or any state thereof and subject to supervision
     and examination by federal and/or state banking authorities, provided that
     the unsecured short-term debt obligations of such depository institution or
     trust company at the date of acquisition thereof have been rated by S&P and
     Fitch in their respective highest unsecured short-term debt rating
     category;

          (iv) commercial paper (having original maturities of not more than 90
     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 S&P
     and Moody's and, if rated by Fitch, Fitch in their respective highest
     short-term rating categories;

          (v) short term investment funds ("STIFS") sponsored by any trust
     company or national banking association incorporated under the laws of the
     United States or any state

                                      -12-

<PAGE>

     thereof which on the date of acquisition has been rated by each Rating
     Agency in their respective highest rating category of long term unsecured
     debt;

          (vi) interests in any money market fund which at the date of
     acquisition of the interests in such fund including any such fund that is
     managed by the Trustee or an Affiliate of the Trustee or for which the
     Trustee or an Affiliate acts as advisor and throughout the time as the
     interest is held in such fund has a rating of "AAA" by S&P, "aa" by Moody's
     or "AAA" by Fitch; and

          (vii) other obligations or securities that are acceptable to each
     Rating Agency as an Eligible Investment hereunder and will not result in a
     reduction in the then current rating of the Certificates, as evidenced by a
     letter to such effect from such Rating Agency and with respect to which the
     Servicer or Master Servicer, as applicable, has received confirmation that,
     for tax purposes, the investment complies with the last clause of this
     definition;

PROVIDED that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provided a yield to maturity at par greater than 120% of the
yield to maturity at par of the underlying obligations; PROVIDED, FURTHER, that
no instrument described hereunder may be purchased at a price greater than par
if such instrument may be prepaid or called at a price less than its purchase
price prior to its stated maturity; and PROVIDED FURTHER, that if S&P is rating
any of the Certificates, an instrument described hereunder shall be rated the
applicable rating of S&P set forth above.

     ERISA RESTRICTED CERTIFICATE: Each of the Class B Certificates, the Class
M-1 and Class M-2 Certificates, the Class BIO Certificates, the Class P
Certificates and each Residual Certificate.

     ESCROW PAYMENTS: The amounts constituting ground rents, taxes, assessments,
water charges, sewer rents, primary insurance policy premiums (if any), fire and
hazard insurance premiums and other payments required to be escrowed by the
Mortgagor with the Mortgagee pursuant to the terms of any Mortgage Note or
Mortgage.

     ESCROW REPAIR LOAN: A Mortgage Loan as to which the Seller holds a portion
of the proceeds in escrow pending repair of the related Mortgaged Property as
specified in the related Mortgage and Mortgage Note.

     EVENT OF DEFAULT: As defined in Section 8.01.

     EXCESS INTEREST: As to any Distribution Date, the Available Funds remaining
after the application of payments pursuant to clauses (1) through (8) of Section
5.01(a).

     EXCESS OVERCOLLATERALIZATION AMOUNT: As to any Distribution Date, the
lesser of (i) the Basic Principal Amount for such Distribution Date and (ii) the
excess, if any, of (x) the Overcollateralization Amount (assuming 100% of the
Basic Principal Amount is distributed as the

                                      -13-

<PAGE>

Aggregate Principal Distribution Amount on the Offered Certificates) over (y)
the Required Overcollateralization Amount.

     EXPENSE FEE RATE: The sum of the Master Servicing Fee Rate, the Servicing
Fee Rate and the Trustee Fee Rate, which is 0.54% per annum.

     FANNIE MAE: Fannie Mae (formerly known as the Federal National Mortgage
Association).

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

     FINAL SCHEDULED DISTRIBUTION DATE: As to any Class of Certificates, the
Distribution Date occurring in the respective month set forth below:

                        Final Scheduled
     Class             Distribution Date
     -----             -----------------

     A                 April 15, 2031
     IO                April 15, 2004
     M-1               April 15, 2031
     M-2               April 15, 2031
     B                 April 15, 2031

     FIRST LIEN: With respect to any Mortgage Loan which is a second priority
lien, the mortgage loan relating to the corresponding Mortgaged Property having
a first priority lien.

     FISCAL AGENT: As defined in the Certificate Insurance Policy.

     FITCH: Fitch, Inc. or its successor in interest.

     FLOOD ZONE SERVICE CONTRACT: A transferable contract maintained for the
Mortgaged Property with a nationally recognized flood zone service provider for
the purpose of obtaining the current flood zone status relating to such
Mortgaged Property.

     FORECLOSURE PROFITS: With respect to a Liquidated Mortgage Loan, the
amount, if any, by which (i) the aggregate of its Net Liquidation Proceeds
exceeds (ii) the related Principal Balance (plus accrued and unpaid interest
thereon at the applicable Loan Rate from the date interest was last paid through
the date of receipt of the final Liquidation Proceeds) of such Liquidated
Mortgage Loan immediately prior to the final recovery of its Liquidation
Proceeds.

     FREDDIE MAC: Freddie Mac (formerly known as the Federal Home Loan Mortgage
Corporation).

     GAAP: Generally accepted accounting principles as in effect from time to
time, consistently applied.

                                      -14-

<PAGE>

     GUARANTEED DISTRIBUTIONS: For any Distribution Date and each Class of
Senior Certificates, the sum of (x) the Class Monthly Interest Amount on each
Class of Senior Certificates, plus (y) the Subordination Deficit, plus (z)
without duplication of clause (y) the outstanding Class Principal Balance of the
Class A Certificates on their respective Final Scheduled Distribution Dates
after giving effect to distributions thereon on that Distribution Date,
determined in accordance with the original terms of the Senior Certificates when
issued and without regard to any subsequent amendment or modification of the
Senior Certificates or this Agreement except amendments or modifications to
which the Certificate Insurer has given its prior written consent. Guaranteed
Distributions shall not include, nor shall coverage be provided under the
Certificate Insurance Policy in respect of, any taxes, withholding or other
charges imposed by a governmental authority due to, or in connection with, the
payment of any Guaranteed Distributions to a Holder.

     HUD: The United States Department of Housing and Urban Development or any
successor thereto.

     INSURANCE AGREEMENT: The Insurance and Indemnity Agreement dated as of
April 10, 2001, among the Seller, the Depositor and the Certificate Insurer,
including any amendments and supplements thereto.

     INSURANCE PROCEEDS: Proceeds paid by any insurer (other than the
Certificate Insurer) pursuant to any insurance policy covering a Mortgage Loan
or Mortgaged Property, or amounts required to be paid by the Servicer pursuant
to Section 3.05, net of any component thereof (i) covering any expenses incurred
by or on behalf of the Servicer in connection with obtaining such proceeds, (ii)
applied to the restoration or repair of the related Mortgaged Property, (iii)
released to the Mortgagor in accordance with the Servicer's normal servicing
procedures or (iv) required to be paid to any holder of a mortgage senior to
such Mortgage Loan.

     INSURED PAYMENTS: As to any Distribution Date, amounts actually paid under
the Certificate Insurance Policy.

     INTEREST PERIOD: The calendar month preceding the month of the applicable
Distribution Date, calculated on the basis of a 360-day year comprised of twelve
30-day months.

     INTEREST RATE ADJUSTMENT DATE: With respect to each adjustable-rate
Mortgage Loan, the date or dates on which the Loan Rate is subject to adjustment
in accordance with the related Mortgage Note.

     INTEREST REMITTANCE AMOUNT: As of any Distribution Date, the portion of
Available Funds that constitutes amounts in respect of interest.

     LIFETIME RATE CAP: With respect to each adjustable-rate Mortgage Loan, the
maximum Loan Rate permitted over the life of such Mortgage Loan, as provided by
the terms of the related Mortgage Note.

     LIQUIDATED MORTGAGE LOAN: As to any Distribution Date, a Mortgage Loan with
respect to which the Servicer has determined, in accordance with the servicing
procedures specified herein as

                                      -15-

<PAGE>

of the end of the preceding Prepayment Period, that all Liquidation Proceeds
which it expects to recover with respect to such Mortgage Loan (including the
disposition of the related REO Property) have been received.

     LIQUIDATION LOAN LOSSES: For each Liquidated Mortgage Loan the amount, if
any, by which the Principal Balance thereof plus accrued and unpaid interest
thereon is in excess of the Liquidation Proceeds realized thereon net of
unreimbursed Servicing Fees, Master Servicing Fees, Servicing Advances and
Monthly Advances with respect thereto.

     LIQUIDATION PROCEEDS: Proceeds (including Insurance Proceeds) received in
connection with the liquidation of any Mortgage Loan or related REO Property,
whether through trustee's sale, foreclosure sale or otherwise.

     LOAN INDEX: With respect to each Interest Rate Adjustment Date for each
adjustable-rate Mortgage Loan that is identified on the Mortgage Loan Schedule
as having a LIBOR Loan Index, the average of the interbank offered rate for
six-month U.S. dollar denominated deposits in the London Market, as determined
according to the terms of the related Note.

     LOAN RATE: With respect to any Mortgage Loan as of any day, the per annum
rate of interest applicable under the related Mortgage Note to the calculation
of interest for such day on the Principal Balance.

     MAINTENANCE: With respect to any Cooperative Unit, the rent paid by the
Mortgagor to the Cooperative Corporation pursuant to the Proprietary Lease.

     MAJORITY CERTIFICATEHOLDER: The Holder or Holders of Certificates
evidencing Voting Rights in excess of 50% in the aggregate.

     MARGIN: As to any adjustable-rate Mortgage Loan, the percentage set forth
as the "Margin" for such Mortgage Loan on the Mortgage Loan Schedule.

     MASTER SERVICER: Saxon Mortgage, Inc., a Virginia corporation or any
successor thereto or any successor hereunder.

     MASTER SERVICER EVENT OF DEFAULT: As defined in Section 8.01(a) hereof.

     MASTER SERVICER REMITTANCE DATE: As to any Distribution Date, one Business
Day preceding such Distribution Date.

     MASTER SERVICING COMPENSATION: The Master Servicing Fee and investment
income to which the Master Servicer is entitled pursuant to Section 3.24.

     MASTER SERVICING FEE: As to each Distribution Date and each Mortgage Loan,
the monthly fee payable to the Master Servicer, which is calculated as an amount
equal to the product of one- twelfth of the Master Servicing Fee Rate and the
Principal Balance thereof at the beginning of the related Due Period.

                                      -16-

<PAGE>

     MASTER SERVICING FEE RATE: 0.01% per annum.

     MASTER SERVICER TERMINATION TEST: The Master Servicer Termination Test is
failed if either (x) Cumulative Net Losses for the Mortgage Loans exceed 5.10%
of the aggregate Original Class Principal Balance of the Offered Certificates or
(y) the most recent Three Month 90-Day Delinquency Rate exceeds 30%.

     MARKER RATE: With respect to the Class B-IO Certificates and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the REMIC II Pass-Through Rates for REMIC II Regular Interests IIIB, IIC,
IID, IIE and IIF, with the rate on REMIC II Regular Interest IIB subject to a
cap equal to 6.265% per annum; with the rate on REMIC II Regular Interest IIC
subject to a cap equal to 7.100% per annum; with the rate on REMIC II Regular
Interest IID subject to a cap equal to 7.100% per annum; with the rate on REMIC
II Regular Interest IIE subject to a cap equal to 7.100% per annum and with the
rate on REMIC II Regular Interest IIF subject to a cap of zero for the purpose
of this calculation.

     MAXIMUM IIF REMIC II ACCRUED INTEREST DEFERRAL AMOUNT: With respect to any
Distribution Date, the excess of (a) accrued interest at the REMIC II
Pass-Through Rate applicable to REMIC II Regular Interest IIF for such
Distribution Date on a balance equal to the excess of (x) the REMIC II Principal
Balance of REMIC II Regular Interest IIF over (y) the REMIC II
Overcollateralized Amount, in each case for such Distribution Date, over (b)
REMIC II Accrued Interest on REMIC II Regular Interests IIB, IIC, IID, IIE and
IIF, with the rate on REMIC II Regular Interest IIB subject to a cap equal to
6.265% per annum; with the rate on REMIC II Regular Interest IIC subject to a
cap equal to 7.100% per annum; with the rate on REMIC II Regular Interest IID
subject to a cap equal to 7.100% per annum; and with the rate on REMIC II
Regular Interest IIE subject to a cap equal to 7.100% per annum for the purpose
of this calculation for such Distribution Date.

     MONTHLY ADVANCE: An advance made by the Servicer or Master Servicer
pursuant to Section 3.15.

     MONTHLY PAYMENT: The scheduled monthly payment of principal and/or interest
required to be made by a Mortgagor on the related Mortgage Loan.

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

     MORTGAGE: The mortgage, deed of trust or other instrument creating a first
or second lien on an estate in fee simple interest in real property securing a
Mortgage Loan.

     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 PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement, as
amended and supplemented from time to time, dated as of the date hereof, by and
between the Depositor and the Seller.

                                      -17-

<PAGE>

     MORTGAGE LOAN SCHEDULE: With respect to any date, the schedule of Mortgage
Loans constituting assets of the Trust transferred to the Trust on the Closing
Date. The Mortgage Loan Schedule is the schedule set forth herein as Exhibit C,
which schedule shall be amended from time to time and sets forth as to each
Mortgage Loan: (i) the Cut-Off Date Principal Balance, (ii) the account number,
(iii) the original principal amount, (iv) the CLTV as of the date of the
origination of the related Mortgage Loan, (v) the next Due Date, (vi) the
original Loan Rate, (vii) the first date on which a Monthly Payment is or was
due under the Mortgage Note, (viii) the original stated maturity date of the
Mortgage Note, (ix) the remaining number of months to maturity as of the Cut-Off
Date, (x) the state in which the related Mortgaged Property is situated, (xi)
the type of property, (xii) the lien status, (xiii) with respect to each
adjustable-rate Mortgage Loan, (a) the Periodic Rate Cap, (b) the Margin, (c)
the Lifetime Rate Cap and (d) the next Interest Rate Adjustment Date after the
Cut-Off Date.

     MORTGAGE LOANS: The mortgage loans that are transferred and assigned to the
Trustee pursuant to Section 2.01, together with the Related Documents, as from
time to time are held by the Custodian on behalf of the Trustee as a part of the
Trust, but excluding Mortgage Loans that are transferred to the Servicer or the
Seller, as the case may be, from time to time pursuant to Section 2.02, 2.04 or
3.16, such Mortgage Loans originally subject to this Agreement being identified
in the Mortgage Loan Schedule delivered on the Closing Date.

     MORTGAGE NOTE: With respect to a Mortgage Loan, the note pursuant to which
the related mortgagor agrees to pay the indebtedness evidenced thereby which is
secured by the related Mortgage.

     MORTGAGED PROPERTY: The underlying property, including real property and
improvements thereon, securing a Mortgage Loan, which, with respect to a
Cooperative Loan, is the related Cooperative Shares and Proprietary Lease.

     MORTGAGOR: The obligor or obligors under a Mortgage Note.

     NET LIQUIDATION PROCEEDS: With respect to any Liquidated Mortgage Loan,
Liquidation Proceeds net of unreimbursed Servicing Fees, Master Servicing Fees,
Servicing Advances and Monthly Advances with respect thereto.

     NET LOAN RATE: With respect to any Mortgage Loan as to any day, the Loan
Rate less the Expense Fee Rate.

     NET RATE CAP CARRYOVER: As to any Distribution Date and any Class of
Offered Certificates (other than the Class IO Certificates), the sum of (i) the
excess, if any, of the related Class Monthly Interest Amount, calculated at the
applicable Certificate Rate (without regard to the Available Funds Cap), over
the Class Monthly Interest Amount for such Distribution Date, (ii) any Net Rate
Cap Carryover remaining unpaid from prior Distribution Dates and (iii) 30 days'
interest on the amount in clause (ii) calculated at the applicable Certificate
Rate (without regard to the Available Funds Cap).

     NET RATE CAP FUND: The account established and maintained pursuant to
Section 5.08.

                                      -18-

<PAGE>

     NET RATE CAP FUND DEPOSIT: As defined in Section 5.08.

     NINETY DAY DELINQUENCY RATE: As to any Distribution Date, the percentage
equivalent of a fraction, the numerator of which is the aggregate Principal
Balances of the Mortgage Loans that are (a) 90 or more days Delinquent as of the
last day of such Prepayment Period plus (b) REO Property and Mortgage Loans in
foreclosure or in bankruptcy and not included pursuant to subsection (a) of this
definition, and the denominator of which is the Pool Balance as of the last day
of the related Due Period.

     NONRECOVERABLE ADVANCES: With respect to any Mortgage Loan, (i) any
Servicing Advance or Monthly Advance previously made and not reimbursed pursuant
to Section 3.03(ii) or (ii) a Servicing Advance or Monthly Advance proposed to
be made in respect of a Mortgage Loan or REO Property which, in the good faith
business judgment of the Servicer or the Master Servicer, as evidenced by an
Officer's Certificate delivered to the Depositor, the Seller, the Master
Servicer and the Trustee no later than the Business Day following such
determination, would not be ultimately recoverable pursuant to Sections 3.03(ii)
or (vi).

     NOTIONAL AMOUNT: The Notional Amount of the Class IO Certificates for any
Distribution Date prior to the 37th Distribution Date will equal the lesser of
(i) the Pool Balance as of the end of the second preceding Due Period and (ii)
the applicable amount set forth below:

               DISTRIBUTION DATES   NOTIONAL AMOUNT
               ------------------   ---------------
               1-3...............     $42,933,673
               4-6...............     $41,502,551
               7-9...............     $40,071,429
               10-12.............     $38,640,306
               13-15.............     $37,209,184
               16-18.............     $34,346,939
               19-21.............     $30,053,571
               22-24.............     $25,760,204
               25-27.............     $21,466,837
               28-30.............     $18,604,592
               31-33.............     $14,311,224
               34-36.............     $12,880,102

     On and after the 37th Distribution Date, the Notional Amount of the
Certificates will be zero.

     The Notional Amount of the Class BIO Certificates for any Distribution Date
will equal the aggregate REMIC II Principal Balances of the REMIC II Regular
Interests immediately prior to such Distribution Date.

     NOTIONAL AMOUNT CERTIFICATES: The Class IO Certificates.

                                      -19-

<PAGE>

     OC FLOOR: An amount equal to 0.50% of the aggregate Original Class
Principal Balance of the Offered Certificates as of the Closing Date (i.e.,
$527,930.00).

     OFFERED CERTIFICATES: The Senior Certificates and the Subordinate
Certificates.

     OFFICER'S CERTIFICATE: A certificate signed by the President, an Executive
Vice President, a Senior Vice President, a First Vice President, a Vice
President, Assistant Vice President, the Treasurer, Assistant Treasurer,
Assistant Secretary, Controller or Assistant Controller of the Servicer or the
Master Servicer and delivered to the Trustee or the Custodian.

     OPINION OF COUNSEL: A written opinion of counsel reasonably acceptable to
the Trustee, who may be in-house counsel for the Servicer, the Master Servicer
or the Seller (except that any opinion relating to the qualification of the
Trust as a REMIC or compliance with the REMIC Provisions must be an opinion of
independent outside counsel) and who, in the case of opinions delivered to each
Rating Agency or the Certificate Insurer, is reasonably acceptable to it.

     OPTIONAL TERMINATION DATE: The Distribution Date following the Due Period
at the end of which the Pool Balance is less than or equal to 10% of the sum of
the aggregate Principal Balance of the Mortgage Loans as of the Cut-Off Date.

     ORIGINAL CLASS PRINCIPAL BALANCE: As to the Class BIO Certificates,
$528.25, as to the Class P Certificates, $100.00 and as to the Residual
Certificates, $0. As to any Class of Offered Certificates, the respective amount
set forth below opposite such Class:

     Class                Original Class Principal Balance
     -----                --------------------------------

     Class A              $ 92,125,000.00
     Class IO                   (1)
     Class M-1            $  6,335,000.00
     Class M-2            $  4,223,000.00
     Class B              $  2,903,000.00
                          ---------------
     Total                $105,586,000.00

----------

(1) This Class has no Class Principal Balance, but will accrue interest on its
Notional Amount.

     ORIGINATOR: Delta Funding Corporation, a New York corporation, or any
successor thereto.

     OUTSTANDING CLASS INTEREST CARRYOVER SHORTFALL: As to any Class of
Certificates and any Distribution Date, the amount of Class Interest Carryover
Shortfall for such Distribution Date.

     OVERCOLLATERALIZATION AMOUNT: As to any Distribution Date, the excess, if
any, of (i) the Pool Balance as of the end of the related Due Period over (ii)
the aggregate Class Principal Balance of the Offered Certificates after giving
effect to the distribution of the Available Funds on such Distribution Date.

                                      -20-

<PAGE>

     OWNERSHIP INTEREST: As to any Certificate 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.

     PAYING AGENT: Any paying agent appointed pursuant to Section 6.05.

     PERCENTAGE INTEREST: With respect to any Offered Certificate, the
percentage obtained by dividing the denomination of such Certificate by the
aggregate of the denominations of all Certificates of the same Class. With
respect to a Residual Certificate, the portion of the Class evidenced thereby as
stated on the face thereof, which shall be either 99.999999% or, but only with
respect to the Tax Matters Person Residual Interest held by the Tax Matters
Person, 0.000001%. With respect to a Class P or a Class BIO Certificate, the
percentage set forth on the face thereof.

     PERIODIC RATE CAP: With respect to each adjustable-rate Mortgage Loan with
respect to which the related Mortgage Note provides for a periodic rate cap, the
maximum percentage increase or decrease in the Loan Rate permitted for such
Mortgage Loan over the Loan Rate in effect as of an Interest Rate Adjustment
Date, as set forth on the Mortgage Loan Schedule.

     PERMITTED TRANSFEREE: Any Person other than (i) the United States or any
State or any political subdivision thereof or any agency or instrumentality of
any of the foregoing; (ii) a foreign government, international organization or
any agency or instrumentality of either of the foregoing; (iii) an organization
which is exempt from tax imposed by Chapter 1 of the Code (including the tax
imposed by section 511 of the Code on unrelated business taxable income) (except
certain farmers' cooperatives described in Code section 521) on any excess
inclusions (as defined in Section 860E(c)(1)) with respect to any Residual
Certificate; (iv) rural electric and telephone cooperatives described in Code
section 1381(a)(2)(C); (v) a Person that is not (a) a citizen or resident of the
United States, (b) a corporation, partnership or other entity created or
organized in or under the laws of the United States or any political subdivision
thereof, (c) an estate whose income from sources without the United States is
includible in gross income for United States federal income tax purposes
regardless of its connection with the conduct of a trade or business within the
United States or (d) a trust if a court within the United States is able to
exercise primary supervision of the administration of the trust and one or more
United States fiduciaries have the authority to control all substantial
decisions of the trust; or (vi) any other Person so designated by the Trustee
based on an Opinion of Counsel to the effect that any transfer to such Person
may cause the Trust to fail to qualify as a REMIC at any time the Certificates
are outstanding. The terms "United States", "State" and "international
organization" shall have the meanings set forth in Code section 7701 or
successor provisions. A corporation will not be treated as an instrumentality of
the United States or of any State or political subdivision thereof if all of its
activities are subject to tax, and, with the exception of Freddie Mac, a
majority of its board of directors is not selected by such governmental unit.

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

     POOL BALANCE: With respect to any date, the aggregate of the Principal
Balances of all Mortgage Loans as of such date.

                                      -21-

<PAGE>

     PREMIUM AMOUNT: As to any Distribution Date, the product of the Premium
Percentage divided by 12 and the Certificate Balance as of the first day of the
calendar month in which such Distribution Date occurs.

     PREMIUM LETTER: The letter, dated the Closing Date, from the Certificate
Insurer to the Depositor and the Seller setting forth the Premium Amount and
other amounts.

     PREMIUM PERCENTAGE: The per annum rate at which the premium due to the
Certificate Insurer accrues, as set forth in the Premium Letter.

     PREPAYMENT ASSUMPTION: With respect to the fixed-rate Mortgage Loans, a
conditional rate of prepayment equal to 4.0% per annum in the first month of the
life of the fixed rate Mortgage Loans and an additional amount of approximately
1.454545% (precisely 16/11 percent per annum) in each month thereafter until the
twelfth month; beginning in the twelfth month and in each month thereafter
during the life of the Mortgage Loans, a conditional prepayment rate of 20% per
annum each month is assumed. With respect to the adjustable-rate Mortgage Loans,
a conditional rate of prepayment equal to 4.0% per annum in the first month of
the life of the adjustable-rate mortgage loans and an additional amount of
approximately 1.068966% (precisely 31/29 percent per annum) in each month
thereafter until the 30th month; beginning in the 30th month and in each month
thereafter during the life of the Mortgage Loans, a conditional prepayment rate
of 35% per annum each month is assumed.

     PREPAYMENT CHARGE: As to a Mortgage Loan, any charge to be paid by a
Mortgagor in connection with certain partial prepayments and all prepayments in
full made during the related Prepayment Charge Period, the Prepayment Charges
with respect to each applicable Mortgage Loan so held by the Trust being
identified in the Prepayment Charge Schedule (other than any Prepayment Charge
Payment Amount).

     PREPAYMENT CHARGE PAYMENT AMOUNT: The amounts payable by the Seller or the
Servicer, as the case may be, pursuant to Section 3.20.

     PREPAYMENT CHARGE PERIOD: As to any Mortgage Loan, the period of time, if
any, during which a Prepayment Charge may be imposed.

     PREPAYMENT CHARGE SCHEDULE: As of any date, the list of Prepayment Charges
included in the Trust on such date, attached hereto as Exhibit R (including the
prepayment charge summary attached thereto). The Prepayment Charge Schedule
shall set forth the following information with respect to each Prepayment
Charge:

          (i) the Mortgage Loan account number;

          (ii) a code indicating the type of Prepayment Charge;

          (iii) the state of origination in which the related Mortgaged Property
     is located;

                                      -22-

<PAGE>

          (iv) the first date on which a Monthly Payment is or was due under the
     related Mortgage Note;

          (v) the term of the Prepayment Charge;

          (vi) the original principal amount of the related Mortgage Loan;

          (vii) the Cut-Off Date Principal Balance of the related Mortgage Loan;

          (viii) the term of the related Mortgage Loan;

          (ix) a code indicating whether a Mortgage Loan has a prepayment
     penalty; and

          (x) a code indicating the amount, if any, of a prepayment on a
     Mortgage Loan that would not be subject to the prepayment penalty that
     would otherwise apply.

     The Prepayment Charge Schedule shall be amended from time to time by the
Servicer in accordance with the provisions of this Agreement, and the Trustee
shall have no responsibility to recalculate or otherwise review the information
set forth therein.

     PREPAYMENT INTEREST SHORTFALL: With respect to any Distribution Date, for
each Mortgage Loan that was the subject during the related Due Period of a
voluntary Principal Prepayment an amount equal to the excess, if any, of (i) 30
days' interest on the Principal Balance of such Mortgage Loan at the Loan Rate
(or at such lower rate as may be in effect for such Mortgage Loan pursuant to
application of the Civil Relief Act), net of the Servicing Fee Rate (which shall
constitute payment of the Servicing Fee with respect to such Mortgage Loan),
over (ii) the amount of interest actually remitted by the Mortgagor in
connection with such Principal Prepayment.

     PREPAYMENT PERIOD: As to any Distribution Date, the preceding calendar
month.

     PRINCIPAL BALANCE: As to any Mortgage Loan and any day, other than a
Liquidated Mortgage Loan, the related Cut-Off Date Principal Balance, minus all
collections credited against the Cut-Off Date Principal Balance of any such
Mortgage Loan. For purposes of this definition, a Liquidated Mortgage Loan shall
be deemed to have a Principal Balance equal to the Principal Balance of the
related Mortgage Loan immediately prior to the final recovery of related
Liquidation Proceeds and a Principal Balance of zero thereafter.

     PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date, the lesser of
(a) the aggregate Class Principal Balances of the Offered Certificates
immediately preceding such Distribution Date and (b) sum of (i) the Basic
Principal Amount minus the Excess Overcollateralization Amount and (ii) the
Subordination Increase Amount.

     PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on a
Mortgage Loan equal to the outstanding principal balance thereof, received in
advance of the final scheduled Due Date which is intended to satisfy a Mortgage
Loan in full (without regard to any Prepayment Charge that may have been
collected by the Servicer in connection with such payment of principal).

                                      -23-

<PAGE>

     PROPRIETARY LEASE: With respect to any Cooperative Unit, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Cooperative Shares.

     PROSPECTUS: The base prospectus of the Seller dated April 4, 2001.

     PROSPECTUS SUPPLEMENT: The prospectus supplement dated April 4, 2001,
relating to the offering of the Offered Certificates.

     PURCHASE PRICE: As to any Mortgage Loan repurchased on any date pursuant to
Section 2.02, 2.04 or 3.16, an amount equal to the sum of (i) the unpaid
Principal Balance thereof, (ii) the greater of (a) all unpaid accrued interest
thereon to the end of the Due Period preceding the Distribution Date on which
such Purchase Price is included in Available Funds and (b) 30 days' interest
thereon, computed at the applicable Loan Rate; PROVIDED, HOWEVER, that if the
purchaser is the Servicer, the amount described in clause (ii) shall be computed
at the Loan Rate net of the Servicing Fee Rate (which shall constitute payment
of the Servicing Fee with respect to such Mortgage Loan), (iii) if the purchaser
is the Seller, (x) any unreimbursed Servicing Advances with respect to such
Mortgage Loan and (y) expenses reasonably incurred or to be incurred by the
Servicer, the Trust or the Trustee in respect of the breach or defect giving
rise to the purchase obligation and (iv) the amount of any penalties, fines,
forfeitures, legal fees and related costs, judgments and any other costs, fees
and expenses incurred by or imposed on the Trustee or the Trust or with respect
to which any of them are liable arising from a breach by the Seller of its
representations and warranties in Section 2.04.

     RATING AGENCY: Any statistical credit rating agency, or its successor, that
rated the Offered Certificates at the request of the Seller at the time of the
initial issuance of the Certificates. If such 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 Seller, notice of which designation
shall be given to the Trustee. References herein to the highest short term
unsecured rating category of a Rating Agency shall mean "A-1" or better in the
case of S&P, "P-1" or better in the case of Moody's and "F-1+" or better in the
case of Fitch. References herein to the highest long-term rating category of a
Rating Agency shall mean "AAA" in the case of S&P and Fitch and "Aaa" in the
case of Moody's.

     RECOGNITION AGREEMENT: With respect to any Cooperative Loan, an agreement
between the Cooperative Corporation and the originator of such Mortgage Loan,
which establishes the rights of such originator in the Cooperative Property.

     RECORD DATE: The last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.

     REFINANCED MORTGAGE LOAN: A Mortgage Loan the proceeds of which were not
used to purchase the related Mortgaged Property.

     REGULAR CERTIFICATES: The Offered Certificates, the Class P Certificates
and the Class BIO Certificates.

                                      -24-

<PAGE>

     REIMBURSEMENT AMOUNT: As to any Distribution Date, the amount, if any,
owing to the Certificate Insurer under the Insurance Agreement.

     RELATED DOCUMENTS: As defined in Section 2.01.

     RELEASED MORTGAGED PROPERTY PROCEEDS: As to any Mortgage Loan, proceeds
received by the Servicer in connection with (a) a taking of an entire Mortgaged
Property by exercise of the power of eminent domain or condemnation or (b) any
release of part of the Mortgaged Property from the lien of the related Mortgage,
whether by partial condemnation, sale or otherwise, which are not released to
the Mortgagor in accordance with applicable law and mortgage servicing standards
the Servicer would use in servicing mortgage loans for its own account and this
Agreement.

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

     REMIC I: The segregated pool of assets consisting of the assets of the
Trust other than the REMIC I Interests, the REMIC II Interests and the Net Rate
Cap Fund.

     REMIC I ACCRUED INTEREST: With respect to each REMIC I Regular Interest on
each Distribution Date, an amount equal to (i) one month's interest at the
related REMIC I Pass-Through Rate on the REMIC I Principal Balance of such REMIC
I Regular Interest minus (ii) such REMIC I Regular Interest's pro rata portion
of any Civil Relief Act Interest Shortfall during the related Due Period based
on the amount of interest to which each such Class would otherwise be entitled
in the absence of such shortfall.

     REMIC I PASS-THROUGH RATE: as defined in Section 2.07.

     REMIC I PRINCIPAL BALANCE: With respect to each REMIC I Regular Interest,
the amount of such REMIC I Regular Interest outstanding as of any date of
determination. As of the Closing Date, the REMIC I Principal Balance of each
REMIC I Regular Interest shall equal the amount set forth in the Section 2.07 as
its initial REMIC I Principal Balance. The REMIC I Principal Balance of each
REMIC I Regular Interest shall never be less than zero.

     REMIC I INTERESTS: As defined in Section 2.07.

     REMIC I REGULAR INTEREST: As defined in Section 2.07.

     REMIC II: The segregated pool of assets consisting of the REMIC I Regular
Interests (other than the Class P Certificates).

     REMIC II ACCRUED INTEREST: With respect to each REMIC II Regular Interest
on each Distribution Date, an amount equal to (i) one month's interest at the
related REMIC II Pass-Through Rate on the REMIC II Principal Balance or REMIC II
Notional Amount, as applicable, of such REMIC II Regular Interest minus (ii)
such REMIC II Regular Interest's pro rata portion of any Civil Relief Act
Interest Shortfall during the related Due Period based on the amount of interest
to which each such Class would otherwise be entitled in the absence of such
shortfall.

                                      -25-

<PAGE>

     REMIC II INTERESTS: As defined in Section 2.07.

     REMIC II NOTIONAL AMOUNT: As defined in Section 2.07.

     REMIC II OVERCOLLATERALIZATION TARGET AMOUNT: 1% of the Required
Overcollateralization Amount.

     REMIC II OVERCOLLATERALIZED AMOUNT: With respect to any date of
determination, (i) 1/2 of the aggregate of the REMIC II Principal Balances of
the REMIC II Regular Interests IIA, IIB, IIC, IID, IIE and IIF minus (ii) the
REMIC II Principal Balance of REMIC II Regular Interests IIB, IIC, IID and IIE
in each case as of such date of determination.

     REMIC II PASS-THROUGH RATE: As defined in Section 2.07.

     REMIC II PRINCIPAL BALANCE: With respect to each REMIC II Regular Interest
(other than REMIC II Regular Interest II-A-IO), the amount of such REMIC II
Regular Interest outstanding as of any date of determination. The REMIC II
Principal Balance of REMIC II Regular Interest IIF shall be increased by
interest deferrals as provided in Section 2.07. As of the Closing Date, the
REMIC II Principal Balance of each REMIC II Regular Interest (other than REMIC
II Regular Interest II-A-IO) shall equal the amount set forth in Section 2.07 as
its initial REMIC II Principal Balance. The REMIC II Principal Balance of each
REMIC II Regular Interest that has a REMIC II Principal Balance shall never be
less than zero.

     REMIC II REGULAR INTEREST: As defined in Section 2.07.

     REMIC III: The segregated pool of assets consisting of the REMIC II Regular
Interests.

     REMIC III CERTIFICATES: As defined in Section 2.07.

     REMIC CERTIFICATE MATURITY DATE: The "latest possible maturity date" as
that term is defined in Section 2.09.

     REMIC CHANGE OF LAW: Any proposed, temporary or final regulation, revenue
ruling, revenue procedure or other official announcement or interpretation
relating to any REMIC and the REMIC Provisions issued after the Closing Date.

     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
regulations promulgated thereunder, as the foregoing may be in effect from time
to time.

     REO PROPERTY: A Mortgaged Property that is acquired by the Servicer on
behalf of the Trust in foreclosure or by deed in lieu of foreclosure.

                                      -26-

<PAGE>

     REQUIRED OVERCOLLATERALIZATION AMOUNT: As to any Distribution Date (a)
prior to the Stepdown Date, the product of (i) 2.20% and (ii) the aggregate
Original Class Principal Balance of the Offered Certificates; and (b) on and
after the Stepdown Date, the greater of (i) the lesser of (x) the product of
2.20% and the aggregate Original Class Principal Balance of the Offered
Certificates and (y) the product of 4.40% and the Pool Balance as of the end of
the related Due Period and (ii) the OC Floor; provided, however, that on each
Distribution Date during the continuance of (a) a Cumulative Loss Event, the
Required Overcollateralization Amount will equal the greater of (1) the lesser
of (x) 8.80% of the Pool Balance as of the last day of the related Due Period
and (y) 2.20% of the aggregate Original Class Principal Balance of the Offered
Certificates and (2) the OC Floor, or (b) a Delinquency Event (and a Cumulative
Loss Event is not then continuing), the Required Overcollateralization Amount
will equal the Required Overcollateralization Amount in effect on the
immediately preceding Distribution Date.

     RESIDENTIAL DWELLING: A one- to five-family dwelling, a five- to
eight-family dwelling, a mixed use property, a unit in a planned unit
development, a unit in a condominium development, a townhouse, a unit in a
Cooperative or a mobile home treated as real property under local law.

     RESIDUAL CERTIFICATES: The Class R-1, Class R-2 and Class R-3 Certificates
collectively.

     RESPONSIBLE OFFICER: When used with respect to the Trustee, any officer
assigned to the corporate trust group (or any successor thereto), including any
vice president, assistant vice president, trust officer, any assistant
secretary, any trust officer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and having direct responsibility for the administration of this
Agreement. When used with respect to the Seller, Servicer or the Master
Servicer, the President or any Vice President, Assistant Vice President or any
Secretary or Assistant Secretary.

     SAIF: The Savings Association Insurance Fund, as from time to time
constituted, created under the Financial Institutions Reform, Recovery and
Enhancement Act of 1989, or, if at any time after the execution of this
Agreement the Savings Association Insurance Fund is not existing and performing
duties now assigned to it, the body performing such duties on such date.

     SAXON PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement, as amended
and supplemented from time to time, dated as of the date hereof, by and among
the Seller, as purchaser, the Originator and Greenwich Capital Financial
Products, Inc., as seller.

     SECURITY AGREEMENT: With respect to any Cooperative Loan, the agreement
between the owner of the related Cooperative Shares and the originator of the
related Mortgage Note, which defines the terms of the security interest in such
Cooperative Shares and the related Proprietary Lease.

     SELLER: Saxon Mortgage, Inc., a Virginia corporation, or any successor
thereto.

     SENIOR CERTIFICATE: Any Certificate executed and authenticated by the
Trustee substantially in the form set forth in Exhibit A and designated as a
Class A or Class IO Certificate pursuant to Section 6.01.

                                      -27-

<PAGE>

     SENIOR CERTIFICATEHOLDER: The Holder of a Senior Certificate.

     SENIOR ENHANCEMENT PERCENTAGE: As to any Distribution Date, the percentage
equivalent of a fraction, the numerator of which is the sum of (i) the aggregate
Class Principal Balances of the Subordinate Certificates and (ii) the
Overcollateralization Amount (in each case, after taking into account the
distribution of Available Funds on such Distribution Date) and the denominator
of which is the Pool Balance as of the last day of the related Due Period.

     SENIOR PORTION: As to any Distribution Date, the percentage equivalent of a
fraction the numerator of which is the Class Principal Balance of the Class A
Certificates and the denominator of which is the aggregate Class Principal
Balance of the Offered Certificates.

     SENIOR PRINCIPAL DISTRIBUTION AMOUNT: As to (a) any Distribution Date prior
to the Stepdown Date or during the continuance of a Delinquency Event, the
lesser of (i) 100% of the Principal Distribution Amount, calculated as if the
Subordination Increase Amount for such Distribution Date is zero, and (ii) the
Class Principal Balance of the Class A Certificates, and (b) any other
Distribution Date, an amount equal to the lesser of (x) the Principal
Distribution Amount, calculated as if the Subordination Increase Amount for such
Distribution Date is zero, and (y) the excess, if any, of (i) the Class
Principal Balance of the Class A Certificates immediately prior to such
Distribution Date over (ii) the lesser of (x) the product of 74.50% and the Pool
Balance as of the last day of the related Due Period minus the Subordination
Required Overcollateralization Amount for such Distribution Date and (y) the
Pool Balance as of the last day of the related Due Period minus the OC Floor.

     SERVICER: Meritech Mortgage Services, Inc., a Texas corporation, or any
successor thereto or any successor hereunder.

     SERVICER EVENT OF DEFAULT: As defined in Section 8.01(a) hereof.

     SERVICER REMITTANCE AMOUNT: As to any Distribution Date, the sum, without
duplication of the following amounts with respect to the Mortgage Loans: (i)
scheduled payments of principal and interest on the Mortgage Loans due during
the related Due Period and received by the Servicer (net of amounts representing
the Servicing Fee with respect to each Mortgage Loan and reimbursement for
related Monthly Advances and Servicing Advances); (ii) Net Liquidation Proceeds
and Insurance Proceeds with respect to the Mortgage Loans (net of amounts
applied to the restoration or repair of a Mortgaged Property) and unscheduled
payments of principal and interest on the Mortgage Loans received by the
Servicer during the related Prepayment Period (net of amounts representing the
Servicing Fee with respect to each Mortgage Loan and reimbursement for related
Monthly Advances and Servicing Advances); (iii) the Purchase Price received from
the Seller for repurchased Defective Mortgage Loans; and (iv) payments from the
Servicer in connection with (a) Monthly Advances, (b) Compensating Interest and
(c) the termination of the Trust with respect to the Mortgage Loans as provided
in this Agreement.

     SERVICER REMITTANCE DATE: As to any Distribution Date, the fourth Business
Day preceding such Distribution Date.

                                      -28-

<PAGE>

     SERVICER TERMINATION TEST: The Servicer Termination Test is failed if
either (x) Cumulative Net Losses for the Mortgage Loans exceed 5.10% of the
aggregate Original Class Principal Balance of the Offered Certificates or (y)
the most recent Three Month 90-Day Delinquency Rate exceeds 30%.

     SERVICING ADVANCES: All reasonable and customary "out of pocket" costs and
expenses incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (i) the preservation,
restoration and protection of the Mortgaged Property, (ii) any enforcement or
judicial proceedings, including foreclosures, (iii) the management and
liquidation of the REO Property, including reasonable fees paid to any
independent contractor in connection therewith, (iv) compliance with the
obligations under Section 3.04, 3.06 or 3.19 and (v) in connection with the
liquidation of a Mortgage Loan, expenditures relating to the purchase or
maintenance of the First Lien pursuant to Section 3.17, all of which reasonable
and customary out-of-pocket costs and expenses are reimbursable to the Servicer
to the extent provided in Sections 3.03(ii) and (vi), and 3.06.

     SERVICING CERTIFICATE: A certificate completed and executed by a Servicing
Officer on behalf of the Servicer.

     SERVICING COMPENSATION: The Servicing Fee and other amounts to which the
Servicer is entitled pursuant to Section 3.08.

     SERVICING FEE: As to each Distribution Date and each Mortgage Loan, the
monthly fee payable to the Servicer, which is calculated as an amount equal to
the product of one-twelfth of the Servicing Fee Rate and the Principal Balance
thereof at the beginning of the related Due Period.

     SERVICING FEE RATE: 0.50% per annum.

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

     SERVICING TRANSFER COSTS: All reasonable costs and expenses incurred by the
Successor Servicer in connection with the transfer of servicing from a
predecessor servicer, including, without limitation, any reasonable costs or
expenses associated with the complete transfer of all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the Successor Servicer to correct any errors or insufficiencies in the
servicing data or otherwise to enable the Successor Servicer to service the
Mortgage Loans properly and effectively.

     SIXTY DAY DELINQUENCY RATE: As to any Distribution Date, the percentage
equivalent of a fraction, the numerator of which is the aggregate Principal
Balances of the Mortgage Loans that are (a) 60 or more days Delinquent as of the
last day of the related Prepayment Period plus (b) REO Property and Mortgage
Loans in foreclosure or in bankruptcy and not included pursuant to subsection
(a) of this definition and the denominator of which is the Pool Balance as of
the last day of the related Due Period.

                                      -29-

<PAGE>

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

     STARTUP DAY: The day designated as such pursuant to Section 2.08.

     STEPDOWN DATE: The later to occur of (x) the earlier to occur of (i) the
Distribution Date in May 2004 and (ii) the Distribution Date on which the Class
Principal Balance of the Class A Certificates is reduced to zero, and (y) the
first Distribution Date on which the Senior Enhancement Percentage (assuming
100% of the Principal Distribution Amount is distributed on the Offered
Certificates) is at least equal to 29.90%.

     SUBORDINATE CERTIFICATES: Any Certificate executed and authenticated by the
Trustee substantially in the form set forth in Exhibit A and designated as a
Class M-1, Class M-2 or Class B Certificate pursuant to Section 6.01.

     SUBORDINATE PORTION: As to Subordinate Certificates and any Distribution
Date, 100% minus the Senior Portion.

     SUBORDINATION DEFICIENCY: As to any Distribution Date, the excess, if any,
of (i) the Required Overcollateralization Amount for such Distribution Date over
(ii) the Overcollateralization Amount for such Distribution Date calculated by
giving effect to the distribution of Available Funds pursuant to Sections
5.01(a)(1) through (8) only on such Distribution Date.

     SUBORDINATION DEFICIT: For any Distribution Date, the amount, if any, by
which the Class Principal Balance of the Class A Certificates exceeds the Pool
Balance as of the last day of the related Due Period, in each case, after giving
effect to all distributions of principal and allocations of Liquidated Loan
Losses on such Distribution Date.

     SUBORDINATION INCREASE AMOUNT: As to any Distribution Date, the lesser of
(i) the Subordination Deficiency and (ii) the Excess Interest.

         SUBORDINATION REQUIRED OVERCOLLATERALIZATION AMOUNT: As to (a) any
Distribution Date on which a Delinquency Event has not occurred, an amount equal
to the Required Overcollateralization Amount for such Distribution Date
calculated as if the OC Floor is zero, and (b) any other Distribution Date, an
amount equal to the Required Overcollateralization Amount for such Distribution
Date.

     SUBSERVICER: Any Person with whom the Servicer has entered into a
Subservicing Agreement and who satisfies the requirements set forth in Section
3.01(b) in respect of the qualification of a Subservicer.

     SUBSERVICING AGREEMENT: Any agreement between the Servicer and any
Subservicer relating to subservicing and/or administration of certain Mortgage
Loans as provided in Section 3.01(b), a copy of which shall be delivered, along
with any modifications thereto, to the Trustee.

     SUCCESSOR MASTER SERVICER: As defined in Section 8.02.

                                      -30-

<PAGE>

     SUCCESSOR SERVICER: As defined in Section 8.02.

     TAX MATTERS PERSON: As defined in Section 2.11.

     TAX MATTERS PERSON RESIDUAL INTEREST: A 0.000001% interest in each of the
Class R-1, Class R-2 and Class R-3 Certificates, which shall be issued to and
held by the Tax Matters Person.

     THREE MONTH DELINQUENCY RATE: As to any Distribution Date the arithmetic
average of the Sixty Day Delinquency Rates for the three Distribution Dates
preceding such Distribution Date.

     THREE MONTH 90-DAY DELINQUENCY RATE: As to any Distribution Date the
arithmetic average of the Ninety Day Delinquency Rates for the three
Distribution Dates preceding such Distribution Date.

     TAX SERVICE CONTRACT: A transferable contract maintained for the Mortgaged
Property with a tax service provider for the purpose of obtaining current
information from local taxing authorities relating to such Mortgaged Property.

     TRUST: The trust created by this Agreement, the corpus of which consists of
the Mortgage Loans, such assets as shall from time to time be deposited in the
Collection Account, the Custodial Account and the Distribution Account in
accordance with this Agreement, property that secured a Mortgage Loan and that
has become REO Property, certain hazard insurance policies maintained by the
Mortgagors or the Servicer in respect of the Mortgage Loans and all proceeds of
each of the foregoing.

     TRUSTEE: Wells Fargo Bank Minnesota, National Association, or any successor
Trustee appointed in accordance with this Agreement that has accepted such
appointment in accordance with this Agreement.

     TRUSTEE FEE: As to any Distribution Date, an amount equal to the product of
(i) one-twelfth of the Trustee Fee Rate and (ii) the Pool Balance as of the
beginning of the related Due Period.

     TRUSTEE FEE RATE: 0.03% per annum.

     VOTING RIGHTS: The right to vote evidenced by a Certificate as follows: the
Class BIO Certificates, in the aggregate, shall evidence Voting Rights equal to
the percentage equivalent of a fraction, the numerator of which is the Required
Overcollateralization Amount and the denominator of which is the Pool Balance;
the Certificates, other than the Class BIO Certificates, shall evidence Voting
Rights equal to 100% minus the Voting Rights evidenced by the Class BIO
Certificates. The Voting Rights allocated to the Certificates, other than the
Class BIO Certificates, shall be allocated 1% to the Notional Amount
Certificates and 1% to the Residual Certificates, in the aggregate and the
remainder among the other Classes of Offered Certificates in proportion to their
respective Class Principal Balances. Voting Rights allocated to a Class of
Certificates shall be allocated among the Certificates of such Class in
proportion to their respective Percentage Interests.

                                      -31-

<PAGE>

     Section 1.02. INTEREST CALCULATIONS. All calculations of interest that are
made in respect of the Principal Balance of the Mortgage Loans shall be made on
the basis of a 360-day year consisting of twelve 30-day months. The Certificate
Rate for the Certificates shall be calculated on the basis of a 360-day year
consisting of twelve 30 day months. The calculation of the Servicing Fee, the
Master Servicing Fee and the Trustee Fee shall be made on the basis of a 360-day
year consisting of twelve 30-day months. All dollar amounts calculated hereunder
shall be rounded to the nearest penny with one-half of one penny being rounded
down.

                                   ARTICLE II

  Conveyance of Mortgage Loans; Original Issuance of Certificates Tax Treatment

     Section 2.01. CONVEYANCE OF MORTGAGE LOANS. (a) The Depositor, concurrently
with the execution and delivery of this Agreement, does hereby transfer, assign,
set over and otherwise convey to the Trust without recourse (subject to Sections
2.02 and 2.04) (i) all of its right, title and interest in and to each Mortgage
Loan, including the Cut-Off Date Principal Balance and all collections in
respect of interest and principal received after the Cut-Off Date (other than
payments in respect of accrued interest and principal due on or before April 1,
2001); (ii) property which secured such Mortgage Loan and which has been
acquired by foreclosure or deed in lieu of foreclosure; (iii) its interest in
any insurance policies in respect of the Mortgage Loans; (iv) all of its right,
title and interest in, but none of its obligations under, the Mortgage Loan
Purchase Agreement; and (v) all proceeds of any of the foregoing. In addition,
on or prior to the Closing Date, the Depositor shall cause the Certificate
Insurer to deliver the Certificate Insurance Policy to the Trustee.

     In connection with such transfer, assignment and conveyance the Depositor
shall cause the Seller to, and the Seller agrees to deliver to and deposit with,
the Trustee or the Custodian on behalf of the Trustee, on or before the Closing
Date, the following documents or instruments with respect to each Mortgage Loan
(the "Related Documents") and the Mortgage Loan Schedule in computer readable
format:

          (i) The original Mortgage Note, with all prior and intervening
     endorsements showing a complete chain of endorsements from the originator
     of the Mortgage Loan to the Person so endorsing the Mortgage Loan to the
     Trustee, endorsed by such Person "Pay to the order of Wells Fargo Bank
     Minnesota, National Association, as Trustee for Soundview Home Equity Loan
     Trust 2001-1 without recourse" and signed, by facsimile or manual
     signature, in the name of such Person;

          (ii) Any of: (1) the original Mortgage and related power of attorney,
     if any, with evidence of recording thereon, (2) a copy of the Mortgage and
     related power of attorney, if any, certified as a true copy of the original
     Mortgage or power of attorney by the originator of the related Mortgage
     Loan or by a Responsible Officer of the Seller by facsimile or manual
     signature or by the closing attorney or by an officer of the title insurer
     or agent of the title insurer that issued the related title insurance
     policy, in each case, if the original has been transmitted for recording
     until such time as the original is returned by the public recording office
     or (3) a copy of the original recorded Mortgage and related power of
     attorney, if any,

                                      -32-

<PAGE>

     certified by the public recording office, if the original has been retained
     by the public recording office;

          (iii) The original Assignment of Mortgage in recordable form, in
     blank, or to "Wells Fargo Bank Minnesota, National Association, as Trustee
     for Soundview Home Equity Loan Trust 2001-1";

          (iv) The original lender's policy of title insurance or a true copy
     thereof or, if such original lender's title insurance policy has been lost,
     a copy thereof certified by the appropriate title insurer to be true and
     complete or, if such lender's title insurance policy has not been issued as
     of the Closing Date, a marked up commitment (binder) to issue such policy;

          (v) All intervening assignments, if any, showing a complete chain of
     assignments from the originator to the Person executing the Assignment of
     Mortgage referred to in (iii) above, including any recorded warehousing
     assignments, with evidence of recording thereon, or a copy thereof
     certified by the originator of the related Mortgage Loan or a Responsible
     Officer of the Seller by facsimile or manual signature, or by the closing
     attorney or by an officer of the title insurer or agent of the title
     insurer that issued the related title insurance policy, as a true copy of
     the original of such intervening assignments if the original has been
     transmitted for recording until such time as the original is returned by
     the public recording office or a copy of the original recorded intervening
     assignments certified by the public recording office, if the original has
     been retained by the public recording office;

          (vi) Originals of all assumption, written assurance, substitution and
     modification agreements, if any; and

          (vii) In the case of a Cooperative Loan, the originals of the
     following documents or instruments:

               (a)  The Cooperative Shares, together with a stock power in
                    blank;

               (b)  The executed Security Agreement;

               (c)  The executed Proprietary Lease;

               (d)  The executed Recognition Agreement;

               (e)  The executed assignment of Recognition Agreement;

               (f)  The executed UCC-1 financing statements with evidence of
                    recording thereon which have been filed in all places
                    required to perfect the Seller's interest in the Cooperative
                    Shares and the Proprietary Lease; and

                                      -33-

<PAGE>

               (g)  Executed UCC-3 financing statements or other appropriate UCC
                    financing statements required by state law, evidencing a
                    complete and unbroken line from the mortgagee to the Trustee
                    with evidence of recording thereon (or in a form suitable
                    for recordation).

     In instances where the original recorded Mortgage is not delivered as
provided above, and in instances where intervening assignments called for by
clause (v) above are unavailable, the Depositor will deliver or cause to be
delivered the original recorded Mortgage and intervening assignments to the
Trustee or the Custodian on behalf of the Trustee promptly upon receipt thereof
but in no event later than one year after the Closing Date.

     The Seller and Depositor hereby confirm to the Trustee that each has caused
the portions of the Electronic Ledger relating to the Mortgage Loans to be
clearly and unambiguously marked, and has made the appropriate entries in its
general accounting records, to indicate that such Mortgage Loans have been
transferred to the Trustee and constitute part of the Trust in accordance with
the terms of the trust created hereunder.

     (b) The parties hereto intend that the transaction set forth herein be a
sale by the Depositor to the Trust of all the Depositor's right, title and
interest in and to the Mortgage Loans and other property described above. In the
event the transaction set forth herein is deemed not to be a sale, the Depositor
hereby grants to the Trust a security interest in all of the Depositor's right,
title and interest in, to and under the Mortgage Loans and other property
described above; and this Agreement shall constitute a security agreement under
applicable law. The Depositor and the Trustee shall, to the extent consistent
with this Agreement, take such actions as may be necessary to ensure that, if
this Agreement were deemed to create a security interest in the Mortgage Loans,
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 the Agreement.

     Except as may otherwise expressly be provided herein, neither the
Depositor, the Seller, the Master Servicer, the Servicer nor the Trustee shall
(and the Servicer and the Master Servicer shall ensure that no Subservicer
shall) assign, sell, dispose of or transfer any interest in the Trust or any
portion thereof, or permit the Trust or any portion thereof to be subject to any
lien, claim, mortgage, security interest, pledge or other encumbrance of, any
other Person.

     In the event that the parties hereto have failed to transfer the entire
legal ownership in and to each Mortgage Loan to the Trust, the parties hereto
intend that this document operate to transfer the entire equitable ownership
interest in and to each Mortgage Loan to the Trust.

     (c) Within 30 days of the Closing Date, the Seller, at its own expense,
shall or shall cause the Servicer to prepare and send for recording the
Assignments of Mortgage in favor of the Trustee in the appropriate real property
or other records. With respect to any Assignment of Mortgage as to which the
related recording information is unavailable within 30 days following the
Closing Date, such Assignment of Mortgage shall be submitted for recording
within 30 days after receipt of such information but in no event later than one
year after the Closing Date. The Trustee or the Custodian on behalf of the
Trustee shall be required to retain a copy of each Assignment of Mortgage
submitted for recording. In the event that any such Assignment of Mortgage is
lost or returned unrecorded

                                      -34-

<PAGE>

because of a defect therein, the Seller shall promptly prepare a substitute
Assignment of Mortgage or cure such defect, as the case may be, and thereafter
the Seller shall be required to submit each such Assignment of Mortgage for
recording. Any failure of the Seller to comply with this Section 2.01(c) shall
result in the obligation of the Seller to purchase the related Mortgage Loans
pursuant to the provisions of Section 2.02.

     (d) Neither the Trustee nor the Custodian on behalf of the Trustee shall
have any responsibility for reviewing any Mortgage File except as expressly
provided in Section 2.02. Without limiting the effect of the preceding sentence,
in reviewing any Mortgage File pursuant to such subsection, neither the Trustee
nor the Custodian shall have any responsibility for determining whether any
document is valid and binding, whether the text of any assignment or endorsement
is in proper or recordable form (except, if applicable, to determine if the
Trustee is the assignee or endorsee), whether any document has been recorded in
accordance with the requirements of any applicable jurisdiction, or whether a
blanket assignment is permitted in any applicable jurisdiction, but shall only
be required to determine whether a document has been executed, that it appears
to be what it purports to be, and, where applicable, that it purports to be
recorded, but shall not be required to determine whether any Person executing
any document is authorized to do so or whether any signature thereon is genuine.

     Section 2.02. ACCEPTANCE BY TRUSTEE. The Trustee hereby acknowledges the
sale and assignment of the Mortgage Loans, and, subject to the review provided
for in this Section 2.02 and the period for delivery provided for in Section
2.01, its receipt or that of the Custodian on behalf of the Trustee of the
Mortgage Files, and declares that the Trustee or the Custodian on behalf of the
Trustee holds and will hold such documents and all amounts received by it
thereunder and hereunder in trust, upon the terms herein set forth, for the use
and benefit of all present and future Certificateholders and the Certificate
Insurer. If the Seller is given notice under this Section 2.02 that a Mortgage
File is defective or incomplete and if the Seller does not correct or cure such
omission or defect within the 90-day period specified in this Section 2.02, the
Seller shall purchase such Mortgage Loan from the Trustee (i) on the
Determination Date in the month following the month in which such 90-day period
expired at the Purchase Price of such Mortgage Loan or (ii) upon the expiration
of such 90-day period if the omission or defect would result in the related
Mortgage Loan not being a Qualified Mortgage Loan for purposes of Section
860G(a)(3) of the Code. The Purchase Price for the purchased Mortgage Loan shall
be delivered to the Servicer for deposit in the Collection Account (and the
Servicer shall deposit such amount upon receipt) no later than the applicable
Determination Date or the Business Day preceding the expiration of such 90-day
period, as the case may be; and, upon receipt by the Trustee or the Custodian on
behalf of the Trustee of written notification of such deposit signed by a
Responsible Officer of the Seller, the Trustee or the Custodian on behalf of the
Trustee shall release to the Seller the related Mortgage File and the Trustee
shall execute and deliver such instruments of transfer or assignment, in each
case without recourse, as shall be necessary to vest in the Seller or its
designee any Mortgage Loan released pursuant hereto. It is understood and agreed
that the obligation of the Seller to purchase any Mortgage Loan as to which a
material defect in or omission of a constituent document exists shall constitute
the sole remedy against the Seller respecting such defect or omission available
to the Servicer (in its role as such), the Certificateholders, or the Trustee on
behalf of Certificateholders. An Opinion of Counsel to the effect set forth in
Section 2.05 shall be delivered to the Trustee in connection with any such
repurchase.

                                      -35-

<PAGE>

     The Seller, promptly following the transfer of a Defective Mortgage Loan
from the Trust pursuant to this Section 2.02 shall amend the Mortgage Loan
Schedule, appropriately mark the Electronic Ledger and make appropriate entries
in its general account records to reflect such transfer.

     The Trustee, on the Closing Date, shall certify on the form annexed hereto
as Exhibit O that (i) all documents constituting part of paragraph (i) of
Section 2.01(a) are in its possession, (ii) without regard to whether such
documents have been endorsed as described in paragraph (i) of Section 2.01(a) or
are endorsed in blank, such documents have been reviewed by it and appear
regular on their face and relate to such Mortgage Loan, and (iii) based on its
examination and only as to the foregoing, the information set forth in the
Mortgage Loan Schedule which corresponds to items (ii), (iii), (vi) and (vii) of
the definition of "Mortgage Loan Schedule" accurately reflects the information
set forth in such Mortgage Loan File. No later than the 45th day following the
Closing Date, the Trustee or the Custodian on behalf of the Trustee shall
certify to the Depositor, the Seller, the Servicer and the Master Servicer (and
the Trustee if the Custodian is so certifying) that it has reviewed each
Mortgage File and that, as to each Mortgage Loan listed in the related Mortgage
Loan Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan
specifically identified in the certification in the form annexed hereto as
Exhibit O as not covered by such certification), (i) all documents constituting
part of such Mortgage File required to be delivered to it pursuant to paragraphs
(i) - (v) and (vii) of Section 2.01(a) are in its possession, (ii) such
documents have been reviewed by it and appear regular on their face and relate
to such Mortgage Loan, and (iii) based on its examination and only as to the
foregoing, the information set forth in the Mortgage Loan Schedule which
corresponds to items (ii), (iii), (vi) and (vii) of the definition of "Mortgage
Loan Schedule" accurately reflects information set forth in the Mortgage File.
If within such 45-day period the Trustee or the Custodian on behalf of the
Trustee finds any document constituting a part of a Mortgage File not to have
been executed or received or to be unrelated to the Mortgage Loans identified in
said Mortgage Loan Schedule or, if in the course of its review, the Trustee or
the Custodian on behalf of the Trustee determines that such Mortgage File is
otherwise defective in any material respect, the Trustee or the Custodian on
behalf of the Trustee shall promptly upon the conclusion of its review notify in
the form of an exception report and the Seller shall have a period of 90 days
after such notice within which to correct or cure any such defect.

     On the 360th day following the Closing Date, the Trustee or the Custodian
on behalf of the Trustee shall deliver to the Depositor, the Seller, the
Servicer and the Master Servicer an updated exception report showing the
documents outstanding pursuant to Section 2.01(a) along with a final
certification annexed hereto as Exhibit P from the previous certification issued
in the form of Exhibit O. The Trustee or the Custodian on behalf of the Trustee
shall also maintain records adequate to determine the date on which any document
required to be delivered to it after such 360th day following the Closing Date
must be delivered to it, and on each such date, the Trustee or the Custodian on
behalf of the Trustee shall review the related Mortgage File to determine
whether such document has, in fact, been delivered. After the delivery of the
final certification, a form of which is attached hereto as Exhibit P, (i) the
Trustee or the Custodian on behalf of the Trustee shall provide to the Servicer,
the Master Servicer, the Depositor and the Seller (and to the Trustee if
delivered by the Custodian), upon request, updated exception reports showing the
documents outstanding pursuant to Section 2.01(a) until all such exceptions have
been eliminated and (ii) the Seller shall provide to the Trustee or the
Custodian on behalf of the Trustee and the Master Servicer, no less frequently
than monthly, updated certifications indicating the then current status of
exceptions until

                                      -36-

<PAGE>

all such exceptions have been eliminated; PROVIDED that the delivery of the
final certification shall not act as a waiver of any of the rights the
Certificateholders may have with respect to such exceptions, and all rights are
reserved with respect thereto.

     Neither the Trustee nor the Custodian makes any representations as to and
shall not be responsible to verify (i) the validity, sufficiency, legality, due
authorization, recordation or genuineness of any document or (ii) the
collectability, insurability or effectiveness of any of the Mortgage Loans.

     Section 2.03. REPRESENTATIONS AND WARRANTIES REGARDING THE SELLER, THE
MASTER SERVICER, THE SERVICER AND THE DEPOSITOR. (a) The Seller represents and
warrants that, as of the Closing Date:

          (i) The Seller is a corporation licensed as a mortgage banker duly
     organized, validly existing and in good standing under the laws of the
     state of its incorporation and has, and had at all relevant times, full
     corporate power to acquire the Mortgage Loans, to own its property, to
     carry on its business as presently conducted and to enter into and perform
     its obligations under this Agreement and the Mortgage Loan Purchase
     Agreement and the Saxon Purchase Agreement;

          (ii) The execution and delivery of this Agreement and the Mortgage
     Loan Purchase Agreement by the Seller and the performance by it of and
     compliance with the terms of this Agreement, the Mortgage Loan Purchase
     Agreement and the Saxon Purchase Agreement will not violate the Seller's
     articles of incorporation or by-laws or constitute a default (or an event
     which, with notice or lapse of time or both, would constitute a default)
     under, or result in the breach or acceleration of, any material contract,
     agreement or other instrument to which the Seller is a party or which may
     be applicable to the Seller or any of its assets;

          (iii) The Seller has the full power and authority to hold each
     Mortgage Loan, to sell each Mortgage Loan and enter into and consummate all
     transactions contemplated by this Agreement, the Mortgage Loan Purchase
     Agreement and the Saxon Purchase Agreement to be consummated by it, has
     duly authorized the execution, delivery and performance of this Agreement,
     the Mortgage Loan Purchase Agreement and the Saxon Purchase Agreement. The
     Seller has duly executed and delivered this Agreement, the Mortgage Loan
     Purchase Agreement and the Saxon Purchase Agreement. This Agreement, the
     Mortgage Loan Purchase Agreement and the Saxon Purchase Agreement, assuming
     due authorization, execution and delivery by the other parties hereto,
     constitute valid, legal and binding obligations of the Seller, enforceable
     against it in accordance with the terms hereof, except as such enforcement
     may be limited by bankruptcy, insolvency, reorganization, receivership,
     moratorium or other similar laws relating to or affecting the rights of
     creditors generally, and by general equity principles (regardless of
     whether such enforcement is considered in a proceeding in equity or at
     law);

          (iv) The Seller is not in violation of, and the execution and delivery
     of this Agreement, the Mortgage Loan Purchase Agreement and the Saxon
     Purchase Agreement by the Seller and the performance by it and compliance
     with the terms of this Agreement, the

                                      -37-

<PAGE>

     Mortgage Loan Purchase Agreement and the Saxon Purchase Agreement will not
     constitute a violation with respect to, any order or decree of any court or
     any order or regulation of any federal, state, municipal or governmental
     agency having jurisdiction, which violation would materially and adversely
     affect the condition (financial or otherwise) or operations of the Seller
     or any of its properties or materially and adversely affect the performance
     of any of its duties hereunder;

          (v) There are no actions or proceedings against, or investigations of,
     the Seller pending or, to the knowledge of the Seller, threatened, before
     any court, administrative agency or other tribunal (A) that, if determined
     adversely, would prohibit its entering into this Agreement, the Mortgage
     Loan Purchase Agreement or the Saxon Purchase Agreement, (B) seeking to
     prevent the consummation of any of the transactions contemplated by this
     Agreement, the Mortgage Loan Purchase Agreement or the Saxon Purchase
     Agreement or (C) that, if determined adversely, would prohibit or
     materially and adversely affect the performance by the Seller of any of its
     obligations under, or the validity or enforceability of, this Agreement,
     the Mortgage Loan Purchase Agreement or the Saxon Purchase Agreement;

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

          (vii) The Seller did not sell the Mortgage Loans to the Depositor with
     any intent to hinder, delay or defraud any of its creditors; and the Seller
     will not be rendered insolvent as a result of the sale of the Mortgage
     Loans to the Depositor;

          (viii) The Seller acquired title to the Mortgage Loans in good faith,
     without notice of any adverse claim. Immediately prior to the transfer of
     the Mortgage Loans to the Depositor, the Seller was the sole owner of the
     related Mortgage and the indebtedness evidenced by the related Mortgage
     Note and upon the transfer and assignment of the Mortgage Loans as
     contemplated by the Mortgage Loan Purchase Agreement, the Depositor will
     own such Mortgage Loan free and clear of any lien. In the event that the
     Seller retains record title, the Seller shall retain such record title to
     each Mortgage, each related Mortgage Note and the related Mortgage Files
     with respect thereto in trust for the Depositor as the owner thereof;

          (ix) The collection practices used by the Seller with respect to the
     Mortgage Loans have been, in all material respects, legal, proper, prudent
     and customary in the non-conforming mortgage servicing business;

          (x) No Officer's Certificate, statement, report or other document
     prepared by the Seller and furnished or to be furnished by it pursuant to
     this Agreement or in connection with the transactions contemplated hereby
     contains any untrue statement of material fact;

                                      -38-

<PAGE>

          (xi) The transfer, assignment and conveyance of the Mortgage Notes and
     the Mortgages by the Seller pursuant to the Mortgage Loan Purchase
     Agreement are not subject to the bulk transfer laws or any similar
     statutory provisions in effect in any applicable jurisdiction;

          (xii) The transactions contemplated by this Agreement and the Mortgage
     Loan Purchase Agreement are in the ordinary course of business of the
     Seller;

          (xiii) The Seller has caused or hereby agrees to cause to be performed
     any and all acts required to be performed to preserve the rights and
     remedies of the Trustee in any insurance policies applicable to the
     Mortgage Loans, including, without limitation, any necessary notifications
     of insurers, assignments of policies or interests therein, and
     establishments of co-insured, joint loss payee and mortgagee rights in
     favor of the Trustee;

          (xiv) The Seller is a HUD approved mortgagee pursuant to Section 203
     of the National Housing Act in good standing. No event has occurred
     including but not limited to a change in insurance coverage, which would
     make the Seller unable to comply with HUD eligibility requirements or which
     would require notification to HUD; and

          (xv) The transfer of the Mortgage Loans shall be treated as a sale on
     the books and records of the Seller, and the Seller has determined that,
     and will treat, the disposition of the Mortgage Loans pursuant to the
     Mortgage Loan Purchase Agreement for tax and accounting purposes as a sale.
     The Seller shall maintain a complete set of books and records for each
     Mortgage Loan which shall be clearly marked to reflect the ownership of
     each Mortgage Loan by the Depositor.

     (b)  The Master Servicer represents and warrants that, as of the Closing
Date:

          (i) The Master Servicer is a corporation licensed as a mortgage banker
     duly organized, validly existing and in good standing under the laws of the
     state of its incorporation and has, and had at all relevant times, full
     corporate power to service the Mortgage Loans, to own its property, to
     carry on its business as presently conducted and to enter into and perform
     its obligations under this Agreement. The Master Servicer has all necessary
     licenses and is qualified to transact business in and is in good standing
     under the laws of each state where a Mortgaged Property is located or is
     otherwise exempt under applicable law from such qualification or is
     otherwise not required under applicable law to effect such qualification
     and no demand for such qualification has been made upon the Master Servicer
     by any state having jurisdiction;

          (ii) The execution and delivery of this Agreement by the Master
     Servicer and the performance by it of and compliance with the terms of this
     Agreement will not violate the Master Servicer's articles of incorporation
     or by-laws or constitute a default (or an event which, with notice or lapse
     of time or both, would constitute a default) under, or result in the breach
     or acceleration of, any material contract, agreement or other instrument to
     which the

                                      -39-

<PAGE>

     Master Servicer is a party or which may be applicable to the Master
     Servicer or any of its assets;

          (iii) The Master Servicer has the full power and authority to enter
     into and consummate all transactions contemplated by this Agreement to be
     consummated by it, has duly authorized the execution, delivery and
     performance of this Agreement, and has duly executed and delivered this
     Agreement. This Agreement, assuming due authorization, execution and
     delivery by the other parties hereto, constitutes a valid, legal and
     binding obligation of the Master Servicer, enforceable against it in
     accordance with the terms hereof, except as such enforcement may be limited
     by bankruptcy, insolvency, reorganization, receivership, moratorium or
     other similar laws relating to or affecting the rights of creditors
     generally, and by general equity principles (regardless of whether such
     enforcement is considered in a proceeding in equity or at law);

          (iv) The Master Servicer is not in violation of, and the execution and
     delivery of this Agreement by the Master Servicer and the performance by it
     and compliance with the terms of this Agreement will not constitute a
     violation with respect to, any order or decree of any court or any order or
     regulation of any federal, state, municipal or governmental agency having
     jurisdiction, which violation would materially and adversely affect the
     condition (financial or otherwise) or operations of the Master Servicer or
     any of its properties or materially and adversely affect the performance of
     any of its duties hereunder;

          (v) There are no actions or proceedings against, or investigations of,
     the Master Servicer pending or, to the knowledge of the Master Servicer,
     threatened, before any court, administrative agency or other tribunal (A)
     that, if determined adversely, would prohibit its entering into this
     Agreement, (B) seeking to prevent the consummation of any of the
     transactions contemplated by this Agreement or (C) that, if determined
     adversely, would prohibit or materially and adversely affect the
     performance by the Master Servicer of any of its obligations under, or the
     validity or enforceability of, this Agreement;

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

          (vii) No Officer's Certificate, statement, report or other document
     prepared by the Master Servicer and furnished or to be furnished by it
     pursuant to this Agreement or in connection with the transactions
     contemplated hereby contains any untrue statement of material fact;

          (viii) The Master Servicer believes that the Master Servicing Fee Rate
     provides a reasonable level of base compensation to the Master Servicer for
     performing the duties of master servicer with respect to the Mortgage Loans
     on the terms set forth herein; and

                                      -40-

<PAGE>

          (ix) The transactions contemplated by this Agreement are in the
     ordinary course of business of the Master Servicer.

     (c)  The Servicer represents and warrants that, as of the Closing Date:

          (i) The Servicer is a corporation licensed as a mortgage servicer duly
     organized, validly existing and in good standing under the laws of the
     state of its incorporation and has, and had at all relevant times, full
     corporate power to service the Mortgage Loans, to own its property, to
     carry on its business as presently conducted and to enter into and perform
     its obligations under this Agreement. The Servicer has all necessary
     licenses and is qualified to transact business in and is in good standing
     under the laws of each state where a Mortgaged Property is located or is
     otherwise exempt under applicable law from such qualification or is
     otherwise not required under applicable law to effect such qualification
     and no demand for such qualification has been made upon the Servicer by any
     state having jurisdiction;

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

          (iii) The Servicer has the full power and authority to enter into and
     consummate all transactions contemplated by this Agreement to be
     consummated by it, has duly authorized the execution, delivery and
     performance of this Agreement, and has duly executed and delivered this
     Agreement. This Agreement, assuming due authorization, execution and
     delivery by the other parties hereto, constitutes a valid, legal and
     binding obligation of the Servicer, enforceable against it in accordance
     with the terms hereof, except as such enforcement may be limited by
     bankruptcy, insolvency, reorganization, receivership, moratorium or other
     similar laws relating to or affecting the rights of creditors generally,
     and by general equity principles (regardless of whether such enforcement is
     considered in a proceeding in equity or at law);

          (iv) The Servicer is not in violation of, and the execution and
     delivery of this Agreement by the Servicer and the performance by it and
     compliance with the terms of this Agreement will not constitute a violation
     with respect to, any order or decree of any court or any order or
     regulation of any federal, state, municipal or governmental agency having
     jurisdiction, which violation would materially and adversely affect the
     condition (financial or otherwise) or operations of the Servicer or any of
     its properties or materially and adversely affect the performance of any of
     its duties hereunder;

          (v) There are no actions or proceedings against, or investigations of,
     the Servicer pending or, to the knowledge of the Servicer, threatened,
     before any court, administrative agency or other tribunal (A) that, if
     determined adversely, would prohibit its entering into this Agreement, (B)
     seeking to prevent the consummation of any of the transactions contemplated
     by this Agreement or (C) that, if determined adversely, would prohibit or

                                      -41-

<PAGE>

     materially and adversely affect the performance by the Servicer of any of
     its obligations under, or the validity or enforceability of, this
     Agreement;

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

          (vii) No Officer's Certificate, statement, report or other document
     prepared by the Servicer and furnished or to be furnished by it pursuant to
     this Agreement or in connection with the transactions contemplated hereby
     contains any untrue statement of material fact;

          (viii) The Servicer believes that the Servicing Fee Rate provides a
     reasonable level of base compensation to the Servicer for servicing the
     Mortgage Loans on the terms set forth herein; and

          (ix) The transactions contemplated by this Agreement are in the
     ordinary course of business of the Servicer.

     (d)  The Depositor represents and warrants that, as of the Closing Date:

          (i) The Depositor is a corporation, duly organized, validly existing
     and in good standing under the laws of the state of its incorporation and
     has, and had at all relevant times, full corporate power to own its
     property, to carry on its business as presently conducted and to enter into
     and perform its obligations under this Agreement and the Mortgage Loan
     Purchase Agreement;

          (ii) The execution and delivery of this Agreement and the Mortgage
     Loan Purchase Agreement by the Depositor and the performance by it of and
     compliance with the terms of this Agreement and the Mortgage Loan Purchase
     Agreement will not violate the Depositor's articles of incorporation or
     by-laws or constitute a default (or an event which, with notice or lapse of
     time or both, would constitute a default) under, or result in the breach or
     acceleration of, any material contract, agreement or other instrument to
     which the Depositor is a party or which may be applicable to the Depositor
     or any of its assets;

          (iii) The Depositor has the full power and authority to enter into and
     consummate all transactions contemplated by this Agreement and the Mortgage
     Loan Purchase Agreement to be consummated by it, has duly authorized the
     execution, delivery and performance of this Agreement and the Mortgage Loan
     Purchase Agreement, and has duly executed and delivered this Agreement and
     the Mortgage Loan Purchase Agreement. This Agreement and the Mortgage Loan
     Purchase Agreement, assuming due authorization, execution and delivery by
     the other parties hereto, constitutes a valid, legal and binding obligation
     of the Depositor, enforceable against it in accordance with the terms
     hereof, except as such enforcement may be limited by bankruptcy,
     insolvency, reorganization, receivership, moratorium or other similar laws
     relating to or affecting the rights of creditors generally, and by general
     equity

                                      -42-

<PAGE>

     principles (regardless of whether such enforcement is considered in a
     proceeding in equity or at law);

          (iv) The Depositor is not in violation of, and the execution and
     delivery of this Agreement or the Mortgage Loan Purchase Agreement by the
     Depositor and the performance by it and compliance with the terms of this
     Agreement and the Mortgage Loan Purchase Agreement will not constitute a
     violation with respect to, any order or decree of any court or any order or
     regulation of any federal, state, municipal or governmental agency having
     jurisdiction, which violation would materially and adversely affect the
     condition (financial or otherwise) or operations of the Depositor or any of
     its properties or materially and adversely affect the performance of any of
     its duties hereunder;

          (v) There are no actions or proceedings against, or investigations of,
     the Depositor pending or, to the knowledge of the Depositor, threatened,
     before any court, administrative agency or other tribunal (A) that, if
     determined adversely, would prohibit its entering into this Agreement or
     the Mortgage Loan Purchase Agreement, (B) seeking to prevent the
     consummation of any of the transactions contemplated by this Agreement or
     the Mortgage Loan Purchase Agreement or (C) that, if determined adversely,
     would prohibit or materially and adversely affect the performance by the
     Depositor of any of its obligations under, or the validity or
     enforceability of, this Agreement or the Mortgage Loan Purchase Agreement;

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

          (vii) The Depositor did not sell the Mortgage Loans to the Trust with
     any intent to hinder, delay or defraud any of its creditors; and the
     Depositor will not be rendered insolvent as a result of the sale of the
     Mortgage Loans to the Trust;

          (viii) The Depositor acquired title to the Mortgage Loans in good
     faith, without notice of any adverse claim;

     (e) The representations and warranties set forth in this Section 2.03 shall
survive the sale and assignment of the Mortgage Loans to the Trust. Upon
discovery of a breach of any representations and warranties which materially and
adversely affects the interests of the Certificateholders or the Certificate
Insurer, the Person discovering such breach shall give prompt written notice to
the other parties. Within 60 days of its discovery or its receipt of notice of
such breach, or, with the prior written consent of a Responsible Officer of the
Trustee, such longer period specified in such consent, the Seller, the Master
Servicer, the Servicer or the Depositor, as the case may be, shall cure such
breach in all material respects.

     Section 2.04. REPRESENTATIONS AND WARRANTIES REGARDING THE MORTGAGE LOANS.

                                      -43-

<PAGE>

     The Seller hereby represents and warrants to the Depositor, the Master
Servicer, the Servicer and the Trustee on behalf of the Certificateholders that,
as to each Mortgage Loan, as of the Closing Date:

          1. The information set forth in the Mortgage Loan Schedule is
     complete, true and correct as of the Cut-off Date;

          2. As of March 31, 2001, all payments required to be made on each
     Mortgage Loan under the terms of the related Mortgage Note have been made,
     except for approximately 2.67% of the Mortgage Loans (by Principal Balance
     as of March 31, 2001) which are up to 59 days delinquent on a contractual
     basis. The Seller has not advanced funds, or induced, solicited or
     knowingly received any advance of funds from a party other than the owner
     of the related Mortgaged Property, directly or indirectly, for the payment
     of any amount required by the Mortgage Note or Mortgage;

          3. There are no delinquent taxes, ground rents, water charges, sewer
     rents, assessments, insurance premiums, leasehold payments, including
     assessments payable in future installments or other outstanding charges
     affecting the related Mortgaged Property;

          4. The terms of the Mortgage Note and the Mortgage have not been
     impaired, waived, altered or modified in any respect, except by written
     instruments, recorded in the applicable public recording office if
     necessary to maintain the lien priority of the Mortgage, and which have
     been delivered to the Trustee or the Custodian; the substance of any such
     waiver, alteration or modification has been approved by the title insurer,
     to the extent required by the related policy, and is reflected on the
     Mortgage Loan Schedule. No instrument of waiver, alteration or modification
     has been executed, and no Mortgagor has been released, in whole or in part,
     except in connection with an assumption agreement approved by the title
     insurer, to the extent required by the policy, and which assumption
     agreement has been delivered to the Trustee or the Custodian and the terms
     of which are reflected in the Mortgage Loan Schedule;

          5. The Mortgage Note and the Mortgage are not subject to any right of
     rescission, set-off, counterclaim or defense, including the defense of
     usury, nor will the operation of any of the terms of the Mortgage Note and
     the Mortgage, or the exercise of any right thereunder, render the Mortgage
     unenforceable, in whole or in part, or subject the Mortgage to any right of
     rescission, set-off, counterclaim or defense, including the defense of
     usury and no such right of rescission, set-off, counterclaim or defense has
     been asserted with respect thereto;

          6. All buildings upon the Mortgaged Property are insured by a
     generally acceptable insurer against loss by fire, hazards of extended
     coverage and such other hazards as are customary in the area where the
     Mortgaged Property is located, pursuant to insurance policies conforming to
     the requirements of this Agreement. All such insurance policies contain a
     standard mortgagee clause naming the Originator, its successors and assigns
     as mortgagee and all premiums thereon have been paid. If upon origination
     of the Mortgage Loan, the Mortgaged Property was in an area identified on a
     Flood Hazard Map or Flood

                                      -44-

<PAGE>

     Insurance Rate Map issued by the Federal Emergency Management Agency as
     having special flood hazards (and such flood insurance has been made
     available) a flood insurance policy meeting the requirements of the current
     guidelines of the Federal Insurance Administration is in effect which
     policy conforms to the requirements of Fannie Mae and Freddie Mac. The
     Mortgage obligates the Mortgagor thereunder to maintain all such insurance
     at the Mortgagor's cost and expense, and on the Mortgagor's failure to do
     so, authorizes the holder of the Mortgage to maintain such insurance at
     Mortgagor's cost and expense and to seek reimbursement therefor from the
     Mortgagor;

          7. Any and all requirements of any federal, state or local law
     including, without limitation, usury, truth in lending, real estate
     settlement procedures, consumer credit protection, equal credit opportunity
     or disclosure laws applicable to the origination and servicing of the
     Mortgage Loan have been complied with. Any and all statements or
     acknowledgments required to be made by the Mortgagor relating to such
     requirements are and will remain in the Mortgage File;

          8. The Mortgage has not been satisfied, canceled, subordinated or
     rescinded, in whole or in part, and the Mortgaged Property has not been
     released from the lien of the Mortgage, in whole or in part, nor has any
     instrument been executed that would effect any such satisfaction,
     cancellation, subordination, rescission or release;

          9. The Mortgage is a valid, existing and enforceable first or second
     lien on the Mortgaged Property (as indicated on the Mortgage Loan
     Schedule), including all improvements on the Mortgaged Property subject
     only to (a) the lien of current real property taxes and assessments not yet
     due and payable, (b) covenants, conditions and restrictions, rights of way,
     easements and other matters of the public record as of the date of
     recording being acceptable to mortgage lending institutions generally and
     specifically referred to in the lender's title insurance policy delivered
     to the originator of the Mortgage Loan and which do not adversely affect
     the Appraised Value of the Mortgaged Property, (c) other matters to which
     like properties are commonly subject which do not materially interfere with
     the benefits of the security intended to be provided by the Mortgage or the
     use, enjoyment, value or marketability of the related Mortgaged Property,
     and (d) with respect to any second lien Mortgage Loan, any first mortgage
     loan secured by the Mortgaged Property. Any security agreement, chattel
     mortgage or equivalent document related to and delivered in connection with
     the Mortgage Loan establishes and creates a valid, existing and enforceable
     first or second lien, as the case may be, and first or second priority
     security interest, as the case may be, on the property described therein
     and the Seller has full right to sell and assign the same to the Depositor;

          10. The Mortgage Note and the related Mortgage are genuine and each is
     the legal, valid and binding obligation of the maker thereof, enforceable
     in accordance with its terms;

          11. All parties to the Mortgage Note and the Mortgage had legal
     capacity to enter into the Mortgage Loan and to execute and deliver the
     Mortgage Note and the Mortgage, and the Mortgage Note and the Mortgage have
     been duly and properly executed by such parties.

                                      -45-

<PAGE>

     The Mortgagor is a natural person who is a party to the Mortgage Note and
     the Mortgage is in an individual capacity or family trust that is
     guaranteed by a natural person;

          12. Except with respect to Escrow Repair Loans, the proceeds of the
     Mortgage Loan have been fully disbursed to or for the account of the
     Mortgagor and there is no obligation for the Mortgagee to advance
     additional funds thereunder and any and all requirements as to completion
     of any on-site or off-site improvement and as to disbursements of any
     escrow funds therefor have been complied with. All costs, fees and expenses
     incurred in making or closing the Mortgage Loan and the recording of the
     Mortgage have been paid, and the Mortgagor is not entitled to any refund of
     any amounts paid or due to the Mortgagee pursuant to the Mortgage Note or
     Mortgage;

          13. Immediately prior to the sale of the Mortgage Loan pursuant to the
     Mortgage Loan Purchase Agreement, the Seller was the sole legal, beneficial
     and equitable owner of the Mortgage Note and the Mortgage and had full
     right to transfer and sell the Mortgage Loan to the Depositor free and
     clear of any encumbrance, equity, lien, pledge, charge, claim or security
     interest;

          14. All parties which have had any interest in the Mortgage Loan,
     whether as mortgagee, assignee, pledgee or otherwise, are (or, during the
     period in which they held and disposed of such interest, were) in
     compliance with any and all applicable "doing business" and licensing
     requirements of the laws of the state wherein the Mortgaged Property is
     located;

          15. The Mortgage Loan is covered by an ALTA lender's title insurance
     policy with an adjustable rate mortgage endorsement (in the case of each
     adjustable rate Mortgage Loan), such endorsement substantially in the form
     of ALTA Form 6.0 or 6.1, acceptable to Fannie Mae or Freddie Mac, issued by
     a title insurer acceptable to Fannie Mae and Freddie Mac and qualified to
     do business in the jurisdiction where the Mortgaged Property is located,
     insuring (subject to the exceptions contained in (9)(a) through (d) above)
     the Seller, its successors and assigns as to the first or second priority
     lien of the Mortgage in the original principal amount of the Mortgage Loan
     and against any loss by reason of the invalidity or unenforceability of the
     lien resulting from the provisions of the Mortgage providing for adjustment
     in the Loan Rate and Monthly Payment. Additionally, such lender's title
     insurance policy affirmatively insures ingress and egress to and from the
     Mortgaged Property, and against encroachments by or upon the Mortgaged
     Property or any interest therein. The Seller is the sole insured of such
     lender's title insurance policy, and such lender's title insurance policy
     is in full force and effect and will be in full force and effect upon the
     consummation of the transactions contemplated by this Agreement. No claims
     have been made under such lender's title insurance policy, and no prior
     holder of the related Mortgage, including the Seller, has done, by act or
     omission, anything which would impair the coverage of such lender's title
     insurance policy;

          16. Except with respect to delinquencies described in clause (2)
     above, there is no default, breach, violation or event of acceleration
     existing under the Mortgage or the Mortgage Note and no event which, with
     the passage of time or with notice and the

                                      -46-

<PAGE>

     expiration of any grace or cure period, would constitute a default, breach,
     violation or event of acceleration, and the Seller has not waived any
     default, breach, violation or event of acceleration;

          17. There are no mechanics' or similar liens or claims which have been
     filed for work, labor or material (and no rights are outstanding that under
     law could give rise to such lien) affecting the related Mortgaged Property
     which are or may be liens prior to, or equal or coordinate with, the lien
     of the related Mortgage;

          18. All improvements which were considered in determining the
     Appraised Value of the related Mortgaged Property lay wholly within the
     boundaries and building restriction lines of the Mortgaged Property, and no
     improvements on adjoining properties encroach upon the Mortgaged Property.
     Each appraisal has been performed in accordance with the provisions of the
     Financial Institutions Reform, Recovery and Enforcement Act of 1989;

          19. Reserved;

          20. Principal payments on the Mortgage Loan commenced no more than
     sixty days after the proceeds of the Mortgage Loan were disbursed. The
     Mortgage Loan bears interest at the Loan Rate. The Mortgage Note is payable
     on each Due Date in Monthly Payments which, in the case of fixed rate
     Mortgage Loans, are sufficient to fully amortize the original principal
     balance over the original term thereof and to pay interest at the related
     Loan Rate, and, in the case of an adjustable-rate Mortgage Loan, are
     changed on each Adjustment Date, and in any case, are sufficient to fully
     amortize the original principal balance over the original term thereof and
     to pay interest at the related Loan Rate. Interest on the Mortgage Loan is
     calculated on the basis of a 360-day year consisting of twelve 30-day
     months. The Mortgage Note does not permit negative amortization. The
     Mortgage Loan does not permit the Mortgagor to convert any Mortgage Loan to
     a fixed rate Mortgage Loan;

          21. The origination and collection practices used by the Originator
     with respect to each Mortgage Note and Mortgage have been in all material
     respects legal, proper, prudent and customary in the mortgage origination
     and servicing industry. The Mortgage Loan has been serviced by each
     predecessor servicer in accordance with the terms of the Mortgage Note, the
     servicing standard set forth in Section 3.01(f) and applicable law. Any
     adjustments to the Loan Rate have been made in compliance with Servicing
     Standard and applicable law. With respect to escrow deposits and Escrow
     Payments, if any, all such payments are in the possession of, or under the
     control with, the Seller and there exist no deficiencies in connection
     therewith for which customary arrangements for repayment thereof have not
     been made. No escrow deposits or Escrow Payments or other charges or
     payments due the Seller have been capitalized under any Mortgage or the
     related Mortgage Note;

          22. The Mortgaged Property is free of damage and waste and there is no
     proceeding pending for the total or partial condemnation thereof;

                                      -47-

<PAGE>

          23. The Mortgage and related Mortgage Note contain customary and
     enforceable provisions such as to render the rights and remedies of the
     holder thereof adequate for the realization against the Mortgaged Property
     of the benefits of the security provided thereby, including, (i) in the
     case of a Mortgage designated as a deed of trust, by trustee's sale, and
     (ii) otherwise by judicial foreclosure. Since the date of origination of
     the Mortgage Loan, the Mortgaged Property has not been subject to any
     bankruptcy proceeding or foreclosure proceeding and the Mortgagor has not
     filed for protection under applicable bankruptcy laws. There is no
     homestead or other exemption available to the Mortgagor, which would
     interfere with the right to sell the Mortgaged Property at a trustee's sale
     or the right to foreclose the Mortgage. The Mortgagor has not notified the
     Seller and the Seller has no knowledge of any relief requested or allowed
     to the Mortgagor under the Soldiers and Sailors Civil Relief Act of 1940;

          24. The related Mortgaged Property is not a leasehold estate;

          25. The Mortgage Note is not and has not been secured by any
     collateral except the lien of the corresponding Mortgage on the Mortgaged
     Property and the security interest of any applicable security agreement or
     chattel mortgage referred to above;

          26. The Mortgage File contains an appraisal of the related Mortgaged
     Property made and signed, prior to the approval of the Mortgage Loan
     application, by a qualified appraiser, duly appointed by the Originator,
     who had no interest, direct or indirect in the Mortgaged Property or in any
     loan made on the security thereof, whose compensation is not affected by
     the approval or disapproval of the Mortgage Loan and who is licensed in the
     jurisdiction in which the Mortgage Property was located. The appraisal
     contains no false or intentionally misleading statement of material fact,
     and the appraiser has not intentionally withheld information necessary to
     prevent any material fact from being misleading. The appraisal is of a form
     customarily accepted by investors in residential mortgages;

          27. In the event the Mortgage constitutes a deed of trust, a trustee,
     duly qualified under applicable law to serve as such, has been properly
     designated and currently so serves and is named in the Mortgage, and no
     fees or expenses are or will become payable by the Purchaser to the trustee
     under the deed of trust, except in connection with a trustee's sale after
     default by the Mortgagor;

          28. No Mortgage Loan contains provisions pursuant to which Monthly
     Payments are (i) paid or partially paid with funds deposited in any
     separate account established by the Seller, the Mortgagor, or anyone on
     behalf of the Mortgagor, (ii) paid by any source other than the Mortgagor
     or (ii) contains any other similar provisions which may constitute a
     "buydown" provision. The Mortgage Loan is not a graduated payment mortgage
     loan and the Mortgage Loan does not have a shared appreciation or other
     contingent interest feature;

          29. The Mortgagor has executed a statement to the effect that the
     Mortgagor has received all disclosure materials required by applicable law
     with respect to the making of adjustable rate mortgage loans; and if the
     Mortgage Loan is a Refinanced Mortgage Loan, the Mortgagor has received all
     disclosure and rescission materials required by applicable law

                                      -48-

<PAGE>

     with respect to the making of a Refinanced Mortgage Loan, and evidence of
     such receipt is and will remain in the Mortgage File;

          30. The Mortgage Note, the Mortgage, the Assignment of Mortgage and
     any other documents required to be delivered with respect to each Mortgage
     Loan pursuant to this Agreement, have been delivered to the Trustee or the
     Custodian all in compliance with the specific requirements of this
     Agreement;

          31. The Mortgaged Property is lawfully occupied under applicable law;
     all inspections, licenses and certificates required to be made or issued
     with respect to all occupied portions of the Mortgaged Property and, with
     respect to the use and occupancy of the same, including but not limited to
     certificates of occupancy, have been made or obtained from the appropriate
     authorities;

          32. No error, omission, misrepresentation, negligence, fraud or
     similar occurrence with respect to a Mortgage Loan has taken place on the
     part of any person, including, without limitation, the Mortgagor, any
     appraiser, any builder or developer, or any other party involved in the
     origination of the Mortgage Loan or in the application of any insurance in
     relation to such Mortgage Loan;

          33. The Assignment of Mortgage, is in recordable form and (other than
     with respect to the blank assignee) is acceptable for recording under the
     laws of the jurisdiction in which the Mortgaged Property is located;

          34. Any principal advances made to the Mortgagor prior to the Cut-off
     Date have been consolidated with the outstanding principal amount secured
     by the Mortgage, and the secured principal amount, as consolidated, bears a
     single interest rate and single repayment term. The lien of the Mortgage
     securing the consolidated principal amount is expressly insured as having
     first or second lien priority by a title insurance policy, an endorsement
     to the policy insuring the mortgagee's consolidated interest or by other
     title evidence acceptable to Fannie Mae and Freddie Mac. The consolidated
     principal amount does not exceed the original principal amount of the
     Mortgage Loan;

          35. No Mortgage Loan has a balloon payment feature and none of the
     Mortgage Loans is a Cooperative Loan;

          36. If the Residential Dwelling on the Mortgaged Property is a
     condominium unit or a unit in a planned unit development (other than a de
     minimis planned unit development) such condominium or planned unit
     development project meets Fannie Mae's eligibility requirements;

          37. Neither the Seller nor any affiliate of the Seller has made a
     mortgage on any Mortgaged Property;

          38. No Mortgage Loan is subject to the provisions of the Homeownership
     and Equity Protection Act of 1994, P.L. 103-325, 108 Stat 2160;

                                      -49-

<PAGE>

          39. No statement, report or other document constituting a part of the
     Mortgage File contains any material untrue statement of fact or omits to
     state a fact necessary to make the statements contained therein not
     misleading which would, either individually or in the aggregate, have a
     material adverse effect on the value of the Mortgage Loans;

          40. Each Mortgage Loan constitutes a "qualified mortgage" within the
     meaning of Section 860G(a)(3) of the Code;

          41. Each Prepayment Charge set forth on the Mortgage Loan Schedule is
     valid and enforceable under generally applicable state and federal law,
     without reliance upon an originator's status as a regulated depository
     institution to establish such enforceability, except as enforcement thereof
     may be limited by bankruptcy, insolvency or similar laws or laws applicable
     to the collection of Prepayment Charges as applied to the circumstances
     under which the related prepayment occurs, as evidenced by an opinion of
     counsel delivered pursuant to Section 3.20 hereof;

          42. The Seller has no knowledge of any circumstances or condition with
     respect to the Mortgage, the Mortgaged Property, the Mortgagor or the
     Mortgagor's credit standing that can reasonably be expected to cause the
     Mortgage Loan to be an unacceptable investment, cause the Mortgage Loan to
     become delinquent, or adversely affect the value of the Mortgage Loan;

          43. The Seller shall, at its own expense, cause each Mortgage Loan not
     covered by a Tax Service Contract as of the Cut-off Date to be covered by a
     Tax Service Contract which is assignable to the Depositor or its designee;
     provided however, that if the Seller fails to purchase such Tax Service
     Contract, the Seller shall be required to reimburse the Depositor or the
     Trust for all costs and expenses incurred by the Depositor or the Trust, as
     the case may be, in connection with the purchase of any such Tax Service
     Contract;

          44. Each Mortgage Loan is covered by a Flood Zone Service Contract
     which is assignable to the Depositor or its designee or, for each Mortgage
     Loan not covered by such Flood Zone Service Contract, the Seller agrees to
     purchase such Flood Zone Service Contract;

          45. Except as indicated on the Mortgage Loan Schedule, at the time
     that the Mortgage Loan was made, each Mortgagor represented that the
     Mortgagor would occupy the Mortgaged Property as Mortgagor's primary
     residence;

          46. The Mortgage Loan was not prepaid in full prior to the Cut-off
     Date and the Seller has not received any notification from a Mortgagor that
     a prepayment in full shall be made after the Cut-off Date;

          47. The Mortgaged Property is in material compliance with all
     applicable environmental laws pertaining to environmental hazards
     including, without limitation, asbestos, and neither the Seller nor, to the
     Seller's knowledge, the related Mortgagor, has received any notice of any
     violation or potential violation of such law; and

                                      -50-

<PAGE>

          48. Each Mortgage Loan was underwritten or re-underwritten in
     accordance with the Originator's underwriting guidelines described in the
     Prospectus Supplement and in effect at the time the Mortgage Loan was
     originated or acquired.

          49. With respect to each Mortgage Loan secured by a second lien on the
     related Mortgaged Property:

                    (a) if the Combined Loan-to-Value Ratio is higher than 80%,
          either the related First Lien does not provide for a balloon payment
          or, if the related First Lien does provide for a balloon payment, the
          maturity date of the second lien is prior to the maturity date of the
          First Lien;

                    (b) the related First Lien does not provide for negative
          amortization; and

                    (c) either no consent for the Mortgage Loan secured by a
          second lien on the related Mortgaged Property is required by the
          holder of the related First Lien or such consent has been obtained and
          is contained in the Mortgage File.

          50. Each Mortgage Loan conforms, and all the Mortgage Loans in the
     aggregate conform, in all material respects to the description thereof set
     forth in the Prospectus Supplement.

          51. No more than 26.29% of the aggregate Principal Balance of the
     Mortgage Loans as of the Cut-off Date relates to Mortgage Loans originated
     or purchased under the Originator's limited documentation program,
     non-income verification program for self- employed borrowers or stated
     income program.

     (c) It is understood and agreed that the representations and warranties set
forth in this Section 2.04 shall survive delivery of the respective Mortgage
Files to the Trustee or the Custodian on behalf of the Trustee and the
termination of the rights and obligations of the Master Servicer or Servicer
pursuant to Section 7.04 or 8.01. Upon discovery by the Depositor, the Seller,
the Master Servicer, the Servicer or a Responsible Officer of the Trustee of a
breach of any of the foregoing representations and warranties, which materially
and adversely affects the value of, or the interests of the Trust, the
Certificateholders or the Certificate Insurer in, the related Mortgage Loan, the
party discovering such breach shall give prompt written notice to the other
parties. Within 60 days of its discovery or its receipt of notice of breach, the
Seller shall use all reasonable efforts to cure its breach in all material
respects or shall purchase such Mortgage Loan from the Trust. Any such purchase
by the Seller shall be at the Purchase Price, and in each case shall be
accomplished in the manner set forth in Section 2.02. The Trustee shall enforce
the Seller's obligations under this subparagraph. It is understood and agreed
that the obligations of the Seller to cure or purchase any Mortgage Loan as to
which a breach of its representation or warranty has occurred and is continuing
shall constitute the sole remedy against the Seller respecting such breach
available to the Servicer, the Master Servicer (in its role as such), the
Certificateholders or the Trustee on behalf of Certificateholders. An Officer's
Certificate and Opinion of Counsel to the effect set forth in Section 2.05(d)
shall be delivered to the Trustee in connection with any such repurchase.

                                      -51-

<PAGE>

     Section 2.05. OPINION OF COUNSEL.

     In connection with any Mortgage Loan that the Seller is required to
purchase, the Seller shall deliver to the Trustee an Opinion of Counsel to the
effect that such purchase will not cause (x) any federal tax to be imposed on
the Trust, including, without limitation, any Federal tax imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on "contributions after
the start-up day" under Section 860G(d)(1) of the Code or (y) any portion of any
REMIC to fail to qualify as a REMIC at any time that any Certificate is
outstanding. In the event that such opinion indicates that a repurchase will
result in the imposition of a prohibited transaction tax, give rise to net
taxable income or be deemed a contribution to a REMIC after its Startup Day, the
Seller shall not be required to repurchase any such Mortgage Loan unless and
until the Servicer has determined and given the Seller, the Depositor and the
Trustee written notice that there is an actual or imminent default with respect
thereto or that such defect or breach adversely affects the enforceability of
such Mortgage Loan.

     Section 2.06. EXECUTION AND AUTHENTICATION OF CERTIFICATES. The Trustee on
behalf of the Trust shall cause to be executed, authenticated and delivered on
the Closing Date to or upon the order of the Depositor, in exchange for the
Mortgage Loans, concurrently with the sale, assignment and conveyance to the
Trustee of the Mortgage Loans, each Class of Certificates in authorized
denominations or Percentage Interests, together evidencing the ownership of the
entire Trust.

     Section 2.07. DESIGNATION OF INTERESTS IN REMICS.

                                     REMIC I
                                     -------

     The Trustee shall make an election to treat the segregated pool of assets
consisting of the Mortgage Loans and all other assets of the Trust other than
the REMIC I Interests, REMIC II Interests and the Net Rate Cap Fund as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC I." REMIC I will be evidenced by (x) REMIC I Regular
Interests IA, IB, IC, ID, IE, IF, IG, IH, II, IJ, IK, IL and IN Interests and
the Class P Certificates (together, the "REMIC I Regular Interests"), which (i)
(except in the case of the Class P Certificates) will be uncertificated and
non-transferable, and (ii) are hereby designated as the "regular interests" in
REMIC I and (y) the Class R-1 Certificates, which are hereby designated as the
sole class of "residual interests" in REMIC I (the REMIC I Regular Interests,
together with the Class R-1 Certificates, the "REMIC I Interests").

     The following table irrevocably sets forth the designation, the initial
REMIC I Principal Balance, and the REMIC I Pass-Through Rate for each of the
REMIC I Interests. Each of the REMIC I Interests (other than the Class P
Certificates and the Class R-1 Certificates) shall accrue interest at the
related 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 REMIC I Principal Balance as
set forth below.

     The REMIC I Certificates will have the following designations, initial
principal balances and pass-through rates:

                                      -52-

<PAGE>

                          REMIC I                    REMIC I
          REMIC I         Principal                  Pass-Through
          INTERESTS       BALANCE                    RATE
          ---------       -------                    -------------

          P               $100                       0% (2)
          IA              $12,880,102                (1)
          IB              $1,431,122                 (1)
          IC              $4,293,368                 (1)
          ID              $2,862,245                 (1)
          IE              $4,293,367                 (1)
          IF              $4,293,367                 (1)
          IG              $4,293,368                 (1)
          IH              $2,862,245                 (1)
          II              $1,431,122                 (1)
          IJ              $1,431,123                 (1)
          IK              $1,431,122                 (1)
          IL              $1,431,122                 (1)
          IN              $62,652,855.25             (1)
          R-1             $0                         0%

(1)  The REMIC I Pass-Through Rate on these REMIC I Regular Interests shall at
     any time of determination equal the weighted average of the Net Loan Rates
     of the Mortgage Loans.

(2)  The Class P Certificates shall be entitled to receive all Prepayment
     Charges collected with respect to the Mortgage Loans. Such Prepayment
     Charges shall not be available for distribution with respect to any other
     Class of REMIC I Interests. The Prepayment Charges received by the Class P
     Certificates shall not be applied to the principal balance of the Class P
     Certificates.

On each Distribution Date, the following amounts from Available Funds shall be
deemed to be distributed by the Trustee from REMIC I to REMIC II on account of
the REMIC I Regular Interests or withdrawn from the Distribution Account and
distributed to the Holders of the Class R-1 Certificates, as the case may be:

          (1) first, to the Holders of REMIC I Regular Interest IA, IB, IC, ID,
     IE, IF, IG, IH, II, IJ, IK and IL, pro rata in an amount equal to (A) the
     REMIC I Accrued Interest for such Distribution Date, plus (B) any amounts
     in respect thereof remaining unpaid from previous Distribution Dates and
     second, to Holders of REMIC I Regular Interest IN in an amount equal to (A)
     the REMIC I Accrued Interest for such Distribution Date, plus (B) any
     amounts in respect thereof remaining unpaid from previous Distribution
     Dates; and

          (2) second, to the Holders of REMIC I Regular Interests (other than
     the Class P Certificates), in an amount equal to the remainder of the
     Available Funds for such Distribution Date after the distributions made
     pursuant to clause (1) above, allocated as follows:

                                      -53-

<PAGE>

               (A) to the Holders of REMIC I Regular Interest IN, until the
          REMIC I Principal Balance of REMIC I Regular Interest IN is reduced to
          zero;

               (B) to the Holders of REMIC I Regular Interest IA, IB, IC, ID,
          IE, IF, IG, IH, II, IJ, IK and IL, in reverse sequential order, until
          the related REMIC I Principal Balance is reduced to zero; then

               (C) any remaining amount to the Holders of the Class R-1
          Certificates.

     On each Distribution Date, Applied Realized Loss Amounts shall be allocated
sequentially, in reverse order to which they are listed above, to the REMIC I
Regular Interests, until the principal balance of each such class is reduced to
zero. Notwithstanding the above, REMIC I will distribute principal to the Class
P Certificates at the time and in the amount specified in Section 5.01 and such
amounts shall be deducted from the amounts distributed under this Section. The
Class R-1 Certificates shall have no principal balance and no pass-through rate
and shall be entitled to only those distributable assets, if any, remaining in
REMIC I on each Distribution Date after all amounts required to be distributed
to the REMIC I Regular Interests and applicable Trust expenses have been paid.
It is expected that there will not be any distributions on the Class R-1
Certificate.

                                    REMIC II
                                    --------

     The Trustee shall make an election to treat the segregated pool of assets
consisting of the REMIC I Regular Interests (other than the Class P
Certificates) as a REMIC for federal income tax purposes, and such segregated
pool of assets will be designated as "REMIC II." REMIC II will be evidenced by
(x) REMIC II Regular Interests IIA, IIB, IIC, IID, IIE, IIF and II-A-IO
(together, the "REMIC II Regular Interests"), which (i) will be uncertificated
and non-transferable, and (ii) are hereby designated as the "regular interests"
in REMIC II and (y) the Class R-2 Certificates, which are hereby designated as
the sole class of "residual interests" in REMIC II (the REMIC II Regular
Interests, together with the Class R-2 Interests, the "REMIC II Interests").

     The following table irrevocably sets forth the designation, the initial
REMIC II Principal Balance, and the REMIC II Pass-Through Rate for each of the
REMIC II Interests. Each of the REMIC II Interests (other than the Class R-2
Certificates) shall accrue interest at the related REMIC II 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 REMIC II Principal Balance as set forth below.

     The REMIC II Certificates will have the following designations and
pass-through rates, and distributions of principal and interest thereon shall be
allocated to the Certificates in the following manner:

                                      -54-

<PAGE>

         REMIC II            Initial Balance        Pass-Through
         Interests                                       Rate
         -------------      ----------------        -------------
         IA                 $103,474,797.69            (1)
         IB                     $921,250.00            (1)
         IC                      $63,350.00            (1)
         ID                      $42,230.00            (1)
         IE                      $29,030.00            (1)
         IF                   $1,055,870.56            (1)
         II-A-IO                        (2)            (3)
         R-2                             $0             0%

---------------
(1)  The REMIC II Pass-Through Rate on these REMIC II Regular Interests shall at
     any time of determination equal the weighted average of the Pass-Through
     Rates of the REMIC I Regular Interests (other than the Class P
     Certificates), after first subtracting 7.00% from the Pass-Through Rates of
     each of such regular interests (other than the Class IN Interest) for the
     Distribution Dates indicated below for each of such regular interests.

                                                                     7.00%
                              7.00%                               Subtraction
        REMIC I            Subtraction            REMIC I        Distribution
       Interests       Distribution-Dates        Interests           Dates
    --------------    --------------------      -----------      --------------
         IA                1 - 36                    IG             1 - 18
         IB                1 - 33                    IH             1 - 15
         IC                1 - 30                    II             1 - 12
         ID                1 -27                     IJ             1 - 9
         IE                1 - 24                    IK             1 - 6
         IF                1- 21                     IL             1 - 3

(2)  The REMIC II Notional Amount of REMIC II Regular Interest II-A-IO shall
     equal the sum of the REMIC I Principal Balances of REMIC I Regular
     Interests IA, IB, IC, ID, IE, IF, IG, IH, II, IJ, IK and IL for the
     Distribution Dates indicated in footnote (1) above for each of such regular
     interests.

(3)  Interest on the Class II-A-IO will equal the sum of 12 strips of interest,
     with each strip being a strip off the principal balance of a REMIC I
     Regular Interest (other than the Class IN Interests and the Class P
     Certificates) at 7.00% per annum for the Distribution Dates indicated in
     the table in note (1) for such regular interest, and 0.0% thereafter. Each
     of the 12 interest strips comprising the interest on the Class II-A-IO
     shall constitute 12 separate components of the Class II-A-IO, each of which
     shall be designated as a separate REMIC II Regular Interest.

                                      -55-

<PAGE>

     On each Distribution Date, in the following order of priority, the
following amounts from the Available Funds shall be deemed to be distributed by
the Trustee from REMIC II to REMIC III on account of the REMIC II Regular
Interests or withdrawn from the Distribution Account and distributed to the
holders of the Class R-2 Certificates, as the case may be:

          (i) first, to the extent of Available Funds, to the Holders of REMIC
     II Regular Interest II-A-IO in an amount equal to (A) the REMIC II Accrued
     Interest for such Distribution Date, plus (B) any amounts in respect
     thereof remaining unpaid from previous Distribution Dates and then to
     Holders of REMIC II Regular Interests IIA, IIB, IIC, IID, IIE and IIF, pro
     rata, in an amount equal to (A) the REMIC II Accrued Interest for such
     Distribution Date, plus (B) any amounts in respect thereof remaining unpaid
     from previous Distribution Dates. Amounts payable as REMIC II Accrued
     Interest in respect of REMIC II Regular Interest IF shall be reduced when
     the REMIC II Overcollateralized Amount is less than the REMIC II
     Overcollateralization Target Amount, by the lesser of (x) the amount of
     such difference and (y) the Maximum IF REMIC II Accrued Interest Deferral
     Amount, and such amount will be payable to the Holders of REMIC II Regular
     Interests IIB, IIC, IID, and IIE in the same proportion as principal
     payments are allocated to the Corresponding Certificates; and

          (ii) second, to the Holders of REMIC II Regular Interests, in an
     amount equal to the remainder of the Available Funds for such Distribution
     Date after the distributions made pursuant to clause (i) above, allocated
     as follows:

               (A) to the Holders of REMIC II Regular Interest IIA, 98.00% of
               such remainder, until the REMIC II Principal Balance of such
               REMIC II Regular Interest is reduced to zero;

               (B) to the Holders of REMIC II Regular Interests IIB, IIC, IID
               and IIE, 1.00% of such remainder, in the same proportion as
               principal payments are allocated to the Corresponding
               Certificates, until the REMIC II Principal Balances of such REMIC
               II Regular Interests are reduced to zero;

               (C) to the Holders of REMIC II Regular Interest IIF, 1.00% of
               such remainder, until the REMIC II Principal Balance of such
               REMIC II Regular Interest is reduced to zero; then

               (D) any remaining amount to the Holders of the Class R-3
               Certificates;

provided, however, that 98.00% and 2.00% of any principal payments that are
attributable to an Excess Overcollateralization Amount shall be allocated to
Holders of REMIC II Regular Interests IIA and IIF, respectively. Applied
Realized Loss Amounts will be allocated as provided in clause (ii) above, with
Applied Realized Loss Amounts allocated under (ii)(B) allocated in the same
proportion as are losses allocated to the Corresponding Certificates.

                                    REMIC III
                                    ---------

                                      -56-

<PAGE>

     The Trustee shall make an election to treat the segregated pool of assets
consisting of the REMIC II Regular Interests as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC III."
REMIC III will be evidenced by (x) the Class A, Class B, Class M-1, Class M-2,
Class IO and Class BIO Certificates, which are hereby designated as the "regular
interests" in REMIC III and (y) the Class R-3 Certificates, which are hereby
designated as the sole class of "residual interests" in REMIC III.

     The following table irrevocably sets forth the designation, the initial
Class Principal Balance, and the Certificate Rate for each of the Certificates.
Each of the Certificates (other than the Class R Certificates) shall accrue
interest at the related Certificate Rate in effect from time to time, and shall
be entitled to distributions of principal (other than the Class IO
Certificates), subject to the terms and conditions hereof, in an aggregate
amount equal to its initial Class Principal Balance as set forth below.

             CLASS               INITIAL CLASS            CERTIFICATE
          DESIGNATION          PRINCIPAL BALANCE             RATE
         -------------      --------------------         --------------
              A                $92,125,000.00               6.265%
              IO                   No annual                7.000%
                              principal balance
             M-1                $6,335,000.00               7.100%
             M-2                $4,223,000.00               7.100%
              B                 $2,903,000.00               7.100%
             R-3                $    -0-                    0.00%

     Section 2.08. DESIGNATION OF STARTUP DAY OF REMIC. The Closing Date is
hereby designated as the "start-up day" of each REMIC within the meaning of
Section 860G(a)(9) of the Code.

     Section 2.09. REMIC CERTIFICATE MATURITY DATE. Solely for purposes of
satisfying Section 1.860G-1(a)(4)(iii) of the Treasury Regulations, the "latest
possible maturity date" of the regular interests in each REMIC is the
Distribution Date on April 15, 2031.

     Section 2.10. TAX RETURNS AND REPORTS TO CERTIFICATEHOLDERS. (a) For
federal income tax purposes, the REMICs comprising the Trust shall have a
calendar year and shall maintain its books on the accrual method of accounting.

     (b) The Trustee, as agent of the Tax Matters Person shall prepare, or cause
to be prepared, execute and deliver to the Seller, the Servicer or
Certificateholders, as applicable, any income tax information returns for each
taxable year with respect to the Trust containing such information at the times
and in the manner as may be required by the Code or state or local tax laws,
regulations or rules, and shall furnish or cause to be furnished to the Trust
and the Certificateholders the schedules,

                                      -57-

<PAGE>

statements or information at such times and in such manner as may be required
thereby. Within thirty (30) days of the Closing Date, the Trustee, as agent of
the Tax Matters Person shall furnish or cause to be furnished to the Internal
Revenue Service, on Form 8811 or as otherwise required by the Code, the name,
title, address and telephone number of the person that Holders of the
Certificates may contact for tax information relating thereto, together with
such additional information at the time or times and in the manner required by
the Code and shall apply for an employer identification number from the Internal
Revenue Service via Form SS-4 or any other acceptable method. Such federal,
state or local income tax or information returns shall be signed by the Trustee
or such other Person as may be required to sign such returns by the Code or
state or local tax laws, regulations or rules.

     (c) In the first federal income tax return of the Trust for its taxable
year ending December 31, 2001, a REMIC election shall be made with respect to
each of REMIC I, REMIC II and REMIC III for such taxable year and all succeeding
taxable years.

     (d) The Trustee, as agent of the Tax Matters Person will maintain or cause
to be maintained such records relating to the Trust, including, but not limited
to, the income, expenses, assets and liabilities of the Trust, and adjusted
basis of the Trust property and assets determined at such intervals as may be
required by the Code, as may be necessary to prepare the foregoing returns,
schedules, statements or information.

     (e) The Servicer, upon request, shall promptly furnish the Trustee as agent
of Tax Matters Person with all such information as may be reasonably available
to, or in the possession of, the Servicer and as may be required in connection
with the Tax Matters Person's REMIC reporting obligations pursuant to this
Agreement. The Trustee shall have no responsibility for the lack of any
information required in connection with REMIC reporting obligations that is not
provided to it by the Servicer.

     Section 2.11. TAX MATTERS PERSON. The tax matters person with respect to
each REMIC (the "Tax Matters Person") shall be the holder of the Tax Matters
Person Residual Interest which initially is the Seller. The Tax Matters Person
shall at all times hold the Tax Matters Person Residual Interest and shall have
the same duties with respect to the Trust as those of a "tax matters partner"
under Subchapter C of Chapter 63 of Subtitle F of the Code. Each holder of a
Residual Certificate shall be deemed to have agreed, by acceptance thereof, to
be bound by this Section 2.11.

     Section 2.12. REMIC RELATED COVENANTS. It is intended that each REMIC
formed hereunder shall constitute, and that the affairs of each REMIC shall be
conducted so as to qualify it as, a REMIC as defined in and in accordance with
the REMIC Provisions. For as long as the Trust shall exist, the Trustee, the
Servicer and the Tax Matters Person shall act in accordance herewith to assure
continuing treatment of each REMIC as a REMIC and avoid the imposition of tax on
the Trust. In particular:

     (a) The Trustee shall not create, or knowingly permit the creation of, any
"interests" in any REMIC within the meaning of Code Section 860D(a)(2) other
than the interests represented by the Regular Certificates, the REMIC I Regular
Interests, the REMIC II Regular Interests and the Residual Certificates.

                                      -58-

<PAGE>

     (b) Except as otherwise provided in the Code, the Seller shall not grant
and the Trustee shall not accept property unless (i) substantially all of the
property held in the Trust constitutes either "qualified mortgages" or
"permitted investments" as defined in Code Sections 860G(a)(3) and (5),
respectively, and (ii) no property shall be contributed to the Trust after the
Startup Day unless such grant would not subject any REMIC to the 100% tax on
contributions to a REMIC after its Startup Day imposed by Code Section 860G(d).

     (c) The Trustee shall not accept on behalf of the Trust any fee or other
compensation for services (other than as otherwise provided herein) and shall
not accept on behalf of the Trust any income from assets other than those
permitted to be held by a REMIC.

     (d) The Trustee shall not sell or permit the sale of all or any portion of
the Mortgage Loans (other than in accordance with Section 2.02, 2.04 or 3.16),
unless such sale is pursuant to a "qualified liquidation" as defined in Code
Section 860F(a)(4)(A) and in accordance with Article VIII.

     (e) The Trustee and the Tax Matters Person shall maintain books with
respect to each REMIC on a calendar year and on an accrual basis.

     (f) Upon filing with the Internal Revenue Service, the Tax Matters Person
shall furnish to the Holders of the Residual Certificates the Form 1066 and each
Form 1066Q for the applicable REMIC and shall respond promptly to written
requests made not more frequently than quarterly by any Holder of Residual
Certificates with respect to the following matters:

          (i) The original projected principal and interest cash flows on the
     Closing Date on each class of regular and residual interests created
     hereunder and on the Mortgage Loans, based on 100% of the applicable
     Prepayment Assumption;

          (ii) The projected remaining principal and interest cash flows as of
     the end of any calendar quarter with respect to each class of regular and
     residual interests created hereunder and the Mortgage Loans, based on 100%
     of the applicable Prepayment Assumption;

          (iii) The applicable percentage of the Prepayment Assumption and any
     interest rate assumptions used in determining the projected principal and
     interest cash flows described above;

          (iv) The original issue discount (or, in the case of the Mortgage
     Loans, market discount) or premium accrued or amortized through the end of
     such calendar quarter with respect to each class of regular or residual
     interests created hereunder and with respect to the Mortgage Loans,
     together with each constant yield to maturity used in computing the same;

          (v) The treatment of losses realized with respect to the Mortgage
     Loans or the regular interests created hereunder, including the timing and
     amount of any cancellation of indebtedness income of each REMIC with
     respect to such regular interests or bad debt deductions claimed with
     respect to the Mortgage Loans;

          (vi) The amount and timing of any non-interest expenses of each REMIC;
     and

                                      -59-

<PAGE>

          (vii) Any taxes (including penalties and interest) imposed on each
     REMIC, including, without limitation, taxes on "prohibited transactions,"
     "contributions" or "net income from foreclosure property" or state or local
     income or franchise taxes.

     In the event that any tax is imposed on "prohibited transactions" of the
Trust as defined in Section 860F(a)(2) of the Code, on the "net income from
foreclosure property" of a REMIC as defined in Section 860G(c) of the Code, on
any contribution to the Trust after the Startup Day pursuant to Section 860G(d)
of the Code, or any other tax (other than any minimum tax imposed by Section
24874 and 23153 of the California Revenue and Taxation Code) is imposed, such
tax shall be paid by (i) the Trustee, if such tax arises out of or results from
a breach by the Trustee of any of its obligations under this Agreement, (ii) the
Tax Matters Person, if such tax arises out of or results from a breach by the
Tax Matters Person of any of the obligations under this Agreement, (iii) the
Servicer, if such tax arises out of or results from a breach by the Servicer of
any of its obligations under this Agreement or (iv) otherwise the Holders of the
applicable Residual Certificates in proportion to their Percentage Interests. To
the extent any tax is chargeable against the Holders of the Residual
Certificates, notwithstanding anything to the contrary contained herein, the
Trustee is hereby authorized to retain from amounts otherwise distributable to
the Holders of the applicable Residual Certificates on any Distribution Date
sufficient funds to reimburse the Trustee for the payment of such tax (to the
extent that the Trustee has not been previously reimbursed or indemnified
therefor).

     The Trustee shall not engage in a "prohibited transaction" (as defined in
Code Section 860F(a)(2)), except that, with the prior written consent of the
Seller , the Trustee may engage in the activities otherwise prohibited by the
foregoing clauses (b), (c) and (d), provided that the Seller shall have
delivered to the Trustee an Opinion of Counsel to the effect that such
transaction will not result in the imposition of a contribution or prohibited
transaction tax on the Trust and will not disqualify any REMIC from treatment as
a REMIC; and provided that the Seller shall have demonstrated to the
satisfaction of the Trustee that such action will not adversely affect the
rights of the holders of the Certificates and the Trustee and that such action
will not adversely impact the rating of the Offered Certificates.

     (g) Except as provided below, the Tax Matters Person shall pay out of its
own funds, without any right of reimbursement, any and all tax related expenses
of the Trust (including, but not limited to, tax return preparation and filing
expenses and any professional fees or expenses related to audits or any
administrative or judicial proceedings with respect to the Trust that involve
the Internal Revenue Service or state tax authorities), other than the expense
of obtaining any Opinion of Counsel required pursuant to Sections 2.05, 3.06 and
10.02 and other than taxes except as specified herein. The Trustee and the Tax
Matters Person shall be entitled to be reimbursed for any professional fees or
expenses related to audits or any administrative or judicial proceedings that do
not result from any breach of their respective duties hereunder.

     (h) On behalf of each REMIC, the Trustee, the Servicer, the Master Servicer
or Tax Matters Person, as applicable, shall do the following:

          (i) the Trustee as agent for the Tax Matters Person shall prepare,
     sign and file, or cause to be prepared and filed, in a timely manner, a
     U.S. Real Estate Mortgage

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     Investment Conduit Income Tax Return (Form 1066) and any other Tax Return
     required to be filed by each REMIC, using a calendar year as the taxable
     year for each REMIC;

          (ii) the Trustee as agent for the Tax Matters Person shall make, or
     cause to be made, an election, on behalf of each REMIC, to be treated as a
     REMIC on the federal tax return of each REMIC for its first taxable year;

          (iii) the Tax Matters Person or the Trustee as agent for the Tax
     Matters Person shall prepare and forward, or cause to be prepared and
     forwarded, to the Master Servicer, the Servicer, the Seller, the Trustee
     (which, subject to receipt thereof shall forward to the Certificateholders)
     and to the Internal Revenue Service and any other relevant governmental
     taxing authority all information returns or reports as and when required to
     be provided to them in accordance with the REMIC Provisions;

          (iv) the Trustee, the Servicer, the Tax Matters Person and the Master
     Servicer shall to the extent that the affairs of any REMIC are within its
     control, conduct such affairs of each REMIC at all times that any
     Certificates are outstanding so as to maintain the status of each REMIC as
     a REMIC under the REMIC Provisions and any other applicable federal, state
     and local laws, including, without limitation with respect to the Trustee,
     information reports relating to "original issue discount," as defined in
     the Code, based upon 100% of the applicable Prepayment Assumption for fixed
     rate Mortgage Loans and 115% of the applicable Prepayment Assumption for
     adjustable rate Mortgage Loans, calculated by using the issue price of the
     Certificates;

          (v) the Trustee, the Servicer, the Master Servicer and Tax Matters
     Person shall not knowingly or intentionally take any action or omit to take
     any action that would cause the termination of the REMIC status of any
     REMIC;

          (vi) the Trustee shall pay the amount of any and all federal, state
     and local taxes upon the Trustee or the Certificateholders in connection
     with the Trust or the Mortgage Loans, prohibited transaction taxes as
     defined in Section 860F of the Code, other than any amount due as a result
     of a transfer or attempted or purported transfer in violation of Section
     6.02, imposed on the Trust when and as the same shall be due and payable
     (but such obligation shall not prevent the Trustee or any other appropriate
     Person from contesting any such tax in appropriate proceedings and shall
     not prevent the Trustee from withholding payment of such tax, if permitted
     by law, pending the outcome of such proceedings). The Trustee shall be
     entitled to reimbursement for all such amounts in accordance with Section
     2.12;

          (vii) the Trustee and the Tax Matters Person shall ensure that any
     such returns or reports filed on behalf of the Trust are properly executed
     by the appropriate person;

          (viii) the Tax Matters Person shall represent the Trust in any
     administrative or judicial proceedings relating to an examination or audit
     by any governmental taxing authority, request an administrative adjustment
     as to any taxable year of the Trust, enter into settlement agreements with
     any government taxing agency, extend any statute of limitations

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     relating to any item of the Trust and otherwise act on behalf of the Trust
     in relation to any tax matter involving the Trust;

          (ix) the Trustee and the Tax Matters Person shall as provided in
     Section 6.02, make available information necessary for the computation of
     any tax imposed (1) on transferors of residual interests to transferees
     that are not Permitted Transferees or (2) on pass-through entities, any
     interest in which is held by an entity which is not a Permitted Transferee;

          (x) the Trustee and the Tax Matters Person shall make available to the
     Internal Revenue Service and those Persons specified by the REMIC
     Provisions all information necessary to compute any tax imposed (A) as a
     result of the Transfer of an Ownership Interest in a Residual Certificate
     to any Person who is not a Permitted Transferee, including the information
     described in Treasury regulations sections 1.860D-1(b)(5) and
     1.860E-2(a)(5) with respect to the "excess inclusions" of such Residual
     Certificate 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 Residual Certificate having as among its record holders at
     any time any Person that is not a Permitted Transferee. Reasonable
     compensation for providing such information may be accepted by the Trustee;
     and

          (xi) the Trustee, the Servicer, the Master Servicer and the Tax
     Matters Person shall cooperate with each other in connection with the
     foregoing obligations, including signing any Tax Returns to the extent
     required by law.

     Section 2.13. INTENTIONALLY OMITTED.

     Section 2.14. THE CUSTODIAN. Notwithstanding anything to the contrary in
this Agreement, the parties hereto acknowledge that the functions of the Trustee
with respect to the acceptance, inspection, custody and release of the Mortgage
Files pursuant to Sections 2.01, 2.02, 2.05 and 2.13 may be performed by the
Custodian pursuant to a Custodial Agreement. The fees and expenses of the
Custodian will be paid by the Trustee and shall not be an expense of the Trust.
The Trustee will be liable for any acts or omissions of the Custodian.

                                   ARTICLE III

                 Administration and Servicing of Mortgage Loans

     Section 3.01. THE SERVICER AND THE MASTER SERVICER. (a) It is intended that
the Trust formed hereunder shall constitute, and that the affairs of the Trust
shall be conducted so as to qualify each REMIC as, a "real estate mortgage
investment conduit" ("REMIC") as defined in and in accordance with the REMIC
Provisions. In furtherance of such intentions, each of the Master Servicer and
the Servicer covenants and agrees that it shall not knowingly or intentionally
take any action or omit to take any action that would cause the termination of
the REMIC status of any REMIC.

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<PAGE>

     (b) The Servicer, as independent contract servicer, shall service and
administer the Mortgage Loans and shall have full power and authority, acting
alone, to do any and all things in connection with such servicing and
administration which the Servicer may deem necessary or desirable and consistent
with the terms of this Agreement. The Servicer may enter into Subservicing
Agreements for any servicing and administration of Mortgage Loans with any
institution which (i) is in compliance with the laws of each state necessary to
enable it to perform its obligations under such Subservicing Agreement and (ii)
is an Approved Servicer or is an affiliate of the Servicer. The Servicer shall
give notice to the Trustee and the Master Servicer of the appointment of any
Subservicer. Any such Subservicing Agreement shall be consistent with and not
violate the provisions of this Agreement. The Servicer shall be entitled to
terminate any Subservicing Agreement in accordance with the terms and conditions
of such Subservicing Agreement and either itself directly service the related
Mortgage Loans or enter into a Subservicing Agreement with a successor
subservicer which qualifies hereunder.

     (c) Notwithstanding any Subservicing Agreement or any of the provisions of
this Agreement relating to agreements or arrangements between the Servicer and a
Subservicer or reference to actions taken through a Subservicer or otherwise,
the Servicer shall remain obligated and primarily liable for the servicing and
administering of the Mortgage Loans in accordance with the provisions of this
Agreement 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 Servicer alone were servicing and administering the Mortgage Loans. For
purposes of this Agreement, the Servicer shall be deemed to have received
payments on Mortgage Loans when the Subservicer has received such payments. The
Servicer shall be entitled to enter into any agreement with a Subservicer for
indemnification of the Servicer by such Subservicer, and nothing contained in
this Agreement shall be deemed to limit or modify such indemnification.

     (d) Any Subservicing Agreement that may be entered into and any
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 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 except as set
forth in Section 3.01(e). The Servicer shall be solely liable for all fees owed
by it to any Subservicer irrespective of whether the Servicer's compensation
pursuant to this Agreement is sufficient to pay such fees.

     (e) In the event the Servicer shall for any reason no longer be the
Servicer (including by reason of a Servicer Event of Default), the Successor
Servicer or its designee approved by the Master Servicer and, if the Senior
Certificates have not been retired and a Certificate Insurer Default does not
exist, the Certificate Insurer, shall thereupon assume all of the rights and
obligations of the Servicer under each Subservicing Agreement that the Servicer
may have entered into, unless the Successor Servicer or such designee elects to
terminate any Subservicing Agreement. Any fee payable in connection with such a
termination will be payable by the outgoing Servicer. If the Successor Servicer
does not terminate the Subservicing Agreements, the Successor Servicer, its
designee or the successor servicer for the Successor Servicer shall be deemed to
have assumed all of the Servicer's interest therein and to have replaced the
Servicer as a party to each Subservicing Agreement to the same extent as if the
Subservicing Agreements had been assigned to the assuming

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<PAGE>

party, except that the Servicer shall not thereby be relieved of any liability
or obligations under the Subservicing Agreements with regard to events that
occurred prior to the date the Servicer ceased to be the Servicer hereunder. The
Servicer, at its expense and without right of reimbursement therefor, shall,
upon the request of the Successor 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 the Subservicing Agreements to the assuming party.

     (f) Consistent with the terms of this Agreement, the Servicer may 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 Servicer's good faith determination such waiver,
modification, postponement or indulgence is not materially adverse to the
interests of the Certificateholders, provided, however, that (unless (x) the
Mortgagor is in default with respect to the Mortgage Loan, or such default is,
in the judgment of the Servicer, imminent and (y) such waiver, modification,
postponement or indulgence would not cause any REMIC to be disqualified or
otherwise cause a tax to be imposed on any REMIC) the Servicer may not permit
any modification with respect to any Mortgage Loan that would change the Loan
Rate, defer or forgive the payment of any principal or interest (unless in
connection with the liquidation of the related Mortgage Loan) or extend the
final maturity date on the Mortgage Loan. No costs incurred by the Servicer or
any Subservicer in respect of Servicing Advances shall, for the purposes of
distributions to Certificateholders, be added to the amount owing under the
related Mortgage Loan. Without limiting the generality of the foregoing, the
Servicer shall continue, and is hereby authorized and empowered to execute and
deliver on behalf of the Trustee and each Certificateholder, all instruments of
satisfaction or cancellation, or of partial or full release, discharge and all
other comparable instruments with respect to the Mortgage Loans and with respect
to the Mortgaged Properties. If requested by the Servicer, the Trustee shall
furnish the Servicer with any powers of attorney and other documents necessary
or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement.

     Notwithstanding anything to the contrary contained herein, the Servicer, in
servicing and administering the Mortgage Loans, shall employ or cause to be
employed procedures (including collection, foreclosure and REO Property
management procedures) and exercise the same care that it customarily employs
and exercises in servicing and administering mortgage loans for its own account,
in accordance with accepted mortgage servicing practices of prudent lending
institutions servicing mortgage loans similar to the Mortgage Loans and giving
due consideration to the Certificateholders' reliance on the Servicer.

     (g) Within ninety (90) days after such time as the Trustee receives the
resignation of, or notice of the removal of, the Servicer from its rights and
obligations under this Agreement, and with respect to resignation pursuant to
Section 7.04, after receipt by the Trustee of the Opinion of Counsel required
pursuant to Section 7.04, the Successor Servicer shall assume all of the rights
and obligations of the Servicer, subject to Section 8.02; provided that if the
Servicer is removed pursuant to Section 8.01, the Successor Servicer shall
immediately be obligated to make Monthly Advances and Servicing Advances as
required in this Agreement. The Servicer shall, upon request of the Successor
Servicer but at the expense of the Servicer, deliver to the Successor Servicer
all documents and records relating to the Mortgage Loans and an accounting of
amounts collected and

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<PAGE>

held by the Servicer and otherwise use its best efforts to effect the orderly
and efficient transfer of servicing rights and obligations to the assuming party
and shall be entitled to reimbursement by the Servicer (or, to the extent not
paid by the Servicer, by the Trust pursuant to Section 5.01(a)(16)) for
Servicing Transfer Costs.

     (h) The Servicer shall deliver a list of Servicing Officers to the Trustee
on or before the Closing Date.

     (i) Consistent with the terms of this Agreement, the Servicer may consent
to the placing of a lien senior to that of the Mortgage on the related Mortgaged
Property; PROVIDED that such senior lien secures a mortgage loan that refinances
a First Lien and the combined loan-to-value ratio of the related Mortgage Loan
immediately following the refinancing (based on the outstanding principal
balance of the Mortgage Loan and the original principal balance of such
refinanced mortgage loan) is not greater than the Combined Loan-to-Value Ratio
of such Mortgage Loan as of the related Cut-Off Date.

     Section 3.02. COLLECTION OF CERTAIN MORTGAGE LOAN PAYMENTS. (a) The
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, follow such collection
procedures as it follows with respect to mortgage loans in its servicing
portfolio comparable to the Mortgage Loans. Consistent with the foregoing, and
without limiting the generality of the foregoing, the Servicer may in its
discretion (i) waive any late payment charge or any assumption fees or other
fees which may be collected in the ordinary course of servicing such Mortgage
Loan and (ii) arrange with a Mortgagor a schedule for the payment of interest
due and unpaid; PROVIDED that such arrangement is consistent with the Servicer's
policies with respect to the mortgage loans it owns or services; PROVIDED,
FURTHER, that notwithstanding such arrangement such Mortgage Loans will be
included in the monthly information delivered by the Servicer to the Trustee
pursuant to Section 5.03.

     (b) The Servicer shall establish and maintain a separate trust account (the
"Collection Account") titled "Wells Fargo Bank Minnesota, National Association,
as Trustee, in trust for the registered holders of Soundview Home Equity Loan
Asset-Backed Certificates, Series 2001-1." The Collection Account shall be an
Eligible Account. On the Closing Date, the Depositor shall cause to be deposited
in the Collection Account any amounts representing payments on and any
collections in respect of the Mortgage Loans received after the related Cut-Off
Date (other than principal and interest accrued and due on or prior to April 1,
2001) and prior to the Closing Date. The Servicer shall deposit within two
Business Days, following receipt thereof the following payments and collections
received or made by it (without duplication):

          (i) all payments received after the related Cut-Off Date on account of
principal on the Mortgage Loans (exclusive of payments in respect of principal
on the Mortgage Loans which were due on or prior to the related Cut-off Date)
and all Principal Prepayments and Curtailments collected after the related
Cut-Off Date;

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<PAGE>

          (ii) all payments received after the related Cut-Off Date on account
of interest on the Mortgage Loans (exclusive of payments in respect of interest
on the Mortgage Loans which have accrued and were due on or prior to the related
Cut-Off Date);

          (iii) all Net Liquidation Proceeds net of Foreclosure Profits;

          (iv) all Insurance Proceeds other than any portion thereof
constituting Net Liquidation Proceeds;

          (v) all Released Mortgaged Property Proceeds;

          (vi) any amounts payable in connection with the repurchase of any
Mortgage Loan;

          (vii) any amount required to be deposited in the Collection Account
pursuant to Sections 3.05, 3.06, 3.07, 5.02 or 5.05; and

          (viii) any Prepayment Charges collected by the Servicer and Prepayment
Charge Payment Amounts.

PROVIDED, HOWEVER, that, with respect to each Due Period, the Servicer shall be
permitted to retain (x) from payments in respect of interest on a Mortgage Loan,
the Servicing Fee for such Mortgage Loan and (y) from payments from Mortgagors,
Liquidation Proceeds, Insurance Proceeds and Released Mortgaged Property
Proceeds, any unreimbursed Servicing Advances and Monthly Advances related
thereto. The foregoing requirements respecting deposits to the Collection
Account are exclusive, it being understood that, without limiting the generality
of the foregoing, the Servicer need not deposit in the Collection Account
amounts representing Servicing Compensation or amounts received by the Servicer
for the accounts of Mortgagors for application toward the payment of taxes,
insurance premiums, assessments and similar items.

     The Servicer may cause the institution maintaining the Collection Account
to invest any funds in the Collection Account in Eligible Investments (including
obligations of the Servicer or any of its Affiliates, if such obligations
otherwise qualify as Eligible Investments) pursuant to Section 5.05.

     Section 3.03. WITHDRAWALS FROM THE COLLECTION ACCOUNT. The Servicer shall
withdraw or cause to be withdrawn funds from the Collection Account for the
following purposes:

          (i) before 1:00 p.m. (New York City time) on the Servicer Remittance
Date, to withdraw the Servicer Remittance Amount, Prepayment Charges, Prepayment
Charge Payment Amounts and that portion of Liquidation Proceeds or Insurance
Proceeds allocated to reimburse the Master Servicer for unreimbursed Master
Servicing Fees or Monthly Advances made by the Master Servicer with respect
thereto, and, in each case, deposit such funds in the Custodial Account;

          (ii) to reimburse the Servicer for any accrued unpaid Servicing
Compensation which the Servicer would not have been required to deposit in the
Collection Account and for

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<PAGE>

unreimbursed Monthly Advances made by the Servicer and Servicing Advances. The
Servicer's right to reimbursement for unpaid Servicing Fees and unreimbursed
Servicing Advances shall be limited to late collections on the related Mortgage
Loan, including Liquidation Proceeds, Released Mortgaged Property Proceeds,
Insurance Proceeds and such other amounts as may be collected by the Servicer
from the related Mortgagor or otherwise relating to the Mortgage Loan in respect
of which such reimbursed amounts are owed. The Servicer's right to reimbursement
for unreimbursed Monthly Advances shall be limited to late collections on any
Mortgage Loan and to Liquidation Proceeds, Released Mortgaged Property Proceeds,
Insurance Proceeds and any purchase or repurchase proceeds on related Mortgage
Loans;

          (iii) to withdraw any amount received from a Mortgagor that is
recoverable and sought to be recovered as a voidable preference by a trustee in
bankruptcy pursuant to the United States Bankruptcy Code in accordance with a
final, nonappealable order of a court having competent jurisdiction;

          (iv) to withdraw any funds deposited in the Collection Account that
were not required to be deposited therein (such as Servicing Compensation) or
were deposited therein in error and to pay such funds to the appropriate Person;

          (v) to withdraw funds necessary for the conservation and disposition
of REO Property pursuant to Section 3.06 to the extent not advanced by the
Servicer;

          (vi) to reimburse the Servicer for Nonrecoverable Advances;

          (vii) to pay to the Depositor collections received in respect of
accrued interest and principal on the Mortgage Loans due on or before the
related Cut-Off Date;

          (viii) to pay to the Servicer or the Trustee the portion of any
Purchase Price in respect of clause (iv) of the definition thereof to the extent
paid in respect of amounts incurred by or imposed on the Servicer or the
Trustee, as the case may be;

          (ix) to reimburse the Servicer for expenses incurred by it in
connection with the Mortgage Loans or Certificates and reimbursable pursuant to
Section 7.03 hereof provided that such amount shall only be withdrawn following
the withdrawal from the Collection Account for deposit into the Distribution
Account pursuant to clause (i)(y) above;

          (x) to clear and terminate the Collection Account upon the termination
of this Agreement and to pay any amounts remaining therein to the applicable
Class R Certificateholders.

     Section 3.04. MAINTENANCE OF HAZARD INSURANCE; PROPERTY PROTECTION
EXPENSES. The Servicer shall cause to be maintained for each Mortgage Loan fire
and hazard insurance naming the Servicer as loss payee thereunder providing
extended coverage in an amount which is at least equal to the lesser of (i) the
maximum insurable value of the improvements securing such Mortgage Loan from
time to time, (ii) the combined principal balance owing on such Mortgage Loan
and any mortgage loan senior to such Mortgage Loan and (iii) the minimum amount
required to compensate for damage or loss on a replacement cost basis. The
Servicer shall also maintain on property

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<PAGE>

acquired upon foreclosure or by deed in lieu of foreclosure hazard insurance
with extended coverage in an amount which is at least equal to the lesser of (i)
the maximum insurable value from time to time of the improvements which are a
part of such property, (ii) the combined principal balance owing on such
Mortgage Loan and any mortgage loan senior to such Mortgage Loan and (iii) the
minimum amount required to compensate for damage or loss on a replacement cost
basis at the time of such foreclosure, fire and or deed in lieu of foreclosure
plus accrued interest and the good-faith estimate of the Servicer of related
Servicing Advances to be incurred in connection therewith. Amounts collected by
the Servicer under any such policies shall be deposited in the Collection
Account to the extent called for by Section 3.02. In cases in which any
Mortgaged Property is located in a federally designated flood area, the hazard
insurance to be maintained for the related Mortgage Loan shall include flood
insurance to the extent such flood insurance is available and the Servicer has
determined such insurance to be necessary in accordance with accepted mortgage
loan servicing standards for mortgage loans similar to the Mortgage Loans. All
such flood insurance shall be in amounts equal to the least of (A) the amount in
clause (i) above, (B) the amount in clause (ii) above and (C) the maximum amount
of insurance available under the National Flood Insurance Act of 1968, as
amended. The 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 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. The costs and expenses incurred by the Servicer in
maintaining any such insurance shall constitute Servicing Advances.

     Section 3.05. MAINTENANCE OF MORTGAGE IMPAIRMENT INSURANCE POLICY. In the
event that the Servicer shall obtain and maintain a blanket policy with an
insurer having a General Policy rating of A:VIII or better in Best's Key Rating
Guide, then, to the extent such policy names the Servicer as loss payee and
provides coverage in an amount equal to the aggregate unpaid principal balance
on the Mortgage Loans without co-insurance, and otherwise complies with the
requirements of Section 3.04, the Servicer shall be deemed conclusively to have
satisfied its obligations with respect to fire and hazard insurance coverage
under Section 3.04, it being understood and agreed that such blanket policy may
contain a deductible clause, in which case the Servicer shall, in the event that
there shall not have been maintained on the related Mortgaged Property a policy
complying with Section 3.04, and there shall have been a loss which would have
been covered by such policy, deposit in the Collection Account the difference,
if any, between the amount that would have been payable under a policy complying
with Section 3.04 and the amount paid under such blanket policy. Upon the
request of the Trustee, the Master Servicer or Servicer shall cause to be
delivered to the Trustee, a certified true copy of such policy. In connection
with its activities as administrator and servicer of the Mortgage Loans, the
Servicer agrees to prepare and present, on behalf of itself, the Trustee, and
the Certificateholders, claims under any such policy in a timely fashion in
accordance with the terms of such policy.

     Section 3.06. MANAGEMENT AND REALIZATION UPON DEFAULTED MORTGAGE LOANS. The
Servicer shall manage, conserve, protect and operate each REO Property for the
Certificateholders solely for the purpose of its prudent and prompt disposition
and sale; provided that the Servicer shall not be required to expend its own
funds in connection with any foreclosure 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 after
reimbursement to itself of such expenses and (ii)

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<PAGE>

that such expenses will be recoverable to it through Liquidation Proceeds
(respecting which it shall have priority for purposes of withdrawals from the
Certificate Account pursuant to Section 3.03 hereof). The Servicer shall be
responsible for all other costs and expenses incurred by it in any such
proceedings; provided that it shall be entitled to reimbursement thereof from
the proceeds of liquidation of the related Mortgaged Property, as contemplated
in Section 3.03 hereof. The Servicer shall, either itself or through an agent
selected by the Servicer, manage, conserve, protect and operate the REO Property
in the same manner that it manages, conserves, protects and operates other
foreclosed property for its own account, and in the same manner that similar
property in the same locality as the REO Property is managed. The Servicer shall
attempt to sell the same (and may temporarily rent the same) on such terms and
conditions as the Servicer deems to be in the best interest of the
Certificateholders.

     The Servicer shall cause to be deposited, no later than two Business Days
after the receipt thereof, in the Collection Account, all revenues received with
respect to the related REO Property and shall retain, or cause the Trustee to
withdraw therefrom, funds necessary for the proper operation, management and
maintenance of the REO Property and the fees of any managing agent acting on
behalf of the Servicer.

     The disposition of REO Property shall be carried out by the Servicer for
cash at such price, and upon such terms and conditions, as the Servicer deems to
be in the best interest of the Certificateholders and, as soon as practicable
thereafter, the expenses of such sale shall be paid out of the proceeds of such
sale. The cash proceeds of sale of the REO Property shall be promptly deposited
in the Collection Account, net of Foreclosure Profits and of any related
unreimbursed Servicing Advances, accrued and unpaid Servicing Fees and
unreimbursed Monthly Advances payable to the Servicer in accordance with Section
3.03, for distribution to the Certificateholders in accordance with Section
5.01.

     The Servicer shall foreclose upon or otherwise comparably convert to
ownership Mortgaged Properties securing such of the Mortgage Loans as come into
and continue in default either when no satisfactory arrangements can be made for
collection of delinquent payments pursuant to Section 3.02 subject to the
provisions contained in the last paragraph of this Section 3.06.

     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 Trustee or to its nominee on behalf of
Certificateholders.

     In the event any Mortgaged Property is acquired as aforesaid or otherwise
in connection with a default or imminent default on a Mortgage Loan, the
Servicer shall (i) dispose of such Mortgaged Property within three years after
the close of the taxable year in which the Mortgaged Property was acquired (the
"grace period") or (ii) prior to the expiration of any extension to such grace
period which is requested on behalf of the Trust by the Servicer (at the expense
of the Trust) more than 60 days prior to the end of the grace period and granted
by the Internal Revenue Service, unless the Trust shall have received an Opinion
of Counsel to the effect that the holding of such Mortgaged Property subsequent
to expiration of the grace period will not result in the imposition of taxes on
"prohibited transactions" as defined in Section 860F of the Code or cause any
REMIC to fail to qualify as a REMIC at any time that any Regular Certificates
are outstanding. Notwithstanding any

                                      -69-

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other provision of this Agreement, (i) no Mortgaged Property acquired by the
Servicer pursuant to this Section 3.06 shall be rented (or allowed to continue
to be rented) or otherwise used for the production of income by or on behalf of
the Trust and (ii) no construction shall take place on such Mortgaged Property
in such a manner or pursuant to any terms, in either case, that would cause such
Mortgaged Property to fail to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code or result in the receipt by the Trust
of any "net income from foreclosure property" which is subject to taxation
within the meaning of Sections 860G(c) and 857(b)(4)(B) of the Code. If a period
greater than the grace period is permitted under this Agreement and is necessary
to sell any REO Property, the Servicer shall give appropriate notice to the
Trustee and the Master Servicer and shall report monthly to the Trustee as to
the progress being made in selling such REO Property.

     If the Servicer has actual knowledge that a Mortgaged Property which the
Servicer is contemplating acquiring in foreclosure or by deed in lieu of
foreclosure is located within a one-mile radius of any site with environmental
or hazardous waste risks known to the Servicer, the Servicer will notify the
Trustee and the Master Servicer prior to acquiring the Mortgaged Property.
Nothing in this Section 3.06 shall affect the Servicer's right to deem certain
advances proposed to be made Nonrecoverable Advances. For the purpose of this
Section 3.06, actual knowledge of the Servicer means actual knowledge of a
Responsible Officer of the Servicer involved in the servicing of the relevant
Mortgage Loan. Actual knowledge of the Servicer does not include knowledge
imputable by virtue of the availability of or accessibility to information
relating to environmental or hazardous waste sites or the locations thereof.

     Section 3.07. TRUSTEE TO COOPERATE. Upon any Principal Prepayment, the
Servicer is authorized to execute, pursuant to the authorization contained in
Section 3.01(f), if the related Assignment of Mortgage has been recorded as
required hereunder, an instrument of satisfaction regarding the related
Mortgage, which instrument of satisfaction shall be recorded by the Servicer if
required by applicable law and be delivered to the Person entitled thereto. It
is understood and agreed that no expenses incurred in connection with such
instrument of satisfaction or transfer shall be reimbursed from amounts
deposited in the Collection Account. If the Trustee or Custodian is holding the
Mortgage Files, from time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, the Trustee or Custodian shall, upon request
of the Servicer and delivery to the Custodian two copies of a Request for
Release, one of which will be returned to the Servicer with the Mortgage File,
in the form annexed hereto as Exhibit I, signed by a Servicing Officer or in a
mutually agreeable electronic format which originates from a Servicing Officer,
release the related Mortgage File to the Servicer, and the Trustee or Custodian
shall execute such documents, in the forms provided by the Servicer, as shall be
necessary for the prosecution of any such proceedings or the taking of other
servicing actions. Such Request for Release shall obligate the Servicer to
return the Mortgage File to the Trustee or the Custodian, as the case may be,
when the need therefor by the Servicer no longer exists unless the Mortgage Loan
shall be liquidated, in which case, upon receipt of a certificate of a Servicing
Officer similar to that hereinabove specified, the Mortgage File shall be
released by the Trustee or Custodian to the Servicer.

     In order to facilitate the foreclosure of the Mortgage securing any
Mortgage Loan that is in default following recordation of the related Assignment
of Mortgage in accordance with the provisions hereof, the Trustee shall, if so
requested in writing by the Servicer, execute an appropriate

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<PAGE>

assignment in the form provided to the Trustee by the Servicer to assign such
Mortgage Loan for the purpose of collection to the 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 Mortgage Loan and deposit or credit the Net Liquidation Proceeds,
exclusive of Foreclosure Profits, received with respect thereto in the
Collection Account. In the event that all delinquent payments due under any such
Mortgage Loan are paid by the Mortgagor and any other defaults are cured then
the assignee for collection shall promptly reassign such Mortgage Loan to the
Trustee and return it to the place where the related Mortgage File was being
maintained.

     Upon request of the Servicer, the Trustee shall furnish the Servicer with
any powers of attorney necessary or appropriate to enable Servicer to execute in
the name of the Trustee all documents reasonably required to perform the
servicing functions described herein.

     Section 3.08. SERVICING COMPENSATION; PAYMENT OF CERTAIN EXPENSES BY
SERVICER. Subject to Section 5.02, the Servicer shall be entitled to retain the
Servicing Fee in accordance with Section 3.02 as compensation for its services
in connection with servicing the Mortgage Loans. Moreover, additional servicing
compensation, late payment charges or other receipts not required to be
deposited in the Collection Account, including, without limitation, Foreclosure
Profits and, subject to Section 5.05, investment income on the Collection
Account shall be retained by the Servicer. The 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 Trust or the Certificateholders) and shall not be
entitled to reimbursement therefor except as specifically provided herein.

     Section 3.09. ANNUAL STATEMENT AS TO COMPLIANCE. (a) The Servicer and the
Master Servicer each will deliver to the Depositor, the Seller, the Trustee, the
Certificate Insurer and the Rating Agencies, on or before March 1 of each year,
beginning March 1, 2002, an Officer's Certificate stating that (i) a review of
the activities of the Servicer or the Master Servicer, as applicable, during the
preceding fiscal year and of its performance under this Agreement has been made
under such officer's supervision and (ii) to the best of such officer's
knowledge, based on such review, the Servicer or the Master Servicer, as
applicable, has fulfilled all its material obligations under this Agreement
throughout such fiscal year, or, if there has been a default in the fulfillment
of any such obligation, specifying each such default known to such officer and
the nature and status thereof. The Servicer or the Master Servicer, as
applicable, shall promptly notify the Depositor, the Seller, the Trustee and
each Rating Agency upon any change in the basis on which its fiscal year is
determined.

     (b) The Servicer or the Master Servicer, as the case may be, shall deliver
to the Trustee, the Certificate Insurer and each of the Rating Agencies,
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 Servicer Event of Default or Master Servicer Event of
Default, as applicable.

     Section 3.10. ANNUAL SERVICING REVIEW. Not later than March 1 of each year,
beginning March 1, 2002, the Servicer and the Master Servicer, each, at its
expense, shall cause a firm of

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<PAGE>

independent public accountants which is a member of the American Institute of
Certified Public Accountants to furnish a letter or letters to the Depositor,
the Seller, the Trustee, the Certificate Insurer and each Rating Agency to the
effect that such firm has, with respect to the Servicer's or Master Servicer's,
as applicable, overall servicing operations, examined such operations in
accordance with the requirements of the Uniform Single Attestation Program for
Mortgage Bankers, and stating such firm's conclusions relating thereto.

     Section 3.11. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING THE
MORTGAGE LOANS. The Servicer shall provide to the Depositor, the Seller, the
Trustee, the Custodian, the Certificate Insurer, Certificateholders which are
federally insured savings and loan associations, the Office of Thrift
Supervision, the FDIC and the supervisory agents and examiners of the Office of
Thrift Supervision access to the documentation regarding the Mortgage Loans
required by applicable regulations of the Office of Thrift Supervision and the
FDIC (acting as operator of the SAIF or the BIF), such access being afforded
without charge but only upon reasonable request and during normal business hours
at the offices of the Servicer. Nothing in this Section 3.11 shall derogate from
the obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Mortgagors and the failure of the
Servicer to provide access as provided in this Section 3.11 as a result of such
obligation shall not constitute a breach of this Section 3.11.

     Section 3.12. MAINTENANCE OF CERTAIN SERVICING INSURANCE POLICIES. The
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 servicer hereunder and (ii) a fidelity bond in
respect of its officers, employees or agents. Each such policy or policies and
bond shall, together, comply with the requirements from time to time of Fannie
Mae for persons performing servicing for mortgage loans purchased by Fannie Mae.

     Section 3.13. REPORTS TO THE SECURITIES AND EXCHANGE COMMISSION. Within 15
days after each Distribution Date, the Trustee shall, on behalf of the Trust,
cause to be filed with the Securities and Exchange Commission via the Electronic
Data Gathering and Retrieval System (EDGAR), a Form 8-K with a copy of the
Remittance Report for such Distribution Date as an exhibit thereto. Prior to
January 30, 2002, the Trustee shall file a Form 15 Suspension Notification with
respect to the Trust, if applicable. Prior to March 30, 2002, the Trustee shall
file a Form 10-K, in substance conforming to industry standards, with respect to
the Trust. The Depositor hereby grants to the Trustee a limited power of
attorney to execute and file each such document on behalf of the Depositor. Such
power of attorney shall continue until either the earlier of (i) receipt by the
Trustee from the Depositor of written termination of such power of attorney and
(ii) the termination of the Trust. Each of the Depositor, the Seller, the Master
Servicer and the Servicer agrees to promptly furnish to the Trustee, from time
to time upon request, such further information, reports, and financial
statements within its control related to this Agreement and the Mortgage Loans
as the Trustee reasonably deems appropriate to prepare and file all necessary
reports with the Securities and Exchange Commission

     Section 3.14. REPORTS OF FORECLOSURES AND ABANDONMENTS OF MORTGAGED
PROPERTIES, RETURNS RELATING TO MORTGAGE INTEREST RECEIVED FROM INDIVIDUALS AND
RETURNS RELATING TO CANCELLATION OF INDEBTEDNESS. The Servicer shall make
reports of foreclosures and abandonments of any Mortgaged Property for each year
beginning in 2001. The Servicer shall file reports relating to each instance

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occurring during the previous calendar year in which the Servicer (i) on behalf
of the Trust acquires an interest in any Mortgaged Property through foreclosure
or other comparable conversion in full or partial satisfaction of a Mortgage
Loan or (ii) knows or has reason to know that any Mortgaged Property has been
abandoned. The reports from the Servicer shall be in form and substance
sufficient to meet the reporting requirements imposed by Sections 6050J, 6050H
and 6050P of the Code.

     Section 3.15. ADVANCES BY THE SERVICER AND MASTER SERVICER. (a) Not later
than 1:00 p.m. New York time on the Servicer Remittance Date related to each
Distribution Date, the Servicer shall remit to the Master Servicer for deposit
in the Custodial Account an amount to be distributed on the related Distribution
Date pursuant to Section 5.01, equal to the Monthly Payment due on each Mortgage
Loan during the related Due Period, but not received as of the related
Determination Date (net of the Servicing Fee) such amount being defined herein
as the "Monthly Advance". The obligation to make Monthly Advances with respect
to each Mortgage Loan shall continue until such Mortgage Loan becomes a
Liquidated Mortgage Loan. In the event the Servicer fails to pay a Monthly
Advance when due, the Master Servicer shall promptly, but in no event later than
12:00 pm New York time on the second business day prior to the Distribution
Date, deposit in the Custodial Account an amount equal to such Monthly Advance,
net of the Master Servicing Fee.

     (b) Notwithstanding anything herein to the contrary, no Servicing Advance
or Monthly Advance shall be required to be made hereunder if the Servicer or
Master Servicer, as applicable, determines that such Servicing Advance or
Monthly Advance would, if made, constitute a Nonrecoverable Advance.

     (c) All Monthly Advances and Servicing Advances, including any
Nonrecoverable Advances shall be reimbursed on a first in, first out basis.

     (d) So long as the Servicer is Meritech Mortgage Services, Inc. or
otherwise has long-term debt rated at least investment grade by one of the
Rating Agencies, Monthly Advances may be made by the Servicer either (i) from
its own funds or (ii) from the Collection Account, to the extent of funds held
therein for future distribution (in which case it will cause to be made an
appropriate entry in the records of Collection Account that amounts held for
future distribution have been, as permitted by this Section 3.15, used by the
Servicer in discharge of any such Monthly Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of Monthly Advances to
be made by the Servicer with respect to the Mortgage Loans and REO Properties.
Any amounts held for future distribution and so used shall be appropriately
reflected in the Servicer's records and replaced by the Servicer by deposit in
the Collection Account on or before the next Servicer Remittance Date.

     Section 3.16. OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS. The Servicer,
in its sole discretion, shall have the right to elect (by written notice sent to
the Trustee) to purchase for its own account from the Trust any Mortgage Loan
which is 90 days or more delinquent in the manner and at the price specified in
Section 2.02. The Purchase Price for any Mortgage Loan purchased hereunder shall
be deposited in the Collection Account and the Trustee, upon receipt of such
deposit, shall release or cause to be released to the purchaser of such Mortgage
Loan the related Mortgage File and shall execute and deliver such instruments of
transfer or assignment prepared by the

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<PAGE>

purchaser of such Mortgage Loan, in each case without recourse, as shall be
necessary to vest in the purchaser of such Mortgage Loan any Mortgage Loan
released pursuant hereto and the purchaser of such Mortgage Loan shall succeed
to all the Trustee's right, title and interest in and to such Mortgage Loan and
all security and documents related thereto. Such assignment shall be an
assignment outright and not for security. The purchaser of such Mortgage Loan
shall thereupon own such Mortgage Loan, and all security and documents, free of
any further obligation to the Trustee or the Certificateholders with respect
thereto.

     Section 3.17. SUPERIOR LIENS. If the Servicer is notified that any superior
lienholder has accelerated or intends to accelerate the obligations secured by
the First Lien, or has declared or intends to declare a default under the
mortgage or the promissory note secured thereby, or has filed or intends to file
an election to have the Mortgaged Property sold or foreclosed, the Servicer
shall take, on behalf of the Trust, whatever actions are necessary to protect
the interests of the Certificateholders and/or to preserve the security of the
related Mortgage Loan, subject to the application of the REMIC Provisions in
accordance with the terms of this Agreement. The Servicer shall immediately
notify the Trustee of any such action or circumstances. The Servicer shall
advance the necessary funds to cure the default or reinstate the superior lien,
if such advance is in the best interests of the Certificateholders in accordance
with the servicing standards in Section 3.01. The Servicer shall not make such
an advance except to the extent that it determines in its reasonable good faith
judgment that the advance would be recoverable from Liquidation Proceeds on the
related Mortgage Loan and in no event in an amount that is greater than the
Principal Balance of the related Mortgage Loan. The Servicer shall thereafter
take such action as is necessary to recover the amount so advanced.

     Section 3.18. ASSUMPTION AGREEMENTS. When a Mortgaged Property has been or
is about to be conveyed by the Mortgagor, the Servicer shall, to the extent it
has knowledge of such conveyance or prospective conveyance, exercise its right
to accelerate the maturity of the related Mortgage Loan under any "due-on-sale"
clause contained in the related Mortgage or Mortgage Note; PROVIDED, HOWEVER,
that the Servicer shall not exercise any such right if the "due-on-sale" clause,
in the reasonable belief of the Servicer, is not enforceable under applicable
law. In such event, the Servicer shall enter into an assumption and modification
agreement with the person to whom such property has been or is about to be
conveyed, pursuant to which such person shall become liable under the Mortgage
Note and, unless prohibited by applicable law, the Mortgagor shall remain liable
thereon. The Servicer, in accordance with accepted mortgage loan servicing
standards for mortgage loans similar to the Mortgage Loans, is also authorized
to enter into a substitution of liability whereby such person is substituted as
mortgagor and becomes liable under the Mortgage Note. The Servicer shall notify
the Trustee that any such substitution or assumption agreement has been
completed by forwarding to the Trustee the original of such substitution or
assumption agreement which original shall be added by the Trustee to the related
Mortgage File and shall, for all purposes, be considered a part of such Mortgage
File to the same extent as all other documents and instruments constituting a
part thereof. In connection with any assumption or substitution agreement
entered into pursuant to this Section 3.18, the Servicer shall not change the
Loan Rate or the Monthly Payment, defer or forgive the payment of principal or
interest, reduce the outstanding principal amount or extend the final maturity
date on such Mortgage Loan.

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     Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.

     Section 3.19. PAYMENT OF TAXES, INSURANCE AND OTHER CHARGES. With respect
to each Mortgage Loan, the Servicer shall maintain accurate records reflecting
fire and hazard insurance coverage.

     With respect to each Mortgage Loan as to which the Servicer maintains
escrow accounts, the Servicer shall maintain accurate records reflecting the
status of ground rents, taxes, assessments, water rates and other charges which
are or may become a lien upon the Mortgaged Property and the status of primary
mortgage guaranty insurance premiums, if any, and fire and hazard insurance
coverage and shall obtain, from time to time, all bills for the payment of such
charges (including renewal premiums) and shall effect payment thereof prior to
the applicable penalty or termination date and at a time appropriate for
securing maximum discounts allowable, employing for such purpose deposits of the
Mortgagor in any escrow account which shall have been estimated and accumulated
by the Servicer in amounts sufficient for such purposes, as allowed under the
terms of the Mortgage. To the extent that a Mortgage does not provide for escrow
payments, the Servicer shall, if it has received notice of a default or
deficiency, monitor such payments to determine if they are made by the
Mortgagor. The Servicer shall maintain a third-party (which may be an Affiliate
of the Servicer) tax monitoring service.

     Section 3.20. COVENANTS OF THE SERVICER AND REPRESENTATIONS OF THE SELLER
REGARDING PREPAYMENT CHARGES. (a) The Servicer will not waive any Prepayment
Charge or part of a Prepayment Charge unless (i) such waiver would, in the
reasonable judgment of the Servicer, maximize recovery of total proceeds taking
into account the value of such Prepayment Charge and related Mortgage Loan and,
if such waiver is made in connection with a refinancing of the related Mortgage
Loan, such refinancing is related to a default or a reasonably foreseeable
default; (ii) the related Mortgage Loan indebtedness has been accelerated; or
(iii) the Servicer obtains a written opinion of counsel, which may be in-house
counsel for the Servicer, opining that the Prepayment Charge is not legally
enforceable in the circumstances under which the related prepayment occurs. In
no event will the Servicer waive a Prepayment Charge in connection with a
refinancing of a Mortgage Loan that is not related to a default or a reasonably
foreseeable default.

     (b) The Seller hereby represents that the information set forth in the
Prepayment Charge Schedule (including the prepayment charge summary attached
thereto) is complete, true and correct in all material respects at the date or
dates respecting which such information is furnished and each Prepayment Charge
is permissible and enforceable in accordance with its terms (except to the
extent that the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors' rights
generally) under applicable state law.

     (c) Upon discovery by the Servicer, the Seller or a Responsible Officer of
the Trustee of a breach of the foregoing, which materially and adversely affects
the Holders of the Class P Certificates, the party discovering such breach shall
give prompt written notice to the other parties. Within 60 days of the earlier
of discovery by the Servicer or the Seller, as applicable, or receipt of

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notice by the Servicer or the Seller, as applicable, of such breach, the
Servicer or the Seller, as applicable, shall cure such breach in all material
respects. If the covenant made by the Servicer in clause (a) above is breached
the Servicer must pay into the Collection Account the amount of the waived
Prepayment Charge. If the representation made by the Seller in clause (b) above
is breached, the Seller must pay to the Servicer for deposit into the Collection
Account the amount of the scheduled Prepayment Charge, less any amount
previously collected and paid by the Servicer into the Collection Account.
Prepayment Charges paid by the Servicer shall not be deemed property of any
REMIC created hereunder.

     Section 3.21. MASTER SERVICER CUSTODIAL ACCOUNT. The Master Servicer shall
establish and maintain a separate trust account (the "Custodial Account") titled
"Wells Fargo Bank Minnesota, National Association, as Trustee, in trust for the
registered holders of Soundview Home Equity Loan Asset-Backed Certificates,
Series 2001-1." The Custodial Account shall be an Eligible Account. The Master
Servicer shall deposit upon receipt thereof the Servicer Remittance Amount and
any amounts required to be deposited in the Custodial Account pursuant to
Sections 3.15, 5.02 and 5.05 PROVIDED, HOWEVER, that, with respect to each Due
Period, the Master Servicer shall be permitted to retain (x) from payments in
respect of interest on a Mortgage Loan, the Master Servicing Fee for such
Mortgage Loan and (y) from payments from Mortgagors, Liquidation Proceeds,
Insurance Proceeds and Released Mortgaged Property Proceeds, any unreimbursed
Monthly Advances made by the Master Servicer related thereto. 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
Master Servicing Compensation.

     Section 3.22. WITHDRAWALS FROM THE CUSTODIAL ACCOUNT. The Master Servicer
shall withdraw or cause to be withdrawn funds from the Custodial Account for the
following purposes:

          (i) before 1:00 p.m. (New York City time) on the Master Servicer
Remittance Date to withdraw the Available Funds, Prepayment Charges deposited by
the Servicer and Prepayment Charge Payment Amounts and, in each case, remit such
funds to the Trustee for deposit to the Distribution Account;

          (ii) before 1:00 p.m. (New York City time) on the Master Servicer
Remittance Date, to pay the Trustee, the Trustee Fee;

          (iii) to reimburse the Master Servicer for any accrued unpaid Master
Servicing Compensation which the Master Servicer would not have been required to
deposit in the Custodial Account and for unreimbursed Monthly Advances made by
the Master Servicer. The Master Servicer's right to reimbursements for unpaid
Master Servicing Fees shall be limited to late collections on the related
Mortgage Loan, including Liquidation Proceeds, Released Mortgaged Property
Proceeds, Insurance Proceeds and such other amounts as may be collected by the
Servicer from the related Mortgagor or otherwise relating to the Mortgage Loan
in respect of which such reimbursed amounts are owed. The Master Servicer's
right to reimbursement for unreimbursed Monthly Advances shall be limited to
late collections on any Mortgage Loan and to Liquidation Proceeds, Released
Mortgaged Property Proceeds, Insurance Proceeds and any purchase or repurchase
proceeds on related Mortgage Loans;

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<PAGE>

          (iv) to withdraw any funds deposited in the Custodial Account that
were not required to be deposited therein (such as Master Servicing
Compensation) or were deposited therein in error and to pay such funds to the
appropriate Person;

          (v) to reimburse the Master Servicer for expenses incurred by it in
connection with the Mortgage Loans or Certificates and reimbursable pursuant to
Section 7.03 hereof provided that such amount shall only be withdrawn following
the withdrawal from the Custodial Account for deposit into the Distribution
Account pursuant to clause (i) above; and

          (vi) to clear and terminate the Custodial Account upon the termination
of this Agreement and to pay any amounts remaining therein to the applicable
Class R Certificateholders.

     Section 3.23. OVERSIGHT OF SERVICING. The Master Servicer shall supervise,
administer, monitor and oversee the servicing of the Mortgage Loans by the
Servicer and the performance by the Servicer of all services, duties,
responsibilities and obligations that are to be observed or performed by the
Servicer under this Agreement. The Master Servicer shall notify the Depositor
and the Trustee of any defaults by the Servicer hereunder of which it receives
notice or acquires knowledge.

     Section 3.24. MASTER SERVICING COMPENSATION; PAYMENT OF CERTAIN EXPENSES BY
THE MASTER SERVICER. Subject to Section 5.02, the Master Servicer shall be
entitled to retain the Master Servicing Fee as compensation for its services in
connection with master servicing the Mortgage Loans. In addition, investment
income on the Custodial Account 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
Servicer, the Trust or the Certificateholders) and shall not be entitled to
reimbursement therefor except as specifically provided herein.

                                   ARTICLE IV

                          Certificate Insurance Policy

     Section 4.01. CERTIFICATE INSURANCE POLICY. As soon as possible, and in no
event later than 11:00 a.m., New York time, on the second Business Day
immediately preceding each Distribution Date, the Trustee shall determine the
amount of Available Funds for such Distribution Date minus the amount of any
Premium Amount and any Trustee Fee to be paid on such Distribution Date.

     If for any Distribution Date a Deficiency Amount exists, the Trustee shall
complete a notice in the form set forth as Exhibit A to the Certificate
Insurance Policy (the "Notice") and shall submit such Notice to the Fiscal Agent
no later than 12:00 noon, New York time, on the second Business Day preceding
such Distribution Date. The Notice shall constitute a claim for an Insured
Payment pursuant to the Certificate Insurance Policy. Upon receipt of the
Insured Payment, at or prior to the latest time payments of the Insured Payment
are to be made by the Certificate Insurer pursuant to the Certificate Insurance
Policy, on behalf of the Senior Certificateholders, the Trustee shall deposit
such

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Insured Payments in the Distribution Account and shall distribute such Insured
Payments only in accordance with Section 5.01(a)(2) and 5.01(a)(4), if
applicable.

     The Trustee shall receive, as attorney-in-fact of each Holder of a Senior
Certificate, any Insured Payment from the Certificate Insurer and disburse the
same to each Holder of a Senior Certificate in accordance with the provisions of
Article V. Insured Payments disbursed by the Trustee from proceeds of the
Certificate Insurance Policy shall not be considered payment by the Trust nor
shall such payments discharge the obligation of the Trust with respect to such
Senior Certificate, and the Certificate Insurer shall become the owner of such
unpaid amounts due from the Trust in respect of such Insured Payments as the
deemed assignee of such Holder and shall be entitled to receive the
Reimbursement Amount pursuant to Section 5.01(a)(5). The Trustee hereby agrees
on behalf of each Holder of a Senior Certificate for the benefit of the
Certificate Insurer that it and they recognize that to the extent the
Certificate Insurer makes Insured Payments, either directly or indirectly (as by
paying through the Trustee), to the Senior Certificateholders, the Certificate
Insurer will be entitled to receive the Reimbursement Amount pursuant to Section
5.01(a)(5).

     It is understood and agreed that the intention of the parties is that the
Certificate Insurer shall not be entitled to reimbursement on any Distribution
Date for amounts previously paid by it unless on such Distribution Date the
Senior Certificateholders shall also have received the full amount of the
Guaranteed Distributions for such Distribution Date.

     Section 4.02. INTENTIONALLY OMITTED.

     Section 4.03. CLAIMS UPON THE CERTIFICATE INSURANCE POLICY. (a) The Trustee
shall comply with the provisions of the Certificate Insurance Policy with
respect to claims upon the Certificate Insurance Policy.

     (b) At the time of the execution and delivery of this Agreement, the
Trustee shall establish a separate special purpose trust account for the benefit
of Holders of the Senior Certificates referred to herein as the "Policy Payments
Account" and over which the Trustee shall have exclusive control and sole right
of withdrawal. The Trustee shall deposit any Insured Payment made under the
Certificate Insurance Policy in the Policy Payments Account and thereafter into
the Distribution Account for distribution of such amount only for purposes of
payment to Holders of the Senior Certificates of Guaranteed Distributions for
the Senior Certificates for which a claim was made and such amount may not be
applied to satisfy any costs, expenses or liabilities of the Trustee or the
Trust. Insured Payments made under the Certificate Insurance Policy shall be
disbursed by the Trustee to Senior Certificateholders in the same manner as
distributions on the Senior Certificates are made under Section 5.01. It shall
not be necessary for such distributions to be made by checks or wire transfers
separate from the check or wire transfer used to pay Guaranteed Distributions
with other funds available to make such distributions. However, the amount of
any Insured Payments made on the Senior Certificates to be paid from funds
transferred from the Policy Payments Account shall be noted in the Certificate
Register and in the statements to be furnished to Holders of the Certificates
pursuant to Section 5.03 hereof. Funds held in the Policy Payments Account shall
not be invested by the Trustee.

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     On any Distribution Date with respect to which a claim has been made under
the Certificate Insurance Policy, the amount of any Insured Payment received by
the Trustee as a result of any claim under the Certificate Insurance Policy and
which is required to make distributions on the Senior Certificates equal to
Guaranteed Distributions on the Senior Certificates on such Distribution Date,
shall be withdrawn from the Policy Payments, Account, deposited into the
Distribution Account and applied directly by the Trustee, together with all
other funds to be withdrawn from the Distribution Account, to the payment in
full of Guaranteed Distributions on the Senior Certificates. Any funds remaining
in the Policy Payments Account on the first Business Day following a
Distribution Date shall be remitted in immediately available funds to the
Certificate Insurer, pursuant to the instructions of the Certificate Insurer, by
the end of such Business Day. The Trustee shall keep a complete and accurate
record of the amount of interest and principal paid in respect of any Senior
Certificate from moneys received under the Certificate Insurance Policy. The
Certificate Insurer shall have the right to inspect such records at reasonable
times during normal business hours upon reasonable prior written notice to the
Trustee.

     (c) The Trustee shall promptly notify the Certificate Insurer of any
proceeding or the institution of any action, of which a Responsible Officer of
the Trustee has actual knowledge, seeking the avoidance as a preferential
transfer under the Bankruptcy Code (a "Preference Claim") of any distribution
made with respect to the Senior Certificates. Each Certificateholder of Senior
Certificates, by its purchase of Senior Certificates, the Seller, the Servicer
and the Trustee hereby agree that the Certificate Insurer (so long as no
Certificate Insurer Default exists) may at any time during the continuation of
any proceeding relating to a Preference Claim direct all matters relating to
such Preference Claim, including, without limitation, (i) the direction of any
appeal of any order relating to such Preference Claim and (ii) the posting of
any surety, supersedeas or performance bond pending any such appeal.

                                    ARTICLE V

                           Payments and Statements to
                Certificateholders; Rights of Certificateholders

     Section 5.01. DISTRIBUTIONS. (a) On each Distribution Date, the Trustee
shall withdraw from (x) the Policy Payments Account, any amounts on deposit
therein and apply them to make the Guaranteed Distributions and (y) the
Distribution Account, Available Funds for such Distribution Date and apply such
amounts in the following order of priority, in each case, to the extent of the
funds remaining therefor:

(1)    to the Certificate Insurer the Premium Amount for such Distribution Date;

(2)    concurrently, to each Class of Senior Certificates, the related Class
       Interest Distribution for such Distribution Date;

(3)    Sequentially, to the Class M-1, Class M-2 and Class B Certificates, in
       that order, the related Class Monthly Interest Amounts for such
       Distribution Date;

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<PAGE>

(4)    To the Class A Certificates, (x) the Senior Principal Distribution Amount
       for such Distribution Date and (y) the principal portion of any Insured
       Payments for such Distribution Date;

(5)    To the Certificate Insurer, any amount owing to it under the Insurance
       Agreement;

(6)    To the Class M-1 Certificates, the Class M-1 Principal Distribution
       Amount for such Distribution Date;

(7)    To the Class M-2 Certificates, the Class M-2 Principal Distribution
       Amount for such Distribution Date;

(8)    To the Class B Certificates, the Class B Principal Distribution Amount
       for such Distribution Date;

(9)    Sequentially, to the Class A, Class M-1, Class M-2 and Class B
       Certificates, in that order, the Subordination Increase Amount for such
       Distribution Date until the related Class of Certificates is retired;

(10)   To the Class M-1 Certificates, any related (a) Class Interest Carryover
       Shortfall and then (b) Class Principal Carryover Shortfall;

(11)   To the Class M-2 Certificates, any related (a) Class Interest Carryover
       Shortfall and then (b) Class Principal Carryover Shortfall;

(12)   To the Class B Certificates, any related (a) Class Interest Carryover
       Shortfall and then (b) Class Principal Carryover Shortfall;

(13)   To the Class BIO Certificates for concurrent deposit in the Net Rate Cap
       Fund, the Net Rate Cap Fund Deposit allocated first to Class Monthly
       Interest and second to Class BIO Principal Distribution Amount;

(14)   Sequentially, to the Class A, Class M-1, Class M-2 and Class B
       Certificates, in that order, the related Net Rate Cap Carryover, to be
       treated as paid from and to the extent of funds on deposit in the Net
       Rate Cap Fund;

(15)   To the Class BIO Certificates, first, the Class Monthly Interest Amount,
       less amounts distributed pursuant to Section 5.01(a)(13) on the
       Distribution Date and second, the Class BIO Principal Distribution Amount
       reduced by amounts allocated to the Class BIO Certificates pursuant to
       Section 5.01(a)(13) above on such Distribution Date;

(16)   To the Successor Servicer or Successor or Master Servicer, as applicable,
       any Servicing Transfer Costs and other amounts payable to such Successor
       Servicer or Successor Master Servicer pursuant to Sections 3.01(g), 8.01
       and 9.05, to the extent not otherwise paid by the Servicer or Master
       Servicer, as applicable and to the Trustee any amounts owing to it
       pursuant to Section 9.05 to the extent not paid by the Seller; and

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<PAGE>

(17)   On the Class P Principal Distribution Date or any Distribution Date
       thereafter to the Class P Certificates, until the Class Principal Balance
       thereof has been reduced to zero; and

(18)   To the Class R-1 Certificateholders, Class R-2 Certificateholders and
       Class R-3 Certificateholders, the remainder in REMIC I, REMIC II and
       REMIC III, respectively.

      On each Distribution Date, the Class Interest Distribution for each Class
of Senior Certificates will be distributed on an equal priority and any
shortfall in the amount required to be distributed as interest thereon to each
such Class will be allocated between such Classes pro rata based on the amount
that would have been distributed on each such Class in the absence of such
shortfall.

     (b) [Reserved].

     (c) DISTRIBUTIONS OF PREPAYMENT CHARGES. On each Distribution Date on or
prior to the Class P Principal Distribution Date, the Trustee shall make
distributions to the Holders of the Class P Certificates of all Prepayment
Charges and Prepayment Charge Payment Amounts on deposit in the Distribution
Account with respect to the Mortgage Loans during the related Prepayment Period.
Such Prepayment Charges and Prepayment Charge Payment Amounts will not be
available for distributions to the Holders of the other Classes of Certificates
and shall not reduce the Principal Balance of the Class P Certificates.

     (d) METHOD OF DISTRIBUTION. The Trustee shall make distributions in respect
of a Distribution Date to each Certificateholder of record on the related Record
Date (other than as provided in Section 10.01 respecting the final
distribution), in the case of Holders of Offered Certificates, by check or money
order mailed to such Certificateholder at the address appearing in the
Certificate Register, or, upon written request by a Holder of an Offered
Certificate delivered to the Trustee at least five Business Days prior to the
related Distribution Date, by wire transfer or otherwise, and, in the case of
Holders of Class P Certificates, Class BIO Certificates or Residual
Certificates, by wire transfer, if appropriate wiring instructions have been
received by the Trustee at least five Business Days prior to the related
Distribution Date, or, if not, by check or money order to such Certificateholder
at the address appearing in the Certificate Register. Distributions among
Certificateholders of a Class shall be made in proportion to the Percentage
Interests evidenced by the Certificates of such Class held by such
Certificateholders.

     (e) DISTRIBUTIONS ON BOOK-ENTRY CERTIFICATES. Each distribution with
respect to a Book-Entry Certificate shall be paid to the Depository, which shall
credit 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. All such credits and disbursements
with respect to a Book-Entry Certificate are to be made by the Depository and
the Depository Participants in accordance with the provisions of the
Certificates. None of the Trustee, the Paying Agent, the Certificate Registrar,
the Depositor, the Master Servicer, the Servicer, the Certificate Insurer or the
Seller shall have any responsibility therefor except as otherwise provided by
applicable law.

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<PAGE>

     Section 5.02. COMPENSATING INTEREST. Not later than the Service Remittance
Date, the Servicer shall deposit into the Collection Account an amount equal to
the lesser of (A) the aggregate of the Prepayment Interest Shortfalls for the
related Distribution Date resulting from Principal Prepayments during the
related Prepayment Period and (B) an amount equal to the product of (i) 1/12,
(ii) 0.50% and (iii) the Pool Balance as of the first day of the related Due
Period. The Servicer shall not have the right to reimbursement for any amounts
deposited to the Collection Account pursuant to this Section 5.02. In the event
that the Servicer fails to make any payment of Compensating Interest due, the
Master Servicer shall, on the Master Servicer Remittance Date, deposit an amount
equal to such Compensating Interest into the Distribution Account.

     Section 5.03. STATEMENTS. (a) Not later than 1:00 p.m., New York time, on
the fifth Business Day prior to each Distribution Date, the Servicer shall
deliver to the Master Servicer and the Trustee by electronic means and to the
Certificate Insurer via e-mail at rmgtapes@fsa.com, a computer file containing
the loan level information necessary to permit the Trustee to calculate the
information required by clauses (i) through (xxv) below as of the end of the
preceding Prepayment Period or Due Period, as applicable, and such other
information as the Trustee shall reasonably require. Not later than 4:00 p.m.,
New York time, three Business Days prior to each Distribution Date, the Trustee
shall deliver to the Depositor, the Servicer, the Master Servicer, the
Certificate Insurer and the Seller by telecopy, with a hard copy thereof to be
delivered on the succeeding Distribution Date, a confirmation of the items in
clause (i) below. Not later than each Distribution Date the Trustee shall
prepare a statement (the "Remittance Report") containing the information set
forth below with respect to such Distribution Date, which information shall be
based upon the loan level information furnished by the Servicer upon which the
Trustee shall conclusively rely without independent verification thereof:

          (i) Available Funds and each Class' Certificate Rate for the related
Distribution Date;

          (ii) the aggregate amount of the distribution to each Class of
Certificates on such Distribution Date;

          (iii) the amount of the distribution set forth in paragraph (i) above
in respect of interest and the amount thereof in respect of any Class Interest
Carryover Shortfall, and the amount of any Class Interest Carryover Shortfall
remaining;

          (iv) the amount of the distribution set forth in paragraph (i) above
in respect of principal and the amount thereof in respect of the Class Principal
Carryover Shortfall, and any remaining Class Principal Carryover Shortfall;

          (v) the amount of Excess Interest paid as principal and the allocation
thereof among the classes of Certificates;

          (vi) the Servicing Fee, the Premium Amount and the Reimbursement
Amount;

          (vii) the Pool Balance as of the close of business on the last day of
the preceding Due Period;

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<PAGE>

          (viii) the Class Principal Balance of each Class of Certificates after
giving effect to payments allocated to principal above;

          (ix) the Overcollateralization Amount, the Required
Overcollateralization Amount and the Subordination Required
Overcollateralization Amount as of the close of business on the Distribution
Date, after giving effect to distributions of principal on such Distribution
Date;

          (x) whether a Cumulative Loss Event or a Delinquency Event has
occurred and is continuing and the calculation thereof;

          (xi) the number and Principal Balances of all Mortgage Loans that were
the subject of Principal Prepayments during the Due Period;

          (xii) the amount of all Curtailments that were received during the Due
Period;

          (xiii) the principal portion of all Monthly Payments received during
the Due Period;

          (xiv) the interest portion of all Monthly Payments received on the
Mortgage Loans during the Due Period;

          (xv) the amount of the Monthly Advances and the Compensating Interest
included in Available Funds for such Distribution Date;

          (xvi) the amount to be distributed to the Class BIO, Class P and Class
R Certificateholders, respectively for the Distribution Date;

          (xvii) the weighted average remaining term to maturity of the Mortgage
Loans and the weighted average Loan Rate as of the first day of the month prior
to the Distribution Date;

          (xviii) the amount of all payments or reimbursements to the Servicer
pursuant to Sections 3.03(ii) and (vi);

          (xix) the number of Mortgage Loans outstanding at the beginning and at
the end of the related Due Period;

          (xx) the amount of Liquidation Loan Losses experienced during the
preceding Due Period and the Cumulative Net Losses as a percentage of the
Cut-Off Date Pool Balance;

          (xxi) as of the end of the preceding calendar month, the number and
Principal Balance of Mortgage Loans which are 30-59 days Delinquent; the number
and Principal Balance of Mortgage Loans which are 60-89 days Delinquent; the
number and Principal Balance of Mortgage Loans which are 90 or more days
Delinquent (including the number and Principal Balance of Mortgage Loans which
are in foreclosure; the number and Principal Balance of Mortgage Loans in
bankruptcy; and the number and Principal Balance of Mortgage Loans which are REO
Property, each separately set forth);

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<PAGE>

          (xxii) [Reserved];

          (xxiii) the number and aggregate Principal Balance of Mortgage Loans,
other than Mortgage Loans in default or imminent default, that were modified by
the Servicer during the related Due Period;

          (xxiv) the amount of Net Rate Cap Carryover distributed to each Class
of Offered Certificates, other than the Class IO Certificates, and the amount of
Net Rate Cap Carryover remaining for each such Class; and

          (xxv) the amount of the Insured Payments, if any, to be made on such
Distribution Date.

     The Trustee shall make available such report to the Master Servicer, the
Servicer, the Seller, the Depositor, the Certificate Insurer, the
Certificateholders, the Rating Agencies, Bloomberg (at 499 Park Avenue, New
York, New York 10022, Attention: Mike Geller) and Intex Solutions (at 35
Highland Circle, Needham, Massachusetts 02144, Attention: Harold Brennman) on
the Distribution Date; provided, however, that the Trustee shall remove from the
report the Premium Amount to be paid to the Certificate Insurer prior to the
submission to Bloomberg and Intex Solutions. The Trustee may fully rely upon and
shall have no liability with respect to information provided by the Servicer.

     To the extent that there are inconsistencies between the telecopy of the
Remittance Report and the hard copy thereof, the Servicer may rely upon the
latter.

     In the case of information furnished pursuant to subclauses (ii), (iii),
(iv) and (vi) above, the amounts shall be expressed in a separate section of the
report as a dollar amount for each Class for each $1,000 original dollar amount
as of the related Cut-Off Date.

     The Trustee will make the Remittance Report (and, at its option, any
additional files containing the same information in an alternative format)
available each month to Certificateholders, and the parties to this Agreement
via the Trustee's internet website. The Trustee's internet website shall
initially be located at "www.ctslink.com". Assistance in using the website can
be obtained by calling the Trustee's customer service desk at (301) 815-6600.
Parties that are unable to use the above distribution options are entitled to
have a paper copy mailed to them via first class mail by calling the customer
service desk and indicating such. The Trustee shall have the right to change the
way Remittance Reports are distributed in order to make such distribution more
convenient and/or more accessible to the above parties and the Trustee shall
provide timely and adequate notification to all above parties regarding any such
changes.

     (b) Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish to each Person who at any time during the calendar
year was a Holder of a Regular Certificate, if requested in writing by such
Person, such information as is reasonably necessary to provide to such Person a
statement containing the information set forth in subclauses (iii) and (iv)
above, aggregated for such calendar year or applicable portion thereof during
which such Person was a Certificateholder. Such obligation of the Trustee shall
be deemed to have been satisfied to the

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<PAGE>

extent that substantially comparable information shall be prepared and furnished
by the Trustee to Certificateholders pursuant to any requirements of the Code as
are in force from time to time.

     (c) On each Distribution Date, the Trustee shall forward to the Class R
Certificateholders a copy of the reports forwarded to the Holders of the Regular
Certificates in respect of such Distribution Date and a statement setting forth
the amounts actually distributed to the Class R Certificateholders on such
Distribution Date together with such other information as the Trustee deems
necessary or appropriate.

     (d) Within a reasonable period of time after the end of each calendar year,
the Trustee shall deliver to each Person who at any time during the calendar
year was a Class R Certificateholder, if requested in writing by such Person,
such information as is reasonably necessary to provide to such Person a
statement containing the information provided pursuant to the previous paragraph
aggregated for such calendar year or applicable portion thereof during which
such Person was a Class R Certificateholder. Such obligation of the Trustee
shall be deemed to have been satisfied to the extent that substantially
comparable information shall be prepared by the Trustee or and furnished to
Certificateholders by the Trustee pursuant to any requirements of the Code as
from time to time in force.

     (e) The Master Servicer, the Servicer and the Trustee shall furnish to the
Certificate Insurer, the Depositor, the Seller and each Certificateholder (if
requested in writing), during the term of this Agreement, such periodic, special
or other reports or information, whether or not provided for herein, as shall be
necessary, reasonable or appropriate with respect to the Certificateholder or
otherwise with respect to the purposes of this Agreement, all such reports or
information to be provided by and in accordance with such applicable
instructions and directions (if requested in writing) as the Certificateholder
may reasonably require; PROVIDED that the Master Servicer, the Servicer and the
Trustee shall be entitled to be reimbursed by such Certificateholder for their
respective fees and actual expenses associated with providing such reports, if
such reports are not generally produced in the ordinary course of their
respective businesses or readily obtainable.

     (f) Reports and computer diskettes or files furnished by the Master
Servicer or the Servicer pursuant to this Agreement shall be deemed confidential
and of a proprietary nature, and shall not be copied or distributed except to
the extent required by law or to the Rating Agencies. No Person entitled to
receive copies of such reports or diskettes or files or lists of
Certificateholders shall use the information therein for the purpose of
soliciting the customers of the Seller or for any other purpose except as set
forth in this Agreement.

     Section 5.04. DISTRIBUTION ACCOUNT. The Trustee shall establish with
itself, a separate account (the "Distribution Account") titled "Wells Fargo Bank
Minnesota, National Association, as Trustee, in trust for the registered holders
of Soundview Home Equity Loan Asset-Backed Certificates, Series 2001-1." The
Distribution Account shall be an Eligible Account. The Trustee shall deposit any
amounts representing payments on and any collections in respect of the Mortgage
Loans received by it immediately following receipt thereof, including, without
limitation, all amounts withdrawn by the Master Servicer from the Custodial
Account pursuant to Section 3.22 for deposit to the Distribution Account.
Amounts on deposit in the Distribution Account may be invested in Eligible
Investments pursuant to Section 5.05.

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<PAGE>

     Section 5.05. INVESTMENT OF ACCOUNTS. (a) Consistent with any requirements
of the Code, all or a portion of any Account (other than the Distribution
Account) held by the Trustee shall be invested and reinvested by the Trustee, as
directed in writing by the Servicer with respect to the Collection Account and
the Master Servicer with respect to the Custodial Account (the applicable
Person, the "Directing Party"), in one or more Eligible Investments bearing
interest or sold at a discount. If the applicable Directing Party does not
provide investment directions, or if the Directing Party is the Master Servicer
and a Master Servicer Event of Default shall have occurred and be continuing the
Trustee shall invest all Accounts in Eligible Investments described in paragraph
(vi) of the definition of Eligible Investments. No such investment in any
Account shall mature later than the Business Day immediately preceding the next
Distribution Date (except that for any such Account other than the Distribution
Account (i) if such Eligible Investment is an obligation of the Trustee or a
money market fund for which the Trustee or any Affiliate is the manager or the
advisor, then such Eligible Investment shall mature not later than such
Distribution Date and (ii) any other date may be approved by the Rating
Agencies).

     (b) If any amounts are needed for disbursement from any Account held by the
Trustee and sufficient uninvested funds are not available to make such
disbursement, the Trustee shall cause to be sold or otherwise converted to cash
a sufficient amount of the investments in such Account. The Trustee shall not be
liable for any investment loss or other charge resulting therefrom unless the
Trustee's failure to perform in accordance with this Section 5.05 is the cause
of such loss or charge.

     (c) Subject to Section 9.01, the Trustee shall not in any way be held
liable by reason of any insufficiency in any Account held by the Trustee
resulting from any investment loss on any Eligible Investment included therein
(except to the extent that the Trustee is the obligor and has defaulted thereon
or as provided in subsection (b) of this Section 5.05).

     (d) The Trustee shall invest and reinvest funds in the Accounts held by the
Trustee, to the fullest extent practicable, in such manner as the applicable
Directing Party shall from time to time direct as set forth in Section 5.05(a),
but only in one or more Eligible Investments.

     (e) So long as no Event of Default shall have occurred and be continuing,
all net income and gain realized from investment of, and all earnings on, (i)
funds deposited in the Collection Account shall be for the benefit of the
Servicer as Servicing Compensation (in addition to the Servicing Fee), and shall
be subject to withdrawal on or before the first Business Day of the month
following the month in which such income or gain is received and (ii) funds
deposited in the Custodial Account shall be for the benefit of the Master
Servicer as Master Servicing Compensation (in addition to the Master Servicing
Fee). The Servicer shall deposit in the Collection Account and the Master
Servicer shall deposit in the Custodial Account, the amount of any loss incurred
in respect of any Eligible Investment held therein which is in excess of the
income and gain thereon immediately upon realization of such loss, without any
right to reimbursement therefore from its own funds.

     (f) All net income and gain realized from investment of, and all earnings
on, funds deposited in the Distribution Account shall be for the benefit of the
Trustee, as compensation (in addition to the Trustee Fee). Any such income shall
be subject to withdrawal on or before the first Business Day of the month
following the month in which such income or gain is received. The

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<PAGE>

Trustee shall deposit in the Distribution Account the amount of any loss
incurred in respect of any Eligible Investment held therein which is in excess
of the income and gain thereon payable to the Trustee immediately upon the
realization of such loss, without any right to reimbursement therefore from its
own funds.

     Section 5.06. ALLOCATION OF LOSSES. On each Distribution Date, the Trustee
shall determine the total of the Applied Realized Loss Amounts for such
Distribution Date. The Applied Realized Loss Amount for any Distribution Date
shall be applied by reducing the Class Principal Balance of each Class of
Subordinate Certificates beginning with the Class of Subordinate Certificates
then outstanding with the lowest relative payment priority, in each case until
the respective Class Principal Balance thereof is reduced to zero. Any Applied
Realized Loss Amount allocated to a Class of Subordinate Certificates shall be
allocated among the Subordinate Certificates of such Class in proportion to
their respective Percentage Interests.

     Section 5.07 [RESERVED].

     Section 5.08 NET RATE CAP FUND. (a) On the Closing Date, the Trustee shall
establish and maintain in its name, in trust for the benefit of the Offered
Certificates, other than the Class IO Certificates, the Net Rate Cap Fund and
deposit therein the amount of $5,000 paid to the Trustee by the Seller therefor.
The Net Rate Cap Fund shall be an Eligible Account, and funds on deposit therein
shall be held separate and apart from, and shall not be commingled with, any
other moneys, including without limitation, other moneys held by the Trustee
pursuant to this Agreement. The Net Rate Cap Fund shall be treated as an
"outside reserve fund" under applicable Treasury regulations and will not be
part of any REMIC. Any investment earnings on the Net Rate Cap Fund will be
treated as owned by the Class BIO Certificateholder and will be taxable to the
Class BIO Certificateholder. Distributions made or deemed deposited to any
outside reserve fund under this Agreement shall be treated as made to the owner
of such fund. For tax purposes, the Trustee shall treat the Net Rate Cap Fund as
having a nominal (zero) value for the Holders of the Offered Certificates other
than the Class IO Certificates.

     (b) On each Distribution Date, the Trustee shall deposit amounts from the
Distribution Account to the Net Rate Cap Fund pursuant to Section 5.01(a)(13).
The amount required to be deposited into the Net Rate Cap Fund on any
Distribution Date (the "Net Rate Cap Fund Deposit") will equal the lesser of (i)
amounts remaining after distributions pursuant to clauses (1) through (12) of
Section 5.01(a) and (ii) any Net Rate Cap Carryover for such Distribution Date
or, if no Net Rate Cap Carryover is payable on such Distribution Date, an amount
such that when added to other amounts already on deposit in the Net Rate Cap
Fund, the aggregate amount on deposit therein will be equal to $10,000. The
Trustee shall make withdrawals from the Net Rate Cap Fund to make distributions
pursuant to Section 5.01(a)(14) hereof.

     (c) Funds in the Net Rate Cap Fund may be invested in Eligible Investments.
Any earnings on such amounts shall be payable to the Class BIO Certificates. The
Class BIO Certificates shall evidence ownership of the Net Rate Cap Fund for
federal tax purposes and shall direct the Trustee in writing as to the
investment of amounts therein.

                                      -87-

<PAGE>

     (d) Upon termination of the Trust, any amounts remaining in the Net Rate
Cap Fund shall be distributed to the Certificateholders of the Class BIO
Certificates in the same manner as if distributed pursuant to Section
5.01(a)(15) hereof.

                                   ARTICLE VI

                                The Certificates

     Section 6.01. THE CERTIFICATES. Each of the Offered Certificates, the Class
P Certificates, the Class BIO Certificates, and the Residual Certificates shall
be substantially in the forms set forth in Exhibits A and B respectively, and
shall, on original issue, be executed, authenticated and delivered by the
Trustee to or upon the order of the Seller concurrently with the sale and
assignment to the Trustee of the Trust. Each Class of Offered Certificates shall
be initially evidenced by one or more certificates representing a fraction of
the applicable Original Class Principal Balance or Notional Amount, as
applicable, and shall be held in minimum dollar denominations of $25,000 and
integral multiples of $1,000 in excess thereof, except that one of each Class of
the Offered Certificate may be in a different denomination so that the sum of
the denominations of all outstanding Offered Certificates shall equal the
aggregate Original Class Principal Balance or Notional Amount, as applicable.
The Residual Certificates, Class P and Class BIO Certificates shall be held in
minimum Percentage Interests of 20% except that the Tax Matters Person shall
hold a Residual Certificate representing a 0.000001% Percentage Interest of the
Residual Certificates.

     The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by a Responsible Officer. Certificates bearing the manual
or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Trustee shall bind
the Trust, notwithstanding that such individuals or any of them have ceased to
be so authorized prior to the authentication and delivery of such Certificates
or did not hold such offices at the date of such Certificate. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless such Certificate shall have been manually authenticated by the
Trustee substantially in the form provided for herein, and such authentication
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication. Subject to Section
6.02(c), the Offered Certificates shall be Book-Entry Certificates. The Residual
Certificates shall not be Book-Entry Certificates.

     Section 6.02. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES. (a)
The Certificate Registrar shall cause to be kept at the Corporate Trust Office a
Certificate Register in which, subject to such reasonable regulations as it may
prescribe, the Certificate Registrar shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
The Trustee shall initially serve as Certificate Registrar for the purpose of
registering Certificates and transfers and exchanges of Certificates as herein
provided.

     Upon surrender for registration of transfer of any Certificate at any
office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph, and, in the case of a Residual Certificate,
upon satisfaction of the conditions set forth below, the Trustee on

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<PAGE>

behalf of the Trust shall execute, authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the same
aggregate Percentage Interest.

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

     (b) Except as provided in paragraph (c) below, the Book-Entry Certificates
shall at all times remain registered in the name of the Depository or its
nominee and at all times: (i) registration of such Certificates may not be
transferred by the Trustee except to another Depository; (ii) the Depository
shall maintain book-entry records with respect to the Certificate Owners and
with respect to ownership and transfers of such Certificates; (iii) ownership
and transfers of registration of such Certificates on the books of the
Depository shall be governed by applicable rules established by the Depository;
(iv) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (v) the Trustee shall deal with the
Depository as representative of the Certificate Owners of the Certificates for
purposes of exercising the rights of Holders under this Agreement, and requests
and directions for and votes of such representative shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; and
(vi) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and Persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners.

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

     (c) If (i)(x) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to discharge properly
its responsibilities as Depository and (y) the Trustee or the Depositor is
unable to locate a qualified successor, (ii) the Depositor, at its sole option
elects to terminate the book-entry system through the Depository or (iii) after
the occurrence of an Event of Default, the Certificate Owners of each Class of
Offered Certificates representing Percentage Interests aggregating not less than
51% advises the Trustee and Depository through the Financial Intermediaries and
the Depository Participants in writing that the continuation of a

                                      -89-

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book-entry system through the Depository to the exclusion of definitive, fully
registered certificates (the "Definitive Certificates") to Certificate Owners is
no longer in the best interests of the Certificate Owners. Upon surrender to the
Certificate Registrar of each Class of Offered Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Trustee shall at the Depositor's expense, execute and authenticate the
Definitive Certificates. Neither the Depositor nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates, the Trustee, the Certificate Registrar, the Master
Servicer, the Servicer, any Paying Agent, the Certificate Insurer and the
Depositor shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder.

     (d) No transfer, sale, pledge or other disposition of any Class BIO, any
Class P or any Residual Certificate shall be made unless such disposition is
exempt from the registration requirements of the Securities Act of 1933, as
amended (the "1933 Act"), and any applicable state securities laws or is made in
accordance with the 1933 Act and laws. In the event of any such transfer, other
than the initial transfer of the Class BIO, the Class P and the Residual
Certificates by the Depositor and the transfer of the Tax Matters Person
Residual Interest to the Trustee in reliance upon Rule 144A under the 1933 Act,
the Trustee and the Depositor shall require either (i) a written Opinion of
Counsel (which may be in-house counsel) acceptable to and in form and substance
reasonably satisfactory to the Trustee and the Depositor that such transfer may
be made pursuant to an exemption, describing the applicable exemption and the
basis therefor, from the 1933 Act or is being made pursuant to the 1933 Act,
which Opinion of Counsel shall not be an expense of the Trustee or the Depositor
or (ii) the Trustee shall require the transferor to execute a transferor
certificate (in substantially the form attached hereto as Exhibit M) and the
transferee to execute an investment letter (in substantially the form attached
hereto as Exhibit N-1 or N-2) acceptable to and in form and substance reasonably
satisfactory to the Depositor and the Trustee certifying to the Depositor and
the Trustee the facts surrounding such transfer, which investment letter shall
not be an expense of the Trustee or the Depositor. The Holder of a Class BIO, a
Class P or a Residual Certificate desiring to effect such transfer shall, and
does hereby agree to, indemnify the Trustee and the Depositor against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.

     No transfer of an ERISA Restricted Certificate shall be made unless the
Trustee shall have received either (i) a representation from the transferee of
such Certificate acceptable to and in form and substance satisfactory to the
Trustee, such requirement is satisfied only by the Trustee's receipt of a
representation letter from the transferee substantially in the form of Exhibit
N-1 or Exhibit N-2, as appropriate), to the effect that such transferee is not
an employee benefit plan or arrangement subject to Section 406 of ERISA or a
plan subject to Section 4975 of the Code, or a person acting on behalf of any
such plan or arrangement or using the assets of any such plan or arrangement to
effect such transfer ("Benefit Plan Investor") or (ii) if an ERISA Restricted
Certificate which is an Offered Certificate is being purchased by an insurance
company, a representation that an insurance company is purchasing such
Certificates with funds contained in an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60") and that the purchase and holding of such Certificates are
covered under Sections I and III of PTCE 95-60 or (iii) if an ERISA Restricted
Certificate which is an Offered Certificate is purchased by a Benefit Plan
Investor, a representation that the Benefit Plan Investor understands

                                      -90-

<PAGE>

that the eligibility of the Certificates for purchase is conditioned upon such
Certificates being rated at least "BBB-" at the time of acquisition of such
Certificates by the Benefit Plan Investor or (iv) in the case of any ERISA
Restricted Certificate presented for registration in the name of a Benefit Plan
Investor, an Opinion of Counsel satisfactory to the Trustee, which Opinion of
Counsel shall not be an expense of either the Trustee or the Trust, addressed to
the Trustee, to the effect that the purchase or holding of such ERISA Restricted
Certificate will not result in prohibited transactions under ERISA and/or
Section 4975 of the Code and will not subject the Trustee to any obligation in
addition to those expressly undertaken in this Agreement or to any liability.
Notwithstanding anything else to the contrary herein, the representation
required by clause (i), (ii) or (iii) above with respect to any ERISA Restricted
Certificate that is a Book-Entry Certificate shall be deemed to have been made
by the Certificate Owner by virtue of such Certificate Owner's acquisition of
such Certificate; and any purported transfer of an ERISA Restricted Certificate
to or on behalf of a Benefit Plan Investor pursuant to clause (iv) above without
the delivery to the Trustee of an Opinion of Counsel satisfactory to the Trustee
as described above shall be void and of no effect.

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

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

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

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

               (A) an affidavit in the form of Exhibit G from the proposed
     transferee to the effect that such transferee is a Permitted Transferee and
     that it is not acquiring its Ownership Interest in the Residual Certificate
     that is the subject of the proposed transfer as a nominee, trustee or agent
     for any Person who is not a Permitted Transferee; and

               (B) a covenant of the proposed transferee to the effect that the
     proposed transferee agrees to be bound by and to abide by the transfer
     restrictions applicable to the Residual Certificates.

          (iv) Any attempted or purported transfer of any Ownership Interest in
a Residual Certificate in violation of the provisions of this Section 6.02 shall
be absolutely null and void and shall vest no rights in the purported
transferee. If any purported transferee shall, in violation of the

                                      -91-

<PAGE>

provisions of this Section 6.02, become a Holder of a Residual Certificate, then
the prior Holder of such Residual Certificate that is a Permitted Transferee
shall, upon discovery that the registration of transfer of such Residual
Certificate was not in fact permitted by this Section 6.02, be restored to all
rights as Holder thereof retroactive to the date of registration of transfer of
such Residual Certificate. The Trustee shall be under no liability to any Person
for any registration of transfer of a Residual Certificate that is in fact not
permitted by this Section 6.02 or for making any distributions due on such
Residual Certificate to the Holder thereof or taking any other action with
respect to such Holder under the provisions of the Agreement so long as the
Trustee received the documents specified in clause (iii). The Trustee shall be
entitled to recover from any Holder of a Residual Certificate that was in fact
not a Permitted Transferee at the time such distributions were made all
distributions made on such Residual Certificate. Any such distributions so
recovered by the Trustee shall be distributed and delivered by the Trustee to
the prior Holder of such Residual Certificate that is a Permitted Transferee.

          (v) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the restrictions in
this Section 6.02, then the Trustee shall have the right but not the obligation,
without notice to the Holder of such Residual Certificate or any other Person
having an Ownership Interest therein, to notify the Seller to arrange for the
sale of such Residual Certificate. The proceeds of such sale, net of commissions
(which may include commissions payable to the Depositor or its Affiliates in
connection with such sale), expenses and taxes due, if any, will be remitted by
the Trustee to the previous Holder of such Residual Certificate that is a
Permitted Transferee, except that in the event that the Trustee determines that
the Holder of such Residual Certificate may be liable for any amount due under
this Section 6.02 or any other provisions of this Agreement, the Trustee may
withhold a corresponding amount from such remittance as security for such claim.
The terms and conditions of any sale under this clause (v) shall be determined
in the sole discretion of the Trustee, and it shall not be liable to any Person
having an Ownership Interest in a Residual Certificate as a result of its
exercise of such discretion.

          (vi) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the restrictions in
this Section 6.02, then the Trustee, based on information provided to the
Trustee by the Seller will provide to the Internal Revenue Service, and to the
persons specified in Sections 860E(e)(3) and (6) of the Code, information needed
to compute the tax imposed under Section 860E(e)(5) of the Code on transfers of
residual interests to disqualified organizations.

The foregoing provisions of this Section 6.02(d) shall cease to apply to
transfers occurring on or after the date on which there shall have been
delivered to the Trustee, in form and substance satisfactory to the Trustee, (i)
written notification from each Rating Agency that the removal of the
restrictions on Transfer set forth in this Section 6.02 will not cause such
Rating Agency to downgrade its rating of the Certificates and (ii) an Opinion of
Counsel to the effect that such removal will not cause any REMIC to fail to
qualify as a REMIC.

     Each Tax Matters Person Residual Interest shall at all times be registered
in the name of the Tax Matters Person.

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<PAGE>

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

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

     Section 6.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (i) any
mutilated Certificate is surrendered to the Certificate Registrar or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate and (ii) there is delivered to the Trustee, the
Depositor and the Certificate Registrar such security or indemnity as may be
required by them to save each of them harmless, then, in the absence of notice
to the Trustee or the Certificate Registrar that such Certificate has been
acquired by a bona fide purchaser, the Trustee shall execute, authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like tenor and Percentage Interest.
Upon the issuance of any new Certificate under this Section 6.03, the Trustee or
the Certificate Registrar may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee and the
Certificate Registrar) in connection therewith. Any duplicate Certificate issued
pursuant to this Section 6.03, shall constitute complete and indefeasible
evidence of ownership in the Trust, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.

     Section 6.04. PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Depositor, the Master Servicer,
the Servicer, the Seller, the Trustee, the Certificate Registrar, the
Certificate Insurer, any Paying Agent and any agent of any of them may treat the
Person, including a Depository, in whose name any Certificate is registered as
the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 5.01 and for all other purposes whatsoever, and none of the
Depositor, the Master Servicer, Servicer, the Seller, the Trustee, the
Certificate Insurer, the Certificate Registrar nor any agent of any of them
shall be affected by notice to the contrary.

     Section 6.05. APPOINTMENT OF PAYING AGENT. (a) The Paying Agent shall make
distributions to Certificateholders from the Distribution Account pursuant to
Section 5.01 and shall report the amounts of such distributions to the Trustee.
The duties of the Paying Agent may include the obligation (i) to withdraw funds
from the Collection Account pursuant to Section 3.03 and for the purpose of
making the distributions referred to above and (ii) to distribute statements and
provide information to Certificateholders as required hereunder. The Paying
Agent hereunder shall at all times be a corporation duly incorporated and
validly existing under the laws of the United States of America or any state
thereof, authorized under such laws to exercise corporate trust powers and
subject to supervision or examination by federal or state authorities. The
Paying Agent shall initially be the Trustee. The Trustee may appoint a successor
to act as Paying Agent, which appointment shall be reasonably satisfactory to
the Depositor.

     (b) The Trustee shall cause the Paying Agent (if other than the Trustee) to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee that

                                      -93-

<PAGE>

such Paying Agent shall hold all sums, if any, held by it for payment to the
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be paid to such Certificateholders and shall agree
that it shall comply with all requirements of the Code regarding the withholding
of payments in respect of Federal income taxes due from Certificate Owners and
otherwise comply with the provisions of this Agreement applicable to it.

                                   ARTICLE VII

                The Seller, the Servicer and the Master Servicer

     Section 7.01. LIABILITY OF THE DEPOSITOR, THE SELLER, THE MASTER SERVICER
AND THE SERVICER. The Depositor, the Seller, the Master Servicer and the
Servicer shall be liable in accordance herewith only to the extent of the
obligations specifically imposed upon and undertaken by the Depositor, the
Seller, the Master Servicer or Servicer, as the case may be, herein.

     Section 7.02. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS
OF, THE DEPOSITOR, THE SELLER, THE MASTER SERVICER OR THE SERVICER. Any
corporation into which the Depositor, the Seller, the Master Servicer or the
Servicer may be merged or consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Depositor, the Seller, the
Master Servicer or the Servicer shall be a party, or any corporation succeeding
to the business of the Depositor, the Seller, the Master Servicer or the
Servicer, shall be the successor of the Depositor, the Seller, the Master
Servicer or the 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 Servicer and the successor Master Servicer shall satisfy all the
requirements of Section 8.02 with respect to the qualifications of a successor
Servicer and successor Master Servicer.

     Section 7.03. LIMITATION ON LIABILITY OF THE SERVICER, THE MASTER SERVICER
AND OTHERS. Neither the Servicer, the Master Servicer nor any of the directors
or officers or employees or agents of the Servicer or the Master Servicer shall
be under any liability to the Trust or the Certificateholders for any action
taken or for refraining from the taking of any action by the Servicer or the
Master Servicer, as applicable, in good faith pursuant to this Agreement, or for
errors in judgment; PROVIDED, HOWEVER, that this provision shall not protect the
Servicer or the Master Servicer or any such Person against any liability which
would otherwise be imposed by reason of its willful misfeasance, bad faith or
negligence in the performance of duties of the Servicer or the Master Servicer,
as applicable, or by reason of its reckless disregard of its obligations and
duties of the Servicer or the Master Servicer hereunder; PROVIDED, FURTHER, that
this provision shall not be construed to entitle the Servicer to indemnity in
the event that amounts advanced by the Servicer to retire any senior lien exceed
Net Liquidation Proceeds realized with respect to the related Mortgage Loan. The
Servicer, the Master Servicer and any director or officer or employee or agent
of the Servicer and 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 Servicer and the Master Servicer and any
director or officer or employee or agent of the Servicer and the Master Servicer
shall be indemnified by the Trust and held harmless against any loss, liability
or expense incurred in connection with any legal action relating to this
Agreement or the Certificates,

                                      -94-

<PAGE>

other than any loss, liability or expense related to any specific Mortgage Loan
or Mortgage Loans (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) and any loss, liability or
expense incurred by reason of its willful misfeasance, bad faith or negligence
in the performance of duties hereunder or by reason of its reckless disregard of
obligations and duties hereunder. Neither the Servicer nor the Master Servicer
shall be under any obligation to appear in, prosecute or defend any legal action
that is not incidental to its duties hereunder and that in its opinion, may
involve it in any expense or liability; provided, however, that the Servicer and
the Master Servicer may undertake any such action which they may deem necessary
or desirable in respect of this Agreement, and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such
event, the reasonable legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities of the Trust. The
Servicer's and the Master Servicer's right to indemnity or reimbursement
pursuant to this Section 7.03 shall survive any resignation or termination of
the Servicer or the Master Servicer, as applicable, pursuant to Section 7.04 or
8.01 with respect to any losses, expenses, costs or liabilities arising prior to
such resignation or termination (or arising from events that occurred prior to
such resignation or termination). This paragraph shall apply to the Master
Servicer solely in its capacity as Master Servicer hereunder and to the Servicer
solely in its capacity as Servicer hereunder and, in each case, in no other
capacities.

     Section 7.04. APPROVED SERVICER OR MASTER SERVICER NOT TO RESIGN. Subject
to the provisions of Section 7.02, neither the Servicer nor the Master Servicer
shall 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 Servicer or the Master
Servicer, as applicable, so causing such a conflict being of a type and nature
carried on by the Servicer or the Master Servicer, as applicable, or its
subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of each of the following conditions: (a) the Servicer has proposed
an Approved Servicer to the Master Servicer or the Master Servicer has proposed
an Approved Master Servicer to the Depositor and the Trustee, as the case may
be, in writing and such proposed Approved Servicer or Approved Master Servicer
is reasonably acceptable to the Master Servicer or to the Depositor and the
Trustee, as applicable; and (b) each Rating Agency shall have delivered a letter
to the Master Servicer or the Trustee prior to the appointment of the Approved
Servicer or Approved Master Servicer, as applicable, stating that the proposed
appointment of such Approved Servicer or Approved Master Servicer as Master
Servicer hereunder will not result in the reduction or withdrawal of the then
current ratings of the Offered Certificates; PROVIDED, HOWEVER, that no such
resignation by the Servicer or the Master Servicer shall become effective until
such successor servicer or, in the case of (i) above, the Successor Master
Servicer shall have assumed the Master Servicer's responsibilities and
obligations hereunder or the Trustee shall have designated a successor servicer
in accordance with Section 8.02. Any such resignation shall not relieve the
Master Servicer of responsibility for any of the obligations specified in
Sections 8.01 and 8.02 as obligations that survive the resignation or
termination of the Master Servicer. Any such determination permitting the
resignation of the Servicer or the Master Servicer pursuant to clause (i) above
shall be evidenced by an Opinion of Counsel to such effect delivered to the
Master Servicer, the Depositor, the Trustee and the Certificate Insurer.

                                      -95-

<PAGE>

     Section 7.05. DELEGATION OF DUTIES. In the ordinary course of business, the
Servicer and the Master Servicer at any time may delegate any of its respective
duties hereunder to any Person, including any of its Affiliates, who agrees to
conduct such duties in accordance with standards comparable to those set forth
in Section 3.01. Such delegation shall not relieve the Servicer nor the Master
Servicer of its respective liabilities and responsibilities with respect to such
duties and shall not constitute a resignation within the meaning of Section
7.04. The Servicer and the Master Servicer shall provide the Trustee with
written notice prior to the delegation of any of its duties to any Person other
than any of the Servicer or the Master Servicer's Affiliates or their respective
successors and assigns.

     Section 7.06. INDEMNIFICATION OF THE TRUST BY THE SERVICER AND THE MASTER
SERVICER. (a) The Servicer and the Master Servicer each shall indemnify and hold
harmless the Trust and the Trustee from and against any loss, liability,
expense, damage or injury suffered or sustained by reason of the Servicer's or
the Master Servicer's willful misfeasance, bad faith or negligence in the
performance of its activities in servicing or administering the Mortgage Loans
pursuant to this Agreement, including, but not limited to, any judgment, award,
settlement, reasonable attorneys' fees and other costs or expenses incurred in
connection with the defense of any actual or threatened action, proceeding or
claim related to the Servicer's or the Master Servicer's misfeasance, bad faith
or negligence. Any such indemnification shall not be payable from the assets of
the Trust. The provisions of this Section 7.06 shall survive the termination of
this Agreement.

     (b) If the Servicer or the Master Servicer fails to make when due (without
regard to any cure period) any Monthly Advance or deposit required by it
hereunder, the Servicer or the Master Servicer, as the case may be, shall pay
the Trustee for the account of the Trustee interest at the prime rate from the
date on which such payment was due (without regard to any cure period) to and
including the date on which the Servicer or the Master Servicer makes such
payment.

                                  ARTICLE VIII

                                     Default

     Section 8.01. EVENTS OF DEFAULT. (a) If any one of the following events
("Events of Default") shall occur and be continuing:

          (i) (A) The failure by the Master Servicer to make any Monthly Advance
when it was due; or (B) any other failure by the Master Servicer to deposit in
the Custodial Account or the Distribution Account any deposit required to be
made under the terms of this Agreement which continues unremedied until the
close of business on the Master Servicer Remittance Date;

          (ii) The failure by the Master Servicer to duly to observe or perform,
in any material respect, any other covenants, obligations or agreements of the
Master Servicer as set forth in this Agreement, which failure continues
unremedied for a period of 60 days, 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 to the Master Servicer and the Trustee, by any
Holder with Certificates evidencing Voting Interests of at least 25%;

                                      -96-

<PAGE>

          (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, marshaling of
assets and liabilities or similar proceedings, or for the winding up or
liquidation of its affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 30 consecutive days;

          (iv) The Master Servicer shall voluntarily go into liquidation,
consent to the appointment of a conservator or receiver or liquidator or similar
person in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings of or relating to the Master Servicer or of
or relating to all or substantially all of its property, or a decree or order of
a court or agency or supervisory authority having jurisdiction in the premises
for the appointment of a conservator, receiver, liquidator or similar person in
any insolvency, readjustment of debt, marshaling 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 30
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; or

          (v) the Master Servicer Termination Test is failed;

          (vi) (A)The failure by the Servicer to make any Monthly Advance which
continues unremedied for a period of one Business Day after it was due; or (B)
any other failure by the Servicer to deposit in the Collection Account, the
Custodial Account or the Distribution Account any deposit required to be made
under the terms of this Agreement which continues unremedied for a period of two
Business Days after such deposit was due;

          (vii) The failure by the Servicer to make any required Servicing
Advance which failure continues unremedied for a period of 60 days or such
lesser period as is necessary to avoid a material adverse effect on the Trust,
or the failure by the Servicer duly to observe or perform, in any material
respect, any other covenants, obligations or agreements of the Servicer as set
forth in this Agreement, which failure continues unremedied for a period of 60
days, after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Servicer by the Trustee or to the
Servicer and the Trustee, by any Holder with Certificates evidencing Voting
Interests of at least 25%;

          (viii) The entry against the 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, marshaling of assets and
liabilities or similar proceedings, or for the winding up or liquidation of its
affairs, and the continuance of any such decree or order unstayed and in effect
for a period of 30 consecutive days;

          (ix) The Servicer shall voluntarily go into liquidation, consent to
the appointment of a conservator or receiver or liquidator or similar person in
any insolvency, readjustment of debt,

                                      -97-

<PAGE>

marshaling of assets and liabilities or similar proceedings of or relating to
the Servicer or of or relating to all or substantially all of its property, or a
decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator, receiver,
liquidator or similar person in any insolvency, readjustment of debt, marshaling
of assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Servicer and
such decree or order shall have remained in force undischarged, unbonded or
unstayed for a period of 30 days; or the 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; or

          (x) the Servicer Termination Test is failed;

          (xi) a Master Servicer Event of Default has occurred and is
continuing.

The Events of Default listed in (a) (i) through (v) above shall be referred to
as "Master Servicer Events of Default". The Events of Default listed in (a)(vi)
through (xi) above shall be referred to as the "Servicer Events of Default."

     (b) (i) then, and in each and every such case, so long as a Master Servicer
Event of Default shall not have been remedied, (x) with respect solely to clause
(a)(i)(A) above, upon receipt of written notice or discovery by a Responsible
Officer of the Trustee of such failure, the Trustee shall give immediate
telephonic notice of such failure to a Servicing Officer of the Master Servicer
and the Trustee shall terminate all of the rights and obligations of the Master
Servicer under this Agreement and the Successor Master Servicer appointed in
accordance with Section 8.02, shall immediately make such Monthly Advance and
assume, pursuant to Section 8.02, the duties of a successor Master Servicer and
(y) in the case of clause (a)(i)(B), (ii), (iii), (iv), and (v) above, the
Trustee may and, at the direction of the Holders of each Class of Offered
Certificates evidencing Voting Rights aggregating more than 50%, the Trustee
shall, by notice then given in writing to the Master Servicer (and to the
Trustee if given by Holders of Certificates), terminate all of the rights and
obligations of the Master Servicer as master servicer under this Agreement;
provided, however, that in the case of clause (v) above such Holders also shall
have determined, in their sole discretion, that the Master Servicer Termination
Test was failed due in whole or in material part to the performance of the
Master Servicer. Any such notice to the Master Servicer shall also be given to
each Rating Agency, the Depositor and the Seller. On or after 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 or the
Mortgage Loans or otherwise, shall pass to and be vested in the Successor Master
Servicer pursuant to and under this Section 8.01; and, without limitation, the
Successor Master Servicer is hereby authorized and empowered to execute and
deliver, on behalf of the Master Servicer, as attorney-in-fact or otherwise, any
and all documents and other instruments, and to do or accomplish all other acts
or things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement of each Mortgage
Loan and related documents, or otherwise. The Master Servicer agrees to
cooperate with the Successor Master Servicer and the Trustee in effecting the
termination of the responsibilities and rights of the Master Servicer hereunder,
including, without limitation, the transfer to the Successor Master Servicer for
the administration by it of all cash amounts that shall at the time be held by
the

                                      -98-

<PAGE>

predecessor Master Servicer and to be deposited by it in the Custodial Account,
or that have been deposited by the predecessor Master Servicer in the Custodial
Account or thereafter received by the predecessor Master Servicer with respect
to the Mortgage Loans.

          (ii) then, and in each and every such case, so long as a Servicer
Event of Default shall not have been remedied, (x) with respect solely to clause
(a)(vi)(A) above, the Master Servicer shall give immediate telephonic notice of
such failure to a Servicing Officer of the Servicer and the Master Servicer
shall terminate all of the rights and obligations of the Servicer under this
Agreement and the Master Servicer shall immediately make such Monthly Advance
and the Successor Servicer appointed in accordance with Section 8.02 shall
assume the duties of a successor Servicer, (y) in the case of clause (a)(vi)(B),
(vii), (viii), (ix), and (x) above, the Master Servicer shall, at the direction
of the Certificate Insurer if the Senior Certificates have not been retired and
a Certificate Insurer Default does not exist, or if the Senior Certificates have
been retired, the Trustee at the direction of the Holders of each Class of
Offered Certificates evidencing Voting Rights aggregating more than 50%, by
notice then given in writing to the Servicer (and to the Trustee if given by
Holders of Certificates), terminate all of the rights and obligations of the
Servicer as servicer under this Agreement; provided, however, that in the case
of clause (x) above such Holders also shall have determined, in their sole
discretion, that the Servicer Termination Test was failed due in whole or in
material part to the performance of the Servicer and (z) with respect solely to
clause (a)(xi) above, the Trustee may and, at the direction of the Holders of
each Class of Offered Certificates evidencing Voting Rights aggregating more
than 50%. The Trustee shall, by notice then given in writing to the Servicer
terminate all the rights and obligations of the Servicer as servicer under this
Agreement. Any such notice to the Servicer shall also be given to each Rating
Agency, the Depositor, the Trustee and the Seller. In the event that the Master
Servicer fails to terminate the Servicer at the permitted request of the
Certificate Insurer pursuant to clause (y) above, the Certificate Insurer may so
terminate the Servicer. On or after receipt by the Servicer of such written
notice, all authority and power of the Servicer under this Agreement, whether
with respect to the Certificates or the Mortgage Loans or otherwise, shall pass
to and be vested in the Successor Servicer pursuant to and under this Section
8.01; and, without limitation, the Successor Servicer is hereby authorized and
empowered to execute and deliver, on behalf of the Servicer, as attorney-in-fact
or otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement of each Mortgage Loan and related documents, or otherwise. The
Servicer agrees to cooperate with the Successor Servicer, the Trustee and the
Master Servicer in effecting the termination of the responsibilities and rights
of the Servicer hereunder, including, without limitation, the transfer to the
Successor Servicer for the administration by it of all cash amounts that shall
at the time be held by the predecessor Servicer and to be deposited by it in the
Collection Account, or that have been deposited by the predecessor Servicer in
the Collection Account or thereafter received by the predecessor Servicer with
respect to the Mortgage Loans. All Servicing Transfer Costs and other reasonable
out-of-pocket costs and expenses (including attorneys' fees) incurred in
connection with transferring the Mortgage Files to the Successor Servicer and
amending this Agreement to reflect such succession as Servicer pursuant to this
Section 8.01 shall be paid by the predecessor Servicer or, to the extent not
paid by the predecessor Servicer, by the Trust pursuant to Section 5.01(a)(16),
upon presentation of reasonable documentation of such costs and expenses. If the
predecessor Servicer is required but fails to pay the amounts specified in the
preceding sentence and such amounts are paid by the Trust, the Trustee shall, at
the direction and expense of the Class BIO

                                      -99-

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Certificateholders, take appropriate action to enforce such obligation and
recover such amounts on behalf of such Class BIO Certificateholders.

     (c) (i) Upon the occurrence of a Master Servicer Event of Default, the
Master Servicer shall act as Master Servicer under this Agreement, subject to
the right of removal set forth in subsection (b) hereof, for an initial period
commencing on the date on which such Event of Default occurred and ending on the
last day of the calendar quarter in which such Event of Default occurred, which
period shall be extended by the Trustee (an "Extension Notice") for a succeeding
quarterly period ending on December 31, March 31, June 30 and September 30 of
each year (each such quarterly period for which the Master Servicer shall be
designated to act as Master Servicer hereunder, a "Term of Service") until such
time as the Trustee receives written direction from the Holders of Certificates
evidencing more than 50% of the Voting Rights not to deliver an Extension
Notice, in which event the Trustee shall follow such direction; provided that
nothing in this clause (c) shall prohibit the Trustee from removing (or prohibit
Certificateholders from directing the Trustee to remove) the Master Servicer
pursuant to clause (b) above. In the event the Trustee fails to deliver an
Extension Notice prior to the end of any Term of Service, the Master Servicer
shall be automatically terminated.

          (ii) Upon the occurrence of a Servicer Event of Default, the Servicer
shall act as Servicer under this Agreement, subject to the right of removal set
forth in subsection (b) hereof, for an initial period commencing on the date on
which such Event of Default occurred and ending on the last day of the calendar
quarter in which such Event of Default occurred, which period shall be extended
by the Master Servicer (an "Extension Notice") for a succeeding quarterly period
ending on December 31, March 31, June 30 and September 30 of each year (each
such quarterly period for which the Servicer shall be designated to act as
Servicer hereunder, a "Term of Service") until such time as the Master Servicer
receives written direction from the Certificate Insurer, if the Senior
Certificates have not yet been retired and a Certificate Insurer Default does
not exist, or if the Senior Certificates have been retired, the Holders of
Certificates evidencing more than 50% of the Voting Rights not to deliver an
Extension Notice, in which event the Master Servicer shall follow such
direction.

     (d) (i) If the Successor Master Servicer or another Person succeeds to the
obligations of Master Servicer hereunder, the term of the Successor Master
Servicer or such Person shall not be limited unless and until a Master Servicer
Event of Default thereafter occurs with respect to such Successor Master
Servicer or other Person. At such time, the provisions of Section 8.01 (c) and
(d) shall become applicable to the then-acting Master Servicer and the Person
then-obligated to succeed such then-acting Master Servicer.

          (ii) If the Successor Servicer or another Person succeeds to the
obligations of Servicer hereunder, the term of the Successor Servicer or such
Person shall not be limited unless and until a Servicer Event of Default
thereafter occurs with respect to such Successor Servicer or other Person. At
such time, the provisions of Section 8.01 (c) and (d) shall become applicable to
the then-acting Servicer and the Person then-obligated to succeed such
then-acting Servicer.

     Section 8.02. APPOINTMENT OF SUCCESSOR. (a) (i) The Depositor hereby
appoints, and Wells Fargo Bank Minnesota, National Association ("Wells Fargo"),
hereby accepts appointment, on

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<PAGE>

behalf of itself or an affiliate, upon receipt by the Master Servicer of a
notice of termination pursuant to Section 8.01 or upon resignation of the Master
Servicer pursuant to Section 7.04(i), to be the successor (the "Successor Master
Servicer") in all respects to the Master Servicer in its capacity as master
servicer and the successor (the "Successor Servicer") to the 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 and Servicer by the
terms and provisions hereof arising on and after its succession; provided,
however, that, without affecting the immediate termination of the rights of the
Master Servicer and Servicer hereunder, it is understood and acknowledged by the
parties hereto that there will be a period of transition not to exceed 90 days
(the "Transition Period") before the servicing transfer is fully effected. In
the event that Wells Fargo is, at any time, concurrently acting hereunder in the
capacity as Successor Master Servicer and Successor Servicer, it is understood
and acknowledged by the parties hereto that Wells Fargo may, at its option,
consolidate the roles of Successor Master Servicer and Successor Servicer into
one business unit within Wells Fargo, provided that such business unit will
perform all of the requisite duties and obligations and exercise, where
applicable, all of the powers and rights of each such role, as set forth in this
Agreement.

     During the Transition Period, neither the Successor Master Servicer, the
Successor Servicer nor the Trustee shall be responsible for the lack of
information and documents that it cannot reasonably obtain on a practicable
basis under the circumstances.

     As compensation therefor, the Successor Master Servicer shall be entitled
to such compensation as the Master Servicer and the Servicer would have been
entitled to hereunder if no such notice of termination had been given.

     Notwithstanding the above, if Wells Fargo is unwilling or legally unable to
act as Successor Master Servicer and Successor Servicer, the Trustee may appoint
or petition a court of competent jurisdiction to appoint, (x) 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 $25,000,000 and that is an
Approved Master Servicer 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; and/or (y) an Approved Servicer as the
successor to the Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer hereunder; PROVIDED that
the appointment of any such successor Master Servicer or Successor Servicer will
not result in the qualification, reduction or withdrawal of the ratings assigned
to the Offered Certificates by the Rating Agencies. Pending appointment of a
successor to the Master Servicer or successor to the Servicer hereunder, unless
the Successor Master Servicer or the Successor Servicer is prohibited by law
from so acting, the Successor Master Servicer and Successor Servicer shall act
in such capacity as hereinabove provided. In connection with such appointment
and assumption, the successor shall be entitled to receive compensation out of
payments on the Mortgage Loans in an amount equal to the compensation which the
Master Servicer or Servicer, as applicable, would otherwise have received
pursuant to Section 3.08 or 3.24 (or such lesser compensation as the Trustee and
such successor shall agree). The appointment of a successor Master Servicer and
Successor Servicer shall not affect any liability of the predecessor Master
Servicer or predecessor Servicer which may have arisen under this Agreement
prior to its termination as Master Servicer or Servicer, as applicable, to pay
any deductible under an insurance policy pursuant to Section 3.05 or to
indemnify the Trustee

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<PAGE>

pursuant to Section 7.06), nor shall any successor Master Servicer or Successor
Servicer be liable for any acts or omissions of the predecessor Master Servicer
or predecessor Servicer or for any breach by such Master Servicer or Servicer,
as applicable, of any of its representations or warranties contained herein or
in any related document or agreement. The Trustee or a successor Master Servicer
or Successor Servicer shall have no responsibility or obligation (i) to
repurchase any of the Mortgage Loans or (ii) for any acts or omissions of a
predecessor Master Servicer or predecessor Servicer during the Transition
Period. The Trustee and such successor shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession.

     (ii) The Depositor and the Trustee hereby appoint, and Saxon Mortgage,
Inc., hereby accepts appointment, on behalf of itself or an affiliate, upon
receipt by the Servicer of a notice of termination pursuant to Sections
8.01(a)(v) through (x) or upon resignation of the Servicer pursuant to Section
7.04(i), to be the Successor Servicer in all respects to the 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 Servicer by the terms and provisions
hereof arising on and after its succession; provided, however, that, without
affecting the immediate termination of the rights of the Servicer hereunder, it
is understood and acknowledged by the parties hereto that there will be a period
of transition not to exceed 90 days (the "Transition Period") before the
servicing transfer is fully effected.

     During the Transition Period, neither the Successor Servicer (other than
Saxon Mortgage, Inc. succeeding Meritech Mortgage Services, Inc.) nor the
Trustee shall be responsible for the lack of information and documents that it
cannot reasonably obtain on a practicable basis under the circumstances.

     As compensation therefor, the Successor Servicer shall be entitled to such
compensation as the Servicer would have been entitled to hereunder if no such
notice of termination had been given. Notwithstanding the above, if the
Successor Servicer is unwilling or legally unable to act as successor servicer,
the Master Servicer may (i) if Wells Fargo is also the Successor Master
Servicer, appoint Wells Fargo as Successor Servicer and Wells Fargo hereby
accepts appointment on behalf of itself or an affiliate upon receipt of notice
thereof, or (ii) with the approval of or at the request of the Certificate
Insurer, if the Senior Certificates have not yet been retired and a Certificate
Insurer Default does not exist, or if the Senior Certificates have been retired,
with the approval of or at the request of the Trustee or the Holders of
Certificates evidencing more than 50% of the Voting Rights, appoint, an Approved
Servicer as the successor to the Servicer hereunder in the assumption of all or
any part of the responsibilities, duties or liabilities of the Servicer
hereunder; PROVIDED that the appointment of any such successor Servicer will not
result in the qualification, reduction or withdrawal of the ratings assigned to
the Offered Certificates by the Rating Agencies. In the event that the Master
Servicer fails to appoint a Successor Servicer at the permitted request of the
Certificate Insurer pursuant to clause (ii) above, the Certificate Insurer may
so appoint a Successor Servicer. Pending appointment of a successor to the
Servicer hereunder, unless the Successor Servicer is prohibited by law from so
acting, the Successor Servicer shall act in such capacity as hereinabove
provided. In connection with such appointment and assumption, the successor
shall be entitled to receive compensation out of payments on the Mortgage Loans
in an amount equal to the compensation which the Master Servicer would otherwise
have received pursuant to Section 3.08 (or such lesser compensation as the
Trustee and such successor shall agree). The appointment of a

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<PAGE>

successor Servicer shall not affect any liability of the predecessor Servicer
which may have arisen under this Agreement prior to its termination as Servicer
to pay any deductible under an insurance policy pursuant to Section 3.05 or to
indemnify the Trustee pursuant to Section 7.06), nor shall any successor
Servicer be liable for any acts or omissions of the predecessor Servicer or for
any breach by such Servicer of any of its representations or warranties
contained herein or in any related document or agreement. The Trustee or a
successor Servicer (other than Saxon Mortgage, Inc. succeeding Meritech Mortgage
Services, Inc.) shall have no responsibility or obligation (i) as Servicer to
repurchase any of the Mortgage Loans or (ii) for any acts or omissions of a
predecessor Servicer during the Transition Period. The Trustee and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession.

     (b) Any successor, including the Successor Servicer or Successor Master
Servicer, to the Servicer or the Master Servicer, as applicable, shall during
the term of its service as servicer (i) continue to service and administer the
Mortgage Loans for the benefit of Certificateholders and (ii) maintain in force
a policy or policies of insurance covering errors and omissions in the
performance of its obligations as Servicer or Master Servicer hereunder and a
fidelity bond in respect of its officers, employees and agents to the same
extent as the Servicer or Master Servicer is so required pursuant to Section
3.12.

     Section 8.03. WAIVER OF DEFAULTS. The Majority Certificateholders may, on
behalf of all Certificateholders, waive any events permitting removal of the
Servicer or the Master Servicer as servicer pursuant to this Article VIII,
PROVIDED, HOWEVER, that the Majority Certificateholders may not waive a default
in making a required distribution on a Certificate without the consent of the
Holder of such Certificate. Upon any waiver of a past default, such default
shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereto
except to the extent expressly so waived. Notice of any such waiver shall be
given by the Trustee to the Rating Agencies and the Certificate Insurer.

     Section 8.04. NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination or
appointment of a successor to the Servicer or Master Servicer pursuant to this
Article VIII or Section 7.04, the Trustee shall give prompt written notice
thereof to the Certificateholders at their respective addresses appearing in the
Certificate Register, the Certificate Insurer and to each Rating Agency.

     Section 8.05. RIGHTS OF THE CERTIFICATE INSURER. By accepting its Senior
Certificate, each holder of a Senior Certificate agrees that unless a
Certificate Insurer Default exists, the Certificate Insurer shall be deemed to
be the holder of the Senior Certificates for all purposes (other than with
respect to payment on the Senior Certificates) and shall have the right to
exercise all rights of the Certificateholders of the Senior Certificates under
this Agreement and under each Class of Senior Certificates without any further
consent of the Certificateholders. In addition, each Certificateholder of a
Senior Certificate agrees that unless a Certificate Insurer Default exists, the
rights specifically enumerated in this Agreement may be exercised by the
Certificateholders of a Senior Certificate only with the prior written consent
of the Certificate Insurer.

                                      -103-

<PAGE>

     The Certificate Insurer may, in writing and in its sole discretion renounce
all or any of its rights under Section 8.05 or any requirement for the
Certificate Insurer's consent for any period of time.

     Section 8.06. CERTIFICATE INSURER DEFAULT. Notwithstanding anything
elsewhere in this Agreement or in the Certificates to the contrary, if a
Certificate Insurer Default exists, or if and to the extent the Certificate
Insurer has delivered its written renunciation of its rights, the provisions of
this Article VIII and all other provisions of this Agreement which (a) permit
the Certificate Insurer to exercise rights of the Certificateholders of the
Senior Certificates, (b) restrict the ability of the Certificateholders of the
Senior Certificates, to act without the consent or approval of the Certificate
Insurer, (c) provide that a particular act or thing must be acceptable to the
Certificate Insurer, (d) permit the Certificate Insurer to direct (or otherwise
to require) the actions of the Trustee, the Master Servicer, the Servicer or the
Certificateholders, (e) provide that any action or omission taken with the
consent, approval or authorization of the Certificate Insurer shall be
authorized hereunder or shall not subject the party taking or omitting to take
such action to any liability hereunder or (f) which have a similar effect, shall
be of no further force and effect and the Trustee shall administer the Trust and
perform its obligations hereunder solely for the benefit of the Holders of the
Certificates; PROVIDED, HOWEVER, that the Certificate Insurer's rights to
consent to amendments, to payments pursuant to Section 5.01(a)(5) and to receive
reports and notices shall not be affected by a Certificate Insurer Default and
all other rights shall be immediately reinstated following the cure of such
Certificate Insurer Default. Nothing in the foregoing sentence, nor any action
taken pursuant thereto or in compliance therewith, shall be deemed to have
released the Certificate Insurer from any obligation or liability it may have to
any party or to the Certificateholders of the Senior Certificates hereunder,
under any other agreement, instrument or document (including, without
limitation, the Certificate Insurance Policy) or under applicable law.

                                   ARTICLE IX

                                   The Trustee

     Section 9.01. 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. If an Event of Default has occurred
(which has not been cured) of which a Responsible Officer has knowledge, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.

     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. If any such instrument is found
not to be in the form specified in this Agreement, on its face, the Trustee
shall take action as it deems appropriate to have the instrument corrected, and
if the instrument is not corrected to the Trustee's satisfaction, the Trustee
will, at the expense of the Master Servicer, provide notice thereof to the

                                      -104-

<PAGE>

Certificateholders and will, at the expense of the Master Servicer, which
expense shall be reasonable given the scope and nature of the required action,
take such further action as directed by the Majority Certificateholders.

     The Trustee may, in accordance with its duties hereunder, do all things
necessary and proper as may be required in connection with any secondary
mortgage licensing laws and similar requirements, including, but not limited to,
consenting to jurisdiction, and the appointment of agents for service of
process, in jurisdictions in which the Mortgaged Properties are located.

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

          (i) prior to the occurrence of 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
     to the Trustee and conforming to the requirements of this Agreement;

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

          (iii) the Trustee shall not be personally liable with respect to any
     action taken, suffered or omitted to be taken by it in good faith in
     accordance with the consent or direction of the Holders of Offered
     Certificates evidencing Percentage Interests aggregating more than 50%
     relating to the time, method and place of conducting any proceeding for any
     remedy available to the Trustee, or exercising or omitting to exercise any
     trust or power conferred upon the Trustee, under this Agreement; and

          (iv) the Trustee shall not be charged with knowledge of any failure by
     the Servicer to comply with the obligations of the Servicer referred to in
     clauses (a)(i) and (ii) of Section 8.01 unless a Responsible Officer of the
     Trustee at the Corporate Trust Office obtains actual knowledge of such
     failure or the Trustee receives written notice of such failure from the
     Servicer or the Holders of Offered Certificates evidencing Percentage
     Interests aggregating more than 50%. This paragraph shall not be construed
     to limit the effect of the first paragraph of this Section 9.01.

     The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions

                                      -105-

<PAGE>

contained in this Agreement shall in any event require the Trustee to perform,
or be responsible for the manner of performance of, any of the obligations of
the Master Servicer or the Servicer under this Agreement, except during such
time, if any, as the Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Master Servicer or the Servicer in
accordance with the terms of this Agreement.

     Section 9.02. CERTAIN MATTERS AFFECTING THE TRUSTEE. Except as otherwise
provided in Section 9.01:

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

          (ii) the Trustee may consult with counsel and any written advice of
     such counsel or 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 advice or
     Opinion of Counsel;

          (iii) the Trustee shall be under no obligation to exercise any of the
     rights or powers vested in it by this Agreement, or to institute, conduct
     or defend any litigation hereunder or in relation hereto, at the request,
     order or direction of any of the Certificateholders pursuant to the
     provisions of this Agreement, unless such Certificateholders shall have
     offered to the Trustee reasonable security or indemnity against the costs,
     expenses and liabilities which may be incurred therein or thereby; the
     right of the Trustee to perform any discretionary act enumerated in this
     Agreement shall not be construed as a duty, and the Trustee shall not be
     answerable for other than its negligence or willful misconduct in the
     performance of any such act; nothing contained herein shall, however,
     relieve the Trustee of the obligations, upon the occurrence of an Event of
     Default (which has not been cured) of which a Responsible Officer has
     knowledge, 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 man would exercise or use under the circumstances in the
     conduct of his 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 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
     documents, unless requested in writing to do so by the Holders of
     Certificates evidencing Percentage Interests aggregating more 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

                                      -106-

<PAGE>

     reasonably assured to the Trustee by the security afforded to it by the
     terms of this Agreement, the Trustee may require reasonable indemnity
     against such cost, expense or liability as a condition to such proceeding.
     The reasonable expense of every such examination shall be paid by the
     Servicer or, if paid by the Trustee, shall be reimbursed by the Servicer
     upon demand. Nothing in this clause (v) shall derogate from the obligation
     of the Servicer to observe any applicable law prohibiting disclosure of
     information regarding the Mortgagors;

          (vi) the Trustee shall not be accountable, shall have no liability and
     makes no representation as to any acts or omissions hereunder of the Master
     Servicer or the Servicer until such time as the Trustee may act as Master
     Servicer or Servicer pursuant to Section 8.02;

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

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

     Section 9.03. TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS. The
recitals contained herein and in the Certificates (other than the authentication
of the Trustee on the Certificates) shall be taken as the statements of the
Depositor, and the Trustee assumes no responsibility for the correctness of the
same. The Trustee makes no representations as to the validity or sufficiency of
this Agreement, the Insurance Agreement, the Certificate Insurance Policy or of
the Certificates (other than the signature and authentication of the Trustee on
the Certificates) or of any Mortgage Loan or related document. The Trustee shall
not be accountable for the use or application by the Master Servicer or Servicer
or for the use or application of any funds paid to the Master Servicer or
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from the
Collection Account by the Servicer. The Trustee shall at no time have any
responsibility or liability for or with respect to the legality, validity and
enforceability of any Mortgage or any Mortgage Loan, or the perfection and
priority of any Mortgage or the maintenance of any such perfection and priority,
or for or with respect to the sufficiency of the Trust or its ability to
generate the payments to be distributed to Certificateholders under this
Agreement, including, without limitation: the existence, condition and ownership
of any Mortgaged Property; the existence and enforceability of any hazard
insurance thereon (other than if the Trustee shall assume the duties of the
Servicer pursuant to Section 8.02); the validity of the assignment of any
Mortgage Loan to the Trustee or of any intervening assignment; the completeness
of any Mortgage Loan; the performance or enforcement of any Mortgage Loan (other
than if the Trustee shall assume the duties of the Master Servicer or Servicer
pursuant to Section 8.02); the compliance by the Depositor, the Seller, the
Master Servicer or the Servicer with any warranty or representation made under
this Agreement or in any related document or the accuracy of any such warranty
or representation prior to the Trustee's receipt of notice or other discovery of
any non-compliance therewith or any breach thereof; any investment of monies by
or at the direction of the Master Servicer or Servicer or any loss resulting
therefrom, it being understood that the Trustee shall remain responsible for any
Trust property that it may hold in its individual capacity; the acts or
omissions of any of the Master Servicer or the Servicer (other than if the
Trustee

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shall assume the duties of the Master Servicer or the Servicer pursuant to
Section 8.02), any Subservicer or any Mortgagor; any action of the Master
Servicer or the Servicer (other than if the Trustee shall assume the duties of
the Master Servicer or Servicer pursuant to Section 8.02) or any Subservicer
taken in the name of the Trustee; the failure of the Master Servicer, the
Servicer or any Subservicer to act or perform any duties required of it as agent
of the Trustee hereunder; or any action by the Trustee taken at the instruction
of the Master Servicer or the Servicer (other than if the Trustee shall assume
the duties of the Master Servicer or Servicer pursuant to Section 8.02);
provided, however, that the foregoing shall not relieve the Trustee of its
obligation to perform its duties under this Agreement, including, without
limitation, the Trustee's duty to review the Mortgage Files pursuant to Section
2.02. Until such time as the Trustee shall have become the Successor Master
Servicer or Successor Servicer, the Trustee shall have no responsibility to
perfect or maintain the perfection of any security interest or lien granted to
it hereunder.

     Section 9.04. TRUSTEE MAY OWN CERTIFICATES. The Trustee in its individual
or any other capacity may become the owner or pledgee of Certificates with the
same rights as it would have if it were not Trustee and may transact any banking
and trust business with the Seller, the Master Servicer or the Servicer.

     Section 9.05. TRUSTEE FEES AND EXPENSES. The Trustee will be paid the
Trustee Fee pursuant to Section 3.22 and such other amounts as agreed with the
Seller. The Seller will pay or reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement or the Insurance
Agreement (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith or which is the responsibility of Certificateholders
hereunder. In addition, the Seller covenants and agrees to indemnify the Trustee
and its officers, directors, employees and agents from, and hold it harmless
against, any and all losses, liabilities, damages, claims or expenses incurred
in connection with or relating to this Agreement, the Insurance Agreement or the
Certificates, other than any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence of the Trustee in the performance
of its duties hereunder or by reason of the Trustee's reckless disregard of
obligations and duties hereunder. To the extent that amounts payable to the
Trustee under this Section 9.05, other than the Trustee Fee, are not paid by the
Seller, such amounts shall be payable to the Trustee by the Trust pursuant to
Section 5.01(a)(16). This Section 9.05 shall survive termination of this
Agreement or the resignation or removal of any Trustee hereunder.

     Section 9.06. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The Trustee hereunder
shall at all times be a corporation duly incorporated and validly existing under
the laws of the United States of America or any state thereof, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $50,000,000 and a minimum long-term debt rating of "Baa3",
and subject to supervision or examination by federal or state authority. If such
corporation 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 9.06, 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

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Trustee shall cease to be eligible in accordance with the provisions of this
Section 9.06, the Trustee shall resign immediately in the manner and with the
effect specified in Section 9.07.

     Section 9.07. RESIGNATION OR REMOVAL OF TRUSTEE. The Trustee may at any
time resign and be discharged from the trusts hereby created by giving written
notice thereof to the Depositor, the Seller, the Master Servicer and each Rating
Agency. Upon receiving such notice of resignation, the Seller shall promptly
appoint a successor Trustee (approved in writing by the Servicer, so long as
such approval shall not unreasonably be withheld) by written instrument, in
duplicate, copies of which instrument shall be delivered to the resigning
Trustee and the Successor Trustee; PROVIDED, HOWEVER, that any such successor
Trustee shall be subject to the prior written approval of the Servicer. If no
successor Trustee shall have been so appointed and having accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Trustee.

     If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.06 and shall fail to resign after written request
therefor by the Depositor or the Seller or if at any time the Trustee shall be
legally unable to act, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor, the Seller or the Master Servicer may remove the Trustee. If the
Depositor, the Seller or the Master Servicer removes the Trustee under the
authority of the immediately preceding sentence, the Seller shall promptly
appoint a successor Trustee by written instrument, in duplicate, copies of which
instrument shall be delivered to the Trustee so removed and to the successor
Trustee.

     The Holders of Certificates evidencing Voting Rights aggregating over 50%
of all Voting Rights may, at any time remove the Trustee by written instrument
or instruments delivered to the Servicer, the Seller and the Trustee; and the
Seller shall thereupon use its best efforts to appoint a successor trustee in
accordance with this Section 9.07.

     Any resignation or removal of the Trustee and appointment of a successor
Trustee pursuant to any of the provisions of this Section 9.07 shall not become
effective until acceptance of appointment by the successor Trustee as provided
in Section 9.08.

     Section 9.08. SUCCESSOR TRUSTEE. Any successor Trustee appointed as
provided in Section 9.07 shall execute, acknowledge and deliver to the
Depositor, the Seller, the Master Servicer and to its predecessor Trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as Trustee. The Depositor,
the Seller, the Master Servicer and the predecessor Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor Trustee all such
rights, powers, duties and obligations.

     No successor Trustee shall accept appointment as provided in this Section
9.08 unless at the time of such acceptance such successor Trustee shall be
eligible under the provisions of Section 9.06.

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<PAGE>

     If a successor Trustee is to become the Successor Master Servicer and/or
the Successor Servicer hereunder, it shall be an Approved Master Servicer and/or
Approved Servicer, as the case may be. If a successor Trustee is not to become
the Successor Master Servicer and/or Successor Servicer hereunder, the entity
then acting as Successor Master Servicer or Successor Servicer, as applicable
hereunder shall continue to act in such capacity until such time as an Approved
Master Servicer or Approved Servicer, as applicable has agreed to assume the
role of Successor Master Servicer or Successor Servicer, as applicable
hereunder.

     Upon acceptance of appointment by a successor Trustee as provided in this
Section 9.08, the Master Servicer shall mail notice of the succession of such
Trustee hereunder to all Holders of Certificates at their addresses as shown in
the Certificate Register and to the Certificate Insurer and each Rating Agency.
If the Master Servicer fails to mail such notice within 30 days after acceptance
of appointment by the successor Trustee, the successor Trustee shall cause such
notice to be mailed at the expense of the Master Servicer.

     Section 9.09. MERGER OR CONSOLIDATION OF TRUSTEE. Any corporation into
which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, PROVIDED that such corporation shall be eligible under the provisions
of Section 9.06, without the execution or filing of any paper or any further act
on the part of any of the parties hereto.

     Section 9.10. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or any Mortgaged Property may at the time be located, the 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, or
separate trustee or separate trustees, of all or any part of the Trust, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Certificateholders such title to the Trust, or any part thereof, and, subject to
the other provisions of this Section 9.10, such powers, duties, obligations,
rights and trusts as the Master Servicer and the Trustee may consider necessary
or desirable. Any such co-trustee or separate trustee shall be subject to the
written approval of the Master Servicer. If the Master Servicer shall not have
joined in such appointment within 15 days after the receipt by it of a request
so to do, or, in the case 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 9.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 9.08. The Seller shall be responsible for the
fees of any co-trustee or separate trustee appointed hereunder.

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

          (i) all rights, powers, duties and obligations conferred or imposed
     upon the Trustee shall be conferred or imposed upon and exercised or
     performed by the Trustee and such separate trustee or co-trustee jointly
     (it being understood that such separate trustee or

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     co-trustee is not authorized to act separately without the Trustee joining
     in such act), except to the extent that under any law of any jurisdiction
     in which any particular act or acts are to be performed (whether as Trustee
     hereunder or as successor to the Servicer hereunder), the Trustee shall be
     incompetent or unqualified to perform such act or acts, in which event such
     rights, powers, duties and obligations (including the holding of title to
     the Trust or any portion thereof in any such jurisdiction) shall be
     exercised and performed singly by such separate trustee or co-trustee, but
     solely at the direction of the Trustee;

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

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

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

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

     Section 9.11. LIMITATION OF LIABILITY. The Certificates are executed by the
Trustee, not in its individual capacity but solely as Trustee of the Trust, in
the exercise of the powers and authority conferred and vested in it by this
Agreement. Each of the undertakings and agreements made on the part of the
Trustee in the Certificates is made and intended not as a personal undertaking
or agreement by the Trustee but is made and intended for the purpose of binding
only the Trust.

     Section 9.12. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
CERTIFICATES; INSPECTION. (a) All rights of action and claims under this
Agreement or the Certificates may be prosecuted and enforced by the Trustee
without the possession of any of the Certificates or the production thereof in
any proceeding relating thereto, and such proceeding instituted by the Trustee
shall be brought in its own name or in its capacity as Trustee. Any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursement and advances of the Trustee, its

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agents and counsel, be for the ratable benefit of the Certificateholders or in
respect of which such judgment has been recovered.

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

     Section 9.13. SUITS FOR ENFORCEMENT. In case an Event of Default or other
default by the Servicer or the Seller hereunder shall occur and be continuing,
the Trustee may proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy, as the Trustee, being advised by counsel, shall deem
most effectual to protect and enforce any of the rights of the Trustee and the
Certificateholders.

                                    ARTICLE X

                                   Termination

     Section 10.01. TERMINATION. (a) The respective obligations and
responsibilities of the Depositor, the Seller, the Master Servicer, the
Servicer, the Custodian and the Trustee created hereby (other than the
obligation of the Trustee to make certain payments to Certificateholders after
the final Distribution Date and the obligation of the Master Servicer to send
certain notices as hereinafter set forth) shall terminate upon notice to the
Trustee of the later of (x) the distribution to Certificateholders of the final
payment or collection with respect to the last Mortgage Loan (or Monthly
Advances of same by the Master Servicer) and (y) the disposition of all funds
with respect to the last Mortgage Loan and the remittance of all funds due under
the Agreement and the payment of all amounts due and payable to the Certificate
Insurer and the Trustee. Notwithstanding the foregoing, in no event shall the
trust created hereby continue beyond the expiration of 21 years from the death
of the last surviving descendant of Joseph P. Kennedy, the late ambassador of
the United States to the Court of St. James, living on the date hereof.

     The Master Servicer may, at its option, terminate this Agreement on any
Distribution Date on or after the Optional Termination Date, by purchasing, on
such Distribution Date, all of the outstanding Mortgage Loans and REO Properties
at a price equal to the sum of (w) 100% of the

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aggregate Principal Balance of the Mortgage Loans plus (x) the lesser of (A) the
appraised value of any REO Property as determined by the higher of two
appraisals completed by two independent appraisers selected by the Master
Servicer and at the Master Servicer's expense and (B) the Principal Balance of
the Mortgage Loan related to such REO Property plus (y) in each case, the
greater of (i) the aggregate amount of accrued and unpaid interest on the
Mortgage Loans through the related Due Period and (ii) 30 days' accrued interest
thereon at a rate equal to the Loan Rate, in each case net of the Servicing Fee,
Master Servicing Fee and Trustee Fee plus (z) any amounts due to the Certificate
Insurer under the Insurance Agreement (the "Termination Price").

     In connection with any such purchase pursuant to the preceding paragraph,
the Master Servicer shall deposit in the Distribution Account all amounts then
on deposit in the Custodial Account (less amounts permitted to be withdrawn by
the Master Servicer pursuant to Section 3.22), which deposit shall be deemed to
have occurred immediately preceding such purchase. The Master Servicer shall
notify the Servicer of such purchase and the Servicer shall deposit in the
Distribution Account all amounts then on deposit in the Collection Account (less
amounts permitted to be withdrawn by the Servicer pursuant to Section 3.03)
which deposit shall occur on the Determination Date before such Distribution
Date on which such purchase will occur.

     Any such purchase shall be accomplished by deposit into the Distribution
Account on the Determination Date before such Distribution Date of the
Termination Price.

     (b) Notice of any termination, specifying the Distribution Date (which
shall be a date that would otherwise be a Distribution Date) upon which the
Certificateholders may surrender their Certificates to the Trustee for payment
of the final distribution and cancellation, shall be given promptly by the
Trustee by letter to Certificateholders and the Certificate Insurer 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 Distribution
Date upon which final distribution of the Certificates will 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 distribution and
(iii) that the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified.

     (c) On the final Distribution Date, the Trustee will withdraw from the
Distribution Account and remit to the Certificate Insurer the lesser of (x) the
amount available for distribution on such final Distribution Date, net of any
portion thereof necessary to pay Certificateholders pursuant to Sections 5.01
and (y) the unpaid amounts due and owing to the Certificate Insurer pursuant to
Section 5.01. Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the holders of Certificates on the Distribution
Date for such final distribution, in proportion to the Percentage Interests of
their respective Certificates and to the extent that funds are available for
such purpose, an amount equal to the amount required to be distributed to
Certificateholders pursuant to Section 5.01 for such Distribution Date.

     (d) In the event that all of the Certificateholders shall not surrender
their Certificates for final payment and cancellation on or before such final
Distribution Date, the Trustee shall promptly following such date cause all
funds in the Distribution Account not distributed in final distribution to
Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by

                                      -113-

<PAGE>

depositing such funds in a separate escrow account for the benefit of such
Certificateholders and the Master Servicer (if the Master Servicer has exercised
its right to purchase the Mortgage Loans) or the Trustee (in any other case)
shall give a second written notice to the remaining Certificateholders to
surrender their Certificates for cancellation and receive the final distribution
with respect thereto. If within one year after the second notice all the Offered
Certificates shall not have been surrendered for cancellation, the Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds on deposit in
such escrow account.

     Section 10.02. ADDITIONAL TERMINATION REQUIREMENTS. (a) In the event that
the Master Servicer exercises its purchase option as provided in Section 10.01,
the Trust shall be terminated in accordance with the following additional
requirements, unless the Trustee shall have been furnished with an Opinion of
Counsel to the effect that the failure of the Trust to comply with the
requirements of this Section 10.02 will not (1) result in the imposition of
taxes on "prohibited transactions" of the Trust as defined in Section 860F of
the Code or (2) cause any REMIC to fail to qualify as a REMIC at any time that
any Regular Certificates are outstanding:

          (i) Within 90 days prior to the final Distribution Date, the Master
     Servicer shall adopt and the Trustee shall sign a plan of complete
     liquidation for each REMIC meeting the requirements of a "Qualified
     Liquidation" under Section 860F of the Code and any regulations thereunder;

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

          (iii) At the time of the making of the final payment on the
     Certificates, the Trustee shall distribute or credit, or cause to be
     distributed or credited (A) to the Trustee, as holder of the REMIC I
     Regular Interests and REMIC II Regular Interests, the unpaid principal
     balance thereof plus accrued interest thereon, (B) to each Class of
     Certificates the amounts payable pursuant to Section 5.01, (C) to the
     Certificate Insurer, all amounts owing to the Certificate Insurer under
     this Agreement and the Insurance Agreement and (D) to the Class R-1
     Certificateholders, Class R-2 Certificateholders and Class R-3
     Certificateholders, all cash on hand in REMIC I, REMIC II and REMIC III,
     respectively, after such payments.

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

                                   ARTICLE XI

                            Miscellaneous Provisions

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<PAGE>

     Section 11.01. AMENDMENT. (a) This Agreement may be amended from time to
time by the Depositor, the Seller, the Master Servicer, the Servicer and the
Trustee subject, in the case of any amendment or modification which affects any
right, benefit, duty or obligation of the Certificate Insurer or the Custodian,
to the consent of the Certificate Insurer or the Custodian, as applicable, in
each case without the consent of any of the Certificateholders, (i) to cure any
ambiguity, (ii) to correct any defective provisions or to correct or supplement
any provisions herein that may be inconsistent with any other provisions herein
or the expectations of Certificateholders, (iii) to add to the duties of the
Master Servicer or the Servicer, (iv) to add any other provisions with respect
to matters or questions arising under this Agreement which shall not be
inconsistent with the provisions of this Agreement, (v) to add or amend any
provisions of this Agreement as required by any Rating Agency or any other
nationally recognized statistical rating agency in order to maintain or improve
any rating of each Class of Offered Certificates (it being understood that,
after obtaining the ratings in effect on the Closing Date, none of the
Certificate Insurer, the Trustee, the Seller, the Servicer or the Master
Servicer is obligated to obtain, maintain or improve any such rating) or (vi) to
add or amend any provisions of this Agreement to such extent as shall be
necessary to maintain the qualification of any REMIC as a REMIC; provided,
however, that (x) as evidenced by an Opinion of Counsel (at the expense of the
requesting party) in each case such action shall not adversely affect in any
material respect the interest of any Certificateholder, without regard to the
existence of the Certificate Insurance Policy, (y) in each case, such action is
necessary or desirable to maintain the qualification of any REMIC as a REMIC or
shall not adversely affect such qualification and (z) if the opinion called for
in clause (x) cannot be delivered with regard to an amendment pursuant to clause
(vi) above, such amendment is necessary to maintain the qualification of any
REMIC as a REMIC; and provided, further, that the amendment shall not be deemed
to adversely affect in any material respect the interests of the
Certificateholders and no Opinion of Counsel to that effect shall be required if
the Person requesting the amendment obtains a letter from each Rating Agency
stating that the amendment would not result in the downgrading or withdrawal of
the respective ratings then assigned to the Offered Certificates, without regard
to the existence of the Certificate Insurance Policy.

     (b) This Agreement also may be amended from time to time by the Depositor,
the Seller, the Master Servicer, the Servicer and the Trustee, subject, in the
case of any amendment or modification which affects any right, benefit, duty or
obligation of the Certificate Insurer or the Custodian, to the consent of the
Certificate Insurer or the Custodian, as applicable, with the consent of the
Holders of each Class of Certificates which is affected by such amendment,
evidencing Voting Rights aggregating more than 50% of such Class (or in the case
of an amendment which affects all classes, more than 50% of all of the Voting
Rights in the Trust), for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall (i) reduce in any manner the amount of, or delay
the timing of, payments on the Certificates which are required to be made on any
Certificate without the consent of the Holder of such Certificate or (ii) reduce
the aforesaid percentage required to consent to any such amendment, without the
consent of the Holders of all Certificates then outstanding.

     (c) Without limiting the provisions of Sections 11.01(a) or 11.01(b) the
amendment to any of the following provisions shall be deemed to affect the
rights, benefits, duties or obligations of the Certificate Insurer and therefore
require the consent of the Certificate Insurer: (i) the amount

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and timing of any amounts payable to the Certificate Insurer hereunder; (ii) the
definitions of Class Interest Distribution, Cumulative Loss Event, Delinquency
Event, Guaranteed Distributions, Required Overcollateralization Amount, Senior
Principal Distribution Amount, Servicing Termination Test; (iii) any other
definition to the extent that the amendment of such definition would increase or
decrease the amounts or limits calculated or specified pursuant to any of the
definitions listed in clause (ii) above or otherwise affect the intended use of
any of the definitions listed in clause (ii) above; and (iv) Section 4.01, 4.03,
8.05, 11.01, 11.09, 11.12, 11.13, and 11.14 of this Agreement. In addition, if
the Trustee is acting as Master Servicer or Servicer hereunder, any proposed
amendment shall require the consent of the Certificate Insurer.

     (d) Prior to the solicitation of consent of Certificateholders in
connection with any such amendment, the party seeking such amendment shall
furnish the Trustee with an Opinion of Counsel stating whether such amendment
would adversely affect the qualification of any REMIC as a REMIC and notice of
the conclusion expressed in such Opinion of Counsel shall be included with any
such solicitation. An amendment made with the consent of all Certificateholders
and executed in accordance with this Section 11.01 shall be permitted or
authorized by this Agreement notwithstanding that such Opinion of Counsel may
conclude that such amendment would adversely affect the qualification of any
REMIC as a REMIC.

     (e) Prior to the execution of any such amendment, the Trustee shall furnish
written notification of the substance of such amendment to each Rating Agency.
In addition, promptly after the execution of any such amendment made with the
consent of the Certificateholders, the Trustee shall furnish written
notification of the substance of such amendment to each Certificateholder and
the Certificate Insurer.

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

     (g) Notwithstanding the permissive language in Section 11.01(a) and
11.01(b), upon satisfaction of the conditions in Section 11.01(a) or 11.01(b) as
applicable, the Trustee shall execute and deliver the applicable amendment;
provided, however, that the Trustee shall not be required to execute any
amendment which, based on an Opinion of Counsel, materially and adversely
affects the rights, duties or immunities of the Trustee hereunder.

     Section 11.02. RECORDATION OF AGREEMENT. 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
Trustee, but only upon direction of Certificateholders, accompanied by an
Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of Certificateholders. The Certificateholders
requesting such recordation shall bear all costs and expenses of such
recordation. The Trustee shall have no obligation to ascertain whether such
recordation so affects the interests of the Certificateholders.

                                      -116-

<PAGE>

     Section 11.03. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.

     No Certificateholder shall have any right to vote (except as provided in
Sections 8.01, 9.01, 9.02 and 11.01) or in any manner otherwise control the
operation and management of the Trust, or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to constitute the Certificateholders from time
to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.

     No Certificateholder shall have any right by virtue or by availing itself
of any provisions 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 Offered Certificates evidencing Voting Rights aggregating more than
50% of all the Voting Interests 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, the Trustee that no one or more Holders of Certificates shall
have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, 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
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section 11.03, each and every
Certificateholder, 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 SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (EXCLUDING PROVISIONS
REGARDING CONFLICTS OF LAWS) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

     Section 11.05. NOTICES. (a) 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 Depositor, Financial Asset Securities Corp., 600
Steamboat Road, Greenwich, Connecticut 06830 Attention: Corporate Secretary, (b)
in the case of the Seller and Master Servicer, Saxon Mortgage, Inc., 4880 Cox
Road, Glen Allen, Virginia 23060 Attention: Mr. Bradley Adams, (c) in the case
of the Servicer, Meritech Mortgage

                                      -117-

<PAGE>

Services, Inc., 4880 Cox Road, Glen Allen, Virginia 23060, Attention: Mr. David
Dill, (d) in the case of the Trustee, Wells Fargo Bank Minnesota, National
Association, at the Corporate Trust Office, Attention: Soundview 2001-1; (d) in
the case of S&P, 55 Water Street, 41st Floor, New York, New York 10041,
Attention: Residential Mortgage Group, (e) in the case of Fitch, One State
Street Plaza, New York, New York 10004, (f) in the case of Moody's, 99 Church
Street, 4th Fl., New York, New York 10004, (g) in the case of the Certificate
Insurer, Financial Security Assurance, Inc., 350 Park Avenue, New York, New York
10022, Attention: Surveillance Department Re: Soundview Home Equity Loan
Asset-Backed Certificates, Series 2001-1, Telecopy No. (212) 339-3518 or 3529
Confirmation: (212) 826-0100 (in each case in which notice or other
communication to the Certificate Insurer refers to an Event of Default, a claim
on the Certificate Insurance Policy or with respect to which failure on the part
of the Certificate Insurer to respond shall be deemed to constitute consent or
acceptance, then a copy of such notice or other communication shall be sent to
the attention of each of the General Counsel and the Head of Financial Guaranty
Group and shall be marked to indicate "URGENT MATERIAL ENCLOSED"), or (h) 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 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. Any notice or other document required to
be delivered or mailed by the Trustee to any Rating Agency shall be given on a
best efforts basis and only as a matter of courtesy and accommodation and the
Trustee shall have no liability for failure to delivery such notice or document
to any Rating Agency.

     (b) NOTICE TO RATING AGENCIES. The Trustee and the Master Servicer shall
each be obligated to use its best efforts promptly to provide notice, at the
expense of the Master Servicer, to each Rating Agency with respect to each of
the following of which a Responsible Officer of the Trustee or Master Servicer,
as the case may be, has actual knowledge:

          (i) Any material change or amendment to this Agreement;

          (ii) The occurrence of any Event of Default that has not been cured or
waived;

          (iii) The resignation or termination of the Master Servicer or the
Trustee;

          (iv) The final payment to Holders of the Certificates of any Class;

          (v) Any change in the location of any Account; and

          (vi) Any event that would result in the inability of the Trustee to
make advances regarding delinquent Mortgage Loans.

     (c) In addition, (i) the Trustee shall promptly furnish to each Rating
Agency copies of the following:

               (A) Each annual report to Certificateholders described in Section
5.03; and

                                      -118-

<PAGE>

               (B) Each statement to Certificateholders described in Section
5.03; and

          (ii) The Master Servicer shall promptly furnish to each Rating Agency
copies of the following:

               (A) Each annual statement as to compliance described in Section
3.09;

               (B) Each annual independent public accountants' servicing report
described in Section 3.10; and

               (C) Each notice delivered pursuant to Section 8.01(b) which
relates to the fact that the Master Servicer has not made a Monthly Advance.

     Any such notice pursuant to this Section 11.05 shall be in writing and
shall be deemed to have been duly given if personally delivered or mailed by
first class mail, postage prepaid, or by express delivery service to the
addresses specified above for each such Rating Agency.

     Section 11.06. 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 11.07. ASSIGNMENT. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 7.02, 7.04 and 7.05 (or 3.01),
this Agreement may not be assigned by the Depositor, the Seller or the Master
Servicer without the prior written consent of the Holders of the Certificates
evidencing Percentage Interests aggregating not less than 66%.

     Section 11.08. CERTIFICATES NONASSESSABLE AND FULLY PAID. The parties agree
that the Certificateholders shall not be personally liable for obligations of
the Trust, that the beneficial ownership interests represented by the
Certificates shall be nonassessable for any losses or expenses of the Trust or
for any reason whatsoever, and that the Certificates upon execution,
authentication and delivery thereof by the Trustee pursuant to Section 6.02 are
and shall be deemed fully paid.

     Section 11.09. THIRD-PARTY BENEFICIARIES. This Agreement will inure to the
benefit of and be binding upon the parties hereto, the Certificateholders, the
Certificate Owners, the Certificate Insurer and their respective successors and
permitted assigns. The Certificate Insurer shall be a third-party beneficiary of
this Agreement, entitled to enforce the provisions hereof as if a party hereto.
Except as otherwise provided in this Agreement, no other person will have any
right or obligation hereunder.

     Section 11.10. COUNTERPARTS. This Agreement 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.

                                      -119-

<PAGE>

     Section 11.11. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.

     Section 11.12. MORTGAGE LOANS AND ACCOUNTS HELD FOR BENEFIT OF THE
CERTIFICATE INSURER. The Trustee shall hold the Mortgage Loans for the benefit
of the Certificateholders and the Certificate Insurer and all references in this
Agreement and in the Certificates to the benefit of Holders of the Certificates
shall be deemed to include the Certificate Insurer. The Trustee shall cooperate
in all reasonable respects with any reasonable request by the Certificate
Insurer for action to preserve or enforce the Certificate Insurer's rights or
interests under this Agreement and the Senior Certificates. The Master Servicer
and Servicer each hereby acknowledges and agrees that it shall service the
Mortgage Loans for the benefit of the Certificateholders and for the benefit of
the Certificate Insurer, and all references in this Agreement to the benefit of
or actions on behalf of the Certificateholders shall be deemed to include the
Certificate Insurer.

     Section 11.13. EFFECT OF PAYMENTS BY THE CERTIFICATE INSURER; SUBROGATION.
Anything herein to the contrary notwithstanding, any payment with respect to
principal of or interest on the Senior Certificates which is made with moneys
received pursuant to the terms of the Certificate Insurance Policy shall not be
considered payment of the Senior Certificates from the Trust and shall not
result in the payment of or the provision for the payment of the principal of or
interest on the Senior Certificates within the meaning of Section 5.01. The
Depositor, the Seller, the Master Servicer, the Servicer and the Trustee
acknowledge, and each Holder by its acceptance of a Certificate agrees, that
without the need for any further action on the part of the Certificate Insurer,
the Depositor, the Seller, the Master Servicer, the Trustee, the Servicer or the
Certificate Registrar, to the extent the Certificate Insurer makes payments,
directly or indirectly, on account of principal of or interest on the Senior
Certificates to the Holders of such Senior Certificates, (i) the Certificate
Insurer will be fully subrogated to the rights of such Holders to receive such
principal and interest from the Trust and (ii) the Certificate Insurer shall be
paid such principal and interest but only from the sources and in the manner
provided herein for the payment of such principal and interest.

     The Depositor, the Seller, the Servicer and the Master Servicer shall
cooperate in all respects with any reasonable request by the Certificate Insurer
for action to preserve or enforce the Certificate Insurer's rights or interests
under this Agreement without limiting the rights or affecting the interests of
the Holders as otherwise set forth herein.

     Section 11.14. NOTICES TO THE CERTIFICATE INSURER. All notices, statements,
reports, certificates or opinions required by this Agreement to be sent to any
other party hereto or to the Certificateholders or the Rating Agencies shall
also be sent to the Certificate Insurer.

                                      -120-

<PAGE>

          IN WITNESS WHEREOF, the Seller, the Depositor, the Master Servicer,
the Servicer and the Trustee have caused this Agreement to be duly executed by
their respective officers all as of the day and year first above written.

                                            FINANCIAL ASSET SECURITIES CORP.,
                                            as Depositor

                                            By     /s/ James Raezer
                                              ---------------------------------
                                            Name:      James Raezer
                                            Title:     Vice President

                                            SAXON MORTGAGE, INC.,
                                              as Seller and Master Servicer

                                            By     /s/ Bradley D. Adams
                                              ---------------------------------
                                            Name:      Bradley D. Adams
                                            Title:     Senior Vice President

                                            MERITECH MORTGAGE SERVICES, INC.,
                                            as Servicer

                                            By     /s/ David Dill
                                              ---------------------------------
                                            Name:      David Dill
                                            Title:     Senior Vice President

                                            WELLS FARGO BANK MINNESOTA,
                                             NATIONAL ASSOCIATION,
                                            as Trustee

                                            By     /s/ Peter A. Gobell
                                              ---------------------------------
                                            Name:      Peter A. Gobell
                                            Title:     Assistance Vice President

<PAGE>

 State of ___________   )
                        ) ss.:
County of ___________   )

          On the __th day of April, 2001 before me, a notary public in and for
the State of ____________, personally appeared ______________ known to me who,
being by me duly sworn, did depose and say that she is the ________________ of
Financial Asset Securities Corp., a ____________ corporation, one of the parties
that executed the foregoing instrument; and that she signed her name thereto by
order of the Board of Directors.

                                        ------------------------------
                                                 Notary Public

[Notarial Seal]

<PAGE>

 State of ___________   )
                        ) ss.:
County of ___________   )

          On the __th day of April, 2001 before me, a notary public in and for
the State of __________, personally appeared ______________ known to me who,
being by me duly sworn, did depose and say that he/she is the ______________ of
Saxon Mortgage, Inc., a ___________ corporation, one of the parties that
executed the foregoing instrument; and that he/she signed his/her name thereto
by order of the Board of Directors.

                                        ------------------------------
                                                 Notary Public

[Notarial Seal]

<PAGE>

State of ____________   )
                        ) ss.:
County of ___________   )

          On the __th day of April 2001, before me, a notary public in and for
the State of ___________, ____________ personally appeared, known to me who,
being by me duly did depose and say that he is an Authorized Officer of Wells
Fargo Bank Minnesota, National Association, a national banking association, one
of the parties that executed the foregoing instrument; and that he signed her
name thereto by order of the Board of Directors of said association.

                                        ------------------------------
                                                 Notary Public

[Notarial Seal]

<PAGE>

 State of ___________      )
                           ) ss.:
County of ___________      )

          On the __th day of April, 2001 before me, a notary public in and for
the State of __________, personally appeared ______________ known to me who,
being by me duly sworn, did depose and say that he/she is the ______________ of
Meritech Mortgage Services, Inc., a ___________ corporation, one of the parties
that executed the foregoing instrument; and that he/she signed his/her name
thereto by order of the Board of Directors.

                                        ------------------------------
                                                 Notary Public

[Notarial Seal]

<PAGE>

                                   EXHIBIT A-1

                          FORM OF CLASS A CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE 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").

Certificate No.:

Cut-Off Date:                               April 1, 2001

First Distribution Date:                    May 15, 2001

Final Scheduled Distribution Date:          April 15, 2031

Initial Certificate Principal
Balance of this Certificate
("Denomination"):

Original Class Principal
Balance:                                    $92,125,000.00

Certificate Rate:                           6.6256%

CUSIP:

Class:                                      A

                                      A-1-1

<PAGE>

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1
                                     Class A

         evidencing a percentage interest in the distributions allocable to the
         Certificates of the above-referenced Class with respect to a Trust
         consisting primarily of a pool of closed-end fixed rate and
         adjustable-rate home equity loans (the "Mortgage Loans")

         Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Principal Balance of this
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Certificate does
not evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Seller or the Trustee referred to below or any of their
respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.

         This certifies that CEDE & CO. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Denomination of this Certificate by the Class Principal Balance) in certain
monthly distributions with respect to the Trust. The Trust was created pursuant
to a Pooling and Servicing Agreement dated as of the Cut-Off Date specified
above (the "Agreement") among Financial Asset Securities Corp., as depositor
(the "Depositor"), Saxon Mortgage, Inc., as seller (the "Seller") and master
servicer (the "Master Servicer"), Meritech Mortgage Services, Inc., as servicer
(the "Servicer") and Wells Fargo Bank Minnesota, National Association, as
trustee (the "Trustee"). 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 Class Certificate by virtue of
the acceptance hereof assents and by which such Holder is bound.

         Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

                                      A-1-2

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  ______________, 20__

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                                     as Trustee

                                            By _________________________________

This is one of the Certificates
referenced in the within-mentioned Agreement

By _________________________________________
         Authorized Signatory of

                                    WELLS FARGO BANK MINNESOTA, NATIONAL
                                    ASSOCIATION,
                                            as Trustee

                                      A-1-3

<PAGE>

                            [Reverse of Certificate]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
                   Home Equity Loan Asset-Backed Certificates,
                                  Series 2001-1

         This Certificate is one of a duly authorized issue of Certificates
designated as Soundview Home Equity Loan Trust 2001-1, Home Equity Loan
Asset-Backed Certificates, Series 2001-1 (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
created by the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

         This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 15th day of each month or, if such 15th day is not a Business Day then the
first Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

         Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or, upon the written request of a Certificateholder
delivered to the Trustee at least five Business Days prior to the related
Distribution Date, by wire transfer or otherwise, as set forth in the Agreement.
The final distribution on each Certificate will be made in like manner, but only
upon presentment and surrender of such Certificate at the office or agency of
the Trustee specified in the notice to Certificateholders of such final
distribution.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Seller, the Trustee, the Master Servicer and the Servicer
with the consent of the Holders of the requisite percentage of the Voting Rights
of each Class of Certificates affected by such amendment, as specified in the
Agreement. 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 therefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.

                                      A-1-4

<PAGE>

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee in Minneapolis,
Minnesota, accompanied by a written instrument of transfer in form satisfactory
to the Trustee and the Certificate Registrar duly executed by the holder hereof
or such holder's attorney duly authorized in writing, and thereupon one or more
new Certificates of the same Class in authorized denominations and evidencing
the same aggregate Percentage Interest in the Trust will be issued to the
designated transferee or transferees.

         The Certificates are issuable only as registered Certificates 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 the same Class in authorized denominations and
evidencing the same 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 Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor or the Trustee or any
such agent shall be affected by any notice to the contrary.

         On any Distribution Date following the Due Period at the end of which
the Pool Balance is less than or equal to 10% of the sum of the aggregate
Principal Balance of the Mortgage Loans as of the Cut-Off Date, the Master
Servicer will have the option to repurchase, in whole, from the Trust the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the earlier of (i)
the day following the Distribution Date on which the aggregate Class Principal
Balance has been reduced to zero and (ii) the final payment or other liquidation
of the last Mortgage Loan in the Trust. In no event, however, will the trust
created by the Agreement continue beyond the expiration of 21 years from the
death of the last survivor of the descendants living at the date of the
Agreement of a certain person named in the Agreement.

         Capitalized terms used herein that are defined in the Agreement shall
have the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

                                      A-1-5

<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 Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

         I (We) further direct the Trustee 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

                           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-1-6

<PAGE>

                                   EXHIBIT A-2

                          FORM OF CLASS IO CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE 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").

THIS CLASS IO CERTIFICATE HAS NO PRINCIPAL BALANCE.

Certificate No.:

Cut-Off Date:                       April 1, 2001

First Distribution Date:            May 15, 2001

Final Scheduled Distribution Date:  April 15, 2004

Initial Notional Amount of
this Certificate ("Denomination"):

Initial Notional Amount
of Class IO Certificates:           None

Certificate Rate :                  Variable

CUSIP:

Class:                              IO

Percentage Interest
Evidenced by this Certificate:

                                      A-2-1

<PAGE>

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1
                                    Class IO

         evidencing a percentage interest in the distributions allocable to the
         Certificates of the above-referenced Class with respect to a Trust
         consisting primarily of a pool of closed-end fixed rate and
         adjustable-rate home equity loans (the "Mortgage Loans")

         This Certificate does not have a principal balance and will not be
entitled to distributions of principal. Interest only in respect of this
Certificate is distributable monthly as set forth herein. This Certificate does
not evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Seller or the Trustee referred to below or any of their
respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.

         This certifies that CEDE & CO. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Denomination of this Certificate by the Class Principal Balance) in certain
monthly distributions with respect to the Trust. The Trust was created pursuant
to a Pooling and Servicing Agreement dated as of the Cut-Off Date specified
above (the "Agreement") among Financial Asset Securities Corp., as depositor
(the "Depositor"), Saxon Mortgage, Inc., as seller (the "Seller") and master
servicer (the "Master Servicer"), Meritech Mortgage Services, Inc., as servicer
(the "Servicer") and Wells Fargo Bank Minnesota, National Association, as
trustee (the "Trustee"). 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 Class Certificate by virtue of
the acceptance hereof assents and by which such Holder is bound.

         Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

                                      A-2-2

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  ______________, 20__

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                                     as Trustee

                                            By _________________________________

This is one of the Certificates
referenced in the within-mentioned Agreement

By _________________________________________
         Authorized Signatory of

                                    WELLS FARGO BANK MINNESOTA, NATIONAL
                                    ASSOCIATION,
                                            as Trustee

                                      A-2-3

<PAGE>

                            [Reverse of Certificate]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
                   Home Equity Loan Asset-Backed Certificates,
                                 Series 2001-1

         This Certificate is one of a duly authorized issue of Certificates
designated as Soundview Home Equity Loan Trust 2001-1, Home Equity Loan
Asset-Backed Certificates, Series 2001-1 (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
created by the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

         This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 15th day of each month or, if such 15th day is not a Business Day then the
first Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

         Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or, upon the written request of a Certificateholder
delivered to the Trustee at least five Business Days prior to the related
Distribution Date, by wire transfer or otherwise, as set forth in the Agreement.
The final distribution on each Certificate will be made in like manner, but only
upon presentment and surrender of such Certificate at the office or agency of
the Trustee specified in the notice to Certificateholders of such final
distribution.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Seller, the Servicer, the Master Servicer, the Trustee with the consent
of the Holders of the requisite percentage of the Voting Rights of each Class of
Certificates affected by such amendment, as specified in the Agreement. 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 therefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                                      A-2-4

<PAGE>

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee in Minneapolis,
Minnesota, accompanied by a written instrument of transfer in form satisfactory
to the Trustee and the Certificate Registrar duly executed by the holder hereof
or such holder's attorney duly authorized in writing, and thereupon one or more
new Certificates of the same Class in authorized denominations and evidencing
the same aggregate Percentage Interest in the Trust will be issued to the
designated transferee or transferees.

         The Certificates are issuable only as registered Certificates 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 the same Class in authorized denominations and
evidencing the same 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 Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor or the Trustee or any
such agent shall be affected by any notice to the contrary.

         On any Distribution Date following the Due Period at the end of which
the Pool Balance is less than or equal to 10% of the sum of the aggregate
Principal Balance of the Mortgage Loans as of the Cut-Off Date, the Master
Servicer will have the option to repurchase, in whole, from the Trust the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the earlier of (i)
the day following the Distribution Date on which the aggregate Class Principal
Balance has been reduced to zero and (ii) the final payment or other liquidation
of the last Mortgage Loan in the Trust. In no event, however, will the trust
created by the Agreement continue beyond the expiration of 21 years from the
death of the last survivor of the descendants living at the date of the
Agreement of a certain person named in the Agreement.

         Capitalized terms used herein that are defined in the Agreement shall
have the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

                                      A-2-5

<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 Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

         I (We) further direct the Trustee 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

                           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-2-6

<PAGE>

                                   EXHIBIT A-3

        FORM OF SUBORDINATE [CLASS M-1, CLASS M-2 OR CLASS B] CERTIFICATE

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES AS
DESCRIBED IN THE AGREEMENT REFERRED TO 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").

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (i) A REPRESENTATION LETTER FROM THE
TRANSFEREE, ACCEPTED TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE,
TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN OR
ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE ("PLAN") NOR A PERSON ACTING ON
BEHALF OF ANY PLAN OR ARRANGEMENT NOR USING THE ASSETS OF ANY PLAN ARRANGEMENT,
CALLED A BENEFIT PLAN INVESTOR, TO EFFECT SUCH TRANSFER, (ii) IF THE PURCHASER
IS AN INSURANCE COMPANY, A REPRESENTATION THAT THE PURCHASER IS AN INSURANCE
COMPANY WHICH IS PURCHASING SUCH CERTIFICATES WITH FUNDS CONTAINED IN AN
"INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH TERM IS DEFINED IN SECTION V(e) OF
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60")) AND THAT THE
PURCHASE AND HOLDING OF SUCH CERTIFICATES ARE COVERED UNDER SECTIONS I AND III
OF PTCE 95-60, (iii) A REPRESENTATION THAT THE TRANSFEREE IS A BENEFIT PLAN
INVESTOR UNDERSTANDS THAT THE ELIGIBILITY OF SUCH CERTIFICATES FOR PURCHASE IS
CONDITIONED UPON SUCH CERTIFICATES BEING RATED AT LEAST "BBB-" AT THE TIME OF
ACQUISITION BY THE BENEFIT PLAN INVESTOR, OR (iv) AN OPINION OF COUNSEL IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 6.02(d) OF THE AGREEMENT REFERRED TO
HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED
TRANSFER OF THIS CERTIFICATE TO

                                      A-3-1

<PAGE>

OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE
PURSUANT TO CLAUSE (IV) ABOVE WITHOUT THE OPINION OF COUNSEL SATISFACTORY TO THE
TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.

Certificate No.:

Cut-Off Date:                               April 1, 2001

First Distribution Date:                    May 15, 2001

Final Scheduled Distribution Date:          April 15, 2031

Initial Certificate Principal
Balance of this Certificate
("Denomination"):

Original Class Principal
Balance:

Certificate Rate:

CUSIP:

Class:                                      [M-1, M-2 or B]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1
                           [Class M-1, M-2 or Class B]

         evidencing a percentage interest in the distributions allocable to the
         Certificates of the above-referenced Class with respect to a Trust
         consisting primarily of a pool of closed-end fixed rate and
         adjustable-rate home equity loans (the "Mortgage Loans")

         Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Principal Balance of this
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Certificate does
not evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Seller or the Trustee referred to below or any of their
respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.

         This certifies that CEDE & CO. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Denomination of this Certificate by the Class Principal

                                      A-3-2

<PAGE>

Balance) in certain monthly distributions with respect to the Trust. The Trust
was created pursuant to a Pooling and Servicing Agreement dated as of the
Cut-Off Date specified above (the "Agreement") among Financial Asset Securities
Corp., as depositor (the "Depositor"), Saxon Mortgage, Inc., as seller (the
"Seller") and master servicer (the "Master Servicer"), Meritech Mortgage
Services, Inc., as servicer (the "Servicer") and Wells Fargo Bank Minnesota,
National Association, as trustee (the "Trustee"). 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 Class Certificate by virtue of the acceptance hereof assents and by which
such Holder is bound.

         No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, or a person acting on behalf of any such plan ("Benefit Plan Investor"),
which representation letter shall not be an expense of the Trustee, or (ii) if
the purchaser is an insurance company, a representation that the purchaser is an
insurance company which is purchasing such Certificates with funds contained in
an "insurance company general account" (as such term is defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the
purchase and holding of such Certificates are covered under PTCE 95-60, (iii) a
representation that the transferee is a plan purchasing such Certificates on or
after the date the final PTE referred to in section 6.02(d) of the Agreement is
published in the Federal Register and that such purchase meets the conditions of
the final PTE, or (iv) in the case of any such Certificate presented for
registration in the name of a Benefit Plan Investor, an Opinion of Counsel
satisfactory to the Trustee to the effect that the purchase or holding of such
Certificate will not result in prohibited transactions under ERISA and/or
Section 4975 of the Code and will not subject the Trustee to any obligation in
addition to those undertaken in this Agreement, which Opinion of Counsel shall
not be an expense of the Trustee. Notwithstanding anything else to the contrary
herein, any purported transfer of a Certificate of this Class to or on behalf of
a Benefit Plan Investor pursuant to clause (iv) above without the Opinion of
Counsel satisfactory to the Trustee as described above shall be void and of no
effect.

         Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

                                      A-3-3

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  ______________, 20__

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                                     as Trustee

                                            By _________________________________

This is one of the Certificates
referenced in the within-mentioned Agreement

By _________________________________________
         Authorized Signatory of

                                    WELLS FARGO BANK MINNESOTA, NATIONAL
                                    ASSOCIATION,
                                            as Trustee

                                      A-3-4

<PAGE>

                            [Reverse of Certificate]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
                   Home Equity Loan Asset-Backed Certificates,
                                  Series 2001-1

         This Certificate is one of a duly authorized issue of Certificates
designated as Soundview Home Equity Loan Trust 2001-1, Home Equity Loan
Asset-Backed Certificates, Series 2001-1 (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
created by the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

         This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 15th day of each month or, if such 15th day is not a Business Day then the
first Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

         Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or, upon the written request of a Certificateholder
delivered to the Trustee at least five Business Days prior to the related
Distribution Date, by wire transfer or otherwise, as set forth in the Agreement.
The final distribution on each Certificate will be made in like manner, but only
upon presentment and surrender of such Certificate at the office or agency of
the Trustee specified in the notice to Certificateholders of such final
distribution.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Seller, the Master Servicer and the Servicer and the
Trustee with the consent of the Holders of the requisite percentage of the
Voting Rights of each Class of Certificates affected by such amendment, as
specified in the Agreement. 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 therefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.

                                      A-3-5

<PAGE>

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee in Minneapolis,
Minnesota, accompanied by a written instrument of transfer in form satisfactory
to the Trustee and the Certificate Registrar duly executed by the holder hereof
or such holder's attorney duly authorized in writing, and thereupon one or more
new Certificates of the same Class in authorized denominations and evidencing
the same aggregate Percentage Interest in the Trust will be issued to the
designated transferee or transferees.

         The Certificates are issuable only as registered Certificates 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 the same Class in authorized denominations and
evidencing the same 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 and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor or the Trustee or any
such agent shall be affected by any notice to the contrary.

         On any Distribution Date following the Due Period at the end of which
the Pool Balance is less than or equal to 10% of the sum of the aggregate
Principal Balance of the Mortgage Loans as of the Cut-Off Date, the Master
Servicer will have the option to repurchase, in whole, from the Trust the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the earlier of (i)
the day following the Distribution Date on which the aggregate Class Principal
Balance has been reduced to zero and (ii) the final payment or other liquidation
of the last Mortgage Loan in the Trust. In no event, however, will the trust
created by the Agreement continue beyond the expiration of 21 years from the
death of the last survivor of the descendants living at the date of the
Agreement of a certain person named in the Agreement.

         Capitalized terms used herein that are defined in the Agreement shall
have the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

                                      A-3-6

<PAGE>

                                   ASSIGNMENT

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

         I (We) further direct the Trustee 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

                           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-3-7

<PAGE>

                                    EXHIBIT B

                          FORM OF CLASS BIO 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").

THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

THIS CLASS BIO CERTIFICATE HAS NO PRINCIPAL BALANCE, DOES NOT BEAR INTEREST AND
WILL NOT RECEIVE ANY DISTRIBUTIONS EXCEPT AS PROVIDED HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (i) A REPRESENTATION LETTER FROM THE
TRANSFEREE ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE,
TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN
SUBJECT TO SECTION 4975 OF THE CODE, OR (ii) AN OPINION OF COUNSEL IN ACCORDANCE
WITH THE PROVISIONS OR A PERSON ACTING ON BEHALF OF ANY SUCH OR ARRANGEMENT OR
USING THE ASSETS OF ANY PLAN OR ARRANGEMENT TO EFFECT SUCH TRANSFER OF SECTION
6.02(D) THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE
CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF
AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE WITHOUT THE OPINION OF
COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO
EFFECT.

Certificate No.:

Percentage Interest evidenced by this Certificate:

                                       B-1

<PAGE>

Class:                                      BIO

                                       B-2

<PAGE>

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1
                                    Class BIO

         evidencing a percentage interest in the distributions allocable to the
         Certificates of the above-referenced Class with respect to a Trust
         consisting primarily of a pool of closed-end fixed rate and
         adjustable-rate home equity loans (the "Mortgage Loans")

         This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Seller or the Trustee referred to below or any of
their respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.

         This certifies that ___________________ is the registered owner of the
Percentage Interest evidenced by this Certificate specified above in the
interest represented by all Certificates of the Class to which this Certificate
belongs in the Trust. The Trust was created pursuant to a Pooling and Servicing
Agreement dated as of April 1, 2001 (the "Agreement") among the Financial Asset
Securities Corp., as depositor (the "Depositor"), Saxon Mortgage, Inc., as
seller (the "Seller") and master servicer (the "Master Servicer"), Meritech
Mortgage Services, Inc., as servicer (the "Servicer") and Wells Fargo Bank
Minnesota, National Association, as trustee (the "Trustee"). 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.

         No distributions are expected to be made on this Certificate. This
Certificate does not have a principal balance or pass-through rate and will be
entitled to distributions only to the extent set forth in the Agreement. In
addition, any distribution of the proceeds of any remaining assets of the Trust
will be made only upon presentment and surrender of this Certificate at the
Corporate Trust Office or the office or agency maintained by the Trustee in
Minneapolis, Minnesota.

         No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee shall each certify to the Trustee in
writing the facts surrounding the transfer. In the event that such a transfer is
to be made within three years from the date of the initial issuance of
Certificates pursuant to the Agreement, there shall also be delivered (except in
the case of a transfer pursuant to Rule 144A of the Securities Act) to the
Trustee an Opinion of Counsel that such transfer may be made pursuant to an
exemption from the Securities Act, which Opinion of Counsel shall not be
obtained at the expense of the Trustee or the Seller. The Holder hereof desiring
to effect such transfer shall, and does hereby agree to, indemnify 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.

                                       B-3

<PAGE>

         No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, nor a person acting on behalf of any such plan or arrangement nor using
the assets of any plan or arrangement ("Benefit Plan Investor") to effect such
transfer, which representation letter shall not be an expense of the Trustee, or
(ii) in the case of any such Certificate presented for registration in the name
of a Benefit Plan Investor, an Opinion of Counsel satisfactory to the Trustee to
the effect that the purchase or holding of such Certificate will not result in
prohibited transactions under ERISA and/or Section 4975 of the Code and will not
subject the Trustee to any obligation in addition to those undertaken in this
Agreement or to any liability, which Opinion of Counsel shall not be an expense
of the Trustee. Notwithstanding anything else to the contrary herein, any
purported transfer of a Certificate of this Class to or on behalf of a Benefit
Plan Investor without the Opinion of Counsel satisfactory to the Trustee as
described above shall be void and of no effect.

         Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions of the Agreement, including but not limited to the
restrictions that (i) each person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee, (ii) no Ownership Interest in
this Certificate may be transferred without delivery to the Trustee of (a) a
transfer affidavit of the proposed transferee and (b) a transfer certificate of
the transferor, each of such documents to be in the form described in the
Agreement, (iii) each person holding or acquiring any Ownership Interest in this
Certificate must agree to require a transfer affidavit and to deliver a transfer
certificate to the Trustee as required pursuant to the Agreement, (iv) each
person holding or acquiring an Ownership Interest in this Certificate must agree
not to transfer an Ownership Interest in this Certificate if it has actual
knowledge that the proposed transferee is not a Permitted Transferee and (v) 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.

         Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized officer of the Trustee.

                                               *         *        *

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:   _______________, 20__

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                            as Trustee

                                       B-4

<PAGE>

                                            By _________________________________

This is one of the Certificates
referenced in the within-mentioned Agreement

By _________________________________________
         Authorized Signatory of

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                             as Trustee

                                       B-5

<PAGE>

                       [Reverse of Class BIO Certificate]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
                   Home Equity Loan Asset-Backed Certificates,
                                  Series 2001-1

         This Certificate is one of a duly authorized issue of Certificates
designated as Soundview Home Equity Loan Trust 2001-1, Home Equity Loan
Asset-Backed Certificates, Series 2001-1 (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
created by the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

         This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 15th day of each month or, if such 15th day is not a Business Day, then the
first Business Day following such Distribution Date (the "Distribution Date"),
commencing on May 15, 2001, to the Person in whose name this Certificate is
registered at the close of business on the applicable Record Date in an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to Holders of Certificates of the
Class to which this Certificate belongs on such Distribution Date pursuant to
the Agreement.

         Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Distribution Date, or, if not, by check mailed by first class
mail to the address of such Certificateholder appearing in the Certificate
Register. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Seller, the Trustee with the consent of the Holders of the requisite
percentage of the Percentage Interests of each Class of Certificates affected by
such amendment, as specified in the Agreement. 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 therefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also

                                       B-6

<PAGE>

permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

         The Certificates are issuable only as registered Certificates 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 the same Class in authorized denominations and
evidencing the same 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 and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor or the Trustee or any
such agent shall be affected by any notice to the contrary.

         On any Distribution Date following the Due Period at the end of which
the Pool Balance is less than or equal to 10% of the sum of the aggregate
Principal Balance of the Mortgage Loans as of the Cut-Off Date, the Master
Servicer will have the option to repurchase, in whole, from the Trust the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the earlier of (i)
the day following the Distribution Date on which the aggregate Class Principal
Balance of the Certificates has been reduced to zero and (ii) the final payment
or other liquidation of the last Mortgage Loan in the Trust. In no event,
however, will the trust created by the Agreement continue beyond the expiration
of 21 years from the death of the last survivor of the descendants living at the
date of the Agreement of a certain person named in the Agreement.

         Capitalized terms used herein that are defined in the Agreement shall
have the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

                                       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 Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

         I (We) further direct the Trustee 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

                           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 B-1

                          FORM OF CLASS R CERTIFICATES

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 REPRESENTS THE "TAX MATTERS PERSON RESIDUAL INTEREST" ISSUED
UNDER THE AGREEMENT REFERRED TO BELOW AND MAY NOT BE TRANSFERRED TO ANY PERSON
EXCEPT IN CONNECTION WITH THE ASSUMPTION BY THE TRANSFEREE OF CERTAIN DUTIES
SPECIFIED IN THE AGREEMENT.]

THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

THIS CLASS R-_ CERTIFICATE HAS NO PRINCIPAL BALANCE, DOES NOT BEAR INTEREST AND
WILL NOT RECEIVE ANY DISTRIBUTIONS EXCEPT AS PROVIDED HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (i) A REPRESENTATION LETTER FROM THE
TRANSFEREE ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE
TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN
SUBJECT TO SECTION 4975 OF THE CODE OR ANY PERSON ACTING ON BEHALF OF ANY SUCH
PLAN OR ARRANGEMENT OR USING THE ASSETS OF ANY PLAN OR ARRANGEMENT TO EFFECT
SUCH TRANSFER, OR FROM THE TRANSFEREE ACCEPTABLE TO AND IN FORM AND SUBSTANCE,
SATISFACTORY TO THE TRUSTEE (ii) AN OPINION OF COUNSEL IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 6.02(D) THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING
ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE
TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE
WITHOUT THE OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE
SHALL BE VOID AND OF NO EFFECT.

                                      B-1-1

<PAGE>

Certificate No.:

Percentage Interest
evidenced by this
Certificate                                 :        [99.999999%] [0.000001%]

Class                                                :        R-_

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1
                                    Class R-_

         evidencing a percentage interest in the distributions allocable to the
         Certificates of the above-referenced Class with respect to a Trust
         consisting primarily of a pool of closed-end fixed rate and
         adjustable-rate home equity loans (the "Mortgage Loans")

         This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Seller or the Trustee referred to below or any of
their respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.

         This certifies that _________________________ is the registered owner
of the Percentage Interest evidenced by this Certificate specified above in the
interest represented by all Certificates of the Class to which this Certificate
belongs in the Trust. The Trust was created pursuant to a Pooling and Servicing
Agreement dated as of April 1, 2001 (the "Agreement") among the Financial Asset
Securities Corp., as depositor (the "Depositor"), Saxon Mortgage, Inc., as
seller (the "Seller") and master servicer (the "Master Servicer"), Meritech
Mortgage Services, Inc., as servicer (the "Servicer") and Wells Fargo Bank
Minnesota, National Association, as trustee (the "Trustee"). 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.

         No distributions are expected to be made on this Certificate. This
Certificate does not have a principal balance or pass-through rate and will be
entitled to distributions only to the extent set forth in the Agreement. In
addition, any distribution of the proceeds of any remaining assets of the Trust
will be made only upon presentment and surrender of this Certificate at the
Corporate Trust Office or the office or agency maintained by the Trustee in
Minneapolis, Minnesota.

         No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect

                                      B-1-2

<PAGE>

such transfer and such Certificateholder's prospective transferee shall each
certify to the Trustee in writing the facts surrounding the transfer. In the
event that such a transfer is to be made within three years from the date of the
initial issuance of Certificates pursuant to the Agreement, there shall also be
delivered (except in the case of a transfer pursuant to Rule 144A of the
Securities Act) to the Trustee an Opinion of Counsel that such transfer may be
made pursuant to an exemption from the Securities Act, which Opinion of Counsel
shall not be obtained at the expense of the Trustee or the Seller. The Holder
hereof desiring to effect such transfer shall, and does hereby agree to,
indemnify 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.

         No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, or a person acting on behalf of any such plan or arrangement or using the
assets of any such plan or arrangement ("Benefit Plan Investor") to affect such
transfer, which representation letter shall not be an expense of the Trustee, or
(ii) in the case of any such Certificate presented for registration in the name
of a Benefit Plan Investor, an Opinion of Counsel satisfactory to the Trustee to
the effect that the purchase or holding of such Certificate will not result in
prohibited transactions under ERISA and/or Section 4975 of the Code and will not
subject the Trustee to any obligation in addition to those undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Trustee.
Notwithstanding anything else to the contrary herein, any purported transfer of
a Certificate of this Class to or on behalf of a Benefit Plan Investor without
the Opinion of Counsel satisfactory to the Trustee as described above shall be
void and of no effect.

         Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions of the Agreement, including but not limited to the
restrictions that (i) each person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee, (ii) no Ownership Interest in
this Certificate may be transferred without delivery to the Trustee of (a) a
transfer affidavit of the proposed transferee and (b) a transfer certificate of
the transferor, each of such documents to be in the form described in the
Agreement, (iii) each person holding or acquiring any Ownership Interest in this
Certificate must agree to require a transfer affidavit and to deliver a transfer
certificate to the Trustee as required pursuant to the Agreement, (iv) each
person holding or acquiring an Ownership Interest in this Certificate must agree
not to transfer an Ownership Interest in this Certificate if it has actual
knowledge that the proposed transferee is not a Permitted Transferee and (v) 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.

         Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized officer of the Trustee.

                                      B-1-3

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:   _______________, 20__

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                             as Trustee

                                            By _________________________________

This is one of the Certificates
referenced in the within-mentioned Agreement

By _________________________________________
         Authorized Signatory of

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                            as Trustee

                                      B-1-4

<PAGE>

                        [Reverse of Class R Certificate]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1

         This Certificate is one of a duly authorized issue of Certificates
designated as Soundview Home Equity Loan Trust 2001-1, Home Equity Loan
Asset-Backed Certificates, Series 2001-1 (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
created by the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

         This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 15th day of each month or, if such 15th day is not a Business Day, then the
first Business Day following such Distribution Date (the "Distribution Date"),
commencing in May 15, 2001, to the Person in whose name this Certificate is
registered at the close of business on the applicable Record Date in an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to Holders of Certificates of the
Class to which this Certificate belongs on such Distribution Date pursuant to
the Agreement.

         Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Distribution Date, or, if not, by check mailed by first class
mail to the address of such Certificateholder appearing in the Certificate
Register. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Seller, the Servicer, the Master Servicer, the Trustee
with the consent of the Holders of the requisite percentage of the Percentage
Interests of each Class of Certificates affected by such amendment, as specified
in the Agreement. 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 therefor or in lieu hereof whether or not notation of such consent is

                                      B-1-5

<PAGE>

made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.

         The Certificates are issuable only as registered Certificates 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 the same Class in authorized denominations and
evidencing the same 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 and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor or the Trustee or any
such agent shall be affected by any notice to the contrary.

         On any Distribution Date following the Due Period at the end of which
the Pool Balance is less than or equal to 10% of the sum of the aggregate
Principal Balance of the Mortgage Loans as of the Cut-Off Date, the Master
Servicer will have the option to repurchase, in whole, from the Trust the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the earlier of (i)
the day following the Distribution Date on which the aggregate Class Principal
Balance of the Offered Certificates has been reduced to zero and (ii) the final
payment or other liquidation of the last Mortgage Loan in the Trust. In no
event, however, will the trust created by the Agreement continue beyond the
expiration of 21 years from the death of the last survivor of the descendants
living at the date of the Agreement of a certain person named in the Agreement.

         Capitalized terms used herein that are defined in the Agreement shall
have the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

                                      B-1-6

<PAGE>

                                   ASSIGNMENT

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

         I (We) further direct the Trustee 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

                           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-1-7

<PAGE>

                                   EXHIBIT B-2

                           FORM OF CLASS P 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").

THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

THIS CLASS P CERTIFICATE DOES NOT BEAR INTEREST AND WILL NOT RECEIVE ANY
DISTRIBUTIONS EXCEPT AS PROVIDED HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (i) A REPRESENTATION LETTER FROM THE
TRANSFEREE ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE
TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN
SUBJECT TO SECTION 4975 OF THE CODE OR ANY PERSON ACTING ON BEHALF OF ANY SUCH
PLAN OR ARRANGEMENT OR USING THE ASSETS OF ANY PLAN OR ARRANGEMENT TO EFFECT
SUCH TRANSFER, OR (ii) AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 6.02(D) OF THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING ANYTHING
ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON
BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR TO THE CODE WITHOUT THE
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID
AND OF NO EFFECT.

Certificate No.:

Percentage Interest evidenced by this Certificate:

                                      B-2-1

<PAGE>

Initial Principal Balance:

Class:                                      P

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
            Home Equity Loan Asset-Backed Certificates, Series 2001-1
                                     Class P

         evidencing a percentage interest in the distributions allocable to the
         Certificates of the above-referenced Class with respect to a Trust
         consisting primarily of a pool of closed-end fixed rate and
         adjustable-rate home equity loans (the "Mortgage Loans")

         This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Seller or the Trustee referred to below or any of
their respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.

         This certifies that _____________________________________ is the
registered owner of the Percentage Interest evidenced by this Certificate
specified above in the interest represented by all Certificates of the Class to
which this Certificate belongs in the Trust. The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2001 (the "Agreement")
among Financial Asset Securities Corp., as depositor (the "Depositor"), Saxon
Mortgage, Inc., as seller (the "Seller") and master servicer (the "Master
Servicer"), Meritech Mortgage Services, Inc., as servicer (the "Servicer"), and
Wells Fargo Bank Minnesota, National Association, as trustee (the "Trustee"). 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.

         This Certificate does not have a pass-through rate and will be entitled
to distributions only to the extent set forth in the Agreement. In addition, any
distribution of the proceeds of any remaining assets of the Trust will be made
only upon presentment and surrender of this Certificate at the Corporate Trust
Office or the office or agency maintained by the Trustee in Minneapolis,
Minnesota.

         No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act and
such laws, in order to assure compliance with the Securities Act and such laws,
the Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee shall each certify to the Trustee in
writing the facts surrounding the transfer. In the event that such a transfer is
to be made within three years from the date of the initial issuance of
Certificates pursuant to the Agreement, there shall also be delivered (except in
the case of a transfer pursuant to Rule 144A of the Securities Act) to the
Trustee an Opinion of Counsel that such transfer may be made pursuant to an
exemption from the

                                      B-2-2

<PAGE>

Securities Act, which Opinion of Counsel shall not be obtained at the expense of
the Trustee or the Seller. The Holder hereof desiring to effect such transfer
shall, and does hereby agree to, indemnify 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.

         No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, or a person acting on behalf of any such plan or arrangement or using the
assets of any such plan or arrangement ("Benefit Plan Investor") to effect such
transfer, which representation letter shall not be an expense of the Trustee, or
(ii) in the case of any such Certificate presented for registration in the name
of a Benefit Plan Investor, an Opinion of Counsel satisfactory to the Trustee to
the effect that the purchase or holding of such Certificate will not result in
prohibited transactions under ERISA and/or Section 4975 of the Code and will not
subject the Trustee to any obligation in addition to those undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Trustee.
Notwithstanding anything else to the contrary herein, any purported transfer of
a Certificate of this Class to or on behalf of a Benefit Plan Investor without
the Opinion of Counsel satisfactory to the Trustee as described above shall be
void and of no effect.

         Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions of the Agreement, including but not limited to the
restrictions that (i) each person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee, (ii) no Ownership Interest in
this Certificate may be transferred without delivery to the Trustee of (a) a
transfer affidavit of the proposed transferee and (b) a transfer certificate of
the transferor, each of such documents to be in the form described in the
Agreement, (iii) each person holding or acquiring any Ownership Interest in this
Certificate must agree to require a transfer affidavit and to deliver a transfer
certificate to the Trustee as required pursuant to the Agreement, (iv) each
person holding or acquiring an Ownership Interest in this Certificate must agree
not to transfer an Ownership Interest in this Certificate if it has actual
knowledge that the proposed transferee is not a Permitted Transferee and (v) 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.

         Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized officer of the Trustee.

                                      * * *

                                      B-2-3

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:   ___________, 20__

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                             as Trustee

                                            By _________________________________

This is one of the Certificates referenced in the within-mentioned Agreement

By _________________________________________
         Authorized Signatory of

                                            WELLS FARGO BANK MINNESOTA, NATIONAL
                                            ASSOCIATION,
                                             as Trustee

                                      B-2-4

<PAGE>

                        [Reverse of Class P Certificate]

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
                   Home Equity Loan Asset-Backed Certificates,
                                  Series 2001-1

         This Certificate is one of a duly authorized issue of Certificates
designated as Soundview Home Equity Loan Trust 2001-1, Home Equity Loan
Asset-Backed Certificates, Series 2001-1 (herein collectively called the
"Certificates"), and representing a beneficial ownership interest in the Trust
created by the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

         This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 15th day of each month or, if such 15th day is not a Business Day, then the
first Business Day following such Distribution Date (the "Distribution Date"),
commencing in April 1, 2001, to the Person in whose name this Certificate is
registered at the close of business on the applicable Record Date in an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to Holders of Certificates of the
Class to which this Certificate belongs on such Distribution Date pursuant to
the Agreement.

         Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Distribution Date, or, if not, by check mailed by first class
mail to the address of such Certificateholder appearing in the Certificate
Register. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Seller, the Servicer, the Master Servicer and the Trustee
with the consent of the Holders of the requisite percentage of the Percentage
Interests of each Class of Certificates affected by such amendment, as specified
in the Agreement. 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 therefor or in lieu hereof whether or not notation of such consent is

                                      B-2-5

<PAGE>

made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.

         The Certificates are issuable only as registered Certificates without
coupons 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 the same Class in authorized denominations
and evidencing the same 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 and the Trustee and any agent of the Depositor or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Trustee or any
such agent shall be affected by any notice to the contrary.

         On any Distribution Date following the Due Period at the end of which
the Pool Balance is less than or equal to 10% of the sum of the aggregate
Principal Balance of the Mortgage Loans as of the Cut-Off Date, the Master
Servicer will have the option to repurchase, in whole, from the Trust the
Mortgage Loans at a purchase price determined as provided in the Agreement. In
the event that no such optional termination occurs, the obligations and
responsibilities created by the Agreement will terminate upon the earlier of (i)
the day following the Distribution Date on which the aggregate Class Principal
Balance of the Certificates has been reduced to zero and (ii) the final payment
or other liquidation of the last Mortgage Loan in the Trust. In no event,
however, will the trust created by the Agreement continue beyond the expiration
of 21 years from the death of the last survivor of the descendants living at the
date of the Agreement of a certain person named in the Agreement.

         Capitalized terms used herein that are defined in the Agreement shall
have the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

                                      B-2-6

<PAGE>

                                   ASSIGNMENT

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

         I (We) further direct the Trustee 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

                           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-2-7

<PAGE>

                                    EXHIBIT C

                             MORTGAGE LOAN SCHEDULE

                        [DELIVERED TO TRUSTEE AT CLOSING]

                                       C-1

<PAGE>

                                    EXHIBIT D

                              INTENTIONALLY OMITTED

                                       D-1

<PAGE>

                                    EXHIBIT E

                              FORM OF MORTGAGE NOTE

                              [NOT INCLUDED HEREIN]

                                       E-1

<PAGE>

                                    EXHIBIT F

                                FORM OF MORTGAGE

                              [NOT INCLUDED HEREIN]

                                       F-1

<PAGE>

                                    EXHIBIT G

                 AFFIDAVIT OF TRANSFER OF RESIDUAL CERTIFICATES
                           PURSUANT TO SECTION 6.02(d)

                     SOUNDVIEW HOME EQUITY LOAN TRUST 2001-1
                   Home Equity Loan Pass-Through Certificates,
                                  Series 2001-1

STATE OF            )
                    ) ss.:
COUNTY OF           )

         The undersigned, being first duly sworn, deposes and says as follows:

         1. The undersigned is an officer of , the proposed Transferee of an
Ownership Interest in a Residual Certificate (the "Certificate") issued pursuant
to the Pooling and Servicing Agreement, (the "Agreement"), relating to the
above-referenced Series, by and among Financial Asset Securities Corp., as
depositor (the "Depositor"), Saxon Mortgage, Inc., as seller (the "Seller") and
master servicer (the "Master Sevicer"), Meritech Mortgage Services, Inc., as
servicer (the "Servicer") and Wells Fargo Bank Minnesota, National Association,
as trustee (the "Trustee"). Capitalized terms used, but not defined herein or in
Exhibit 1 hereto, shall have the meanings ascribed to such terms in the
Agreement. The Transferee has authorized the undersigned to make this affidavit
on behalf of the Transferee.

         2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificate either (i) for its own account or (ii) as
nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit. The
Transferee has no knowledge that any such affidavit is false.

         3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.

         4. The Transferee has been advised of, and understands that a tax will
be imposed on a "pass-through entity" holding the Certificate if at any time
during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in

                                       G-1

<PAGE>

such entity. The Transferee understands that such tax will not be imposed for
any period with respect to which the record holder furnishes to the pass-through
entity an affidavit that such record holder is a Permitted Transferee and the
pass-through entity does not have actual knowledge that such affidavit is false.
(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 and, except as may be provided in
Treasury Regulations, persons holding interests in pass-through entities as a
nominee for another Person.)

         5. The Transferee has reviewed the provisions of Section 6.02(d) of the
Agreement (attached hereto as Exhibit 2 and incorporated herein by reference)
and understands the legal consequences of the acquisition of an Ownership
Interest in the Certificate including, without limitation, the restrictions on
Subsequent Transfers and the provisions regarding voiding the Transfer and
mandatory sales. The Transferee expressly agrees to be bound by and to abide by
the provisions of Section 6.02(d) of the Agreement and the restrictions noted on
the face of the Certificate. The Transferee understands and agrees that any
breach of any of the representations included herein shall render the Transfer
to the Transferee contemplated hereby null and void.

         6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit M to the Agreement (a "Transferor Certificate") to the
effect that such Transferee has no actual knowledge that the Person to which the
Transfer is to be made is not a Permitted Transferee.

         7. The Transferee does not have the intention to impede the assessment
or collection of any tax legally required to be paid with respect to the
Certificate.

         8. The Transferee's taxpayer identification number is
_________________.

         9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).

         10. The Transferee is aware that the Certificate may be a "noneconomic
residual interest" within the meaning of proposed 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.

         11. The Transferee is either (i) not an employee benefit plan that is
subject to ERISA or a plan that is subject to Section 4975 of the Code (a
"Plan"), nor is acting on behalf of such a plan or arrangement or using the
assets of any such plan or arrangement to effect such transfer, or (ii) is a
Plan which has provided the Trustee with the Opinion of Counsel referred to in
Section 6.02(d) of the Agreement.

                                       G-2

<PAGE>

                                      * * *

                                       G-3

<PAGE>

         IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer and its corporate seal to be hereunto affixed, duly
attested, this day of ________________, __ .

                                                     [NAME OF TRANSFEREE]

                                                     By:________________________
                                                        Name:
                                                        Title:

[Corporate Seal]

ATTEST:

[Assistant] Secretary

         Personally appeared before me the above-named , known or proved to me
to be the same person who executed the foregoing instrument and to be the of the
Transferee, and acknowledged that he executed the same as his free act and deed
and the free act and deed of the Transferee.

         Subscribed and sworn before me this       day of          , 20  .

                                                       NOTARY PUBLIC

         My Commission expires the ____ day of ___________________, ____.

                                       G-4

<PAGE>

                             EXHIBIT 1 to EXHIBIT G

                               Certain Definitions

         "Ownership Interest": As to any Certificate 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.

         "Permitted Transferee": Any Person other than (i) the United States or
any State or any political subdivision thereof or any agency or instrumentality
of any of the foregoing; (ii) a foreign government, international organization
or any agency or instrumentality of either of the foregoing; (iii) an
organization which is exempt from tax imposed by Chapter 1 of the Code
(including the tax imposed by section 511 of the Code on unrelated business
taxable income) (except certain farmers' cooperatives described in Code section
521) on any excess inclusions (as defined in Section 860E(c)(1)) with respect to
any Residual Certificate; (iv) rural electric and telephone cooperatives
described in Code section 1381(a)(2)(C); (v) a Person that is not (a) a citizen
or resident of the United States, (b) a corporation, partnership or other entity
created or organized in or under the laws of the United States or any political
subdivision thereof, (c) an estate whose income from sources without the United
States is includible in gross income for United States federal income tax
purposes regardless of its connection with the conduct of a trade or business
within the United States or (d) a trust if a court within the United States is
able to exercise primary supervision of the administration of the trust and one
or more United States fiduciaries have the authority to control all substantial
decisions of the trust; or (vi) any other Person so designated by the Trustee
based on an Opinion of Counsel to the effect that any transfer to such Person
may cause the Trust to fail to qualify as a REMIC at any time the Certificates
are outstanding. The terms "United States", "State" and "international
organization" shall have the meanings set forth in Code section 7701 or
successor provisions. A corporation will not be treated as an instrumentality of
the United States or of any State or political subdivision thereof if all of its
activities are subject to tax, and, with the exception of the Freddie Mac, a
majority of its board of directors is not selected by such governmental unit.

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

         "Transfer": Any direct or indirect transfer or sale of any Ownership
Interest in a Certificate, including the acquisition of a Certificate by the
Depositor.

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

                                       G-5

<PAGE>

                             EXHIBIT 2 to EXHIBIT G

         Section 6.02(d) of the Agreement

         (d) Except with respect to the initial transfer of the Class BIO, the
Class P and the Residual Certificates by the Seller, no transfer, sale, pledge
or other disposition of any Class BIO, any Class P or any Residual Certificate
shall be made unless such disposition is exempt from the registration
requirements of the Securities Act of 1933, as amended (the "1933 Act"), and any
applicable state securities laws or is made in accordance with the 1933 Act and
laws. In the event of any such transfer, other than the transfer of the Tax
Matters Person Residual Interest to the Trustee in reliance upon Rule 144A under
the 1933 Act, the Trustee and the Seller shall require either (i) a written
Opinion of Counsel (which may be in-house counsel) acceptable to and in form and
substance reasonably satisfactory to the Trustee and the Seller that such
transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the 1933 Act or is being made pursuant to
the 1933 Act, which Opinion of Counsel shall not be an expense of the Trustee or
the Seller or (ii) the Trustee shall require the transferor to execute a
transferor certificate (in substantially the form attached hereto as Exhibit M)
and the transferee to execute an investment letter (in substantially the form
attached hereto as Exhibit N-1 or N-2) acceptable to and in form and substance
reasonably satisfactory to the Seller and the Trustee certifying to the Seller
and the Trustee the facts surrounding such transfer, which investment letter
shall not be an expense of the Trustee or the Seller. The Holder of a Class BIO,
a Class P or a Residual Certificate desiring to effect such transfer shall, and
does hereby agree to, indemnify the Trustee and the Seller against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.

         No transfer of an ERISA Restricted Certificate shall be made unless the
Trustee shall have received either (i) a representation from the transferee of
such Certificate acceptable to and in form and substance satisfactory to the
Trustee, such requirement is satisfied only by the Trustee's receipt of a
representation letter from the transferee substantially in the form of Exhibit
N-1 or Exhibit N-2, as appropriate), to the effect that such transferee is not
an employee benefit plan or arrangement subject to Section 406 of ERISA or a
plan subject to Section 4975 of the Code, or a person acting on behalf of any
such plan or arrangement or using the assets of any such plan or arrangement to
effect such transfer ("Benefit Plan Investor") or (ii) if an ERISA Restricted
Certificate which is an Offered Certificate is being purchased by an insurance
company, a representation that an insurance company is purchasing such
Certificates with funds contained in an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60") and that the purchase and holding of such Certificates are
covered under Sections I and III of PTCE 95-60 or (iii) if an ERISA Restricted
Certificate which is an Offered Certificate is purchased by a Benefit Plan
Investor, a representation that the Benefit Plan Investor understands that the
eligibility of the Certificates for purchase is conditioned upon such
Certificates being rated at least "BBB-" at the time of acquisition of such
Certificates by the Benefit Plan Investor or (iv) in the case of any ERISA
Restricted Certificate presented for registration in the name of a Benefit Plan
Investor, an Opinion of Counsel satisfactory to the Trustee, which Opinion of
Counsel shall not be an expense of either the Trustee or the Trust, addressed to
the Trustee, to the effect that the purchase

                                       G-6

<PAGE>

or holding of such ERISA Restricted Certificate will not result in prohibited
transactions under ERISA and/or Section 4975 of the Code and will not subject
the Trustee to any obligation in addition to those expressly undertaken in this
Agreement or to any liability. Notwithstanding anything else to the contrary
herein, the representation required by clause (i), (ii) or (iii) above with
respect to any ERISA Restricted Certificate that is a Book-Entry Certificate
shall be deemed to have been made by the Certificate Owner by virtue of such
Certificate Owner's acquisition of such Certificate; and any purported transfer
of an ERISA Restricted Certificate to or on behalf of a Benefit Plan Investor
pursuant to clause (iv) above without the delivery to the Trustee of an Opinion
of Counsel satisfactory to the Trustee as described above shall be void and of
no effect.

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

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

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

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

                           (A) an affidavit in the form of Exhibit G from the
proposed transferee to the effect that such transferee is a Permitted Transferee
and that it is not acquiring its Ownership Interest in the Residual Certificate
that is the subject of the proposed transfer as a nominee, trustee or agent for
any Person who is not a Permitted Transferee; and

                           (B) a covenant of the proposed transferee to the
effect that the proposed transferee agrees to be bound by and to abide by the
transfer restrictions applicable to the Residual Certificates.

                  (iv) Any attempted or purported transfer of any Ownership
Interest in a Residual Certificate in violation of the provisions of this
Section 6.02 shall be absolutely null and void and shall vest no rights in the
purported transferee. If any purported transferee shall, in violation of the
provisions of this Section 6.02, become a Holder of a Residual Certificate, then
the prior Holder of such Residual Certificate that is a Permitted Transferee
shall, upon discovery that the registration of transfer of such Residual
Certificate was not in fact permitted by this Section 6.02, be restored to all
rights as Holder thereof retroactive to the date of registration of transfer of
such Residual Certificate. The Trustee shall be under no liability to any Person
for any registration of transfer of

                                       G-7

<PAGE>

a Residual Certificate that is in fact not permitted by this Section 6.02 or for
making any distributions due on such Residual Certificate to the Holder thereof
or taking any other action with respect to such Holder under the provisions of
the Agreement so long as the Trustee received the documents specified in clause
(iii). The Trustee shall be entitled to recover from any Holder of a Residual
Certificate that was in fact not a Permitted Transferee at the time such
distributions were made all distributions made on such Residual Certificate. Any
such distributions so recovered by the Trustee shall be distributed and
delivered by the Trustee to the prior Holder of such Residual Certificate that
is a Permitted Transferee.

                  (v) If any Person other than a Permitted Transferee acquires
any Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section 6.02, then the Trustee shall have the right but not
the obligation, without notice to the Holder of such Residual Certificate or any
other Person having an Ownership Interest therein, to notify the Seller to
arrange for the sale of such Residual Certificate. The proceeds of such sale,
net of commissions (which may include commissions payable to the Seller or its
Affiliates in connection with such sale), expenses and taxes due, if any, will
be remitted by the Trustee to the previous Holder of such Residual Certificate
that is a Permitted Transferee, except that in the event that the Trustee
determines that the Holder of such Residual Certificate may be liable for any
amount due under this Section 6.02 or any other provisions of this Agreement,
the Trustee may withhold a corresponding amount from such remittance as security
for such claim. The terms and conditions of any sale under this clause (v) shall
be determined in the sole discretion of the Trustee, and it shall not be liable
to any Person having an Ownership Interest in a Residual Certificate as a result
of its exercise of such discretion.

                  (vi) If any Person other than a Permitted Transferee acquires
any Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section 6.02, then the Trustee, based on information
provided to the Trustee by the Seller will provide to the Internal Revenue
Service, and to the persons specified in Sections 860E(e)(3) and (6) of the
Code, information needed to compute the tax imposed under Section 860E(e)(5) of
the Code on transfers of residual interests to disqualified organizations.

The foregoing provisions of this Section 6.02(d) shall cease to apply to
transfers occurring on or after the date on which there shall have been
delivered to the Trustee, in form and substance satisfactory to the Trustee, (i)
written notification from each Rating Agency that the removal of the
restrictions on Transfer set forth in this Section 6.02 will not cause such
Rating Agency to downgrade its rating of the Certificates and (ii) an Opinion of
Counsel to the effect that such removal will not cause any REMIC to fail to
qualify as a REMIC.

         Each Tax Matters Person Residual Interest shall at all times be
registered in the name of the Seller.

                                       G-8

<PAGE>

                                    EXHIBIT H

                            LETTER OF REPRESENTATIONS

                 [To be attached but not included in 8-K filing]

                                       H-1

<PAGE>

                                    EXHIBIT I

                    FORM OF REQUEST FOR RELEASE OF DOCUMENTS

Wells Fargo Bank Minnesota, N.A.
1015 10th Avenue S.E.
Minneapolis, MN 55414-0031
Attention: Inventory Control

         Re:      Pooling and Servicing Agreement dated as of April 1, 2001
                  among Financial Asset Securities Corp., as Depositor, Wells
                  Fargo Bank Minnesota, National Association, as Trustee, Saxon
                  Mortgage, Inc. as Seller and Master Servicer and Meritech
                  Mortgage Services, Inc. as Servicer for Soundview Home Equity
                  Loan Trust 2001-1, Home Equity Loan Pass-Through Certificates,
                  Series 2001-1.

         In connection with the administration of the Mortgage Loans held by
you, as Custodian, pursuant to the above-captioned Custodial Agreement, we
request the release, and hereby acknowledge receipt, of the Mortgage File for
the Mortgage Loan described below, for the reason indicated.

Mortgage Loan Number:      ________
--------------------

Mortgagor Name, Address & Zip Code:
----------------------------------

Reason for Requesting Documents (check one):
-------------------------------

____     1.       Mortgage Paid in Full

____     2.       Foreclosure

____     3.       Substitution

____     4.       Other Liquidation

____     5.       Nonliquidation Reason:______________________

                                           By:__________________________
                                           (authorized signer)

                                           Issuer:______________________

                                           Address:_____________________

                                           Date:________________________

                                       I-1

<PAGE>

Custodian

Wells Fargo Bank Minnesota, N.A.

Please acknowledge the execution of the above request by your signature and date
below:

--------------------------          ----------------------
Signature                           Date

Documents returned to Custodian:

--------------------------          ---------------------
Custodian                           Date

                                       I-2

<PAGE>

                                    EXHIBIT J

                                   [RESERVED]

                                       K-1

<PAGE>

                                    EXHIBIT K

                           FORM OF CUSTODIAL AGREEMENT

                               CUSTODIAL AGREEMENT

THIS CUSTODIAL AGREEMENT (as amended and supplemented from time to time, the
"Custodial Agreement"), dated as of _________________, by and among Wells Fargo
Bank Minnesota, National Association, not individually, but solely as trustee
(the "Trustee")and ____________________ (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, as the Trustee, has entered into a Pooling and Servicing Agreement
dated as of April 1, 2001, with Financial Asset Securities Corp., Saxon
Mortgage, Inc. and Meritech Mortgage Services, Inc. relating to the issuance of
Soundview's Home Equity Loan Asset-Backed Certificates, Series 2001-1 (as
amended and supplemented from time to time, the "Agreement"); 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 under the 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 and the Custodian hereby agree as
follows:

                              ARTICLE I DEFINITIONS

         Capitalized terms used in this Custodial Agreement and not defined
herein shall have the meanings assigned in the Agreement, unless otherwise
required by the context herein.

                    ARTICLE II CUSTODY OF MORTGAGE DOCUMENTS

Section 2.1.      Custodian to Act as Agent; Acceptance of Mortgage Files.

         The Custodian, as the duly appointed agent of the Trustee for these
purposes, acknowledges that it will hold the Mortgage Notes, the Related
Documents, the assignments and other documents required to be delivered by the
Seller to the Custodian pursuant to Section 2.01(a) of the Agreement and
relating to the Mortgage Loans identified on Schedule I hereto and declares that
it will hold such Mortgage Notes, Related Documents, assignments and other
documents and any similar documents received by the Trustee subsequent to the
date hereof (the "Mortgage Files") as agent for the Trustee, in trust, for the
benefit of all present and future Certificateholders. The Custodian agrees to
execute the Initial Certification and the Final Certification described in
Section 2.02 and set forth on Exhibits O and P of the Agreement. The Custodian,
at the request of the Trustee, shall furnish to the Trustee an electronic file
describing all outstanding exceptions to the items to be delivered to the
Seller.

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Section 2.2.      Recordation of Assignments.

         If any Mortgage File includes one or more assignments to the Trustee of
Related Documents that have not been recorded, within 30 days of the Closing
Date, Delta, at no expense to the Custodian, shall 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; provided, however, that Delta shall not be required to cause
to be recorded such assignments if the related Mortgage Property is located in a
jurisdiction in which the recording thereof is not necessary to protect the
interests of the Trustee or the Certificateholders in the related Mortgage, as
set forth in Section 2.01(c) of the Agreement. The Custodian also agrees to
perform its other obligations under the Agreement, including, but not limited
to, its obligations under Sections 2.01, 2.02, 2.05, 2.14 and 3.07 thereof.

Section 2.3.      Review of Mortgage Files.

         The Custodian agrees, for the benefit of the Seller and the
Certificateholders, to review, in accordance with the provisions of Section 2.02
of the Agreement, each Mortgage File. If in performing the reviews required by
this Section 2.3, the Custodian finds any document or documents constituting a
part of a Mortgage File to be unexecuted or missing or, based on the criteria
set forth in Section 2.02 of the Agreement, to be unrelated to the applicable
Mortgage Loan, the Custodian shall promptly so notify Delta and the Trustee.

         In connection with such review, the Custodian makes no representations
as to, and shall not be responsible to verify (A) the validity, legality,
enforceability, due authorization, recordability, sufficiency, or genuineness of
any of the documents contained in any Mortgage File or (B) the collectability,
insurability, effectiveness, or suitability of any Mortgage Loan.

Section 2.4.      Notification of Breaches of Representations and Warranties.

         Upon discovery by the Custodian of a breach of any representation or
warranty made by Delta as set forth in Section 2.03 of the Agreement, the
Custodian shall give prompt written notice to Delta and to the Trustee.

Section 2.5.      Custodian to Cooperate; Release of Mortgage Files.

         Upon the payment in full of any Mortgage Loan, or the receipt by the
Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Servicer shall promptly notify the Custodian by
delivering to the Custodian two copies of a Request for Release (Exhibit I to
the Agreement), one of which will be returned to the Servicer with the Mortgage
File, executed by a Servicing Officer or in a mutually agreeable electronic
format that originates from a Servicing Officer and shall request delivery to it
of the Mortgage File. The Custodian agrees, upon receipt of such certification
and request, promptly to release the related Mortgage File to the Servicer.

         From time to time as is appropriate for the servicing or foreclosure of
any Mortgage Loan, the Servicer shall deliver to the Custodian two copies of a
Request for Release requesting that

                                       K-3

<PAGE>

possession of all of the Mortgage File be released to the Servicer and
certifying as to the reason for such release. With such Request for Release, the
Servicer shall deliver to the Custodian a receipt signed by a Servicing Officer
of the Servicer on behalf of the Servicer (or in a mutually agreeable electronic
format that originates from a Servicing Officer), and upon receipt of the
foregoing, the Custodian shall deliver the Mortgage File or such document to the
Servicer and the Servicer shall hold the Mortgage File or such document in trust
for the benefit of the Seller and the Certificateholders. The Servicer shall
cause each Mortgage File to be returned to the Custodian when the need therefor
by the 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 Collection Account to the extent required by the Agreement or
(ii) the Mortgage File has been delivered to an attorney, or to a public trustee
or other public official as required by law, for purposes of initiating or
pursuing legal action or other proceedings for the foreclosure of the Mortgaged
Property either judicially or non-judicially, and the Servicer has delivered to
the Custodian a certificate of a Servicing Officer of the Servicer certifying as
to the name and address of the Person to which such Mortgage File was delivered
and the purpose or purposes of such delivery. In the event of the liquidation of
a Mortgage Loan, the Custodian shall deliver such receipt with respect thereto
to the Servicer upon deposit of the related Liquidation Proceeds in the
Distribution Account to the extent required by the Agreement.

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
Custodial Agreement in accordance with the terms and provisions of the
Agreement, the 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 document shall be
added to the related Mortgage File and, for all purposes, shall be considered a
part of such Mortgage 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, Related Document and other
documents constituting each Mortgage File which are delivered to the Custodian,
the Custodian is exclusively the bailee and agent of the Trustee, holds such
documents for the benefit of the Trust and 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 Custodial Agreement, no Mortgage Note, Related Document or other document
constituting a part of a Mortgage File shall be delivered by the Custodian to
the Servicer or otherwise released from the possession of the Custodian.

Section 3.2.      Indemnification.

         _________ 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,

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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 Custodial 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 Seller, which approval shall not be
unreasonably withheld, and the cost of defending any action, suit or proceedings
or resisting any claim. 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, fees, 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 Custodial Agreement
shall not apply. The indemnification provided by this Section 3.2 shall survive
the termination or assignment of this Custodial Agreement or the resignation or
removal of the Custodian hereunder.

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.      Custodian's Fees and Expenses.

         _______ will pay all fees payable to the Custodian hereunder for all
services rendered by it in the exercise and performance of any of the powers and
duties hereunder of the Custodian, as set forth in a separate letter agreement.
_______ 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 Custodial 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 giving 60 days written notice to the Trustee. Upon receiving
such notice of resignation, the Trustee shall either take custody of the
Mortgage Files itself and give prompt notice thereof to ________ and the
Custodian or promptly appoint a successor Custodian which is able to satisfy the
requirements of Section 3.7(i) of this Custodial Agreement 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 Mortgage Files and no successor Custodian
shall have been so appointed and have accepted resignation, the resigning
Custodian may petition any court of competent jurisdiction for the appointment
of a successor Custodian. All fees and expenses of any successor Custodian shall
be the responsibility of ___________.

         The Trustee may remove the Custodian at any time for cause, or
otherwise the Trustee may remove the Custodian at any time upon giving 60 days
written notice. In such event, the Trustee shall take custody of the Mortgage
Files itself, or shall appoint, or petition a court of competent

                                       K-5

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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(i) of this Custodial Agreement.

         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 only upon acceptance of appointment by the successor Custodian
and subject to the prior approval of __________. The Trustee shall give prompt
notice to _______ and the Custodian of the appointment of any successor
Custodian.

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.

Section 3.7.      Representations of the Custodian.

         The Custodian hereby represents and warrants as follows:

                  (i) It is a national banking association subject to
supervision or examination by a federal authority, has a combined capital and
surplus of at least $50,000,000 and is qualified to do business in the
jurisdiction in which it will hold any Mortgage File;

                  (ii) It has full power, authority and legal right to execute
and deliver this Custodial Agreement and to perform its obligations hereunder
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Custodial Agreement;

                  (iii) To the best of its knowledge, after reasonable
investigation, the execution and delivery by it of this Custodial Agreement and
the performance by it of its obligations hereunder will not violate any
provision of its Charter or By-Laws or any law or regulation governing it or any
order, writ, judgment or decree of any court, arbitrator or governmental
authority or agency applicable to it or any of its assets. To the best of its
knowledge, after reasonable investigation, such execution, delivery 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 its
activities. To the best of its knowledge, after reasonable investigation, such
execution, delivery and performance will not conflict with, or result in a
breach or violation of, any material indenture, mortgage, deed of trust, lease
or other agreement or instrument to which it is a party or by which it or its
properties are bound; and

                  (iv) This Custodial Agreement has been duly executed and
delivered by it. This Custodial Agreement, when executed and delivered by the
other parties hereto, will constitute its valid, legal and binding obligation,
enforceable against it in accordance with its terms, except as the

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enforcement thereof may be limited by applicable debtor relief laws and that
certain equitable remedies may not be available regardless of whether
enforcement is sought in equity or at law.

Section 3.8.      Limitations on the Responsibilities of the Custodian.

         (a) Neither the Custodian nor any of its Affiliates, directors,
officers, agents, counsel, attorneys-in-fact, and employees shall be liable for
any action or omission to act hereunder except for its own or such person's
gross negligence or willful misconduct. Notwithstanding the foregoing sentence,
in no event shall the Custodian or its Affiliates, directors, officers, agents,
counsel, attorneys-in-fact, and employees be held liable for any special,
indirect, punitive or consequential damages resulting from any action taken or
omitted to be taken by it or them hereunder or in connection herewith even if
advised of the possibility of such damages. The provisions of this Section 3.8
shall survive the resignation or removal of the Custodian and the termination of
this Agreement.

         (b) The Custodian shall not be responsible for preparing or filing any
reports or returns relating to federal, state or local income taxes with respect
to this Agreement, other than for the Custodian's compensation or for
reimbursement of expenses.

         (c) The Custodian shall not be responsible or liable for, and makes no
representation or warranty with respect to, the validity, adequacy or perfection
of any lien upon or security interest in any Mortgage File.

         (d) The Custodian shall not be responsible for delays or failures in
performance resulting from acts beyond its control. Such acts shall include, but
not be limited to, acts of God, strikes, lockouts, riots, acts or war or
terrorism, epidemics, nationalization, expropriation, currency restrictions,
governmental regulations superimposed after the fact, fire, communication line
failures, computer viruses, power failures, earthquakes or other disasters.

         (e) The duties and obligations of the Custodian shall only be such as
are expressly set forth in this Agreement or as set forth in a written amendment
to this Agreement executed by the parties hereto or their successors and
assigns. In the event that any provision of this Agreement implies or requires
that action or forbearance be taken by a party, but is silent as to which party
has the duty to act or refrain from acting, the parties agree that the Custodian
shall not be the party required to take the action or refrain from acting. In no
event shall the Custodian have any responsibility to ascertain or take action
except as expressly provided herein.

         (f) Nothing in this Agreement shall be deemed to impose on the
Custodian any duty to qualify to do business in any jurisdiction, other than (i)
any jurisdiction where any Mortgage File is or may be held by the Custodian from
time to time hereunder, and (ii) any jurisdiction where its ownership of
property or conduct of business requires such qualification and where failure to
qualify could have a material adverse effect on the Custodian or its property or
business or on the ability of the Custodian to perform it duties hereunder.

         (h) The Trustee and _________ agree that the Custodian may delegate any
of its duties under this Agreement to any of its agents, attorneys-in-fact, or
Affiliates. Any such agent,

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attorney-in-fact, or Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Custodian is entitled under this Agreement.

         (i) The Custodian shall have no duty to ascertain whether or not any
cash amount or payment has been received by the Seller and Servicer or any third
person.

                       ARTICLE IV MISCELLANEOUS PROVISIONS

Section 4.1.      Notices.

         All notices, requests, consents and demands and other communications
required under this Custodial 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 below (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:

         The Trustee:        Wells Fargo Bank Minnesota, National Association
                             11000 Broken Land Parkway
                             Columbia, Maryland  21044
                             Attention:  Corporate Trust Services, Soundview
                                         Home Equity Loan
                             Asset-Backed Certificates, Series 2000-4
                             Telecopy:  (410) 884-2363
                             Confirmation: (410) 884-2000

         The Custodian:
                             ------------------------------------------
                             Attention:     Custodian
                             Telecopy:
                                            ---------------------------

         Servicer:
                             ------------------------------------------
                             ------------------------------------------
                             ------------------------------------------
                             ------------------------------------------
                             Telecopy No.:
                                            ------------------

Section 4.2.      Amendments.

         No modification or amendment of or supplement to this Custodial
Agreement shall be valid or effective unless the same is in writing and signed
by all parties hereto, and the Trustee shall not enter into any amendment hereof
except as permitted by the Agreement. The Trustee shall give

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prompt notice to the Custodian of any amendment or supplement to the Agreement
and furnish the Custodian with written copies thereof. ____________ and the
Trustee agree to obtain the Custodian's written consent prior to entering into
any amendment or modification of the Agreement which affects any right, benefit,
duty, or obligation of the Custodian thereunder.

Section 4.3.      Governing Law.

         THIS CUSTODIAL 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 ITS
CONFLICTS OF LAWS PROVISIONS).

Section 4.4.      Recordation of Agreement.

         To the extent permitted by applicable law, this Custodial 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 Mortgaged Properties subject to the Mortgage Loans are situated, and
in any other appropriate public recording office or elsewhere, such recordation
to be effected by ________ and at its expense on direction by the Trustee, 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; provided however, that the Trustee shall be under no
obligation to determine the necessity of the recordation of this Agreement.

         For the purpose of facilitating the recordation of this Custodial
Agreement as herein provided and for other purposes, this Custodial 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 4.5.      Severability of Provisions.

         If any one or more of the covenants, agreements, provisions or terms of
this Custodial 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 Custodial
Agreement and shall in no way affect the validity or enforceability of the other
provisions of this Custodial Agreement or of the Certificates or the rights of
the Holders thereof.

Section 4.6.      Waiver of Trial By Jury.

         Each party hereto waives the right to trial by jury in any action,
suit, proceeding, or counterclaim of any kind arising out of or related to this
Custodial Agreement. In the event of litigation, this Custodial Agreement may be
filed as a written consent to a trial by the court.

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Section 4.7.      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 4.8.      Reliance of Custodian.

         In the absence of bad faith, negligence or willful misconduct on the
part of the Custodian, the Custodian may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon any
request, instructions, certificate, opinion or the document furnished to the
Custodian, reasonably believed by the Custodian to be genuine and to have been
signed or presented by the proper party or parties and conforming to the
requirements of this Custodial Agreement; but in the case of any Related
Document or other request, instruction, document or certificate which by any
provision hereof is specifically required to be furnished to the Custodian, the
Custodian shall be under a duty to examine the same to determine whether or not
it conforms to the requirements of this Custodial Agreement.

         The Custodian may rely upon the validity of documents delivered to it,
without investigation as to their authenticity or legal effectiveness and
_________ will hold the Custodian harmless from any claims that may arise or be
asserted against the Custodian because of the invalidity of any such documents.
Except as provided herein, no provision of this Custodial Agreement shall
require the Custodian to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, if it
should have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it. The Custodian may consult with competent counsel with regard to legal
questions arising out of or in connection with this Custodial Agreement and the
informed advice or opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, omitted or suffered
by the Custodian in good faith in accordance herewith.

Section 4.9.      Transmission of Mortgage Files.

         Written instructions as to the method of shipment and shipper(s) the
Custodian is directed to utilize in connection with the transmission of Mortgage
Files and Related Documents in the performance of the Custodian's duties
hereunder shall be delivered by the Servicer to the Custodian prior to any
shipment of any Mortgage Files and Related Documents hereunder. The Servicer
will arrange for the provision of such services at its sole cost and expense
(or, at the Custodian's option, reimburse the Custodian for all costs and
expenses incurred by the Custodian consistent with such instructions) and will
maintain such insurance against loss or damage to Mortgage Files and Related
Documents as the Servicer deems appropriate. Without limiting the generality of
the provisions of Section 3.2 above, it is expressly agreed that in no event
shall the Custodian have any liability for any losses or damages to any person,
including without limitation, the Servicer arising out of actions of the
Custodian consistent with instructions of the Servicer. If the Custodian does
not receive written direction, the Custodian is hereby authorized and
indemnified to utilize a nationally recognized courier service.

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<PAGE>

         IN WITNESS WHEREOF, this Agreement is executed as of the date first
above written.

________________________________
as Custodian

By:      _____________________________
         Name:
         Title:

WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
   as Trustee

By:      _____________________________
         Name:
         Title:

________________________________
as Servicer

By:      _____________________________
         Name:
         Title:

                                      K-11

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                                   Schedule I
                             to Custodial Agreement

                             List of Mortgage Loans

                                      K-12

<PAGE>

                                    EXHIBIT L

                        DELINQUENCY AND LOSS INFORMATION

                              [NOT INCLUDED HEREIN]

                                       L-1

<PAGE>

                                    EXHIBIT M

                         FORM OF TRANSFEROR CERTIFICATE

[DATE]

Wells Fargo Bank Minnesota, National Association,
 as trustee
Wells Fargo Center
Sixth Street and Marquette Avenue
Minneapolis, Minnesota  55479-0113
Attn:    Soundview Home Equity Loan Asset-Backed
         Certificates, Series 2001-1

         Re:      Soundview Home Equity Loan Asset-Backed
                  Certificates, Series 2001-1, [Class P], [Class BIO] and
                  [Class R-1]

Ladies and Gentlemen:

                  In connection with our disposition of the above Certificates
we certify that (a) we understand that the Certificates have not been registered
under the Securities Act of 1933, as amended (the "Act"), and are being disposed
by us in a transaction that is exempt from the registration requirements of the
Act, (b) we have not offered or sold any Certificates to, or solicited offers to
buy any Certificates from, any person, or otherwise approached or negotiated
with any person with respect thereto, in a manner that would be deemed, or taken
any other action which would result in, a violation of Section 5 of the Act and
(c) with respect to our disposition of the [Class P], [Class BIO] or [Class R-1]
Certificates, we have no knowledge that the transferee is not a Permitted
Transferee.

                                                     Very truly yours,

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

                                                     By:  ______________________
                                                             Authorized Officer

                                       M-1

<PAGE>

                                   EXHIBIT N-1

                    FORM OF INVESTMENT LETTER (NON-RULE 144A)

[DATE]

[Seller]
[Seller Address]

Wells Fargo Bank Minnesota, National Association,
 as trustee
Wells Fargo Center
Sixth Street and Marquette Avenue
Minneapolis, Minnesota  55479-0113
Attn:    Soundview Home Equity Loan Asset-Backed
         Certificates, Series 2001-1

                  Re:        Soundview Home Equity Loan Trust 2001-1
                             Home Equity Loan Pass-Through Certificates,
                             Series 2001-1, [Class P,] [Class BIO,] and
                             [Class R-1]

Ladies and Gentlemen:

         In connection with our acquisition of the above-captioned Certificates,
we certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is exempt
from the registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the Seller
concerning the purchase of the Certificates and all matters relating thereto or
any additional information deemed necessary to our decision to purchase the
Certificates, (d) either (i) we are not an employee benefit plan or arrangement
that is subject to the Employee Retirement Income Security Act of 1974, as
amended, or a plan that is subject to Section 4975 of the Internal Revenue Code
of 1986, as amended, ("Plan") nor are we acting on behalf of any such Plan or
using the assets of any Plan to effect the transfer of the Certificate or (ii)
we are a Plan which has provided the Trustee with the Opinion of Counsel
referred to in Section 6.02(d) of the Agreement, (e) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with clause
(g) below), (f) we have not offered or sold any Certificates to, or solicited
offers to buy any Certificates from, any person, or otherwise approached or
negotiated with any person with respect thereto, or taken any other action which
would result in a violation of

                                      N-1-1

<PAGE>

Section 5 of the Act, and (g) we will not sell, transfer or otherwise dispose of
any Certificates unless (1) such sale, transfer or other disposition is made
pursuant to an effective registration statement under the Act or is exempt from
such registration requirements, and if requested, we will at our expense provide
an opinion of counsel satisfactory to the addressees of this Certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this
certificate, and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Pooling and Servicing Agreement, dated
as of April 1, 2001, among Financial Asset Securities Corp., as Depositor, Saxon
Mortgage, Inc., as Seller and Master Servicer, Meritech Mortgage Services, Inc.,
as Servicer, and Wells Fargo Bank Minnesota, National Association, as Trustee.

                                               Very truly yours,

                                               [NAME OF TRANSFEREE]

                                               By:________________________
                                                          Authorized Officer

                                      N-1-2

<PAGE>

                                   EXHIBIT N-2

                            FORM OF RULE 144A LETTER

[DATE]

[Seller]
[Seller Address]

Wells Fargo Bank Minnesota, National Association,
 as trustee
Wells Fargo Center
Sixth Street and Marquette Avenue
Minneapolis, Minnesota  55479-0113
Attn:    Soundview Home Equity Loan Asset-Backed
         Certificates, Series 2001-1

                  Re:        Soundview Home Equity Loan Trust 2001-1
                             Home Equity Loan Pass-Through Certificates,
                             Series 2001-1, [Class P,] [Class BIO,] and
                             [Class R-1]

Ladies and Gentlemen:

         In connection with our acquisition of the above Certificates we certify
that (a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have had the
opportunity to ask questions of and receive answers from the Seller concerning
the purchase of the Certificates and all matters relating thereto or any
additional information deemed necessary to our decision to purchase the
Certificates, (c) either (i) we are not an employee benefit plan or arrangement
that is subject to the Employee Retirement Income Security Act of 1974, as
amended, or a plan that is subject to Section 4975 of the Internal Revenue Code
of 1986, as amended, ("Plan") nor are we acting on behalf of any such Plan or
using the assets of any Plan to effect the transfer of the Certificate or (ii)
we are a Plan which has provided the Trustee with the Opinion of Counsel
referred to in Section 6.02(d) of the Agreement, (d) we have not, nor has anyone
acting on our behalf offered, transferred, pledged, sold or otherwise disposed
of the Certificates, any interest in the Certificates or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Certificates, any interest in the Certificates or any other
similar security from, or otherwise approached or negotiated with respect to the
Certificates, any interest in the Certificates 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 Certificates under the Act or that would
render the disposition of the Certificates a violation of Section 5 of the Act
or require registration pursuant thereto, nor will act, nor has authorized or
will authorize any person to act, in such manner with respect to the
Certificates, (e) we are a "qualified

                                      N-2-1

<PAGE>

institutional buyer" as that term is defined in Rule 144A under the Act and have
completed either of the forms of certification to that effect attached hereto as
Annex 1 or Annex 2. We are aware that the sale to us is being made in reliance
on Rule 144A. We are acquiring the Certificates for our own account or for
resale pursuant to Rule 144A and further, understand that such Certificates may
be resold, pledged or transferred only (A)(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 Act, and (B)(i) the
purchaser or transferee of such Certificates has executed and delivered to you a
certificate to substantially the same effect as this certificate, and (ii) the
purchaser or transferee has otherwise complied with any conditions for transfer
set forth in the Pooling and Servicing Agreement, dated as of April 1, 2001,
among Financial Asset Securities Corp., as Depositor, Saxon Mortgage, Inc., as
Seller and Master Servicer, Meritech Mortgage Services, Inc., as Servicer, and
Wells Fargo Bank Minnesota, National Association, as Trustee.

                                             Very truly yours,

                                             [NAME OF TRANSFEREE]

                                             By:      _____________________
                                                      Authorized Officer

                                      N-2-2

<PAGE>

                             ANNEX 1 TO EXHIBIT N-2

QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

[For Transferees Other Than Registered Investment Companies]

         The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:

         (a) As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.

         (b) 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, as amended ("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 of 1986, as amended.

___ 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, a
copy of which is attached hereto.

___ 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, territory
or the District of Columbia.

                                      N-2-3

<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 Advisor. The Buyer is an investment advisor registered under the
Investment Advisors Act of 1940.

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

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

         (d) 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, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. 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, as
amended.

         (e) 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.

         (f) Until the date of purchase of the Rule 144A Securities, 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 the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank

                                      N-2-4

<PAGE>

or savings and loan is provided above, the Buyer agrees that it will furnish to
such parties updated annual financial statements promptly after they become
available.

                                               Print Name of Buyer

                                               By:___________________________
                                                  Name:
                                                  Title:

                                               Date:

                                      N-2-5

<PAGE>

                             ANNEX 2 TO EXHIBIT N-2

QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

[For Transferees That are Registered Investment Companies]

                  The undersigned (the "Buyer") hereby certifies as follows to
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:

                  (a) 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, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.

                  (b) 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, as amended 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, except (i) where the Buyer or the Buyer's Family of
Investment Companies reports its securities holdings in its financial statements
on the basis of their market value, and (ii) no current information with respect
to the cost of those securities has been published. If clause (ii) in the
preceding sentence applies, the securities may be valued at market.

 ___ 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).

                  (c) 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).

                  (d) 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) securities issued or guaranteed by
the U.S. or any instrumentality thereof, (iii) bank deposit notes and

                                      N-2-6

<PAGE>

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.

                  (e) The Buyer is familiar with Rule 144A and under-stands that
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates 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.

                  (f) Until the date of purchase of the Certificates, the
undersigned will notify the parties listed in the Rule 144A Transferee
Certificate to which this certification relates of any changes in the
information and conclusions herein. Until such notice is given, the Buyer's
purchase of the Certificates will constitute a reaffirmation of this
certification by the undersigned as of the date of such purchase.

                                             Print Name of Buyer or Adviser

                                             By:___________________________
                                                Name:
                                                Title:

                                             IF AN ADVISER:

                                             ------------------------------
                                                      Print Name of Buyer

                                             Date:

                                                       N-2-7

<PAGE>

                                                     EXHIBIT O

                                                      FORM OF
                                               INITIAL CERTIFICATION

[DATE]

Wells Fargo Bank Minnesota, National Association,
 as trustee
11000 Broken Land Parkway
Columbia, Maryland  21044

Financial Asset Securities Corp.
600 Steamboat Road
Greenwich, CT 06830

                  Re:        Pooling and Servicing Agreement dated as of April
                             1, 2001 among Financial Asset Securities Corp., as
                             Depositor, Wells Fargo Bank Minnesota, National
                             Association, as Trustee, Saxon Mortgage, Inc. as
                             Seller and Master Servicer and Meritech Mortgage
                             Services, Inc. as Servicer for Soundview Home
                             Equity Loan Trust 2001-1, Home Equity Loan
                             Pass-Through Certificates, Series 2001-1.

Ladies and Gentlemen:

         In accordance with the provisions of Section 2.02 of the
above-referenced Pooling and Servicing Agreement, the undersigned, as Custodian,
hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan
specifically identified on the attachment hereto), it has reviewed the documents
delivered to it pursuant to Section 2.02 of the Pooling and Servicing Agreement
and has determined that (i) all documents required to be delivered to it
pursuant to the above-referenced Pooling and Servicing Agreement are in its
possession, (ii) such documents have been reviewed by it and appear regular on
their face and have not been mutilated, damaged, torn or otherwise physically
altered and relate to such Mortgage Loans, (iii) based on its examination and
only as to the foregoing documents, the information set forth in the Mortgage
Loan Schedule as to the information set forth in clauses (ii), (iii), (vi) and
(vii) of the definition "Mortgage Loan Schedule" set forth in the Pooling and
Servicing Agreement accurately reflects the information set forth in the
Trustee's Mortgage File and (iv) each Mortgage Note has been endorsed as
provided in Section 2.01 of the Pooling and Servicing Agreement. The Custodian
has made no independent examination of such documents beyond the review
specifically required in the above-referenced Pooling and Servicing Agreement.
The Custodian makes no representations as to: (i) the validity, legality,
enforceability or genuineness of any such documents contained in each or any of
the Mortgage Loans identified on the Mortgage

                                       O-1

<PAGE>

Loan Schedule, or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.

         Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.

                                       WELLS FARGO MINNESOTA, N.A.
                                       as Custodian

                                       By:_______________________________
                                                Name:
                                                Title:

                                       O-2

<PAGE>

                                    EXHIBIT P

                           FORM OF FINAL CERTIFICATION

[DATE]

Wells Fargo Bank Minnesota, National Association,
as trustee
11000 Broken Land Parkway
Columbia, Maryland  21044

Financial Asset Securities Corp.
600 Steamboat Road
Greenwich, CT 06830

         Re:      Pooling and Servicing Agreement dated as of April 1, 2001
                  among Financial Asset Securities Corp., as Depositor, Wells
                  Fargo Bank Minnesota, National Association, as Trustee, Saxon
                  Mortgage, Inc. as Seller and Master Servicer and Meritech
                  Mortgage Services, Inc. as Servicer for Soundview Home Equity
                  Loan Trust 2001-1, Home Equity Loan Pass-Through Certificates,
                  Series 2001-1

Ladies and Gentlemen:

         In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Custodian, hereby certifies that,
except as noted on the attachment hereto, as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on
the attachment hereto) the Custodian has reviewed the documents delivered to it
pursuant to Section 2.01 (other than items listed in Section 2.01(a)(vii) and
(viii)) of the Pooling and Servicing Agreement and has determined that (i) all
such documents are in its possession, (ii) such documents have been reviewed by
it and have not been mutilated, damaged, torn or otherwise physically altered
and relate to such Mortgage Loan, (iii) based on its examination, and only as to
the foregoing documents, the information set forth in the Mortgage Loan Schedule
respecting such Mortgage Loan is correct and (iv) each Mortgage Note has been
endorsed as provided in Section 2.01 of the Pooling and Servicing Agreement.

         The Custodian has made no independent examination of such documents
beyond the review specifically required in the above-referenced Pooling and
Servicing Agreement. The Custodian makes no representations as to: (i) the
validity, legality, enforceability or genuineness of any such documents
contained in each or any of the Mortgage Loans identified on the Mortgage Loan
Schedule, or (ii) the collectibility, insurability, effectiveness or suitability
of any such Mortgage Loan.

                                       P-1

<PAGE>

         Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.

                                       WELLS FARGO BANK MINNESOTA
                                       as Custodian

                                       By:_____________________________
                                       Name:
                                       Title:

                                       P-2

<PAGE>

                                    EXHIBIT Q

                              INTENTIONALLY OMITTED

                                       Q-1

<PAGE>

                                    EXHIBIT R

                           PREPAYMENT CHARGE SCHEDULE

                [to be attached, but not included in 8-K filing]

                                       R-1Exhibit 4.1

	

EXHIBIT 4.1

HiBand
Semiconductors Inc. 2000 Equity Incentive Plan

	TO:	Holders of Options to Purchase Common Stock
	 
	SUBJECT:	Employee Stock Options/Grants

	

     The
purpose of this memorandum is to clarify some of the procedures and consequences relating
to the grant of shares of Common Stock as well as options to purchase shares of Common
Stock of HiBand Semiconductors Inc., a California corporation (the “Corporation”), under
the HiBand Semiconductors Inc. 2000 Equity Incentive Plan (the “Plan”), and the purchase
and subsequent disposition of shares of the Corporation’s Common Stock received upon the
exercise of such options. The exact terms and conditions of the options, including the
exercise price of the shares of Common Stock, are governed by the provisions of the Plan
and the agreements thereunder between the Corporation and the participating employees,
directors, officers or other individuals. 

	 	
THIS
MEMORANDUM IS FOR GENERAL INFORMATION ONLY AND SHOULD NOT BE CONSTRUED AS AN OFFER FOR
THE SALE OF SECURITIES. EACH INDIVIDUAL IS ENCOURAGED TO CONSULT WITH INDEPENDENT COUNSEL
AS TO THE APPLICABILITY OF THE TAX AND SECURITIES LAWS AND OTHER MATTERS DISCUSSED HEREIN
TO HIS OR HER SPECIFIC SITUATION.

	

GENERAL

     The
Corporation’s Board of Directors adopted the Plan as of December 6, 1999. The
Corporation’s shareholders adopted the plan as of December 6, 1999. A total of 3,000,000
shares of Common Stock have been reserved for issuance upon the exercise of options and
stock grants under the Plan. 

     The
Plan allows for the grant of stock options intended to qualify as “incentive stock
options” under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”),
as well as nonstatutory stock options. See “Federal Income Tax Consequences” below for
information concerning the tax treatment of incentive stock options and nonstatutory
stock options. The Plan also allows for the grant of Common Stock as a bonus for services
actually rendered to the Corporation. 

SUMMARY OF THE PLAN

     Set
forth below is a summary of the principal features of the Plan. 

Administration

     The
Plan is currently being administered by the Corporation’s Board of Directors (the
“Board”). The interpretation and construction of any provision of the Plan by the Board
shall be final and conclusive. 

	

Eligibility

     The
Plan provides that options and/or stock may be granted to the Corporation’s employees,
directors, officers or other individuals or entities involved with the Corporation. One
or several Corporation officers designated by the Board, such as the President and/or
Chief Operating Officer will select the participants and determine the number of shares
to be subject to each option and/or grant. However, incentive stock options can only be
granted to employees. 

     The
Plan provides for a maximum number of shares of the Corporation’s Common Stock which may
be granted, either directly or under an option, to any one employee or other eligible
participant. In addition, the value of the shares subject to all incentive stock options
of an optionee that become exercisable for the first time during any calendar year cannot
exceed $100,000 (determined as of the date of grant). See “Federal Income Tax
Consequences” below. 

	

Terms of Options

     Each
option is evidenced by a stock option agreement between the Corporation and the person to
whom such option is granted, which sets forth the terms and conditions of the option. The
following terms and conditions generally apply to all options, unless the stock option
agreement provides otherwise: 

	(a) 		Exercise
of the Option. The optionee must earn the right to exercise his or her option by
continuing to work for the Corporation. The Board determines when options granted under
the Plan may be exercisable, but in no event shall an option be exercised more than ten
(10) years after the date of grant. An option is exercised by giving written notice of
exercise to the Corporation specifying the number of full shares of Common Stock to be
purchased, and by tendering payment to the Corporation for the purchase price. Unless
otherwise provided in the stock option agreement, the purchase price of shares purchased
upon exercise of an option shall be paid by any of the following means, or by any
combination thereof: (i) cash; (ii) certified or bank’s cashier’s check; or (iii)
surrender to the Corporation of shares of the Corporation’s Common Stock, provided a
public market then exists for such Common Stock.  

	(b) 		Exercise
Price. The exercise price of options granted under the Plan is determined by the Board
and must not be less than: (i) the fair market value of the Common Stock on the date the
option is granted in the case of incentive stock options; or (ii) eighty-five percent
(85%) of such fair market value in the case of nonstatutory stock options. Where the
participant owns stock representing more than ten percent (10%) of the total combined
voting power of the Corporation’s issued and outstanding capital stock., the exercise
price for options must not be less than 110% of such fair market value. Until such time
as there has been a registered public offering of the Corporation’s Common Stock and a
public trading market for the Corporation’s Common Stock exists, the fair market value of
Common Stock will be determined by the Board. In making its determination, the Board will
take into account such relevant factors as recent transactions (if any) in shares of the
Corporation’s Common Stock and the Corporation’s past financial performance and prospects
for future earnings.  

	

-2- 

	

	(c) 		Restricted
Stock Option Purchase Agreement. As a condition to the exercise of any option granted
under the Plan, the optionee must sign and deliver a Restricted Stock Option Purchase
Agreement in a form approved by the Board pursuant to which the Corporation is granted:
(1) a repurchase option when the optionee exercises his/her Option; and (2) a right of
first refusal if the optionee sells stock received under the Plan. See “Terms of
Restricted Stock Option Purchase Agreement” below.  

	(d) 		Termination
of Employment. If an optionee’s employment (or other service) with the Corporation
terminates either (i) for cause or (ii) voluntary on the part of the optionee and without
good reason (as determined by the Board, in its sole discretion), the options, to the
extent not previously exercised, will terminate on the date of such termination of
employment (or service). If an optionee’s employment or other service with the
Corporation terminates for reasons other than (a) termination that is either (i) for
cause, (ii) voluntary on the part of the optionee and without good reason, (b)
termination by reason of disability and (c) death, options under the Plan may be
exercised not later than three (3) months after such termination, but may be exercised
only to the extent the options were exercisable on the date of termination.  

	(e) 		Retirement
and Total and Permanent Disability. If an optionee should become permanently and totally
disabled while an employee, non-employee director or officer of the Corporation or while
providing other services to the Corporation, options shall become fully exercisable as to
all shares subject to them and may be exercised at any time within one (1) year following
the date of disability. If an optionee should retire with the written consent of the
Corporation, options shall become fully exercisable as to all shares subject to them and
may be exercised at any time within three (3) months of such retirement. Incentive stock
options that are not exercised within one (1) year of such termination will automatically
be converted to nonstatutory stock options, and will lose special tax treatment. (Please
see discussion on Federal Income Tax Consequences below.)  

	(f) 		Death.
If an optionee should die while an employee, non-employee director or officer of the
Corporation or while providing other services to the Corporation, options may be
exercised at any time within one (1) year following the date of death.  

	(g) 		Termination
of Options. All options granted under the Plan expire on the date specified in the option
agreement, but in no event shall the term of incentive stock options exceed ten (10)
years. However, all incentive stock options granted under the Plan to any participant who
owns stock possessing more than ten percent (10%) of the total combined voting power of
the Corporation’s outstanding capital stock must expire not later than five (5) years
from the date of grant.  

	(h) 		Nontransferability
of Options. An option is nontransferable by the optionee otherwise than by will or the
laws of descent and distribution, and is exercisable during his or her lifetime only by
him, or in the event of his or her death, by a person who acquires the right to exercise
the option by bequest or inheritance or by reason of the death of the optionee.  

	

-3- 

	

	(i) 		Other
Provisions. The option agreement may contain such other terms, provisions and conditions
not inconsistent with the Plan as may be determined by the Board.  

	

Adjustments
Upon Changes in Capitalization

     In the
event of any change in the Corporation’s capital structure, appropriate adjustments shall
be made by the Board in the number of shares subject to each option and the per share
exercise price thereof. Upon the occurrence of the following events which constitute a
“Corporate Change”: (1) certain mergers or consolidations, (2) sale, lease or exchange of
substantially all of the assets of the Corporation, (3) liquidation or dissolution, (4)
acquisition by any person or entity of more than twenty-five percent (25%) (based on
voting power) of the Corporation’s outstanding capital stock or acquisition by a person
or entity who currently has beneficial ownership in the Corporation which increases such
ownership to fifty percent (50%) or more, (5) as a result of a contested election,
persons who were directors cease to constitute a majority of the Board, the Board also
may make provisions for proportionately adjusting the number or class of stock covered by
any option, as well as the option exercise price. The Board may take any of the following
actions in connection with the occurrence of a Corporate Change: (1) accelerate the
exercisability for the options to be exercised, (2) require the mandatory surrender of
outstanding options to the Corporation in exchange for cash for the bargain element the
optionee would have realized upon the occurrence of the Corporate Change, if any, (3)
make adjustments to the options to reflect such Corporate Change, (4) provide that upon
exercise of the option, the optionee will be entitled to purchase other securities or
property, or (5) cancel the options if the fair market value of the Common Stock of the
Corporation which underlies the options is below the option exercise price. 

Amendment and
Termination of the Plan

     The
Board may amend the Plan at any time or from time to time or may terminate it without the
approval of the Corporation’s shareholders: provided, however, that the approval of the
holders of a majority of the outstanding shares of the Corporation entitled to vote is
required for any amendment which increases the maximum number of shares for which options
may be granted, changes the minimum option exercise price or the standards of
eligibility, materially increases the benefits which may accrue to participants under the
Plan or decreases any authority granted to the Board in contravention of Rule 16b-3 of
the General Rules and Regulations of the Securities and Exchange Commission under the
Exchange Act (“Exchange Act”). However, no such action by the Board or shareholders may
alter or impair any option previously granted under the Plan. In any event, the Plan
shall terminate on February 20, 2007. 

Terms of
Restricted Stock Option Purchase Agreement

     All
optionees must execute and deliver to the Corporation a form of Restricted Stock Option
Purchase Agreement (the “Purchase Agreement”) approved by the Board in connection with
the exercise of options granted under the Plan. The Purchase Agreement provides, among
other things, that the Corporation shall have a repurchase option and a right of first
refusal to purchase any shares which are subject to a bona fide purchase offer from a
third party. The Corporation will repurchase shares received by an optionee upon exercise
of his or her options from the optionee. 

-4- 

	

	

     An
optionee may not sell or transfer (including transfer by operation of law) the shares
received upon exercise of his or her option unless he or she first gives written notice
to the Corporation of his or her intention to do so and first offers the shares to the
Corporation. Such written notice must include: (i) the name and address of the person or
firm to whom such shares are to be sold; (ii) the number of shares, or interest therein,
to be sold or transferred; (iii) the price or amount to be paid for the proposed transfer
(including the amount of any debt to be paid, canceled or forgiven upon foreclosure of a
security interest in the shares or upon any other transfer to the optionee’s creditors);
and (iv) all other terms of the proposed transfer. Within thirty (30) days after receipt
of the notice, the Corporation or its designee may elect to purchase all (but not less
than all) such shares so offered at the purchase price set forth in the optionee’s
notice, which purchase must be consummated no later than thirty (30) days following the
date of delivery of optionee’s notice to the Corporation. 

     If
none or only part of the shares referred to in the optionee’s notice to the Corporation
is bid for purchase by the Corporation, or its designee or designees, the optionee may
dispose of any or all shares referred to in the notice to the Corporation to any person
or persons, but only within a period of ninety (90) days from the date of delivery of the
notice to the Corporation, and provided further that any such sale is in accordance with
all the terms and conditions set forth in the Purchase Agreement. 

     The
optionee may make a gift of all or part of his or her shares to any of his or her
parents, spouse or issue or to a trust for his or their exclusive benefit; provided,
however, that the gift shall be held subject to the above-described repurchase option and
right of first refusal. 

Terms of Restricted
Stock Grant Agreement

     All
grantees must execute and deliver to the Corporation a form of Restricted Stock Grant
Agreement (the “Grant Agreement”), approved by the Board in connection with the granting
of Common Stock under the Plan. The Grant Agreement provides, among other things, that
the Corporation shall have a repurchase option to purchase any shares if during the term
of the Grant Agreement the grantee ceases to be employed or contracted by the Corporation
on a full-time basis for any reason, or no reason, with or without cause, including
involuntary termination, death or disability. The grantee may not sell or transfer any of
the shares without first delivering a Transfer Notice to the Corporation, which shall
have the option to purchase such shares. The Transfer Notice must specify: (i) the name
and address of the proposed transferee; (ii) the number of shares, or interest therein,
proposed to be sold or transferred; (iii) the price or amount to be paid for the proposed
transfer (including the amount of any debt to be paid, canceled or forgiven upon
foreclosure of a security interest in the shares or upon any other transfer to the
grantee’s creditors); and (iv) all other material terms and conditions of the proposed
transfer. 

     Within
thirty (30) days after receipt of the Transfer Notice, the Corporation may elect to
purchase all, but not less than all, of the shares to which the Transfer Notice refers at
the per share price specified in the Transfer Notice. If no price is specified in the
Transfer Notice, the purchase price shall be the fair market value of the shares on the
date the Corporation receives the Transfer Notice, as determined in good faith by the
Board of Directors of the Corporation. 

-5- 

	

     In the
event the Corporation elects to acquire shares from the grantee as specified in the
Transfer Notice, the Secretary of the Corporation shall so notify the Grantee and
settlement thereof shall be made in cash within thirty (30) days after the Corporation
receives the Transfer Notice, provided that if the terms of payment set forth in the
Transfer Notice were other than cash against delivery, the Corporation shall pay for such
shares on the same terms and conditions set forth in the Transfer Notice. 

     If the
shares referred to in the Transfer Notice are not purchased by the Corporation, the
grantee, within a period of ninety (90) days from the date of delivery of the Transfer
Notice to the Corporation, may sell such shares to the person or persons named in the
Transfer Notice at the price and on the terms specified in the Transfer Notice, provided
that such sale or transfer is consummated within ninety (90) days following the date of
delivery of the Transfer Notice to the Corporation and, provided further, that such sale
is in accordance with all the terms and conditions hereof. The transferee will hold all
shares transferred hereunder subject to the provisions of this Agreement. 

     The
grantee may make a gift of all or part of the shares to any of his parents, brothers or
sisters, spouse or issue, or to a trust for his or their exclusive benefit. The donee or
donees shall hold such shares subject to all provisions of this Agreement. 

Federal Income
Tax Consequences

			(a) 		Incentive
Stock Options.

	

     Section
422 of the Internal Revenue Code of 1986, as amended (the “Code”), provides favorable
federal income tax treatment for stock options which qualify as “incentive stock
options.” When an option granted under an option plan qualifies as an incentive stock
option, the optionee does not recognize income for federal income tax purposes upon the
grant or exercise of the incentive stock option (unless the alternative minimum tax
applies as discussed below). Upon a sale of the shares (assuming that the sale occurs no
sooner than two years after the grant of the option and one year after the receipt of the
shares by the optionee), any gain or loss will be treated as long-term capital gain or
loss for federal income tax purposes. 

     In
order for an option to qualify as an “incentive stock option,” it must be exercised while
the optionee is an employee of the Corporation or of a parent or subsidiary of the
Corporation, or within ninety (90) days after the optionee ceases to be an employee for
any reason other than death, in which case there is no statutory limitation, or permanent
and total disability, in which case the exercise may occur within one year after
termination of employment. See “Terms of Options” above. 

     Other
conditions which must be satisfied include the following: (i) the option cannot be
exercisable more than ten (10) years from the date of grant; (ii) the exercise price of
the option must not be less than the fair market value of the shares at the time the
option is granted; (iii) the Plan must have been approved by the shareholders of the
Corporation; (iv) the option must be nontransferable other than upon death and must be
exercisable during the optionee’s lifetime by him or her only; (v) the optionee may not
own more than 10% of the voting power or value of all classes of the Corporation’s
capital stock immediately before the option is granted, unless the exercise price is at
least 110% of the fair market value of the shares on the date of grant and the option is
exercisable only within five years of the date of grant; and (vi) the value of the shares
subject to one or more incentive stock options that are exercisable for the first time
during any calendar year (under all stock option plans of the Corporation and its parents
and subsidiaries) cannot exceed $100,000 (determined as of the date of grant). 

-6- 

	

     The
favorable federal income tax consequences described above will not apply to the extent
the optionee disposes of the shares acquired within one year of the date of exercise or
within two years of the date of grant of the option (hereinafter a “disqualifying
disposition”). A disqualifying disposition does not include the disposition of shares
acquired upon exercise of an option after the employee’s death and, under certain
circumstances, the disposition of shares (acquired by exercising an incentive stock
option) by an insolvent individual to a trustee, receiver or other similar fiduciary in
an insolvency proceeding. 

     In the
event of a disqualifying disposition, the optionee generally will recognize ordinary
income in the year of disposition equal to the amount by which the fair market value of
the stock at the date of exercise exceeds the option exercise price. Any additional gain
will be long-term or short-term gain, depending on how long the optionee has held the
stock. The income recognized on a disqualifying disposition will be added to the
optionee’s tax basis for determining gain or loss with respect to a subsequent sale of
his or her stock. 

     The
Corporation is obligated to provide optionees with a statement regarding the transfer of
shares of the Corporation’s Common Stock pursuant to the exercise of an incentive stock
option on or before January 31 of the year following the year of the transfer. Generally,
this statement identifies the Corporation and the optionee and describes the transaction. 

			(b) 		Alternative
Minimum Tax.

	

     The
excess of the stock’s fair market value over the option exercise price of an incentive
stock option, which is generally not subject to tax at the time of exercise, is treated
as an item of income in determining an individual taxpayer’s alternative minimum tax
liability. The alternative minimum tax is defined under the Code as the excess of the
“tentative minimum tax” over the “regular tax.” The “tentative minimum tax” is the amount
of tax due on the individual’s alternative minimum taxable income (“AMTI”) at the
applicable alternative minimum tax rate. Under the Omnibus Budget Reconciliation Act of
1993 (“OBRA 1993”), the alternative minimum tax rates were increased to 26% of excess
tentative minimum tax up to $175,000 and 28% of so much of the taxable excess as exceeds
$175,000. 

     It is
advisable for all optionees holding incentive stock options to attempt to forecast their
income tax liabilities before deciding when to exercise incentive stock options, or even
whether to receive stock compensation in the form of incentive stock options. Despite the
potential advantages for capital gains income after OBRA 1993 (as discussed below), the
alternative minimum tax risk can make incentive stock options unappealing if the
potential spread on exercise of the option in any particular year will be substantial
(e.g., greater than $50,000). Moreover, the Internal Revenue Service (the “IRS”) takes
the position that an optionee owes alternative minimum tax and is not entitled to a
refund in the event of a disqualifying disposition of the stock in a subsequent year,
notwithstanding the loss of the original tax benefit, in determining his or her regular
tax liability for the year of the disqualifying disposition. In determining alternative
minimum tax liability in subsequent years, however, the optionee will be entitled to
increase the basis of the stock by the amount of this income adjustment. Furthermore, if
there is a disqualifying disposition of the stock in the year of exercise, the
alternative minimum taxable income adjustment will be limited to the gain on the sale. 

-7- 

	

			(c) 		Nonstatutory
Stock Options.

	

     Options
granted under the Plan that do not qualify as incentive stock options are considered
“nonstatutory” stock options and do not qualify for any special tax benefits to the
optionee. Under the Code, such stock options are not deemed to have a readily
ascertainable value, so the optionee generally does not recognize any taxable income at
the time he or she is granted a nonstatutory stock option. However, upon exercise of a
nonstatutory stock option, the optionee will generally recognize taxable compensation
measured by the excess of the fair market value of the shares on the date of exercise
over the option exercise price unless such shares are subject to a substantial risk of
forfeiture and are not freely transferable at such time, in which case the tax is
generally deferred until one of such restrictions lapse. 

     The
income recognized by the optionee will be treated as wage compensation and will be
subject to federal income tax and F.I.C.A. withholding by the Corporation out of the
current earnings paid to the optionee up to 28% of such income. There may be additional
state income tax withholding. If wage withholdings are insufficient to pay the tax, the
optionee will be required to make direct payment to the Corporation for the tax
liability. Upon a resale of such shares by the optionee, any difference between the sale
price and the fair market value of the shares on the date of exercise of the option will
be treated as capital gain or loss. 

     The
IRS takes the position that under Treasury Regulation Section 1.61-15(c)(1), an optionee
must report the grant of a nonstatutory stock option by attaching a statement concerning
the option grant to his or her federal income tax return for the taxable year in which he
or she acquired the option. Accordingly, the Corporation advises all recipients of
nonstatutory stock options under the Plan to file such a statement. 

			(d) 		Capital
Gains.

	

     The
Code provides a special tax rate of 20% for capital gains (10% for taxpayers in the 15%
bracket). This can be compared to the lowest ordinary income tax rate of 15% and the
maximum rate on such income of over 40% (with adjustments). In addition, while ordinary
compensation income is subject to certain payroll and Medicare taxes, capital gains are
not; this increases the effective tax rate advantage of capital gains. Capital losses may
generally be offset only against capital gains. Shares acquired upon exercise of an
option must generally be held for more than 12 months for gain or loss from the sale of
such shares to qualify for long-term capital gain or loss treatment. 

-8- 

	

			(e) 		Use
of Stock to Exercise Options.

	

     Under
certain circumstances, the Board may permit the exercise of options using shares of the
Corporation’s stock already owned by the optionee through appropriate provisions in the
stock option agreement. This allows the optionee to exercise additional options and,
under certain circumstances, provide for payment of his or her withholding taxes, without
the payment of cash. The federal income tax treatment of such exchanges depends upon the
nature of the stock option and the shares exchanged. Generally, incentive stock options
can be exercised using shares previously owned by the optionee in payment of the exercise
price (based on the value of the surrendered shares) without triggering the recognition
of income by the optionee (provided the exchange does not constitute a disqualifying
disposition of shares previously acquired upon exercise of an incentive stock option).
Also no gain will generally be recognized upon the exercise of a nonstatutory stock
option in this manner to the extent that the fair market value of all of the surrendered
shares does not exceed the aggregate option exercise price of the acquired shares. Any
excess will generally be treated as ordinary income. Finally, the tax basis of the
surrendered stock is generally carried over to the newly acquired shares. 

			(f) 		Stock
Grants.

	

     For
restricted stock grants that are nontransferable and subject to a substantial risk of
forfeiture pursuant to the Grant Agreement, grantees will recognize ordinary income in
the amount of the fair market value of the stock on the date of lapse of either
restriction less any amount paid for the stock. Any increase in value after such taxable
event generally will be taxed as capital gain upon disposition. 

     An
individual or entity receiving restricted stock pursuant to the Plan may elect to have
the ordinary income element of the restricted property close at the time the property is
transferred. Closing the taxable event under Code §.83(b) gives the employee the
opportunity to limit his/her ordinary income from the transaction to any spread on the
date the property is transferred between the fair market value and the amount paid for
the property. Any appreciation in property after the date of the transfer is then
potential capital gain income which will be recognized when the property is disposed of
by the employee. The Code §.83(b) election must be made within 30 days after the transfer
of the property; and once the election is made, it is irrevocable, unless the Internal
Revenue Service agrees to the revocation. The election is not without risk. If an
individual or entity makes the election and recognizes ordinary income and the property
is thereafter forfeited pursuant to the restrictions, no deduction is available to the
individual or entity. 

			(g) 		Qualified
Small Business Stock.

	

     A
provision of OBRA 1993 provides, in certain circumstances, for a reduction in the capital
gains tax rate for individuals or certain other taxpayers who acquire “qualified small
business stock” at its original issue and hold it for more than five years. One-half of
the gain (up to certain limits) on such stock is generally excluded from taxable income
for regular tax purposes and 25% of such gain (up to certain limits) is generally
excluded for alternative minimum tax purposes. 

-9- 

	

     The
new law has many limitations, only two of which are described here. In order to qualify,
the issuer must not have more than $50,000,000 in gross assets, including amounts
received on issuance of the stock. Gross assets generally means cash and the adjusted tax
basis of other property. In addition, the issuer must use at least 80% of its assets in
the “active conduct” of one or more qualified trades or businesses for substantially all
of the holding period of the stock. For issuers who have been in existence for more than
two years, up to 50% of the issuer’s assets may qualify as used in the “active conduct”
of a business by being held for reasonably required working capital needs or held for
investment and reasonably expected to be used within two years to finance research and
development. The Corporation must meet this test for substantially all of the taxpayer’s
holding period for the stock. If the Corporation meets this test, it must also submit
periodic reports to the IRS and to the Corporation’s shareholders detailing its
compliance with the law’s requirements. 

     The
foregoing summary of the effect of current federal income taxation upon grantees and
optionees with respect to the grant of options for, and the purchase and subsequent
disposition of, shares under the Plan does not purport to be complete, and reference is
made to the applicable provisions of the Code. The laws, court decisions and
administrative rulings applicable to federal income taxation change frequently, and the
discussion in this summary is based only on such laws, court decisions and administrative
rulings as of the date hereof. 

     The
foregoing summary also does not reflect provisions of the income tax laws of any state or
foreign jurisdiction in which grantees or optionees may reside, and does not address
prospective estate, gift and other tax consequences of acquiring stock under the Plan. In
particular, the income tax laws of some states do not presently contain provisions
comparable to the incentive stock option provisions of the Code. All grantees and
optionees are urged to consult their own tax and financial advisers regarding the current
and prospective tax consequences of acquiring options and shares under the Plan. 

Restrictions
on Transfer and Absence of Public Market

     The
shares of Common Stock issuable under the Plan either upon grant or upon the exercise of
options granted under the Plan are “restricted securities” within the meaning of Rule 144
under the Securities Act of 1933, as amended (the “Act”), insofar as such securities have
not been registered thereunder and must be held indefinitely unless they are subsequently
registered or an exemption from such registration is available; provided, however, that,
in any event, the exemption from registration under Rule 144 will not be available for at
least one (1) year after the purchase and payment for the shares, unless the options and
the shares were issued pursuant to Rule 701, and even then will not be available unless:
(i) a public trading market then exists for the Common Stock; (ii) adequate information
concerning the Corporation is then available to the public; and (iii) other terms and
conditions of Rule 144 are complied with, including, among other things, the sale being
made through a broker in an unsolicited “broker’s transaction” or in transactions
directly with a “market maker” and the number of shares being sold in any three-month
period not exceeding specified limitations. There is not now a public market for shares
of the Corporation’s Common Stock and there can be no assurance that a public market will
ever exist. Accordingly, optionees should be prepared to hold the shares of Common Stock
received upon exercise of their options for an indefinite period of time. 

-10- 

	

     The
shares of Common Stock granted under the Plan or options granted under the Plan and the
shares of Common Stock issuable upon exercise of such options have not been qualified
under the securities laws of any state and are being issued in reliance upon available
exemptions from such qualification. Shares of Common Stock granted under the Plan or
acquired upon the exercise of any option granted under the Plan may be transferred only
in accordance with the provisions of applicable state securities or “blue sky” laws. To
make sure that another exemption from registration under the Act would be available for
the original grant of options and the issuance of shares upon exercise thereof, you will
be required to make certain “investment representations” to the Corporation at the time
you exercise the option. (See Exhibit A to this Summary Memorandum for the form of such
representations.) These representations relate to your investment intent and your
acknowledgment of disclosure by the Corporation of, and your access to, financial and
other information concerning the Corporation. A restrictive legend will be placed on the
stock certificate stating that no sale or other disposition of the stock may be made
without meeting certain conditions, which include registration of the stock by the
Corporation or an opinion to the Corporation by an attorney that an exemption is
available under the Act for a resale of the stock. You are advised that because the
Corporation’s securities have not been registered under the Act, any shares purchased
upon exercise of an option must be held indefinitely unless they are subsequently
registered for sale under the Act or an exception from such registration is available. 

Information
About the Corporation

     The
Corporation agrees to provide to all optionees and grantees during the term of the option
copies of all annual reports and other information which are provided to all shareholders
of the Corporation. 

-11- 

	

EXHIBIT A

INVESTMENT
REPRESENTATION STATEMENT

	PURCHASER

Corporation

          
SECURITY

AMOUNT

DATE	:

:

:

:

:	

HiBand Semiconductors Inc., (the “Corporation”)
          

COMMON STOCK

	

     In
connection with the purchase or grant of the above-listed Securities, I, the Purchaser,
represent to the Corporation the following: 

	(a) 		I
am aware of the Corporation’s business affairs and financial condition, and have
acquired sufficient information about the Corporation to reach an informed and
knowledgeable decision to acquire the Securities. I am purchasing or receiving these
Securities for my own account for investment purposes only and not with a view to, or for
the resale in connection with, any “distribution” thereof for purposes of the Securities
Act of 1933, as amended (the “Securities Act”). 

	(b) 		I
understand that the Securities have not been registered under the Securities Act in
reliance upon a specific exemption there from, which exemption depends upon, among other
things, the bona fide nature of my investment intent as expressed herein. In this
connection, I understand that, in the view of the Securities and Exchange Commission (the
“SEC”), the statutory basis for such exemption may be unavailable if my representation
was predicated solely upon a present intention to hold these Securities for the minimum
capital gains period specified under tax statutes, for a deferred sale, for or until an
increase or decrease in the market price of the Securities, or for a period of one year
or any other fixed period in the future. 

	(c) 		I
further understand that the Securities must be held indefinitely unless subsequently
registered under the Securities Act or unless an exemption from registration is otherwise
available. Moreover, I understand that the Corporation is under no obligation to register
the Securities. In addition, I understand that the certificate evidencing the Securities
will be imprinted with a legend which prohibits the transfer of the Securities unless
they are registered or such registration is not required in the opinion of counsel for
the Corporation. 

	(d) 		I
am familiar with the provisions of Rule 701 and Rule 144, each promulgated under the
Securities Act, which, in substance, permit limited public resale of “restricted
securities” acquired, directly or indirectly, from the issuer thereof, in a non-public
offering subject to the satisfaction of certain conditions. Rule 701 provides that if the
issuer qualified under Rule 701 at the time of issuance of the Securities, such issuance
will be exempt from registration under the Securities Act. In the event the Corporation
later becomes subject to the reporting requirements of Sections 13 or 15(d) of the
Securities Exchange Act of 1934, ninety (90) days thereafter the securities exempt under
Rule 701 may be resold, subject to the satisfaction of certain of the conditions
specified by Rule 144, including, among other things: (1) the sale being made through a
broker in an unsolicited “broker’s transaction” or in transactions directly with a market
maker (as such term is defined under the Securities Exchange Act of 1934); and, in the
case of an affiliate, (2) the availability of certain public information about the
Corporation, and the amount of securities being sold during any three- month period not
exceeding the limitations specified in Rule 144(e), if applicable. Notwithstanding this
paragraph (d), I acknowledge and agree to the restrictions set forth in paragraph (e)
hereof. 

	

	 	     In
the event that the Corporation does not qualify under Rule 701 at the time of issuance of
the Securities, then the Securities may be resold in certain limited circumstances
subject to the provisions of Rule 144, which requires among other things: (1) the
availability of certain public information about the Corporation, (2) the resale
occurring not less than one year after the party has purchased, and made full payment
for, within the meaning of Rule 144, the securities to be sold; and, in the case of an
affiliate, or of a non-affiliate who has held the securities less than two years, (3) the
sale being made through a broker in an unsolicited “broker’s transaction” or in
transactions directly with a market maker (as said term is defined under the Securities
Exchange Act of 1934) and the amount of securities being sold during any three month
period not exceeding the specified limitations stated therein, if applicable.

	(e) 		I
agree, in connection with any initial underwritten public offering of the Corporation’s
securities, (1) not to sell, make short sale of, loan, grant any options for the purchase
of, or otherwise dispose of any shares of Common Stock of the Corporation held by me
(other than those shares included in the registration) without the prior written consent
of the Corporation or the underwriters managing such initial underwritten public offering
of the Corporation’s securities for one hundred eighty (180) days from the effective date
of such registration, and (2) I further agree to execute any agreement reflecting (1)
above as may be requested by the underwriters at the time of the public offering:
provided, however, that the officers and directors of the Corporation who own the stock
of the Corporation also agree to such restrictions. 

	

-2- 

	

	(f) 		I
further understand that in the event all of the applicable requirements of Rule 144 or
Rule 701 are not satisfied, registration under the Securities Act, compliance with
Regulation A, or some other registration exemption will be required; and that,
notwithstanding the fact that Rule 144 and Rule 701 are not exclusive, the Staff of the
SEC has expressed its opinion that persons proposing to sell private placement securities
other than in a registered offering and otherwise than pursuant to Rule 144 or Rule 701
will have a substantial burden of proof in establishing that an exemption from
registration is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own risk. 

		Signature of Purchaser:
          

Dated: __________, 199_

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