Document:

Exhibit 4.10

                                NORTHERN ROCK PLC
                                as Administrator

                                     - and -

                        GRANITE FINANCE TRUSTEES LIMITED
                              as Mortgages Trustee

                                     - and -

                                NORTHERN ROCK PLC
                                    as Seller

                         GRANITE FINANCE FUNDING LIMITED
                                 as Beneficiary

                                     - and -

                              THE BANK OF NEW YORK
                               as Security Trustee

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                           FIRST AMENDED AND RESTATED
                            ADMINISTRATION AGREEMENT

                             DATED 28 SEPTEMBER 2001

                          which amends and restates the

                            ADMINISTRATION AGREEMENT

                               DATED 26 MARCH 2001

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                           SIDLEY AUSTIN BROWN & WOOD
                             1 THREADNEEDLE STREET
                                LONDON EC2R 8AW
                            TELEPHONE 020 7360 3600
                            FACSIMILE 020 7626 7937
                                      REF:

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                                    CONTENTS

CLAUSE                                                                 PAGE NO.

1.    Definitions and Interpretation.......................................2

2.    Appointment of Administrator.........................................2

3.    The Administration Services..........................................3

4.    Interest Rates.......................................................6

5.    Administration of Mortgages..........................................9

6.    No Liability........................................................12

7.    New Mortgage Loans..................................................12

8.    Product Switching and Further Advances..............................12

9.    Redemption of Mortgages.............................................13

10.   Powers of Attorney..................................................13

11.   Costs and Expenses..................................................14

12.   Information.........................................................14

13.   Remuneration........................................................16

14.   Insurances..........................................................17

15.   Title Deeds.........................................................19

16.   Data Protection.....................................................19

17.   Covenants and Representations and Warranties of Administrator.......20

18.   Services Non-exclusive..............................................21

19.   Termination.........................................................22

20.   Further Assurances..................................................25

21.   Miscellaneous.......................................................25

22.   Confidentiality.....................................................26

23.   No Partnership......................................................27

24.   Assignment..........................................................27

25.   Security Trustee; Authorised Third Party............................28

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26.   New Intercompany Loan Agreements....................................28

27.   Non Petition Covenant; Limited Recourse.............................28

28.   Amendments and Waiver...............................................29

29.   Notices.............................................................30

30.   Third Party Rights..................................................31

31.   Execution in Counterparts; Severability.............................31

32.   Governing Law and Submission to Jurisdiction........................31

33.   Process Agent.......................................................31

34.   Appropriate Forum...................................................32

SCHEDULE 1  THE SERVICES..................................................33

SCHEDULE 2  FORM OF INVESTORS' QUARTERLY REPORT...........................34

SCHEDULE 3  ADMINISTRATOR REPRESENTATIONS AND WARRANTIES..................38

SCHEDULE 4   AUTHORISED THIRD PARTY.......................................40

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THIS FIRST AMENDED AND RESTATED ADMINISTRATION AGREEMENT DATED 28 SEPTEMBER 2001
AMENDS AND RESTATES THE ADMINISTRATION AGREEMENT DATED 26 MARCH 2001 BETWEEN:

(1)   NORTHERN ROCK PLC (registered number 3273685), a public limited company
      incorporated under the laws of England and Wales whose registered office
      is at Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL in its
      capacity as administrator of the Mortgage Loans and the Related Security
      (the "ADMINISTRATOR") which expression shall include such other person as
      may from time to time be appointed as administrator of the Mortgage
      Portfolio pursuant to this Agreement);

(2)   GRANITE  FINANCE  TRUSTEES  LIMITED   (registered   number  79309),  a
      private  limited company  incorporated  under the laws of Jersey whose
      registered  office is at 22 Grenville Street,  St. Helier,  Jersey JE4
      8PX, Channel Islands (the "MORTGAGES TRUSTEE");

(3)   NORTHERN ROCK PLC (registered number 3273685), a public limited company
      incorporated under the laws of England and Wales whose registered office
      is at Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL in its
      capacity as seller of the Mortgage Loans (the "SELLER");

(4)   GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
      limited company incorporated under the laws of Jersey but acting out of
      its branch office established in England (registered overseas company
      number FC022999 and branch number BR0051916) at 4th Floor, 35 New Bridge
      Street, Blackfriars, London EC4V 6BW ("FUNDING" and together with the
      Seller, the "BENEFICIARIES"); and

(5)   THE BANK OF NEW YORK, whose principal office is at One Canada Square, 48th
      Floor, London E14 5AL, in its capacity as trustee (the "SECURITY
      TRUSTEE"), which expression shall include such company and all other
      persons or companies for the time being acting as the trustee or trustees
      under the Funding Deed of Charge).

WHEREAS:

(A)   The Administrator carries on the business of, inter alia, administering
      mortgage loans secured on residential properties within the United
      Kingdom.

(B)   By the Mortgage Sale Agreement, the Seller has agreed to assign the
      Mortgage Loans and Related Security comprised in the Initial Mortgage
      Portfolio to the Mortgages Trustee. The Mortgages Trustee shall hold the
      Initial Mortgage Portfolio together with any New Mortgage Portfolio on
      trust for Funding and the Seller pursuant to the terms of the Mortgages
      Trust Deed.

(C)   The Administrator is willing to administer the Mortgage Loans on behalf of
      the Mortgages Trustee and to provide certain other administration and
      management services to the Mortgages Trustee, the Seller and Funding on
      the terms and subject to the conditions contained in this Agreement in
      relation to, inter alia, the Mortgage Loans and Related Security assigned
      to the Mortgages Trustee by the Seller.

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IT IS HEREBY AGREED as follows:

1.    DEFINITIONS AND INTERPRETATION

1.1   DEFINITIONS: The Master Definitions Schedule signed for the purposes of
      identification by Brown & Wood and Clifford Chance Limited Liability
      Partnership on 26 March 2001 (as the same may be amended, varied or
      supplemented from time to time with the consent of each of the parties
      hereto) is expressly and specifically incorporated into this Agreement
      and, accordingly, the expressions defined in the Master Definitions
      Schedule (as so amended, varied or supplemented) shall, except where the
      context otherwise requires and save where otherwise defined herein, have
      the same meanings in this Agreement, including the recitals hereto, and
      this Agreement shall be construed in accordance with the interpretation
      provisions set out in Clause 2 of that Master Definitions Schedule.

1.2   EXERCISE OF DISCRETION: Any reference in this Agreement to any discretion,
      power or right on the part of the Mortgages Trustee shall be as exercised
      by the Mortgages Trustee only as directed by the Beneficiaries but subject
      in each case to the provisions of the Mortgages Trust Deed.

1.3   SCHEDULES: For the avoidance of doubt, the parties hereto agree that the
      Schedules attached to this Agreement shall form a part of this Agreement,
      and the provisions of this Agreement shall be construed in accordance with
      such Schedules.

2.    APPOINTMENT OF ADMINISTRATOR

2.1   APPOINTMENT: Subject to Clause 4.5 herein, and until termination pursuant
      to Clause 19 herein (Termination), the Mortgages Trustee hereby appoints
      the Administrator to administer the Mortgages Loans on its behalf, and
      each of the Mortgage Trustee, the Seller and Funding (according to their
      respective estates and interests) each hereby appoints the Administrator
      as its lawful agent on their respective behalves to provide certain other
      administration and management services and to exercise their respective
      rights, powers and discretions, and to perform their respective duties,
      under and in relation to the Mortgage Loans and their Related Security.
      The Administrator in each case hereby accepts such appointment on the
      terms and subject to the conditions of this Agreement. The Security
      Trustee consents to the appointment of the Administrator on the terms of
      and subject to the conditions of this Agreement.

2.2   POWER AND AUTHORITY: For the avoidance of doubt and in connection with the
      rights, powers and discretions conferred under Clause 2.1 herein, during
      the continuance of its appointment hereunder, the Administrator shall,
      subject to the terms and conditions of this Agreement, the Mortgage
      Conditions, the Mortgage Sale Agreement and the Mortgages Trust Deed, have
      the full power, authority and right to do or cause to be done any and all
      things which it reasonably considers necessary, convenient or incidental
      to the administration of the Mortgage Loans and their Related Security or
      the exercise of such rights, powers and discretions, provided however that
      neither the Mortgages Trustee nor Funding nor their respective directors
      shall be required or obliged at any time to enter into any transaction or
      to comply with any directions which the Administrator may give with
      respect to the operating and financial policies of the Mortgages Trustee
      or Funding and the Administrator hereby acknowledges that all powers to
      determine such policies (including the determination of whether or not

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      any particular policy is for the benefit of the Mortgages Trustee or
      Funding) are, and shall at all times remain, vested, as the case may be,
      in the Mortgages Trustee and/or Funding (and their respective directors)
      and none of the provisions of this Agreement shall be construed in a
      manner inconsistent with this proviso.

2.3   APPOINTMENT CONDITIONAL: The appointment pursuant to Clause 2.1 herein is
      conditional upon the issue of the First Issuer Notes having taken place
      and shall take effect upon and from the Initial Closing Date automatically
      without any further action on the part of any person PROVIDED THAT if the
      issue of the First Issuer Notes has not occurred by 30 April 2001, or such
      later date as the First Issuer and the Lead Manager may agree, this
      Agreement shall cease to be of further effect.

3.    THE ADMINISTRATION SERVICES

3.1   GENERAL: The duty of the Administrator shall be to provide the services
      set out in this Agreement including Schedule 1 (the "SERVICES").

3.2   SUB-CONTRACTS:

      (a)   The Administrator may sub-contract or delegate the performance of
            all or any of its powers and obligations under this Agreement,
            provided that (but subject to Clause 3.2(b) herein):

            (i)   the prior written consent of the Mortgages Trustee and Funding
                  to the proposed arrangement (including, if Funding considers
                  it necessary after consulting with the Security Trustee,
                  approving any contract which sets out the terms on which such
                  arrangements are to be made) has been obtained, the Security
                  Trustee has been consulted and notification has been given to
                  each of the Rating Agencies;

            (ii)  where the arrangements involve the custody or control of any
                  Mortgage Loan Files and/or Title Deeds relating to the
                  Mortgage Portfolio for the purpose of performing any delegated
                  Services, the sub-contractor or delegate has executed an
                  acknowledgement in writing acceptable to Funding and the
                  Security Trustee to the effect that any such Mortgage Loan
                  Files and/or Title Deeds are and will be held to the order of
                  the Mortgages Trustee (as trustee for the Beneficiaries);

            (iii) where the arrangements involve or may involve the receipt by
                  the sub-contractor or delegate of monies belonging to the
                  Beneficiaries which, in accordance with this Agreement, are to
                  be paid into the relevant Collection Account, the
                  sub-contractor or delegate has executed a declaration in
                  writing acceptable to the Beneficiaries that any such monies
                  held by it or to its order are held on trust for the
                  Beneficiaries and will be paid forthwith into the relevant
                  Collection Account in accordance with the terms of the
                  Mortgages Trust Deed;

            (iv)  any such sub-contractor or delegate has executed a written
                  waiver of any Security Interest arising in connection with
                  such delegated

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                  Services (to the extent that such Security Interest relates to
                  the Mortgage Portfolio or any amount referred to in (iii)
                  above); and

            (v)   neither the Mortgages Trustee, the Security Trustee nor the
                  Beneficiaries shall have any liability for any costs, charges
                  or expenses payable to or incurred by such sub-contractor or
                  delegate or arising from the entering into, the continuance or
                  the termination of any such arrangement.

      (b)   The provisos to Clause 3.2(a) (i), (ii) and (iii) herein shall not
            apply:

            (i)   to the engagement by the Administrator of:

                  (1)   any receiver, solicitor, insurance broker, valuer,
                        surveyor, accountant, estate agent, insolvency
                        practitioner, auctioneer, bailiff, debt counselor,
                        tracing agent, property management agent, licensed
                        conveyancer or other professional adviser acting as
                        such; or

                  (2)   any locksmith, builder or other contractor acting as
                        such in relation to a Mortgaged Property, in any such
                        case being a person or persons whom the Administrator
                        would be willing to appoint in respect of its own
                        mortgages in connection with the performance by the
                        Administrator of any of its obligations or functions or
                        in connection with the exercise of its powers under this
                        Agreement; or

            (ii)  to any delegation to any wholly-owned subsidiary of the Seller
                  from time to time.

      (c)   The Mortgages Trustee and/or Funding and the Security Trustee may
            require the Administrator to assign to the Mortgages Trustee any
            rights which the Administrator may have against any sub-contractor
            or delegate arising from the performance of services by such person
            in association with any matter contemplated by this Agreement and
            the Administrator acknowledges that such rights assigned to the
            Mortgages Trustee will be exercised by the Mortgages Trustee as
            trustee for the Beneficiaries subject to the terms of the Mortgages
            Trust Deed.

      (d)   Notwithstanding any sub-contracting or delegation of the performance
            of the Administrator's obligations under this Agreement:

            (i)   the Administrator shall not thereby be released or discharged
                  from any liability hereunder;

            (ii)  the Administrator shall remain responsible for the performance
                  of the obligations of the Administrator under this Agreement;

            (iii) the performance or non-performance or the manner of
                  performance of any sub-contractor or delegate of any of the
                  Services shall not affect the Administrator's obligations
                  under this Agreement;

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            (iv)  any breach in the performance of the Services by any
                  sub-contractor or delegate shall, subject to the Administrator
                  being entitled for a period of twenty (20) Business Days from
                  receipt of notice of the breach to remedy such breach by any
                  sub-contractor or delegate, be treated as a breach of this
                  Agreement by the Administrator; and

            (v)   the Security Trustee shall have no liability for any act or
                  omission of the sub-contractor or delegate and shall have no
                  responsibility for monitoring or investigating the suitability
                  of any such sub-contractor or delegate.

3.3   NOTICES ETC.

      (a)   Within fifteen (15) days after the Initial Closing Date, the
            Administrator will:

            (i)   on behalf of the Mortgages Trustee (at the direction of the
                  Beneficiaries or with their consent), give to third parties
                  such notices as any of the Beneficiaries are required to give
                  pursuant to the Mortgage Sale Agreement; and

            (ii)  submit for registration at the Companies Registry a duly
                  completed Form 395 and original executed copy of the First
                  Issuer Deed of Charge pursuant to Chapter 1 of Part XII of the
                  Companies Act 1985,

            and in each case, the Administrator shall take all reasonable steps
            to ensure the return by the relevant recipient of the duplicate
            notices of assignment by way of acknowledgement thereof.

      (b)   Promptly upon request by Funding and the Security Trustee, the
            Administrator shall procure that any notices permitted to be given
            by the Mortgages Trustee under Clause 6.4 (Prior to Completion) of
            the Mortgage Sale Agreement are so given by the Administrator on the
            Mortgages Trustee's behalf.

3.4   LIABILITY OF ADMINISTRATOR:

      (a)   The Administrator shall indemnify each of the Mortgages Trustee and
            the Beneficiaries on demand on an after-tax basis for any loss,
            liability, claim, expense or damage suffered or incurred by either
            of them in respect of the negligence or wilful default of the
            Administrator in carrying out its functions as Administrator under
            this Agreement or the other Transaction Documents or as a result of
            a breach by the Administrator of the terms and provisions of this
            Agreement or the other Transaction Documents in relation to such
            functions.

      (b)   For the avoidance of doubt, the Administrator shall not be liable in
            respect of any loss, liability, claim, expense or damage suffered or
            incurred by the Mortgages Trustee and/or the Beneficiaries and/or
            any other person as a result of the proper performance of the
            Services by the Administrator save where such loss, liability,
            claim, expense or damage is suffered or incurred as a result of any
            negligence or wilful default of the Administrator or as a result of
            a breach by the Administrator of the terms and provisions of this
            Agreement or the other Transaction Documents in relation to such
            functions.

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      (c)   Any indemnification under this Clause 3.4 in respect of loss
            suffered by the Beneficiaries shall be paid for by reducing the
            Seller Share of the Trust Property by an amount equal to the
            relevant loss incurred by the Beneficiaries in accordance with
            Clause 8.4 (Adjustments to Trust Property) of the Mortgages Trust
            Deed and Schedule 2 to the Cash Management Agreement.

3.5   PERFECTION OF MORTGAGES TRUSTEE'S AND BENEFICIARIES' TITLE TO THE MORTGAGE
      LOANS

      Subject to Clause 6 of the Mortgage Sale Agreement:

      (a)   upon the receipt by the Seller of a written request from the
            Mortgages Trustee, Funding or the Security Trustee to execute
            transfers pursuant to Clause 6.2 of the Mortgage Sale Agreement, the
            Administrator shall execute or procure the execution of such
            transfers on behalf of the Seller or shall provide sufficient
            information to enable the Mortgages Trustee, Funding or the Security
            Trustee to do so; and

      (b)   upon the Seller being required to do so by the Mortgages Trustee,
            Funding or the Security Trustee pursuant to Clause 6.1 of the
            Mortgage Sale Agreement, the Administrator shall do all or any of
            the acts, matters or things referred to in Clauses 6.2 and 6.3 of
            the Mortgage Sale Agreement.

4.    INTEREST RATES

4.1   DETERMINATION OF INTEREST RATES: Subject to the provisions of applicable
      law and regulations and any regulatory undertakings binding on the
      Administrator or the Issuer from time to time and subject to the following
      provisions of this Clause 4, the Mortgages Trustee and each of the
      Beneficiaries each hereby grants the Administrator full right, liberty and
      authority from time to time to determine:

      (a)   in accordance with the applicable Mortgage Conditions, Mortgage
            Terms and the Base Rate Pledge, the Standard Variable Rate
            chargeable to Borrowers from time to time; and

      (b)   the Existing Borrowers' Re-Fix Rate in accordance with Clause 4.4
            herein.

      In exercising such right, liberty and authority the Administrator
      undertakes to each of the other parties to this Agreement that it shall
      not at any time set or maintain the Standard Variable Rate at a rate which
      is higher than the then prevailing Standard Variable Rate offered by the
      Seller, unless the Administrator is required to do so pursuant to Clause
      4.3 herein, and, subject to that requirement, that it shall not change the
      Standard Variable Rate save for the same reasons as the Seller was
      entitled, under the Mortgage Conditions, to change the then prevailing
      Standard Variable Rate offered by the Seller prior to the assignment to
      the Mortgages Trustee of the Mortgage Loans comprised in the Mortgage
      Portfolio and their Related Security. Each of the Issuer and the Security
      Trustee shall be bound by any Mortgage Rates (including the Existing
      Borrowers' Re-Fix Rate) determined by the Administrator in accordance with
      this Clause 4.

4.2   NOTIFICATION TO BORROWERS: The Administrator shall take all steps
      necessary pursuant to the relevant Mortgage Conditions or applicable law
      to bring each change in the

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      Standard Variable Rate and any consequent changes in Monthly Payments to
      the attention of the relevant Borrowers and shall, as soon as reasonably
      practicable after any change in the Standard Variable Rate, provide
      details of such change to each of the Mortgages Trustee, the Security
      Trustee and the Beneficiaries, and shall, upon receipt of a request from
      any of such parties, notify such requesting party of any changes in the
      Monthly Payments in relation to the Mortgage Loans.

4.3   INTEREST RATE SHORTFALL:

      (a)   On each Payment Date the Administrator shall determine, having
            regard to:

            (i)   the income which Funding would expect to receive during the
                  next succeeding Interest Period;

            (ii)  the Standard Variable Rate in respect of the Mortgage Loans
                  which the Administrator proposes to set under this Clause 4;
                  and

            (iii) the other resources available to Funding including the Funding
                  Reserve Fund and amounts standing to the credit of any Issuer
                  Reserve Fund and/or any Issuer Liquidity Reserve Fund,

            whether Funding would receive an amount of income during that
            Interest Period which when aggregated with the funds otherwise
            available to it is less than the amount which is the aggregate of
            (1) the amount of interest which will be payable by Funding in order
            to fund (whether by payment to a swap provider or otherwise) the
            amount of interest payable in respect of the Class A Notes of the
            First Issuer (and the highest ranking class of notes of any New
            Issuer, if any) and all amounts which rank in priority thereto on
            the Payment Date occurring at the end of such Interest Period, and
            (2) all other amounts payable by Funding which rank in priority to
            or pari passu with interest due on the First Issuer Intercompany
            Loan in respect of interest which is payable on the Class A Notes of
            the First Issuer (and any New Intercompany Loan, if any, in respect
            of interest which is payable by any New Issuer on the highest rated
            class of Notes issued by such New Issuer, if any) (the amount (if
            any) by which it is less being the "INTEREST RATE SHORTFALL").

      (b)   If the Administrator determines that there will be an Interest Rate
            Shortfall, it will within one (1) London Business Day of such
            determination give written notice thereof to the Mortgages Trustee,
            Funding and the Security Trustee of such Interest Rate Shortfall and
            of the Standard Variable Rate which would, in the Administrator's
            opinion, need to be set in order for no Interest Rate Shortfall to
            arise, having regard to the obligations of Funding under all
            Intercompany Loans.

      (c)   If the Mortgages Trustee, Funding and/or the Security Trustee notify
            the Administrator that, having regard to the obligations of Funding,
            the Standard Variable Rate should be increased (which shall be the
            same rate as previously notified to the Mortgages Trustee, Funding
            and the Security Trustee in accordance with Clause 4.3(b)), the
            Administrator, as agent for and on behalf of the Mortgages Trustee,
            shall take all steps which are necessary, including publishing any
            notice which is required in accordance with the Mortgage

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 Terms, to
            effect such change in the Standard Variable Rate on the date(s)
            specified in the notice referred to in Clause 4.3(b) herein.

4.4   EXISTING BORROWERS' RE-FIX RATE:

      (a)   The Administrator shall, in relation to each Fixed Rate Mortgage
            Loan, serve on the Seller as agent for and on behalf of, inter alia,
            the Mortgages Trustee and the Beneficiaries the notice referred to
            in Clause 8.6(a) of the Mortgage Sale Agreement sixty (60) days
            before the expiry of the initial fixed rate period (as defined in
            Clause 8.6(a) of the Mortgage Sale Agreement) applicable to that
            Fixed Rate Mortgage Loan.

      (b)   If Clause 8.6(b) of the Mortgage Sale Agreement applies to any Fixed
            Rate Mortgage Loan, the Administrator shall take all steps which are
            necessary to perform the obligations of the Seller and exercise the
            rights under such Clause.

      (c)   The Administrator shall, whenever Clause 8.6(c) of the Mortgage Sale
            Agreement applies to a Fixed Rate Mortgage Loan, determine (after
            consultation with the Basis Rate Swap Provider, the Currency Swap
            Provider, and any other swap provider the Administrator (acting
            reasonably) determines appropriate) the rate (and terms) upon which
            the Existing Borrowers' Re-Fix Rate should be set having regard to
            the interests of the Basis Rate Swap Provider and the Currency Swap
            Provider (except to the extent that the Administrator believes that
            the interests of either of the Basis Rate Swap Provider or the
            Currency Swap Provider are materially prejudicial to the interests
            of the Noteholders). The Administrator will give written notice of
            such determination within one Business Day thereof to the Mortgages
            Trustee and the Beneficiaries recommending what the Existing
            Borrowers' Re-Fix Rate should be and the terms at which it should be
            offered, having regard to the interests of the Basis Rate Swap
            Provider and the Currency Swap Provider (except to the extent that
            the Administrator believes that the interests of either of the Basis
            Rate Swap Provider or the Currency Swap Provider are materially
            prejudicial to the interests of the Noteholders). The Administrator
            will solicit quotations on rates from each of (i) the Mortgages
            Trustee, (ii) Funding, and (iii) other trustees for re-fixed
            mortgage loans in relation to other outstanding securitisations of
            the Seller (if any), and shall notify the Mortgages Trustee and the
            Beneficiaries as to the higher of (x) any rate provided by any of
            the parties in (i) through (iii) herein and (y) current rates for
            re-fixed mortgage loans (not included in any Mortgage Portfolio) in
            relation to other Mortgage Loans of the Administrator. If the
            Mortgages Trustee agrees in writing with such recommendation, or
            (whether or not it has received the Administrator's recommendation)
            requires alternative rates and/or terms (such agreement or
            requirement being the "EBRR DETERMINATION") the Administrator shall
            immediately notify the Seller and the First Issuer (and any New
            Issuer) of the EBRR Determination, and take all steps which are
            necessary to enable the First Issuer (and any New Issuer) to enter
            into the relevant swap agreement either with the Basis Rate Swap
            Provider or the Currency Swap Provider (or other swap provider whose
            appointment would not adversely affect the then current ratings of
            the Notes) at the rate (and on the terms) required in accordance
            with the EBRR Determination (the "REQUIRED RATE AND TERMS"). Nothing
            in this Clause 4.4(c) shall prevent the Mortgages Trustee from
            setting

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            the Existing Borrowers' Re-Fix Rate in accordance with its powers
            under the Mortgage Sale Agreement.

      (d)   If Clause 8.6 of the Mortgage Sale Agreement applies to any Fixed
            Rate Mortgage Loan, and the Seller fails to set the Existing
            Borrowers' Re-Fix Rate immediately upon being required to do so in
            accordance with the Required Rate and Terms or otherwise to perform
            its obligations under Clause 8.6(c) of the Mortgage Sale Agreement,
            the Administrator as attorney for the Mortgages Trustee and the
            Beneficiaries shall set the Existing Borrowers' Re-Fix Rate on the
            Required Rate and Terms.

4.5   TERMINATION OF AUTHORITY: The Mortgages Trustee and/or Funding and the
      Security Trustee may terminate the authority of the Administrator under
      Clauses 4.1 and 4.3 herein to determine either of the Mortgage Rate(s) or
      Existing Borrowers' Re-Fix Rate on or after the occurrence of a
      Termination Event pursuant to Clause 19 herein, in which case the
      Mortgages Trustee shall set the Mortgage Rate(s) or Existing Borrowers'
      Re-Fix Rate, as applicable, in accordance with this Clause 4.

5.    ADMINISTRATION OF MORTGAGES

5.1   COLLECTION OF PAYMENTS:

      (a)   For the purposes of collecting amounts due from any Borrower under a
            Mortgage Loan, where such Borrower makes a Monthly Payment by way of
            Direct Debit the Administrator will, unless otherwise agreed in
            writing with the Beneficiaries:

            (i)   act as collecting agent for the Beneficiaries under the Direct
                  Debiting Scheme;

            (ii)  comply with the obligations on its part set out in the Bank
                  Account Agreement including, without limitation, the specific
                  provisions relating to the collection of monies set out in
                  Clause 4 of the Bank Account Agreement;

            (iii) comply in all material respects with the requirements from
                  time to time of the Direct Debiting Scheme; and;

            (iv)  using its reasonable endeavours, credit any Monthly Payment
                  made by a Borrower by way of Direct Debit to the relevant
                  Collection Account within one (1) London Business Day of
                  receipt (and in any event within three (3) London Business
                  Days of such receipt) into the relevant Collection Account.

      (b)   The Administrator may agree with a Borrower that the Direct Debiting
            Scheme shall not apply to Monthly Payments to be made by such
            Borrower, provided that (i) alternative payment arrangements are
            made which are intended to ensure the timely making of Monthly
            Payments due from the Borrower to the Mortgages Trustee, and (ii)
            the change in arrangements was made at the instigation of the
            Borrower or by the Administrator in accordance with the procedures
            which would be adopted by a reasonable and prudent

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            mortgage lender. The Administrator shall, using its reasonable
            endeavours, credit Monthly Payments made by a Borrower under an
            alternative payment arrangement as follows to the relevant
            Collection Account:

            (i)   by standing order, by close of business on the second (2nd)
                  London Business Day following the day on which such amount is
                  received or credited by the Administrator;

            (ii)  by payment of cash, transfer payment from another account of
                  the Seller or check where reference to the relevant Borrower
                  is provided or payments made by way of paying-in book, by
                  close of business on the London Business Day which immediately
                  follows the day on which such amount is received or credited
                  by the Administrator; and

            (iii) in the case of any payment by check where a reference to the
                  relevant Borrower is not provided, by close of business on the
                  next London Business Day after notification from the Operating
                  Banks of the identity of the Borrower;

      (c)   provided however, that in any event the Administrator shall credit
            Monthly Payments made by a Borrower under an alternative payment
            arrangement within three (3) London Business Days of such receipt.

      (d)   The Administrator may, notwithstanding the proviso to Clause 5.2(b)
            herein, agree such procedures for the payment by a Borrower of (i)
            overdue amounts and (ii) amounts payable on redemption of a Mortgage
            in whole or in part other than through the Direct Debiting Scheme as
            would be agreed by a reasonable and prudent mortgage lender.

      (e)   Where a Borrower permits a Direct Debit to be made to his bank
            account, the Administrator will endeavour to procure that such
            Borrower maintains a valid and effective mandate relating to such
            Direct Debit in relation to each Monthly Payment due from that
            Borrower, provided that in any case where a Borrower will not permit
            a Direct Debit to be made to his bank account the Administrator will
            endeavour to make alternative arrangements acceptable to a
            reasonable and prudent mortgage lender so that such Borrower
            nevertheless pays each Monthly Payment on the due date.

      (f)   In the event that the Bankers Automated Clearing System ceases to
            operate for any reason the Administrator will use reasonable
            endeavours to make alternative arrangements for the use of the
            back-up systems available to each Account Bank.

5.2   ADMINISTRATION AND ENFORCEMENT OF MORTGAGES:

      (a)   The Mortgages Trustee as trustee for the Beneficiaries hereby
            directs the Administrator to administer the Mortgage Loans comprised
            in the Mortgage Portfolio and carry out its specific obligations
            under this Agreement in accordance with the Administration
            Procedures.

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      (b)   The Administrator will, in relation to any default by a Borrower
            under or in connection with a Mortgage Loan or a Mortgage comprised
            in the Mortgage Portfolio, comply with the Enforcement Procedures
            or, to the extent that the Enforcement Procedures are not applicable
            having regard to the nature of the default in question, take such
            action as is not materially prejudicial to the interests of the
            Mortgages Trustee (as trustee for the Beneficiaries) and the
            Beneficiaries under the relevant MIG Policy, provided that:

            (i)   the Administrator shall only become obliged to comply with the
                  Enforcement Procedures (to the extent applicable) or to take
                  action as aforesaid after it has become aware of the default;

            (ii)  it is acknowledged by the Beneficiaries that mortgage lenders
                  generally exercise discretion in pursuing their respective
                  enforcement procedures and that the Administrator may exercise
                  such discretion as would a reasonable and prudent mortgage
                  lender in applying the Enforcement Procedures to any
                  particular defaulting Borrower or taking action as aforesaid,
                  provided that in exercising such discretion the interest of
                  Funding in the Mortgage Portfolio is not materially
                  prejudiced; and

            (iii) in any case where any of the Insurance Policies requires exact
                  compliance with certain enforcement procedures, the
                  Administrator shall procure the prior written consent of the
                  relevant insurance company for any deviation by it from such
                  enforcement procedures.

5.3   RECORDS: The Administrator shall keep and maintain records in relation to
      the Mortgage Portfolio, on a Mortgage Loan by Mortgage Loan basis, for the
      purposes of identifying amounts paid by each Borrower, any amount due from
      a Borrower and the balance from time to time outstanding on a Borrower's
      account and such other records as would be kept by a reasonable and
      prudent mortgage lender. Subject always to the restrictions and conditions
      set forth in Clause 16, the Administrator will provide such information to
      the Mortgages Trustee and/or Funding and/or the Security Trustee at any
      time upon reasonable notice, subject to the Administrator being reasonably
      capable of providing such information without significant additional cost
      and subject to the provisions of the Data Protection Act 1998 and other
      applicable legislation from time to time, and provided that no duty of
      confidence and no industry code of practice will or may be breached
      thereby.

5.4   TRUST:

      (a)   If the Administrator, in carrying out its functions as Administrator
            under this Agreement, receives (including in its capacity as agent
            for the Mortgages Trustee as trustee for the Beneficiaries) any
            money whatsoever arising from the Mortgage Loans and their Related
            Security, which money belongs to the Mortgages Trustee (as trustee
            for the Beneficiaries) and is to be paid to the relevant Collection
            Account pursuant to this Agreement or any of the other Transaction
            Documents or otherwise, it will hold such monies on trust for the
            Mortgages Trustee and shall keep such money separate from all other
            monies held by the Administrator and shall, as soon as reasonably
            practicable and in

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<PAGE>

            any event within three (3) London Business Days of receipt of the
            same, pay the monies into the relevant Collection Account.

      (b)   All other sums received by the Administrator in respect of the
            Mortgage Loans and their Related Security shall be held by the
            Administrator for itself.

6.    NO LIABILITY

6.1   NO GUARANTEE OF MORTGAGE LOAN: The Administrator shall have no liability
      for any obligation of a Borrower under any Mortgage Loan comprised in the
      Mortgage Portfolio or any Related Security and nothing herein shall
      constitute a guarantee, or similar obligation, by the Administrator of any
      Mortgage Loan, Mortgage or any Borrower.

6.2   NO GUARANTEE TO MORTGAGES TRUSTEE OR BENEFICIARIES: Save as otherwise
      provided in this Agreement, the Administrator shall have no liability for
      the obligations of the Mortgages Trustee or the Beneficiaries under any of
      the Transaction Documents or otherwise and nothing herein shall constitute
      a guarantee, or similar obligation, by the Administrator of the Mortgages
      Trustee or the Beneficiaries in respect of any of them.

7.    NEW MORTGAGE LOANS

7.1   NEW MORTGAGE PORTFOLIO: The Mortgage Portfolio may be augmented from time
      to time by the assignment to the Mortgages Trustee on any Distribution
      Date of a New Mortgage Portfolio by the Seller.

7.2   ASSIGNMENT SUBJECT TO TERMS: The assignment of each New Mortgage Portfolio
      to the Mortgages Trustee will in all cases be subject to the terms set out
      in the Mortgage Sale Agreement including, without limitation, the
      conditions set out in Clause 4 of the Mortgage Sale Agreement and the
      representations and warranties set out in Clause 8 of the Mortgage Sale
      Agreement.

8.    PRODUCT SWITCHING AND FURTHER ADVANCES

8.1   ACCEPTANCE OF APPLICATION: The Administrator shall not accept an
      application for a Further Advance or a Product Switch without first having
      received confirmation in writing from the Seller that the Seller would, if
      invited to do so by the Mortgages Trustee, purchase the relevant Mortgage
      Loan and its Related Security from the Mortgages Trustee.

8.2   NOTIFICATION: Subject to complying with the terms of Clause 8.1 herein,
      where the Administrator accepts a Product Switch or a Further Advance, the
      Administrator shall then promptly notify the Seller and the Mortgages
      Trustee in writing.

8.3   EXISTING BORROWERS RE-FIX RATE: Notwithstanding Clause 8.1 herein,
      whenever Clause 8.6 of the Mortgage Sale Agreement applies to a Fixed Rate
      Mortgage Loan, the Administrator may accept an application from a Borrower
      to set the Existing Borrowers' Re-Fix Rate, subject to the terms of Clause
      4.4 herein.

8.4   PROCEDURES: Subject to complying with the terms of Clauses 8.1 and 8.3
      herein, the Administrator may accept requests from Borrowers for Product
      Switches and Further

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<PAGE>

      Advances provided that the Administrator acts in accordance with its then
      procedure which would be acceptable to a reasonable and prudent mortgage
      lender.

9.    REDEMPTION OF MORTGAGES

9.1   RECEIPT OR DISCHARGE: Upon repayment in full of all sums secured by a
      Mortgage and/or other Related Security comprised in the Mortgage
      Portfolio, the Administrator shall, and is hereby authorised by the
      Mortgages Trustee as trustee for the Beneficiaries to, execute a receipt
      or discharge or relevant Form DS1 (of the United Kingdom Land Registry) of
      the Mortgage and any such other or further instrument or deed of
      satisfaction regarding such Mortgage and/or the Related Security as it
      considers to be necessary or advisable and to release the relevant Title
      Deeds to the person or persons entitled thereto.

9.2   TITLE DEEDS: The Administrator undertakes that prior to any actual release
      by it of any relevant Title Deeds it will take reasonable and appropriate
      steps to satisfy itself that the relevant Title Deeds are being released
      to the person or persons entitled thereto.

9.3   PAYMENT OF SUMS DUE: The Administrator shall procure that if, upon
      completion of the Enforcement Procedures, an amount in excess of all sums
      due from the relevant Borrower is recovered or received, the balance,
      after discharge of all sums due from the Borrower, is paid to the person
      or persons next entitled thereto.

10.   POWERS OF ATTORNEY

10.1  APPOINTMENT: The Mortgages Trustee hereby appoints the Administrator as
      its attorney on its behalf, and in its own or the attorney's name, for the
      following purposes:

      (a)   executing all documents necessary for the purpose of discharging a
            Mortgage comprised in the Mortgage Portfolio which has been repaid
            in full and any Related Security or for the sale of a Mortgaged
            Property as Mortgagee;

      (b)   executing all documents necessary for the purpose of releasing a
            Borrower in accordance with Clause 9 herein (Redemption of
            Mortgages);

      (c)   executing all documents and doing all acts and things which in the
            reasonable opinion of the Administrator are necessary or desirable
            for the efficient provision of the Services hereunder; and

      (d)   exercising its rights, powers and discretion under the Mortgages
            including the right to fix the rate of interest payable under the
            Mortgage Loans or any related rights (but subject, in relation to
            the right to set the interest rate under the Base Rate Pledge and
            the Existing Borrowers' Re-Fix Rate, to the limitations, conditions
            and qualifications set out in the Mortgage Sale Agreement and the
            powers of attorney executed pursuant to it),

      provided that, for the avoidance of doubt, these Powers of Attorney shall
      not authorise the Administrator to sell any of the Mortgage Loans and/or
      their Related Security comprised in the Mortgage Portfolio except as
      specifically authorised in the Transaction Documents. For the avoidance of
      doubt, neither the Mortgages Trustee nor Funding shall be liable or
      responsible for the acts of the Administrator or any failure by the
      Administrator to act under or in respect of these Powers of Attorney.

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<PAGE>

10.2  APPOINTMENTS IRREVOCABLE: The appointments contained in Clause 10.1 herein
      shall be irrevocable unless and until following a Termination Event
      pursuant to Clause 19 herein (Termination) the Mortgages Trustee and/or
      Funding and the Security Trustee serves notice pursuant to Clause 19
      herein (Termination) to terminate the Administrator's appointment under
      this Agreement upon which the appointments contained in Clause 10.1 herein
      shall be automatically revoked.

11.   COSTS AND EXPENSES

      The Mortgages Trustee will on each Distribution Date reimburse, in
      accordance with Clause 10.2(b) of the Mortgages Trust Deed, the
      Administrator for all out-of-pocket costs, expenses and charges (inclusive
      of any amounts in respect of Irrecoverable VAT due thereon) properly
      incurred by the Administrator in the performance of the Services including
      any such costs, expenses or charges not reimbursed to the Administrator on
      any previous Distribution Date and the Administrator shall supply the
      Mortgages Trustee with an appropriate VAT invoice issued by the person
      making the supply.

12.   INFORMATION

12.1  MAINTENANCE OF RECORDS:

      (a)   The Administrator shall keep the Mortgage Loan Files relating to the
            Mortgage Portfolio in safe custody and shall take appropriate
            technical and organisational measures against the unauthorised or
            unlawful processing of personal data and against accidental loss or
            destruction of, or damage to, personal data. The Administrator shall
            maintain in an adequate form such records as are necessary to
            enforce each Mortgage comprised in the Mortgage Portfolio and, where
            relevant, any other Related Security. The Administrator shall keep
            the Mortgage Loan Files in relation to the Mortgage Portfolio in
            such a way that they can be distinguished from information held by
            the Administrator for its own behalf as mortgagee or for other third
            persons.

      (b)   A duplicate of any computer records held by the Administrator which
            contains information relating to the Mortgage Loans and the Related
            Security shall be lodged by the Administrator on a quarterly basis
            in a location separate from that in which the original computer
            records are stored and in an environment conducive to the safe
            storage of electronic media and which allows the information to be
            stored in an incorruptible form, such records to be held to the
            order of the Mortgages Trustee and to be replaced by a revised
            duplicate as and when the original records are revised. The
            Administrator shall keep the Mortgages Trustee informed of the
            location of the Mortgage Loan Files and duplicate computer records.

12.2  USE OF INFORMATION TECHNOLOGY SYSTEMS:

      (a)   The Administrator will use all reasonable endeavours to negotiate
            with the relevant parties so that any intellectual property rights
            not owned by it but used by it in connection with the performance of
            its obligations under this Agreement and in particular all software
            programmes used in connection with the Mortgage Loans and the
            Related Security therefor and their administration

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<PAGE>

            are licensed or sub-licensed to the Mortgages Trustee as trustee for
            the Beneficiaries so as to permit the Mortgages Trustee as trustee
            for the Beneficiaries to use such intellectual property rights only
            in connection with the administration of the Mortgage Loans free of
            charge for so long as any of the Mortgage Loans are outstanding. For
            the avoidance of doubt, the Administrator shall not be in breach of
            its obligations under this Agreement if such rights and/or software
            programmes are not so licensed or sub-licensed to the Mortgages
            Trustee as trustee for the Beneficiaries at any time after it has
            ceased to be the Administrator:

      (b)   If this Agreement is terminated, then for a period of six months
            following such termination (or such shorter period as may be
            necessary to allow the administration of the Mortgage Loans to be
            transferred to another person) the Administrator shall use
            reasonable endeavours to assist the Mortgages Trustee and/or the
            Beneficiaries and/or any substitute or successor Administrator to:

            (i)   establish and implement a computer system for administering
                  the Mortgage Loans; and

            (ii)  load the data held by the Administrator in relation to
                  Borrowers and the Mortgage Loans on to such computer system,

            and, prior to (i) and (ii) having taken place, the Administrator
            will provide all necessary access and assistance to the Mortgages
            Trustee and/or the Beneficiaries and/or the substitute Administrator
            in respect of its own intellectual property rights in relation to
            the administration of the Mortgage Loans.

      (c)   Subject always to the restrictions and conditions set forth in
            Clause 16, upon termination of the appointment of the Administrator
            under this Agreement, the Administrator shall forthwith deliver to
            the Mortgages Trustee and/or the Beneficiaries and/or the substitute
            Administrator all computer and data records in its possession or
            under its control relating to the affairs of or belonging to the
            Mortgages Trustee and the Beneficiaries and/or relating to the
            Mortgage Loans and the Related Security in a form agreeable to each
            of the Administrator, the Mortgages Trustee and/or the Beneficiaries
            and/or the substitute Administrator which accords with the standard
            practice of the electronic data processing industry at the time the
            event occurs.

      (d)   The Administrator covenants that it will take no action, nor omit to
            take any action, the effect or likely effect of such action or
            omission will be to terminate any existing licence agreement in
            relation to any such intellectual property rights, provided that a
            licence agreement may be terminated if it is replaced by a
            substitute arrangement under which the intellectual property rights,
            including rights to computer software, are such that the services
            resulting therefrom are equivalent to the previous arrangement.

12.3  ACCESS TO BOOKS AND RECORDS: Subject to all applicable laws, and subject
      always to the restrictions and conditions set forth in Clause 16, the
      Administrator shall permit the Mortgages Trustee and Funding (and their
      auditors) and the Security Trustee and any other person nominated by the
      Beneficiaries (to whom the Administrator has no

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<PAGE>

      reasonable objection) upon reasonable notice during normal office hours to
      have access, or procure that such person or persons are granted access, to
      all books of record and account (including, for the avoidance of doubt,
      the Title Deeds and Mortgage Loan Files) relating to the administration of
      the Mortgage Loans and the Related Security comprised in the Mortgage
      Portfolio and related matters in accordance with this Agreement.

12.4  INFORMATION COVENANTS:

      (a)   The Administrator shall, within ten (10) Business Days following
            each Payment Date, provide the Mortgages Trustee, the Beneficiaries,
            the Rating Agencies, the Lead Manager, Bloomberg, L.P. (unless
            otherwise prohibited by law) and any other party as the Mortgages
            Trustee may direct with a report in, or substantially in, the form
            set out in Schedule 2 hereto (or such other form reasonably
            requested by the Mortgages Trustee and approved by the Beneficiaries
            and the Rating Agencies) and shall assist the Cash Manager in the
            production of quarterly reports substantially in the forms set out
            in Schedule 3 of the Cash Management Agreement.

      (b)   The Administrator shall notify the Rating Agencies in writing of the
            details of (i) any material amendment to the Transaction Documents,
            (ii) any proposed material change in the valuation procedures or
            policies applied or to be applied in relation to Mortgaged
            Properties by it in connection with its mortgage business (details
            of which change may be included in a report provided under
            subparagraph (a) above) and (iii) any other information relating to
            its mortgage business and financial condition as the Rating Agencies
            may reasonably request in connection with the ratings of the First
            Issuer Notes and any New Notes and other matters contemplated by the
            Transaction, provided that such request does not adversely interfere
            with the Administrator's day to day provision of the Services under
            the other terms of this Agreement.

      (c)   The Administrator shall, at the request of Funding and the Security
            Trustee (where the Administrator is the Seller) and at the request
            of the Beneficiaries (where the Administrator is no longer the
            Seller), furnish Funding, the Security Trustee and/or the
            Beneficiaries (as appropriate) and the Rating Agencies with such
            other information relating to its business and financial condition
            as it may be reasonable for Funding, the Security Trustee and/or the
            Beneficiaries (as appropriate) to request in connection with the
            ratings of the First Issuer Notes and any New Notes and other
            matters contemplated by the Transaction, provided that Funding, the
            Security Trustee or the Beneficiaries (as is appropriate) shall not
            make such a request more than once every three months unless, in the
            belief of Funding, the Security Trustee or the Beneficiaries (as
            appropriate), an Intercompany Loan Event of Default or a Termination
            Event pursuant to Clause 19 herein shall have occurred and is
            continuing or may reasonably be expected to occur.

13.   REMUNERATION

13.1  ADMINISTRATION FEE: The Mortgages Trustee shall pay to the Administrator
      for its Services hereunder an administration fee (the "ADMINISTRATION
      FEE") (inclusive of VAT) which:

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      (a)   shall be calculated in relation to each Trust Calculation Period on
            the basis of the number of days elapsed and a 365 day year (or, in
            the case of a Trust Calculation Period ending in a leap year, a 366
            day year) at the Administration Fee Rate, inclusive of VAT, on the
            aggregate amount of the Funding Share of the Trust Property as at
            close of business of such Trust Calculation Period; and

      (b)   shall be paid to the Administrator on each Distribution Date in the
            manner contemplated by and in accordance with the provisions of
            Clause 10 of the Mortgages Trust Deed.

13.2  SUBSTITUTE OR SUCCESSOR ADMINISTRATOR: If a substitute or successor
      administrator shall be appointed under this Agreement with respect to any
      of the Mortgage Loans, the Mortgages Trustee shall set the Administration
      Fee Rate with such substitute or successor administrator at the time such
      substitute or successor administrator enters into an administration
      agreement.

14.   INSURANCES

14.1  ADMINISTRATION: The Administrator will administer the arrangements for
      insurance to which the Mortgages Trustee is a party or in which either the
      Seller or the Mortgages Trustee has an interest and which relate to the
      Mortgage Loans and the Mortgages comprised in the Mortgage Portfolio or
      the business of the Mortgages Trustee.

14.2  ACTION OF ADMINISTRATOR: The Administrator shall not knowingly take or
      omit to take any action which would:

      (a)   result in the avoidance or termination of any of the Insurance
            Policies in relation to any Mortgage Loans and Mortgages to which
            any Insurance Policy applies;

      (b)   reduce the amount payable on any claim made on behalf of the
            Mortgages Trustee (as trustee for the Beneficiaries) under any
            Insurance Policy; or

      (c)   invalidate any Insurance Policy.

14.3  SUBMISSION OF CLAIMS: The Administrator shall prepare and submit any claim
      under the Insurance Policies in accordance with the requirements of the
      relevant Insurance Policy and otherwise with the usual procedures
      undertaken by a reasonable and prudent mortgage lender on behalf of the
      Mortgages Trustee as trustee for the Beneficiaries and shall comply with
      the other requirements of the insurer under the relevant Insurance Policy.

14.4  PROCEEDS: The Administrator shall use its reasonable endeavours to credit
      to the relevant Collection Account all proceeds received from any claim
      made under each Insurance Policy in relation to any Mortgage Loan by close
      of business on the London Business Day which immediately follows the day
      on which such amounts are received or credited by the Administrator (and
      in any event within three (3) London Business Days of such receipt) and
      which is applied either in whole or in part in repayment of a Mortgage
      Loan.

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<PAGE>

14.5  MIG POLICIES:

      (a)   Without prejudice to Clause 3 herein, the Mortgages Trustee as
            trustee for the Beneficiaries acknowledges that the Administrator
            may settle or compromise claims on a Mortgage Loan by Mortgage Loan
            basis in respect of any MIG Policy in a manner consistent with its
            normal practice in respect of mortgage indemnity polices, provided
            that the Administrator shall not, without the prior written consent
            of the Mortgages Trustee, settle any claims or initiate any legal
            proceedings or other legal process in respect of a group of class of
            mortgages or in respect of the MIG Policies as a whole and provided
            further that each such MIG Policy and all proceeds thereof remains
            subject to the Funding Deed of Charge.

      (b)   If the Enforcement Procedures requires the Administrator to make a
            claim under the relevant MIG Policy and the Administrator has failed
            to make such a claim, then the Beneficiaries may direct the
            Mortgages Trustee on their behalf to direct the Administrator to
            make a claim or, in default thereof by the Administrator, the
            Beneficiaries may direct the Mortgages Trustee to make a claim
            itself under such policy and the Administrator shall, within ten
            (10) London Business Days of receiving a written request from the
            Mortgages Trustee (as trustee for the Beneficiaries), provide the
            Mortgages Trustee with such information as the Mortgages Trustee may
            require to enable it to make a claim under the relevant MIG Policy.

      (c)   Without prejudice to the rights of the Administrator under Clause
            14.5(b) herein, the Administrator shall, in administering the
            Mortgage Loans, ensure that the cover under any MIG Policy relating
            to any Mortgage is not adversely affected.

14.6  BUILDINGS POLICIES:

      (a)   Upon receipt of notice that any Borrower whose Mortgage Loan is
            secured by a mortgage of a leasehold Mortgaged Property has failed
            to make a payment when due of any sums due under the relevant lease
            in respect of the insurance of the property, the Administrator may
            debit such Borrower's account with the relevant amount which shall
            then be paid to the relevant landlord.

      (b)   If the Administrator becomes aware that a Borrower has failed to pay
            premiums due under any Buildings Policy, the Administrator shall
            take such action as would a reasonable and prudent mortgage lender
            with a view to ensuring that the relevant Mortgaged Property
            continues to be insured in accordance with the applicable Mortgage
            Terms or the Alternative Insurance Requirements.

14.7  LIFE POLICIES:

      (a)   The Administrator shall use its reasonable endeavours to ensure that
            upon maturity of a Life Policy or on the death of a Borrower, if
            earlier, all sums which it is agreed between the Seller and the
            relevant Borrower are due to be paid under the Life Policy are paid
            by the relevant insurance company in

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<PAGE>

            repayment of the Mortgage for which such Life Policy is collateral
            security and credited to the relevant Collection Account.

      (b)   If so requested by a Borrower the Administrator may, on behalf of
            the Beneficiaries, exercise its discretion as a reasonable and
            prudent mortgage lender to agree to the release of a Life Policy
            from the relevant legal or equitable charge granted by the related
            Borrower in favour of the Seller.

15.   TITLE DEEDS

15.1  CUSTODY: The Administrator shall keep the Title Deeds relating to the
      Mortgage Portfolio in safe custody and shall not without the prior written
      consent of the Mortgages Trustee and the Beneficiaries part with
      possession, custody or control of them otherwise than to a sub-contractor
      or delegate appointed pursuant to Clause 3.2 herein (Sub-Contracts) or to
      a solicitor, licensed conveyancer or authorised practitioner, subject to
      the usual undertaking to hold them to the order of the Seller (who in turn
      will hold them to the order of the Mortgages Trustee (as trustee for the
      Beneficiaries)) or to H.M. Land Registry or, upon redemption of the
      relevant Mortgage Loan, to the order of the Borrower.

15.2  IDENTIFICATION: The Title Deeds relating to the Mortgage Portfolio shall
      be kept in a manner such that a computer record is maintained of their
      location and they are identifiable and retrievable by reference to an
      account number and pool identifier and identifiable and distinguishable
      from the title deeds relating to other properties and mortgages in respect
      of which the Administrator is mortgagee or administrator.

15.3  ACCESS: The Administrator shall provide access, or procure that access is
      provided to, the Title Deeds relating to the Mortgage Portfolio to the
      Mortgages Trustee, the Beneficiaries and their respective agents at all
      reasonable times and upon reasonable notice. The Administrator
      acknowledges that the Title Deeds and Mortgage Loan Files relating to the
      Mortgage Portfolio in its possession, custody or control will be held to
      the order of the Mortgages Trustee (as trustee for the Beneficiaries) and
      that it has, in its capacity as Administrator, no beneficial interest
      therein and the Administrator (in its capacity as such but not in its
      capacity as a Beneficiary) irrevocably waives any rights or any Security
      Interest which it might have therein or to which it might at any time be
      entitled.

15.4  DELIVERY UPON TERMINATION: The Administrator shall, forthwith on the
      termination of the appointment of the Administrator pursuant to Clause 19
      herein (Termination), deliver the Title Deeds and Mortgage Loan Files to
      or to the order of the Mortgages Trustee or to such person as the
      Mortgages Trustee elects as a substitute administrator in accordance with
      the terms of this Agreement upon written request by the Mortgages Trustee
      made at any time on or after notice of, or on or after, termination of the
      appointment of the Administrator pursuant to Clause 19 herein
      (Termination).

16.   DATA PROTECTION

      The Administrator represents that as at the date hereof the Administrator
      has and hereafter it will maintain on behalf of itself and on behalf of
      the Mortgages Trustee (as trustee for the Beneficiaries) all appropriate
      registrations, licences and authorities (if any) required under the Data
      Protection Act 1998 to enable each of them to

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<PAGE>

      perform their respective obligations under this Agreement. In addition to
      the foregoing and notwithstanding any of the other provisions of this
      Agreement, each of the Administrator and the Mortgages Trustee hereby
      agree and covenant as follows:

      (a)   that only non-"PERSONAL DATA" (as described in the Data Protection
            Act 1998) may be transferred by the Administrator to the Mortgages
            Trustee or any other entity located in Jersey (unless Jersey is
            declared an "approved state" by the European Commission, in which
            case the Administrator may transfer such personal data to the
            Mortgages Trustee in Jersey);

      (b)   that, to the extent that circumstances enable the Mortgages Trustee
            to exercise its right to demand that the Administrator transfer
            inter alia personal data to the Mortgages Trustee, the Administrator
            shall only transfer such personal data to an agent of the Mortgages
            Trustee that is located in the United Kingdom and maintains all
            appropriate registrations, licences and authorities (if any)
            required under the Data Protection Act 1998 (unless Jersey is
            declared an "APPROVED STATE" by the European Commission, in which
            case the Administrator may transfer such personal data to the
            Mortgages Trustee in Jersey);

      (c)   that, to the extent that circumstances enable the Mortgages Trustee
            to exercise its right to demand that the Administrator transfer
            inter alia personal data to the Mortgages Trustee, the Administrator
            notify each Borrower that the Mortgages Trustee is a "DATA
            CONTROLLER" (as defined in the Data Protection Act 1998) and provide
            each such Borrower with the address of the Mortgages Trustee;

      (d)   that the Administrator and the Mortgages Trustee will only use any
            data in relation to the Mortgage Loans and the related Borrowers for
            the purposes of administering and/or managing the Mortgage
            Portfolio, and will not sell such data to any third party or allow
            any third party to use such data other than in compliance with the
            conditions stated in this Clause 16 and for the sole purpose of
            administering and/or managing the Mortgage Portfolio;

      (e)   that the Mortgages Trustee will comply with the provisions of the
            Data Protection (Jersey) Law 1987 (as amended) and (so long as the
            provisions of the Data Protection Act 1998 do not conflict with the
            provisions of the Data Protection (Jersey) Law 1987) with the
            provisions of the Data Protection Act 1998 (as amended);

      (f)   that, upon the request of a Borrower, the Administrator will inform
            such Borrower that both the Administrator and the Mortgages Trustee
            are "data controllers" as described in the Data Protection Act 1998;
            and

      (g)   that both the Administrator and the Mortgages Trustee shall maintain
            a written record of their reasons for applying the Data Protection
            Order 2000 (as set forth under the Conditions under paragraph 3 of
            Part II of Schedule I of such Order).

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17.   COVENANTS AND REPRESENTATIONS AND WARRANTIES OF ADMINISTRATOR

17.1  COVENANTS: The Administrator hereby covenants with and undertakes to each
      of the Mortgages Trustee, the Beneficiaries and the Security Trustee that,
      without prejudice to any of its specific obligations hereunder, it will:

      (a)   administer the Mortgage Loans and their Related Security as if the
            same had not been assigned to the Mortgages Trustee but had remained
            on the books of the Seller;

      (b)   provide the Services in such manner and with the same level of
            skill, care and diligence as would a reasonable and prudent mortgage
            lender;

      (c)   comply with any reasonable directions, orders and instructions which
            the Mortgages Trustee or the Beneficiaries may from time to time
            give to it in accordance with the provisions of this Agreement and,
            in the event of any conflict, those of the Mortgages Trustee shall
            prevail;

      (d)   keep in force all licences, approvals, authorisations and consents
            which may be necessary in connection with the performance of the
            Services and prepare and submit all necessary applications and
            requests for any further approval, authorisation, consent or licence
            required in connection with the performance of the Services and in
            particular any necessary registrations under the Data Protection Act
            1998;

      (e)   not knowingly fail to comply with any legal requirements in the
            performance of the Services;

      (f)   make all payments required to be made by it pursuant to this
            Agreement on the due date for payment thereof in pounds sterling (or
            as otherwise required under the Transaction Documents) in
            immediately available funds for value on such day without set-off
            (including, without limitation, any fees owed to it) or
            counterclaim, but subject to any deductions required by law;

      (g)   not without the prior written consent of the Mortgages Trustee amend
            or terminate any of the Transaction Documents save in accordance
            with their terms;

      (h)   forthwith upon becoming aware of any event which may reasonably give
            rise to an obligation of the Seller to repurchase any Mortgage Loan
            pursuant to Clause 8 of the Mortgage Sale Agreement, notify the
            Mortgages Trustee and the Beneficiaries in writing of such event;

17.2  COVENANTS TO SURVIVE: The covenants of the Administrator in Clause 17.1
      herein shall remain in force until this Agreement is terminated but
      without prejudice to any right or remedy of the Mortgages Trustee and/or
      the Seller and/or Funding arising from breach of any such covenant prior
      to the date of termination of this Agreement.

17.3  REPRESENTATIONS AND WARRANTIES: The Administrator hereby makes the
      representations and warranties to each of the Mortgages Trustee, Funding
      and the Security Trustee that are specified on Schedule 3 hereto.

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18.   SERVICES NON-EXCLUSIVE

      Nothing in this Agreement shall prevent the Administrator from rendering
      or performing services similar to those provided for in this Agreement to
      or for itself or other persons or from carrying on business similar to or
      in competition with the business of the Mortgages Trustee and the
      Beneficiaries.

19.   TERMINATION

19.1  TERMINATION EVENT: If any of the following events (each a "Termination
      Event") shall occur:

      (a)   default is made by the Administrator in the payment on the due date
            of any payment due and payable by it under this Agreement and such
            default continues unremedied for a period of five London Business
            Days after the Administrator becoming aware of such default;

      (b)   default is made by the Administrator in the performance or
            observance of any of its other covenants and material obligations
            under this Agreement or any of the other Transaction Documents,
            which, the Security Trustee having been informed thereof as
            specified below in this sub-clause, is materially prejudicial to the
            interests of the holders of the First Issuer Notes and any New Notes
            from time to time and such default continues unremedied for a period
            of twenty (20) days after the Administrator becoming aware of such
            default, provided however that where the relevant default occurs as
            a result of a default by any person to whom the Administrator has
            sub-contracted or delegated part of its obligations hereunder, such
            default shall not constitute a Termination Event if within such
            twenty (20) day period the Administrator replaces the relevant
            sub-contractor or delegate with an entity capable of remedying such
            default or alternatively indemnifies the Mortgages Trustee and the
            Beneficiaries against the consequences of such default;

      (c)   the Administrator at any time fails to obtain the necessary license
            or regulatory approval required by any UK mortgage regulatory regime
            which would be required in order to enable it to continue
            administering the Mortgage Loans; or

      (d)   the Administrator becomes subject to an Insolvency Event,

      then the Mortgages Trustee and/or Funding and the Security Trustee may at
      once or at any time thereafter while such default continues, by notice in
      writing to the Administrator, terminate its appointment as Administrator
      under this Agreement with effect from a date (not earlier than the date of
      the notice) specified in such notice. Upon termination of the
      Administrator, the Security Trustee shall use its reasonable endeavours to
      appoint a substitute Administrator that satisfies the conditions set forth
      in Clause 19.2(c), (d) and (e), provided that in the event the Security
      Trustee has not, having used reasonable endeavours, appointed a substitute
      Administrator, the Security Trustee shall have no liability to any person
      and, notwithstanding any other provision of the Transaction Documents,
      shall not itself be required to perform any duties of the Administrator.

19.2  RESIGNATION: The Administrator may resign under this Agreement at any time
      following the expiry of not less than 12 months' notice of resignation
      given by the Administrator to the Mortgages Trustee and the Beneficiaries
      provided that:

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      (a)   the Mortgages Trustee and the Beneficiaries consent in writing to
            such termination;

      (b)   a substitute administrator is appointed by the Mortgages Trustee,
            Funding and the Security Trustee (and in the event of failure to
            agree, by the Security Trustee), such appointment to be effective
            not later than the date of such termination (and the Administrator
            shall notify the Rating Agencies in writing of the identity of such
            substitute administrator);

      (c)   if possible, such substitute administrator has experience of
            administering mortgages of residential property in England and Wales
            and is approved by the Mortgages Trustee and the Beneficiaries;

      (d)   such substitute administrator enters into an agreement on
            substantially the same terms as the relevant provisions of this
            Agreement and the Administrator shall not be released from its
            obligations under the relevant provisions of this Agreement until
            such substitute administrator has entered into such new agreement;
            and

      (e)   the then current ratings (if any) of the First Issuer Notes or any
            New Notes are not adversely affected as a result thereof, unless
            otherwise agreed by an Extraordinary Resolution (as defined in the
            Note Trust Deed) of the holders of the relevant class of Notes.

19.3  TERMINATION OF AUTHORITY: On and after resignation by, or termination of
      the appointment of, the Administrator under this Agreement pursuant to
      this Clause 19, all authority and power of the Administrator under this
      Agreement shall be terminated and be of no further effect and the
      Administrator shall not thereafter hold itself out in any way as the agent
      of the Mortgages Trustee and/or the Beneficiaries pursuant to this
      Agreement.

19.4  DELIVERY OF FILES: Upon resignation by, or termination of the appointment
      of, the Administrator under this Agreement pursuant to this Clause 19, the
      Administrator shall:

      (a)   forthwith deliver to (and in the meantime hold on trust for, and to
            the order of) the Mortgages Trustee or as it shall direct the
            Mortgage Loan Files, the Title Deeds, all books of account, papers,
            records, registers, correspondence and documents in its possession
            or under its control relating to the affairs of, or belonging to,
            the Mortgages Trustee (as trustee for the Beneficiaries) and the
            Mortgages in the Mortgage Portfolio and any other Related Security,
            (if practicable, on the date of receipt) any monies then held by the
            Administrator on behalf of the Mortgages Trustee and any other
            assets of the Mortgages Trustee as trustee for the Beneficiaries;

      (b)   take such further action as the Mortgages Trustee, Funding and the
            Security Trustee may reasonably direct at the expense of the
            Beneficiaries (including in relation to the appointment of a
            substitute administrator) provided that neither the Mortgages
            Trustee nor the Security Trustee shall be required to take or direct
            to be taken such further action unless it has been indemnified to
            its satisfaction;

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(c)         provide all relevant information contained on computer records in
            the form of magnetic tape, together with details of the layout of
            the files encoded on such magnetic tapes; and

(d)         co-operate and consult with and assist the Mortgages Trustee,
            Funding, the Security Trustee and their nominees (which shall, for
            the avoidance of doubt, include any new administrator appointed by
            any of them) for the purposes of explaining the file layouts and the
            format of the magnetic tapes generally containing such computer
            records on the computer system of the Mortgages Trustee or such
            nominee.

19.5  NOTIFICATION OF TERMINATION EVENT: The Administrator shall notify the
      Mortgages Trustee, the Security Trustee and the Beneficiaries as soon as
      reasonably practicable but in any event within five (5) days of becoming
      aware of any Termination Event or any event which with the giving of
      notice or lapse of time or certification would constitute the same. Such
      notification shall specify which event in Clause 19 occurred and was the
      cause of such Termination Event (or any event which with the giving of
      notice or lapse of time or certification would constitute a Termination
      Event), a description of the details of such Termination Event, and a
      reference to the provision in this Agreement or the other Transaction
      Documents which the Administrator has breached.

19.6  NO PREJUDICE: Termination of this Agreement or the appointment of the
      Administrator under this Agreement shall be without prejudice to the
      liabilities of the Mortgages Trustee as trustee for the Beneficiaries to
      the Administrator or vice versa incurred before the date of such
      termination. The Administrator shall have no right of set-off or any lien
      in respect of such amounts against amounts held by it on behalf of the
      Mortgages Trustee.

19.7  AUTOMATIC TERMINATION: This Agreement shall terminate at such time as the
      Mortgages Trustee has no further interest in any of the Mortgage Loans or
      the Mortgages which have been comprised in the Mortgage Portfolio.

19.8  FURTHER COMPENSATION: Upon resignation by, or termination of the
      appointment of, the Administrator under the provisions of this Clause 19,
      the Administrator shall be entitled to receive all fees and other monies
      accrued up to the date of resignation or termination, as the case may be,
      but shall not be entitled to any other or further compensation. Such
      monies so receivable by the Administrator shall be paid by the Mortgages
      Trustee on the dates on which they would otherwise have fallen due
      hereunder. For the avoidance of doubt, such resignation or termination
      shall not affect the Administrator's rights to receive payment of all
      amounts (if any) due to it from the Mortgages Trustee other than under
      this Agreement.

19.9  CO-OPERATION: Prior to termination of this Agreement, the Administrator,
      the Seller, the Mortgages Trustee and Funding shall co-operate to obtain
      the agreement of the Borrowers to a new bank mandate permitting the
      Mortgages Trustee to operate the Direct Debiting Scheme.

19.10 SURVIVAL OF TERMS: Any provision of this Agreement which is stated to
      continue after termination of the Agreement shall remain in full force and
      effect notwithstanding termination.

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<PAGE>

19.11 NO SUPERVISION: The Security Trustee shall not be obliged to monitor or
      supervise the performance by any substitute Administrator of its duties
      hereunder or in relation to the other Transaction Documents, nor shall the
      Security Trustee be responsible or liable for any act or omission of such
      substitute Administrator or for any loss caused thereby.

20.   FURTHER ASSURANCES

20.1  CO-OPERATION: The parties hereto agree that they will co-operate fully to
      do all such further acts and things and execute any further documents as
      may be necessary or desirable to give full effect to the arrangements
      contemplated by this Agreement.

20.2  POWERS OF ATTORNEY: Without prejudice to the generality of Clause 20.1
      herein, the Mortgages Trustee as trustee for the Beneficiaries shall upon
      request by the Administrator forthwith give to the Administrator such
      further powers of attorney or other written authorisations, mandates or
      instruments as are necessary to enable the Administrator to perform the
      Services.

20.3  NOTICE TO RATING AGENCIES: In the event that there is any change in the
      identity of the Mortgages Trustee or an additional Mortgages Trustee is
      appointed, the remaining Mortgages Trustee and/or the retiring Mortgages
      Trustee, as the case may be, shall execute such documents with any other
      parties to this Agreement and take such actions as such new Mortgages
      Trustee may reasonably require for the purposes of vesting in such new
      Mortgages Trustee the rights of the Mortgages Trustee under this Agreement
      and releasing the retiring Mortgages Trustee from further obligations
      thereunder and while any Note remains outstanding shall give notice
      thereof to the Rating Agencies.

20.4  NO OBLIGATIONS: Nothing herein contained shall impose any obligation or
      liability on the Mortgages Trustee to assume or perform any of the
      obligations of the Administrator hereunder or render it liable for any
      breach hereof.

21.   MISCELLANEOUS

21.1  INSUFFICIENT FUNDS: Subject to Clause 21.2 herein, in the event that the
      funds available to the Mortgages Trustee on any Payment Date are not
      sufficient to satisfy in full the aggregate amount payable to the
      Administrator by the Mortgages Trustee on such Payment Date then the
      amount payable to the Administrator on such Payment Date shall be reduced
      by the amount of the shortfall and such shortfall shall (subject always to
      the provisions of this Clause 21) be payable on the immediately succeeding
      Payment Date.

21.2  REDUCTION OF FEES: In the event that:

      (a)   after redemption in full of the Intercompany Loans; or

      (b)   after service of an Intercompany Loan Enforcement Notice and payment
            of all other prior claims,

      the remaining sums available to the Mortgages Trustee or remaining
      proceeds of enforcement are insufficient to satisfy in full the
      outstanding fees or other claims of the Administrator, such fees shall be
      reduced by the amount of the deficiency.

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21.3  SET-OFF: Each of the Seller and the Administrator agrees that it will not:

      (a)   set off or purport to set off any amount which the Mortgages
            Trustee, Funding or each Issuer is or will become obliged to pay to
            it under any of the Transaction Documents against any amount from
            time to time standing to the credit of or to be credited to any
            Collection Account, the Mortgages Trustee Transaction Account, the
            Mortgages Trustee GIC Account, the Funding Transaction Account, the
            Funding GIC Account, any Funding (Issuer) GIC Account, any Issuer
            Transaction Account in any other account prior to transfer to any
            Collection Account, the Mortgages Trustee Transaction Account, the
            Mortgages Trustee GIC Account, the Funding Transaction Account, the
            Funding GIC Account, any Funding (Issuer) GIC Account or any Issuer
            Transaction Account, as appropriate; or

      (b)   make or exercise any claims or demands, any rights of counterclaim
            or any other equities against or withhold payment of any and all
            sums of money which may at any time and from time to time be
            standing to the credit of any Collection Account, the Mortgages
            Trustee Transaction Account, the Mortgages Trustee GIC Account, the
            Funding Transaction Account, the Funding GIC Account, any Funding
            (Issuer) GIC Account or any Issuer Transaction Account.

21.4  NO PETITION: The Administrator agrees that for so long as any First Issuer
      Notes and New Notes are outstanding it will not petition nor commence
      proceedings for the administration or winding up of the Mortgages Trustee
      or Funding or any Issuer nor participate in any ex parte proceedings with
      regard thereto.

21.5  LIMITED RECOURSE: In relation to all sums due and payable by the Mortgages
      Trustee to the Administrator, the Administrator agrees that it shall have
      recourse only to sums paid to or received by (or on behalf of) the
      Mortgages Trustee pursuant to the provisions of the Mortgage Sale
      Agreement, the other Transaction Documents and in relation to the
      Mortgages.

21.6  NO PREJUDICE: For the avoidance of doubt, neither Beneficiary shall be
      liable to pay any amounts due under Clauses 11 or 13 herein without
      prejudice to the obligations of the Mortgages Trustee in respect of such
      amounts.

21.7  TERMINATION: Notwithstanding any other provisions of this Agreement, all
      obligations to, and rights of, Funding under or in connection with this
      Agreement (other than its obligations under Clause 22 herein
      (Confidentiality)) shall automatically terminate upon the discharge in
      full of all amounts owing by it under any Intercompany Loan Agreement,
      provided that this shall be without prejudice to any claims in respect of
      such obligations and rights arising on or prior to such date.

22.   CONFIDENTIALITY

      From the date of this Agreement and notwithstanding its termination, each
      of the Mortgages Trustee and the Beneficiaries shall use its best
      endeavours not to disclose to any person whatsoever any information
      relating to the business, finances or other matters of a confidential
      nature of any other party hereto of which it may by virtue of being party
      to the Transaction Documents have become possessed and shall use all

                                       26

<PAGE>

      reasonable endeavours to prevent any such disclosure as aforesaid,
      provided however that the provisions of this Clause 22 shall not apply:

      (a)   to any information already known to the Mortgages Trustee or the
            Beneficiaries otherwise than as a result of entering into any of the
            Transaction Documents;

      (b)   to any information subsequently received by the Mortgages Trustee or
            the Beneficiaries which it would otherwise be free to disclose;

      (c)   to any information which is or becomes public knowledge otherwise
            than as a result of the conduct of the Mortgages Trustee or the
            Beneficiaries;

      (d)   to any extent that the Mortgages Trustee or the Beneficiaries is
            required to disclose the same pursuant to any Transaction Document,
            pursuant to any law or order of any court or pursuant to any
            direction, request or requirement (whether or not having the force
            of law) of any central bank or any governmental or other authority
            (including, without limitation, any official bank examiners or
            regulators);

      (e)   to the extent that the Mortgages Trustee or the Beneficiaries needs
            to disclose the same for determining the existence of, or declaring,
            an Intercompany Loan Event of Default or a Termination Event, the
            protection or enforcement of any of its rights under any of the
            Transaction Documents or in connection herewith or therewith or for
            the purpose of discharging, in such manner as it thinks fit, its
            duties under or in connection with such agreements in each case to
            such persons as require to be informed of such information for such
            purposes; or

      (f)   in relation to any information disclosed to the professional
            advisers of the Mortgages Trustee or the Beneficiaries or (in
            connection with the review of current ratings of the First Issuer
            Notes or any New Notes or with a prospective rating of any debt to
            be issued by an Issuer) to any credit rating agency or any
            prospective new Administrator or Mortgages Trustee.

23.   NO PARTNERSHIP

      It is hereby acknowledged and agreed by the parties that nothing in this
      Agreement shall be construed as giving rise to any partnership between any
      of the parties.

24.   ASSIGNMENT

24.1  CONSENT: The Mortgages Trustee may not assign or transfer any of its
      rights and obligations under this Agreement without the prior written
      consent of each of the Beneficiaries.

24.2  AGREEMENT: The Administrator may not assign or transfer any of its rights
      or obligations under this Agreement (a) without the prior written consent
      of the Mortgages Trustee (as trustee for the Beneficiaries) and each of
      the Beneficiaries and (b) other than to a person who agrees to be bound by
      the provisions contained in Clause 5 of the Funding Deed of Charge as if
      such person had been named as an original party thereto in place of
      Northern Rock but without prejudice to their obligations under such
      Clause.

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24.3  ASSIGNMENT OF RIGHTS TO SECURITY TRUSTEE: The Administrator acknowledges
      that Funding has assigned its rights under this Agreement to the Security
      Trustee pursuant to the Funding Deed of Charge and acknowledges that
      pursuant to the terms of the Funding Deed of Charge, Funding has, inter
      alia, authorised the Security Trustee, following the Funding Security
      becoming enforceable, to exercise, or refrain from exercising, all of
      Funding's rights, powers, authorities, discretions and remedies under or
      in respect of the Funding Transaction Documents, including this Agreement,
      in such manner as in the Security Trustee's absolute discretion it shall
      think fit.

25.   SECURITY TRUSTEE; AUTHORISED THIRD PARTY

25.1  VESTING OF RIGHTS: If there is any change in the identity of the security
      trustee in accordance with the Funding Deed of Charge, the Administrator,
      the Seller, Funding and the Mortgages Trustee shall execute such documents
      and take such action as the successor security trustee and the outgoing
      security trustee may reasonably require for the purpose of vesting in the
      successor security trustee the rights and obligations of the outgoing
      security trustee under this Agreement and releasing the outgoing security
      trustee from its future obligations under this Agreement.

25.2  NO ASSUMPTION: It is hereby acknowledged and agreed that by its execution
      of this Agreement the Security Trustee shall not assume or have any of the
      obligations or liabilities of the Administrator, the Seller, Funding or
      the Mortgages Trustee under this Agreement. Furthermore, any liberty or
      power which may be exercised or any determination which may be made
      hereunder by the Security Trustee may be exercised or made in the Security
      Trustee's absolute discretion without any obligation to give reasons
      therefor, but in any event must be exercised or made in accordance with
      the provisions of the Funding Deed of Charge and Schedule 4 hereto.

25.3  DELEGATION: The Security Trustee may delegate the performance of all or
      any of its powers and obligations under all or any of the Operating
      Agreements pursuant to the terms of Schedule 4 of this Agreement and
      subject always to the provisions of the Funding Deed of Charge.

26.   NEW INTERCOMPANY LOAN AGREEMENTS

      If Funding enters into a New Intercompany Loan Agreement, then the
      Administrator, the Seller, Funding, the Security Trustee and the Mortgages
      Trustee shall execute such documents and take such action as may be
      necessary or required by the Rating Agencies for the purpose of including
      the New Issuer, any Basis Rate Swap Provider, any Currency Swap Provider,
      any New Start-up Loan Provider and any other person who has executed an
      Accession Undertaking or any New Intercompany Loan Agreement in the
      Transaction Documents.

27.   NON PETITION COVENANT; LIMITED RECOURSE

27.1  NON PETITION COVENANT: Each of the parties hereto hereby agrees that it
      shall not institute against either Funding or the Mortgages Trustee any
      winding-up, administration, insolvency or similar proceedings so long as
      any sum is outstanding under any Intercompany Loan Agreement of any Issuer
      or for two years plus one day since the last day on which any such sum was
      outstanding.

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27.2  LIMITED RECOURSE:  Each of the parties hereto agrees that:

      (a)   in relation to the Mortgages Trustee, any amount payable by the
            Mortgages Trustee to any other party to this Agreement under this
            Agreement not being an amount payable out of the Trust Property in
            accordance with the terms of the Mortgages Trust Deed shall only be
            payable to the extent that on that date the Mortgages Trustee has
            sufficient funds to pay such amount out of fees paid to it under the
            Mortgages Trust Deed; and

      (b)   in relation to Funding:

            (i)   only the Security Trustee may enforce the security created in
                  favour of the Security Trustee under the Funding Deed of
                  Charge in accordance with the provisions thereof;

            (ii)  notwithstanding any other provision of this Agreement or any
                  other Transaction Document, no sum due or owing to any party
                  to this Agreement from or by Funding under this Agreement
                  shall be payable by Funding except to the extent that Funding
                  has sufficient funds available or (following enforcement of
                  the Funding Security) the Security Trustee has realised
                  sufficient funds from the Funding Security to pay such sum
                  subject to and in accordance with the relevant Funding
                  Priority of Payments and provided that all liabilities of
                  Funding required to be paid in priority thereto or pari passu
                  therewith pursuant to such Funding Priority of Payments have
                  been paid, discharged and/or otherwise provided for in full;
                  and

            (iii) it shall not take any steps for the purpose of recovering any
                  amount payable by Funding or enforcing any rights arising out
                  of this Agreement against Funding otherwise than in accordance
                  with the Funding Deed of Charge.

27.3  CORPORATE OBLIGATIONS: To the extent permitted by law, no recourse under
      any obligation, covenant, or agreement of any person contained in this
      Agreement shall be had against any shareholder, officer or director of
      such person as such, by the enforcement of any assessment or by any legal
      proceeding, by virtue of any statute or otherwise; it being expressly
      agreed and understood that this Agreement is a corporate obligation of
      each person expressed to be a party hereto and no personal liability shall
      attach to or be incurred by the shareholders, officers, agents or
      directors of such person as such, or any of them, under or by reason of
      any of the obligations, covenants or agreements of such person contained
      in this Agreement, or implied therefrom, and that any and all personal
      liability for breaches by such person of any of such obligations,
      covenants or agreements, either under any applicable law or by statute or
      constitution, of every such shareholder, officer, agent or director is
      hereby expressly waived by each person expressed to be a party hereto as a
      condition of and consideration for the execution of this Agreement.

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28.   AMENDMENTS AND WAIVER

28.1  ENTIRE AGREEMENT: This Agreement sets out the entire agreement and
      understanding between the parties with respect to the subject matter of
      this Agreement superseding all prior oral or written understandings other
      than the other Transaction Documents.

28.2  AMENDMENTS AND WAIVER: No amendment or waiver of any provision of this
      Agreement nor consent to any departure by any of the parties therefrom
      shall in any event be effective unless the same shall be in writing and
      signed by each of the parties hereto. In the case of a waiver or consent,
      such waiver or consent shall be effective only in the specific instance
      and as against the party or parties giving it for the specific purpose for
      which it is given.

28.3  RIGHTS CUMULATIVE: The respective rights of each of the parties to this
      Agreement are cumulative and may be exercised as often as they consider
      appropriate. No failure on the part of any party to exercise, and no delay
      in exercising, any right hereunder shall operate as a waiver thereof, nor
      shall any single or partial exercise of any such right preclude any other
      or further exercise thereof or the exercise of any other right. The
      remedies in this Agreement are cumulative and not exclusive of any
      remedies provided by law.

28.4  VARIATION OR WAIVER: No variation or waiver of this Agreement shall be
      made if the same would adversely affect the then current ratings of` any
      of the Notes.

29.   NOTICES

      Any notices or other communication or document to be given or delivered
      pursuant to this Agreement to any of the parties hereto shall be
      sufficiently served if sent by prepaid first class post, by hand or by
      facsimile transmission and shall be deemed to be given (in the case of
      facsimile transmission) when despatched or (where delivered by hand) on
      the day of delivery if delivered before 17.00 hours on a London Business
      Day or on the next London Business Day if delivered thereafter or (in the
      case of first class post) when it would be received in the ordinary course
      of the post and shall be sent:

      (a)   in the case of the Administrator and the Seller, to Northern Rock
            PLC, Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL
            (facsimile number: 0191 213 2203) for the attention of the Group
            Secretary;

      (b)   in the case of the Mortgages Trustee, to Granite Finance Trustees
            Limited, c/o 22 Grenville Street, St. Helier, Jersey JE4 8PX,
            Channel Islands (facsimile number 01534-609-333) for the attention
            of the Company Secretary;

      (c)   in the case of Funding, to Granite Finance Funding Limited, 4th
            Floor, 35 New Bridge Street, Blackfriars, London EC4V 6BW (facsimile
            number 0207-332-6199 for the attention of the Company Secretary;

      (d)   in the case of the Security Trustee, to The Bank of New York (London
            Branch), One Canada Square, 48th Floor, London E14 5AL (facsimile
            number 020-7964-6399) for the attention of Corporate Trust (Global
            Structured Finance);

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<PAGE>

      (e)   in the case of Fitch, to Fitch Ratings Ltd., at Eldon House, 2 Eldon
            Street, London EC2M 7UA (facsimile number 0207 7417 6262) for the
            attention of European Structured Finance Surveillance;

      (f)   in the case of Moody's, to Moody's Investors Services, Inc., at 1st
            Floor, 2 Minster Court, Mincing Lane, London EC3R 7XB (facsimile
            number 0207 772 5400) for the attention of David Harrison;

      (g)   in the case of S&P, to Standard & Poor's Ratings Services, a
            division of The McGraw-Hill Companies, Inc., at Garden House, 18
            Finsbury Circus, London EC2M 7NJ (facsimile number 0207-826-3598)
            for the attention of Andre Vollmann;

      or to such other address or facsimile number or for the attention of such
      other person or entity as may from time to time be notified by any party
      or by any Rating Agency to the others by written notice in accordance with
      the provisions of this Clause 29. All notices served under this Agreement
      shall be simultaneously copied to the Security Trustee by the person
      serving the same.

30.   THIRD PARTY RIGHTS

      A person who is not a party to this Agreement may not enforce any of its
      terms under the Contracts (Rights of Third Parties) Act 1999, but this
      shall not affect any right or remedy of a third party which exists or is
      available apart from that Act.

31.   EXECUTION IN COUNTERPARTS; SEVERABILITY

31.1  COUNTERPARTS: This Agreement may be executed in any number of counterparts
      (manually or by facsimile) and by different parties hereto in separate
      counterparts, each of which when so executed shall be deemed to be an
      original and all of which when taken together shall constitute one and the
      same instrument.

31.2  SEVERABILITY: Where any provision in or obligation under this Agreement
      shall be invalid, illegal or unenforceable in any jurisdiction, the
      validity, legality and enforceability of the remaining provisions or
      obligations under this Agreement, or of such provision or obligation in
      any other jurisdiction, shall not be affected or impaired thereby.

32.   GOVERNING LAW AND SUBMISSION TO JURISDICTION

32.1  GOVERNING  LAW: This  Agreement is governed by, and shall be construed
      in accordance with, English law.

32.2  SUBMISSION TO JURISDICTION: Each of the parties hereto irrevocably agrees
      that the courts of England shall have jurisdiction to hear and determine
      any suit, action or proceeding, and to settle any disputes, which may
      arise out of or in connection with this Agreement and, for such purposes,
      irrevocably submits to the jurisdiction of such courts.

                                       31

<PAGE>

33.   PROCESS AGENT

      The Mortgages Trustee irrevocably and unconditionally appoints Mourant &
      Co. Capital (SPV) Limited at Fourth Floor, 35 New Bridge Street,
      Blackfriars, London EC4V 6BW or otherwise at its registered office for the
      time being as its agent for service of process in England in respect of
      any proceedings in respect of this Agreement and undertakes that in the
      event of Mourant & Co. Capital (SPV) Limited ceasing so to act it will
      appoint another person with a registered office in London as its agent for
      service of process.

34.   APPROPRIATE FORUM

      Each of the parties hereto irrevocably waives any objection which it might
      now or hereafter have to the courts of England being nominated as the
      forum to hear and determine any Proceedings and to settle any disputes,
      and agrees not to claim that any such court is not a convenient or
      appropriate forum.

IN WITNESS WHEREOF the parties have caused this Agreement to be executed as a
deed the day and year first before written.

                                       32

<PAGE>

                                   SCHEDULE 1

                                  THE SERVICES

In addition to the Services set out in the body of the Administration Agreement,
the Administrator shall:

(a)   keep records (written or computerised) and books of account for the
      Mortgages Trustee in relation to the Mortgage Loans comprised in the
      Mortgage Portfolio;

(b)   keep records for all taxation purposes and VAT;

(c)   notify relevant Borrowers of any change in their Monthly Payments;

(d)   assist the auditors of the Mortgages  Trustee and provide  information
      to them upon reasonable request;

(e)   provide a redemption statement to a Borrower or any person acting on the
      Borrower's behalf, in each case upon written request or otherwise at the
      discretion of the Administrator;

(f)   notify relevant Borrowers of any other matter or thing which the
      applicable Mortgage Conditions or Offer Conditions require them to be
      notified of in the manner and at the time required by the relevant
      Mortgage Terms;

(g)   subject to the provisions of this Agreement (including without limitation
      Clause 5.2 herein (Administration and Enforcement of Mortgages) take all
      reasonable steps to recover all sums due to the Mortgages Trustee
      including without limitation by the institution of proceedings and/or the
      enforcement of any Mortgage Loan comprised in the Mortgage Portfolio or
      any New Mortgage Portfolio or any Related Security;

(h)   take all other action and do all other things which it would be reasonable
      to expect a reasonable and prudent mortgage lender to do in administering
      its mortgages;

(i)   keep a Mortgage Account for each Mortgage Loan which shall record all
      proceeds received in respect of that Mortgage Loan and all amounts debited
      to such Mortgage Account;

(j)   at its  discretion,  prepare  and send on request an annual  statement
      to  Borrowers  in relation to each  calendar  year in the agreed form;
      and

(k)   assist the Cash Manager in the preparation of a quarterly report
      substantially in the form set out in the Cash Management Agreement.

                                       33

<PAGE>

                                   SCHEDULE 2

                       FORM OF INVESTORS' QUARTERLY REPORT

GRANITE FINANCE TRUSTEES LIMITED
MONTHLY REPORT

Date of Report [  ]

MORTGAGES

Number of Mortgages in Pool                                  [  ]

Current Balance                                       (pound)[  ]

Opening Trust Assets                                  (pound)[  ]

Funding Share                                         (pound)[  ]

Funding Share Percentage                                     [  ]%

Seller Share                                          (pound)[  ]

Seller Share Percentage                                      [  ]%

Minimum Seller Share (Amount)                         (pound)[  ]

Minimum Seller Share (% of Total)                            [  ]%

ARREARS ANALYSIS OF NON REPOSSESSED MORTGAGES

                         Number              Principal         Arrears

Less than [  ] month     [  ]                [  ]              [  ]
[  ] - [  ] months       [  ]                [  ]              [  ]
[  ] - [  ] months       [  ]                [  ]              [  ]
[  ] - [  ] months       [  ]                [  ]              [  ]
[  ] - [  ] months       [  ]                [  ]              [  ]
[  ] months +            [  ]                [  ]              [  ]
Total                    [  ]                [  ]              [  ]

                                       34

<PAGE>

Properties in Possession   Number            Principal      Arrears

Total                      [  ]                [  ]            [  ]

Number Brought Forward                                         [  ]

Repossed                                                       [  ]

Sold                                                           [  ]

Number Carried Forward                                         [  ]

Average Time from                                              [  ]
Possession to Sale

Average Arrears at Sale                                        [  ]

Repossed                                                       [  ]

MIG Claims Submitted                                           [  ]

MIG Claims Outstanding                                         [  ]

Average Time from Claim                                        [  ]
to Payment

Note: The arrears analysis and repossession information is as at close of
business for the report month

Substitution                     Number                    Principal

Substituted this period (this    [  ]                      [  ]
month)
Substituted to dated (since      [  ]                      [  ]
[  ])

CPR Analysis                     Monthly                   Annualised

Current [  ] Month CPR Rate      [  ]%                     [  ]%

Previous [  ] Month CPR Rate     [  ]%                     [  ]%

Weighted Average Seasoning (by value)   [  ]

Average Loan Size                       [  ]

Weighted Average LTV (by value)         [  ]%

                                       35

<PAGE>

Product Breakdown

Fixed Rate                              [  ]%

Flexible - Together                     [  ]%

LTV LEVELS BREAKDOWN            Number                    Value

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ] - [  ]%                    [  ]                      [  ]

[  ]% +                         [  ]                      [  ]

Totals                          [  ]                      [  ]

NR Current Existing Borrowers'                            [  ]
SVR

Effective Date of Change                                  [  ]

                                       36

<PAGE>

NOTES       Outstanding       Rating               Reference Rate
                              Moodys/S&P/Fitch
Series 1

A1          $ XXX,XXX,XXX       Aaa/AAA/AAA       X.XXX%         X.XX%

A2          $ XXX,XXX,XXX       Aaa/AAA/AAA       X.XXX%         X.XX%

B           $ XX,XXX,XXX        Aa3/AA/AA         X.XXX%         X.XX%

C           $ XX,XXX,XXX        Baa2/BBB/BBB      X.XXX%         X.XX%

Series 2

A     (pound) XXX,XXX,XXX       Aaa/AAA/AAA       X.XXX%         X.XX%

B     (pound) XX,XXX,XXX        Aa3/AA/AA         X.XXX%         X.XX%

C     (pound) XX,XXX,XXX        Baa2/BBB/BBB      X.XXX%         X.XX%

Issuer Reserve Fund Requirement                             (pound)[  ]

Balance brought forward                                     (pound)[  ]

Drawings this period

Reserve Fund Top-up this period*                            (pound)[  ]

Excess Spread                                               (pound)[  ]

Current Balance                                             (pound)[  ]

*Top-ups only occur at the end of each quarter.

Funding Reserve Balance                                     (pound)[  ]

Funding Reserve %                                                  [  ]%

                                       37

<PAGE>

                                    SCHEDULE 3

                ADMINISTRATOR REPRESENTATIONS AND WARRANTIES

The Administrator makes the following representations and warranties to each of
the Mortgages Trustee, Funding and the Security Trustee:

1.    STATUS: It is a public limited company duly incorporated, validly existing
      and registered under the laws of the jurisdiction in which it is
      incorporated, capable of being sued in its own right and not subject to
      any immunity from any proceedings, and it has the power to own its
      property and assets and to carry on its business as it is being conducted.

2.    POWERS AND AUTHORITY: It has the power to enter into, perform and deliver,
      and has taken all necessary corporate and other action to authorise the
      execution, delivery and performance by it of each of the Transaction
      Documents to which it is or will be a party, and each such Transaction
      Document has been duly executed and delivered by it.

3.    LEGAL VALIDITY: Each Transaction Document to which it is or will be a
      party constitutes or when executed in accordance with its terms will
      constitute its legal, valid and binding obligation.

4.    NON-CONFLICT: The execution by it of each of the Transaction Documents to
      which it is a party and the exercise by it of its rights and the
      performance of its obligations under such Transaction Documents will not:

      (a)   result in the existence or imposition of, nor oblige it to create,
            any Security Interest in favour of any person over all or any of its
            present or future revenues or assets;

      (b)   conflict with any document which is binding upon it or any of its
            assets;

      (c)   conflict with its constitutional documents; or

      (d)   conflict with any law, regulation or official or judicial order of
            any government, governmental body or court, domestic or foreign,
            having jurisdiction over it.

5.    NO LITIGATION: It is not a party to any material litigation, arbitration
      or administrative proceedings and, to its knowledge, no material
      litigation, arbitration or administrative proceedings are pending or
      threatened against it.

6.    CONSENTS AND LICENCES: All governmental consents, licences and other
      approvals and authorisations required in connection with the entry into,
      performance, validity and enforceability of, and the transactions
      contemplated by, the Transaction Documents have been obtained or effected
      (as appropriate) and are in full force and effect.

7.    SOLVENCY: No Insolvency Event has occurred in respect of the
      Administrator, and the Administrator is not insolvent.

                                       38

<PAGE>

8.    FINANCIAL STATEMENTS: The most recent financial statements of the
      Administrator:

      (a)   were prepared in accordance with accounting principles generally
            accepted in England and Wales consistently applied;

      (b)   disclose all liabilities (contingent or otherwise) and all
            unrealised and or anticipated losses of the Administrator; and

      (c)   save as disclosed therein, give a true and fair view of the
            financial condition and operations of the Administrator during the
            relevant financial year.

9.    NO ADVERSE CHANGE: Since the date as of which the most recent financial
      statements of the Administrator were stated to be prepared, there has
      been:

      (a)   no significant change in the financial position of the
            Administrator; and

      (b)   no material adverse change in the financial position or prospects of
            the Administrator.

10.   RANKING OF CLAIMS

      Under the laws of England and Wales in force as at the date of making this
      representation, claims against the Administrator under the Transaction
      Documents will rank at least pari passu with the claims of all its other
      unsecured and unsubordinated creditors, save those whose claims are
      preferred solely by any bankruptcy, liquidation or other similar laws of
      general application.

11.   INFORMATION IN PROSPECTUS AND OFFERING CIRCULAR:

      (a)   All information in the Prospectus and the Offering Circular with
            regard to the Administrator, its business and its experience
            administering mortgage loans (including its arrears and repossession
            experience) are true and accurate in all material respects and not
            misleading in any material respect.

      (b)   Any opinions, predictions and intentions expressed in the Prospectus
            and/or the Offering Circular on the part of the Administrator are
            honestly held and not misleading in any material respect.

      (c)   Each of the Prospectus and the Offering Circular does not omit to
            state any material fact necessary to make such information,
            opinions, predictions or intentions not misleading in any material
            respect.

      (d)   The Administrator has made all proper inquiries to ascertain and to
            verify the foregoing.

                                       39

<PAGE>

                                   SCHEDULE 4

                             AUTHORISED THIRD PARTY

1.    AGREEMENT TO ALLOW DELEGATION

1.1.  The Seller and the Administrator agree (subject to the other provisions of
      this Schedule, including paragraph 2 (Appointment and Payment) and subject
      to the Funding Deed of Charge) that the Security Trustee may appoint or
      facilitate the appointment of an Authorised Third Party to implement,
      administer and carry out the duties and powers of the Security Trustee:

      (a)   under the Seller's Power of Attorney;

      (b)   in connection with and following a Completion Event; and

      (c)   in connection with and following a Termination Event,

      (together the "BACK-UP FUNCTIONS")

1.2.  Each of the Seller and the Administrator shall authorise the Authorised
      Third Party on their behalf and in their name or otherwise to sign or
      execute or make any alteration or addition or deletion in or to any
      agreements or documents or certificates or instructions or notices which
      they are entitled or required to give, receive, implement, transact or
      become a party to in relation to the Back-up Functions or for doing any
      other act or thing required to be done by them under or in connection with
      the Back-up Functions and otherwise generally to sign, seal and deliver
      any agreement, assurance, document, certificate, instruction or act which
      may be required by the Authorised Third Party acting in connection with
      the Back-up Functions.

2.    APPOINTMENT AND PAYMENT

      The appointment of the Authorised Third Party shall be on the terms and
      conditions as negotiated between the Security Trustee, the Seller and/or
      the Administrator (as the case may be) and such Authorised Third Party.
      The fees, costs and expenses payable to such Authorised Third Party shall
      be considered as part of the additional remuneration and expenses of the
      Security Trustee and therefore shall be payable in the manner contemplated
      by and in accordance with Clause 18 of the Funding Deed of Charge from
      funds that the Security Trustee receives in accordance with the Funding
      Priority of Payments as set forth in the Funding Deed of Charge.

3.    DELEGATION

3.1.  The Security Trustee shall use reasonable endeavours (in its opinion) to
      appoint in writing one or more persons to act as an Authorised Third Party
      in respect of the Back-up Functions (on any terms other than the power to
      appoint a delegate), and references in the Operating Agreements to the
      "Security Trustee" shall be construed accordingly and, unless the context
      does not permit, include any Authorised Third Party. Any such appointment
      of an Authorised Third Party may be revoked by the Security Trustee at any
      time.

                                       40

<PAGE>

3.2.  In the event that the Security Trustee has not, having used such
      reasonable endeavours, appointed such Authorised Third Party, the Security
      Trustee shall have no liability to any person and, notwithstanding any
      other provision of the Operating Agreements, shall not itself be required
      to perform any Back-up Functions or any other duties of the Seller or the
      Administrator either during the period it is seeking to appoint an
      Authorised Third Party or thereafter.

3.3.  As condition precedents to the appointment of the Authorised Third Party,
      the arrangements to be entered into between the Authorised Third Party and
      the Seller or Administrator (as the case may be) shall provide that (1)
      the Authorised Third Party shall make timely transfer of information to
      the Seller or Administrator (as appropriate); and (2) the Security Trustee
      shall provide any Authorised Third Party with a copy of the Operating
      Agreements and the Funding Deed of Charge and shall request such
      Authorised Third Party to confirm in writing to the Seller, the
      Administrator and the Security Trustee that it has read and understood the
      terms of this Agreement and the other Operating Agreements.

4.    RATIFICATION

      Each of the Seller and the Administrator shall, upon the written request
      of the Security Trustee or such Authorised Third Party, ratify and confirm
      all documents, deeds, certificates, instructions, acts and things which
      the Security Trustee or such Authorised Third Party shall execute or do in
      the exercise of any of the powers conferred, or purported to be conferred,
      on him by this Agreement and the other Operating Agreements. The terms of
      appointment of the Authorised Third Party shall oblige the Authorised
      Third Party to provide information concerning its activities on a regular
      basis and on request to the Seller, Administrator, Funding and the
      Security Trustee.

5.    LIMITATIONS ON THE RESPONSIBILITY OF THE SECURITY TRUSTEE

      The Security Trustee shall not be obliged to monitor or supervise the
      performance by such Authorised Third Party of its duties hereunder or in
      relation to the Operating Agreements and shall not be responsible or
      liable for any act or omission of such Authorised Third Party or for any
      loss caused thereby, provided that if any party to a Transaction Document
      notifies the Security Trustee that an Authorised Third Party appointed by
      the Security Trustee is implementing, administering or carrying out the
      duties and powers of the Security Trustee in breach of the terms and
      conditions of the relevant Operating Agreement pursuant to which such
      duties and powers are to be performed, the Security Trustee shall use its
      reasonable endeavours to appoint or facilitate the appointment of a
      substitute Authorised Third Party to implement, administer and carry out
      such duties and powers. The terms of appointment of an Authorised Third
      Party and the Security Trustee's responsibilities in relation thereto as
      set out in this Schedule 4 shall apply to the appointment of a substitute
      Authorised Third Party. Nothing in this Schedule constitutes the Security
      Trustee in its role as specified in this schedule as trustee or fiduciary
      for any person. The Security Trustee shall assume, until it receives
      notice thereof pursuant to the relevant Operating Agreement, that no
      Back-up Trigger Event has occurred and until such time that it receives
      such notification and is first indemnified and/or secured to its
      satisfaction, is not entitled to take any action in respect of the Back-up
      Functions under the Operating Agreements.

                                       41

<PAGE>

6.    EXONERATION

6.1.  Without limiting paragraph 6.2 below, the Security Trustee shall not be
      liable to any Person for any action taken or not taken by the Security
      Trustee or such Authorised Third Party under or in connection with the
      Operating Agreements, other than in respect of any loss, liability, claim,
      expense or damage suffered or incurred by such Person in respect of the
      gross negligence or wilful default of the Security Trustee or such
      Authorised Third Party in carrying out its functions under the relevant
      Operating Agreement.

6.2.  No Person may take any proceedings against any officer, employee or agent
      of the Security Trustee in respect of any claim it might have against the
      Security Trustee in respect of any act or omission of any kind by their
      officer, employee or agent.

                                       42

<PAGE>

                                 EXECUTION PAGE

AS ADMINISTRATOR
EXECUTED for and on behalf of             )
NORTHERN ROCK PLC                         )
by:                                       )

-------------------------
AUTHORISED SIGNATORY

Name:

Title:

AS SELLER

EXECUTED for and on behalf of             )
NORTHERN ROCK PLC                         )
by:                                       )

-------------------------
AUTHORISED SIGNATORY

Name:

Title:

EXECUTED for and on behalf of             )
GRANITE FINANCE TRUSTEES LIMITED          )
by:                                       )

-------------------------
AUTHORISED SIGNATORY

Name:

Title:

EXECUTED for and on behalf of             )
GRANITE FINANCE FUNDING LIMITED           )
by:                                       )

-------------------------
AUTHORISED SIGNATORY

Name:

Title:

                                       43DATED [O] 2002

                           GRANITE MORTGAGES 02-2 PLC
                                as Current Issuer

                                  GPCH LIMITED
                     as Post-Enforcement Call Option Holder

                                     - AND -

                              THE BANK OF NEW YORK
                                 as Note Trustee

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

                       ISSUER POST-ENFORCEMENT CALL OPTION
                                    AGREEMENT

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

                           SIDLEY AUSTIN BROWN & WOOD
                              1 THREADNEEDLE STREET
                                 LONDON EC2R 8AW
                             TELEPHONE 020 7360 3600
                             FACSIMILE 020 7626 7937
                          REF: LHC/30507-00013/IM550580

<PAGE>

THIS AGREEMENT IS MADE BY WAY OF DEED dated [o] 2002

BETWEEN

(1)   GRANITE MORTGAGES 02-2 PLC (registered number 4482804), a public limited
      company incorporated under the laws of England and Wales whose registered
      office is at Fifth Floor, 100 Wood Street, London EC2V 7EX (the "CURRENT
      ISSUER");

(2)   GPCH LIMITED (registered number 4128437), a private limited company
      incorporated under the laws of England whose registered office is at Fifth
      Floor, 100 Wood Street, London EC2V 7EX (the "POST-ENFORCEMENT CALL OPTION
      HOLDER"); and

(3)   THE BANK OF NEW YORK acting through its office at One Canada Square, 48th
      Floor, London E14 5AL (in its capacity as the "NOTE TRUSTEE", which
      expressions shall include such persons and all other persons for the time
      being acting as note trustee or note trustees under the Current Issuer
      Deed of Charge).

IT IS HEREBY AGREED AS FOLLOWS:

1.    INTERPRETATION

      The provisions of:

      (a)   the Master Definitions Schedule as amended and restated by (and
            appearing in Appendix 1 to) the Master Definitions Schedule Third
            Amendment and Restatement Deed made on [o] 2002 between, among
            others, the Seller, Funding and the Mortgages Trustee, and

      (b)   the Issuer Master Definitions Schedule signed for the purposes of
            identification by Sidley Austin Brown & Wood and Allen & Overy on
            [o] 2002,

      (as the same have been and may be amended, varied or supplemented from
      time to time with the consent of the parties hereto) are expressly and
      specifically incorporated into and shall apply to this Agreement.

      The Issuer Master Definitions Schedule shall prevail to the extent that it
      conflicts with the Master Definitions Schedule.

2.    OPTION

2.1   In the event that (a) the Current Issuer Security is enforced and, after
      payment of all other claims ranking in priority to the Current Issuer
      Notes under the Current Issuer Deed of Charge, the remaining proceeds of
      such enforcement are insufficient to pay in full all principal and
      interest and other amounts whatsoever due in respect of the Current Issuer
      Notes and all other claims ranking PARI PASSU therewith, or (b) within 20
      days following the Final Maturity Date of the latest maturing Notes, the
      Note Trustee certifies that there is no further amount outstanding under
      the Current Issuer Intercompany Loan, then all interests in the Global
      Note Certificates will be automatically exchanged (such date of exchange
      being the "OPTION EXERCISE DATE") for equivalent interests in an
      equivalent amount of Notes in an equivalent Principal

<PAGE>

      Amount Outstanding represented by Individual Note Certificates and such
      Global Note Certificates will be cancelled.

2.2   In connection with the issuance of the Current Issuer Notes, the Note
      Trustee hereby grants, and the Current Issuer hereby acknowledges, an
      option (the "OPTION"), under which the Note Trustee has no personal
      liability, exercisable by the Post-Enforcement Call Option Holder (or by
      any designated subsidiary of the Post-Enforcement Call Option Holder, to
      be designated by notice from the Post-Enforcement Call Option Holder to
      the Note Trustee at the discretion of the Post-Enforcement Call Option
      Holder (the "DESIGNATED SUBSIDIARY") permitting the Post-Enforcement Call
      Option Holder (or any Designated Subsidiary) to acquire at any time on or
      after the Option Exercise Date all (but not some only) of the Relevant
      Notes (as defined below) outstanding as at the Option Exercise Date,
      together with accrued interest thereon ("RELEVANT NOTES" being for the
      purposes of this Deed, all the Current Issuer Notes represented by
      Individual Note Certificates as at the Option Exercise Date).

2.3   The Option shall be exercised by the Post-Enforcement Call Option Holder
      (or any Designated Subsidiary) by notice from the Post-Enforcement Call
      Option Holder (or the Designated Subsidiary) to the Note Trustee and the
      Noteholders in accordance with Condition 14 of the Current Issuer Notes.

3.    REPRESENTATIONS AND WARRANTIES

      The Post-Enforcement Call Option Holder represents and warrants for the
      benefit of the Current Issuer and the Note Trustee that:

      (a)   it is resident for tax purposes solely in, and has its usual place
            of abode, in the United Kingdom;

      (b)   it does not hold, and has not at any time held, any shares in or
            other interests in any company;

      (c)   it has not engaged in, nor will it engage in, any activities other
            than those contemplated by the Transaction Documents;

      (d)   it will discharge all of its liabilities and meet all of its
            obligations (including any liability in respect of United Kingdom
            corporation tax) as and when they fall due.

4.    CONSIDERATION

      The Post-Enforcement Call Option Holder (or the Designated Subsidiary)
      shall pay to the Noteholders in respect of the exercise of the Option, the
      sum of one pence sterling in respect of each Current Issuer Note then
      outstanding.

5.    ACKNOWLEDGEMENT BY NOTE TRUSTEE

      The Note Trustee acknowledges that the Current Issuer Notes are to be
      issued subject to the Option and the Note Trustee hereby grants the Option
      but does so entirely without warranty, responsibility or liability as to
      its effectiveness or otherwise on the part of the Note Trustee to the
      Noteholders or any other person. In accordance with the Conditions, each
      of the Noteholders, by subscribing for or purchasing the Current

                                       2

<PAGE>

      Issuer Notes, shall, upon subscription or purchase, be deemed to have
      agreed to be bound by and, to the extent necessary, to have ratified the
      granting of the Option.

6.    NOTICES

      Any notices to be given pursuant to this Deed to any of the parties hereto
      shall be sufficiently served if sent by prepaid first class post, by hand
      or facsimile transmission and shall be deemed to be given (in the case of
      facsimile transmission) when despatched, (where delivered by hand) on the
      day of delivery if delivered before 17.00 hours on a Business Day or on
      the next Business Day if delivered thereafter or on a day which is not a
      Business Day or (in the case of first class post) when it would be
      received in the ordinary course of the post and shall be sent:

      (a)   in the case of the Current Issuer to: Granite Mortgages 02-2 plc:
            c/o Fifth Floor, 100 Wood Street, London EC2V 7EX (facsimile: 020
            7606 0643) for the attention of the Company Secretary;

            with a copy to:

            Northern Rock plc, Northern Rock House, Gosforth, Newcastle upon
            Tyne NE3 4PL, (facsimile: 0191 213 2203) for the attention of the
            Group Secretary;

      (b)   in the case of the Post-Enforcement Call Option Holder to: GPCH
            Limited c/o Fifth Floor, 100 Wood Street, London EC2V 7EX
            (facsimile: 020 7606 0643) for the attention of The Company
            Secretary; and

      (c)   in the case of the Note Trustee to: The Bank of New York, One Canada
            Square, 48th Floor, London E14 5AL (facsimile: 020 7964 6399) for
            the attention of Global Structured Finance Corporate Trust,

      or to such other address or facsimile number or for the attention of such
      other person or entity as may from time to time be notified by any party
      to the others by written notice in accordance with the provisions of this
      Clause 6.

7.    CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

      A person who is not a party to this Deed may not enforce any of its terms
      under the Contracts (Rights of Third Parties) Act 1999, but this shall not
      affect any right or remedy of a third party which exists or is available
      apart from that Act.

8.    GOVERNING LAW AND JURISDICTION; APPROPRIATE FORUM

8.1   This Deed shall be governed by, and construed in accordance with, English
      law.

8.2   Each of the parties hereto irrevocably agrees that the courts of England
      shall have jurisdiction to hear and determine any suit, action or
      proceeding, and to settle any disputes, which may arise out of or in
      connection with this Deed and, for such purposes, irrevocably submits to
      the jurisdiction of such courts.

8.3   Each of the parties hereto irrevocably waives any objection which it might
      now or hereafter have to the courts of England being nominated as the
      forum to hear and determine any proceedings and to settle any disputes,
      and agrees not to claim that any

                                       3

<PAGE>

      such court is not a convenient or appropriate forum.

AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first before written.

                                       4

<PAGE>

                                 EXECUTION PAGE

EXECUTED for and on behalf of     )
GRANITE MORTGAGES 02-2 PLC        )
by:                               )

Name: C. RAKESTROW
REPRESENTING LDC SECURITISATION DIRECTOR
NO 1 LIMITED
Title: DIRECTOR

EXECUTED for and on behalf of     )
GPCH LIMITED                      )
by:                               )

Name: JULIAN MASON-JEBB
REPRESENTING LDC SECURITISATION DIRECTOR
NO 2 LIMITED
Title: DIRECTOR

EXECUTED for and on behalf of     )
THE BANK OF NEW YORK              )
by:                               )

Name:

Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00043-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00043-of-00352.parquet"}]]