Document:

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                       CITIGROUP MORTGAGE LOAN TRUST INC.,
                                    Depositor

              CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC,
                                     Seller

                            LITTON LOAN SERVICING LP,
                                    Servicer

                                       and

                         U.S. BANK NATIONAL ASSOCIATION,
                                     Trustee

                         POOLING AND SERVICING AGREEMENT

                            Dated as of March 1, 2004

                                 2004-CB3 Trust

         C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB3

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<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

                                    ARTICLE I

                                   DEFINITIONS
Section 1.01    Defined Terms................................................-8-
Section 1.02    Accounting..................................................-61-
Section 1.03    Allocation of Certain Interest Shortfalls...................-62-

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01    Conveyance of Mortgage Loans................................-64-
Section 2.02    Acceptance by the Trustee...................................-66-
Section 2.03    Repurchase or Substitution of Mortgage Loans by the Seller..-68-
Section 2.04    Representations and Warranties of the Seller with Respect
                to the Mortgage Loans.......................................-71-
Section 2.05    Representations, Warranties and Covenants of the Servicer...-72-
Section 2.06    Representations and Warranties of the Depositor.............-75-
Section 2.08    Representations and Warranties of the Seller................-77-
Section 2.09    Covenants of the Seller.....................................-79-
Section 2.10.   Conveyance of REMIC 1 Regular Interests and Acceptance of
                REMIC 1 by the Trustee; Issuance of Certificates............-79-
Section 2.11.   Conveyance of Class B-1 Interest and Acceptance of REMIC 3
                by the Trustee; Issuance of the Class B-1 Certificates......-80-
Section 2.12.   Conveyance of Class B-2 Interest and Acceptance of REMIC 4
                by the Trustee; Issuance of the Class B-2 Certificates......-81-
Section 2.13.   Conveyance of Class X/N Interest and Acceptance of REMIC 5
                by the Trustee; Issuance of the Class X/N Certificates......-82-

                                       -i-

<PAGE>

                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                                OF THE TRUST FUND
Section 3.02    Collection of Mortgage Loan Payments........................-85-
Section 3.03    Realization Upon Defaulted Mortgage Loans...................-85-
Section 3.04    Collection Account and Distribution Account.................-87-
Section 3.05    Permitted Withdrawals From the Collection Account...........-89-
Section 3.06    Establishment of Escrow Accounts; Deposits in Escrow
                Accounts....................................................-90-
Section 3.07    Permitted Withdrawals From Escrow Account...................-91-
Section 3.08    Payment of Taxes, Insurance and Other Charges;
                Collections Thereunder......................................-91-
Section 3.09    Transfer of Accounts........................................-92-
Section 3.10    Maintenance of Hazard Insurance.............................-92-
Section 3.11    Maintenance of Mortgage Impairment Insurance Policy.........-93-
Section 3.12    Fidelity Bond, Errors and Omissions Insurance...............-94-
Section 3.13    Title, Management and Disposition of REO Property...........-94-
Section 3.14    Due-on-Sale Clauses; Assumption and Substitution
                Agreements..................................................-96-
Section 3.15    Notification of Adjustments.................................-97-
Section 3.16    Optional Purchases of Mortgage Loans by Servicer............-98-
Section 3.17    Trustee to Cooperate; Release of Files......................-99-
Section 3.18    Servicing Compensation.....................................-100-
Section 3.19    Annual Statement as to Compliance..........................-100-
Section 3.20    Annual Independent Certified Public Accountants' Reports...-101-
Section 3.21    Access to Certain Documentation and Information Regarding
                the Mortgage Loans.........................................-102-
Section 3.22    Commission Reporting.......................................-102-
Section 3.23    Obligations of the Servicer in Respect of Compensating
                Interest...................................................-104-
Section 3.24    Obligations of the Servicer in Respect of Mortgage Interest
                Rates and Monthly Payments.................................-105-
Section 3.25    Investment of Funds in the Collection Account and the
                Distribution Account.......................................-105-
Section 3.26    Liability of Servicer; Indemnification.....................-106-
Section 3.27    Reports of Foreclosure and Abandonment of Mortgaged
                Properties.................................................-107-
Section 3.28    Protection of Assets.......................................-107-
Section 3.29.   LIBOR Carryover Reserve Account............................-108-
Section 3.30.   Advance Facility...........................................-109-

                                      -ii-

<PAGE>

                                   ARTICLE IV

                                  FLOW OF FUNDS
Section 4.01    Interest Distributions.....................................-113-
Section 4.02    Distributions of Principal and Monthly Excess Cashflow
                Amounts....................................................-115-
Section 4.03    Allocation of Losses.......................................-120-
Section 4.04    Method of Distribution.....................................-122-
Section 4.05    Distributions on Book-Entry Certificates...................-122-
Section 4.06    Statements.................................................-122-
Section 4.07    Remittance Reports; Advances...............................-126-
Section 4.08    REMIC Distributions........................................-127-

                                    ARTICLE V

                                THE CERTIFICATES
Section 5.01    The Certificates..........................................-131-
Section 5.02    Registration of Transfer and Exchange of Certificates.....-131-
Section 5.03    Mutilated, Destroyed, Lost or Stolen Certificates.........-137-
Section 5.04    Persons Deemed Owners.....................................-138-
Section 5.05    Appointment of Paying Agent...............................-138-

                                   ARTICLE VI

                   THE SELLER, THE SERVICER AND THE DEPOSITOR
Section 6.01    Liability of the Seller, the Servicer and the Depositor....-139-
Section 6.02    Merger or Consolidation of, or Assumption of the Obligations
                of, the Seller, the Servicer or the Depositor..............-139-
Section 6.03    Limitation on Liability of the Servicer and Others.........-139-
Section 6.04    Servicer Not to Resign.....................................-140-
Section 6.05    Delegation of Duties.......................................-141-

                                   ARTICLE VII

                                     DEFAULT
Section 7.01    Servicer Events of Termination.............................-142-

                                       iii

<PAGE>

Section 7.02    Trustee to Act; Appointment of Successor...................-144-
Section 7.03    Waiver of Defaults.........................................-145-
Section 7.04    Notification to Certificateholders.........................-146-
Section 7.05    Survivability of Servicer Liabilities......................-146-

                                  ARTICLE VIII

                                   THE TRUSTEE
Section 8.01    Duties of Trustee..........................................-147-
Section 8.02    Certain Matters Affecting the Trustee......................-148-
Section 8.03    Trustee Not Liable for Certificates or Mortgage Loans......-150-
Section 8.04    Trustee May Own Certificates...............................-151-
Section 8.05    Seller to Pay Trustee Fees and Expenses....................-151-
Section 8.06    Eligibility Requirements for Trustee.......................-152-
Section 8.07    Resignation or Removal of Trustee..........................-153-
Section 8.08    Successor Trustee..........................................-153-
Section 8.09    Merger or Consolidation of Trustee.........................-154-
Section 8.10    Appointment of Co-Trustee or Separate Trustee..............-154-
Section 8.11    Limitation of Liability....................................-156-
Section 8.12    Trustee May Enforce Claims Without Possession of
                Certificates...............................................-156-
Section 8.13    Suits for Enforcement......................................-156-
Section 8.14    Waiver of Bond Requirement.................................-157-
Section 8.15    Waiver of Inventory, Accounting and Appraisal Requirement..-157-
Section 8.16    Compliance with National Housing Act of 1934...............-157-

                                   ARTICLE IX

                              REMIC ADMINISTRATION
Section 9.01.   REMIC Administration.......................................-158-
Section 9.02.   Prohibited Transactions and Activities.....................-160-
Section 9.03.   Indemnification with Respect to Certain Taxes and
                Loss of REMIC Status.......................................-161-

                                    ARTICLE X

                                   TERMINATION

                                      -iv-

<PAGE>

Section 10.01   Termination................................................-162-
Section 10.02   Additional Termination Requirements........................-163-

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS
Section 11.01   Amendment..................................................-165-
Section 11.02   Recordation of Agreement; Counterparts.....................-166-
Section 11.03   Limitation on Rights of Certificateholders.................-166-
Section 11.04   Governing Law; Jurisdiction................................-167-
Section 11.05   Notices....................................................-168-
Section 11.06   Severability of Provisions.................................-168-
Section 11.07   Article and Section References.............................-169-
Section 11.08   Notice to the Rating Agencies..............................-169-
Section 11.09   Further Assurances.........................................-170-
Section 11.10   Benefits of Agreement......................................-170-
Section 11.11   Acts of Certificateholders.................................-170-

                                       -v-

<PAGE>

                                    EXHIBITS:
                                    ---------

Exhibit A-1       Form of Class AV-1 Certificates
Exhibit A-2       Form of Class AV-2 Certificates
Exhibit A-3       Form of Class AV-3 Certificates
Exhibit A-4       Form of Class AV-4 Certificates
Exhibit B-1       Form of Class B-1 Certificates
Exhibit B-2       Form of Class B-2 Certificates
Exhibit B-3       Form of Class B-3 Certificates
Exhibit B-4       Form of Class B-4 Certificates
Exhibit C-1-1     Form of Class R Certificates
Exhibit C-1-2     Form of Class R-X Certificates
Exhibit C-2       Form of Class M-1 Certificates
Exhibit C-3       Form of Class M-2 Certificates
Exhibit C-4       Form of Class M-3 Certificates
Exhibit C-5       Form of Class X Certificates
Exhibit C-6       Form of Class N Certificates
Exhibit D         Mortgage Loan Schedule
Exhibit E         Form of Request for Release
Exhibit F-1       Form of Trustee's or Custodian's Initial Certification
Exhibit F-2       Form of Trustee's or Custodian's Final Certification
Exhibit F-3       Form of Receipt of Mortgage Note
Exhibit G         Mortgage Loan Purchase Agreement
Exhibit H         Form of Lost Note Affidavit
Exhibit I         Form of ERISA Representation
Exhibit J-1       Form of Investment Letter [Non-Rule 144A]
Exhibit J-2       Form of Investment Letter [Rule 144A]
Exhibit K         Form of Residual Certificate Transfer Affidavit
Exhibit L         Form of Transferor Certificate
Exhibit M         Monthly Information Provided by Servicer
Exhibit N         Form of Officer's Certificate with Respect to Prepayments
Exhibit O-1       Form of Certification to Be Provided by the Servicer with
                  Form 10-K
Exhibit O-2       Form of Certification to Be Provided to the Servicer by the
                  Trustee
Exhibit P         Form of Power of Attorney

                                      -vi-

<PAGE>

                  This Pooling and Servicing Agreement is dated as of March 1,
2004 (the "Agreement"), among CITIGROUP MORTGAGE LOAN TRUST INC., as depositor
(the "Depositor"), CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC, as
seller (the "Seller"), LITTON LOAN SERVICING LP, as servicer (the "Servicer")
and U.S. BANK NATIONAL ASSOCIATION, as trustee (the "Trustee").

                              PRELIMINARY STATEMENT

                  The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple Classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund created hereunder. The Certificates will consist of fifteen
Classes of Certificates, designated as (i) the Class AV-1 Certificates, the
Class AV- 2 Certificates, the Class AV-3 Certificates and the Class AV-4
Certificates, (ii) the Class M-1 Certificates, Class M-2 Certificates and the
Class M-3 Certificates, (iii) the Class B-1 Certificates, the Class B-2
Certificates, the Class B-3 Certificates and the Class B-4 Certificates, (iv)
the Class N Certificates, (v) the Class X Certificates and (vi) the Class R
Certificates and the Class R-X Certificates.

<PAGE>

                                     REMIC 1
                                     -------

                  As provided herein, the Trustee will make an election to treat
the segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement (but exclusive of the LIBOR Carryover
Reserve Account) as a real estate investment conduit (a "REMIC") for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC 1." The Class R-1 Interest will represent the sole class of "residual
interests" in REMIC 1 for purposes of the REMIC Provisions under federal income
tax law. The following table irrevocably sets forth the designation, the
Uncertificated REMIC 1 Pass-Through Rate, the initial Uncertificated Principal
Balance, and solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC 1
Regular Interests. None of the REMIC 1 Regular Interests will be certificated.

                 Uncertificated              Initial
                      REMIC 1            Uncertificated         Latest Possible
 Designation    Pass-Through Rate            Balance           Maturity Date(1)
------------    ------------------       ---------------       -----------------
    LT1AA          Variable(2)           $192,562,338.61       February 25, 2034
   LT1AV1          Variable(2)           $  1,186,470.00       February 25, 2034
   LT1AV2          Variable(2)           $    187,080.00       February 25, 2034
   LT1AV3          Variable(2)           $    170,840.00       February 25, 2034
   LT1AV4          Variable(2)           $     46,210.00       February 25, 2034
    LT1M1          Variable(2)           $    117,895.00       February 25, 2034
    LT1M2          Variable(2)           $     98,250.00       February 25, 2034
    LT1M3          Variable(2)           $     34,385.00       February 25, 2034
    LT1B1          Variable(2)           $     29,475.00       February 25, 2034
    LT1B2          Variable(2)           $     24,560.00       February 25, 2034
    LT1B3          Variable(2)           $     24,560.00       February 25, 2034
    LT1B4          Variable(2)           $     24,565.00       February 25, 2034
    LT1ZZ          Variable(2)           $  1,985,553.65       February 25, 2034
   LT1SUB          Variable(2)           $      5,584.36       February 25, 2034
   LT1GRP          Variable(2)           $     29,313.77       February 25, 2034
   LT2SUB          Variable(2)           $      1,902.07       February 25, 2034
   LT2GRP          Variable(2)           $      9,984.67       February 25, 2034
    LT1XX          Variable(2)           $196,445,397.40       February 25, 2034
----------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date immediately following the maturity date
     for the Mortgage Loan with the latest maturity date has been designated as
     the "latest possible maturity date" for each REMIC 1 Regular Interest.
(2)  Calculated in accordance with the definition of "Uncertificated REMIC 1
     Pass-Through Rate" herein.

                                       -2-

<PAGE>

                                     REMIC 2
                                     -------

                  As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the REMIC 1 Regular Interests
as a REMIC for federal income tax purposes, and such segregated pool of assets
will be designated as "REMIC 2." The Class R-2 Interest represents the sole
class of "residual interests" in REMIC 2 for purposes of the REMIC Provisions.
The following table sets forth the Class designation, Pass-Through Rate and
Original Class Certificate Principal Balance for each Class of Certificates that
represents one or more of the "regular interests" in REMIC 2 created hereunder:

                                         Original Class
                        Pass-Through   Certificate Principal     Assumed Final
  Class Designation          Rate            Balance            Maturity Date(1)
----------------------  ------------   ---------------------  ------------------
Class AV-1............   Variable(2)    $237,294,000.00       February 25, 2034
Class AV-2............   Variable(2)    $ 37,416,000.00       February 25, 2034
Class AV-3............   Variable(2)    $ 34,168,000.00       February 25, 2034
Class AV-4............   Variable(2)    $  9,242,000.00       February 25, 2034
Class M-1.............   Variable(2)    $ 23,579,000.00       February 25, 2034
Class M-2 ............   Variable(2)    $ 19,650,000.00       February 25, 2034
Class M-3.............   Variable(2)    $  6,877,000.00       February 25, 2034
Class B-1 Interest....   Variable(2)    $  5,895,000.00       February 25, 2034
Class B-2.............   Variable(2)    $  4,912,000.00       February 25, 2034
Class B-3.............   Variable(2)    $  4,912,000.00       February 25, 2034
Class B-4 Interest....   Variable(2)    $  4,913,000.00       February 25, 2034
Class X/N Interest ...   Variable(2)    $  4,126,364.52(4)    February 25, 2034
------------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest maturity date has been designated as the
     "latest possible maturity date" for each Class of Certificates that
     represents one or more of the "regular interests" in REMIC 2.
(2)  Calculated in accordance with the definition of "Pass-Through Rate" herein.
(3)  Subject to increase and subject to a cap in accordance with the definition
     of "Pass-Through Rate" herein.
(4)  The Class X/N Interest will accrue interest at its variable Pass-Through
     Rate on the Notional Amount of the Class X/N Interest outstanding from time
     to time which shall equal the aggregate of the Uncertificated Principal
     Balances of the REMIC 1 Regular Interests. The Class X/N Interest will not
     accrue interest on its Class Certificate Principal Balance.

                                       -3-

<PAGE>

                                     REMIC 3
                                     -------

                  As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class B-1 Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 3." The Class R-3 Interest represents the sole class of
"residual interests" in REMIC 3 for purposes of the REMIC Provisions. The
following table sets forth the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the Class of Certificates that represent
the "regular interest" in REMIC 3 created hereunder:

                                         Original Class
                      Pass-Through     Certificate Principal     Assumed Final
Class Designation          Rate              Balance            Maturity Date(1)
--------------------  ------------     ---------------------   -----------------
Class B-1...........   Variable(2)        $5,895,000.00        February 25, 2034
------------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest maturity date has been designated as the
     "latest possible maturity date" for the Class of Certificates that
     represent the "regular interest" in REMIC 3.
(2)  The Class B-1 Certificates will receive 100% of amounts received in respect
     of the Class B-1 Interest.

                                       -4-

<PAGE>

                                     REMIC 4
                                     -------

                  As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class B-4 Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 4." The Class R-4 Interest represents the sole class of
"residual interests" in REMIC 4 for purposes of the REMIC Provisions. The
following table sets forth the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the Class of Certificates that represent
the "regular interest" in REMIC 4 created hereunder:

                                          Original Class
                       Pass-Through    Certificate Principal     Assumed Final
Class Designation           Rate             Balance            Maturity Date(1)
--------------------   -------------   ---------------------   -----------------
Class B-4...........    Variable(2)       $4,913,000.00        February 25, 2034
------------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest maturity date has been designated as the
     "latest possible maturity date" for the Class of Certificates that
     represent the "regular interest" in REMIC 4.
(2)  The Class B-4 Certificates will receive 100% of amounts received in respect
     of the Class B-4 Interest.

                                       -5-

<PAGE>

                                     REMIC 5
                                     -------

                  As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class X/N Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 5." The Class R-5 Interest represents the sole class of
"residual interests" in REMIC 5 for purposes of the REMIC Provisions. The
following table sets forth (or describes) the Class designation, Pass-Through
Rate and Original Class Certificate Principal Balance for the Class of
Certificates that represent the "regular interest" in REMIC 5 created hereunder.
The Class X/N Certificates will not be certificated.

                                          Original Class
                       Pass-Through    Certificate Principal    Assumed Final
Class Designation          Rate             Balance            Maturity Date(1)
-------------------    ------------    ---------------------   -----------------
Class X/N..........     Variable(2)       $4,126,364.52        February 25, 2034
------------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest maturity date has been designated as the
     "latest possible maturity date" for the Class of Certificates that
     represent the "regular interest" in REMIC 5.
(2)  The Class X/N Certificates will receive 100% of amounts received in respect
     of the Class X/N Interest.

                                       -6-

<PAGE>

                  In addition to the above Certificates, the Trust Fund shall
issue two additional Classes of Certificates, designated as the Class N
Certificates and the Class X Certificates. For federal income tax purposes, in
the event that the beneficial ownership of the Class N Certificates and the
Class X Certificates is held by different investors for tax purposes, the
Trustee shall treat the Class N Certificates as debt of the Class X
Certificateholders for federal income tax purposes and shall not treat such
Class of Certificates as an interest in any REMIC created hereunder. In the
event that the beneficial ownership of the Class N Certificates and the Class X
Certificates is held by the same investor, the Trustee shall treat the Class N
Certificates as not having been issued for federal income tax purposes so that
the entire economic entitlement of the Class N Certificates and Class X
Certificates (excluding the Class X Certificates right to receive amounts from
the LIBOR Carryover Reserve Account) will represent a "regular interest" in
REMIC 5. The following table irrevocably sets forth the designation, the
Pass-Through Rate, the Notional Amount for the Class N Certificates and the
Class X Certificates.

                         Pass-Through                            Assumed Final
Class Designation            Rate            Notional Amount     Maturity Date
------------------      ----------------     ---------------   -----------------
Class N...........      10.00% per annum     $23,750,000.00    February 25, 2034
Class X...........        Variable(1)              N/A         February 25, 2034
------------------
(1)  The Class X Certificates are entitled to all amounts remaining following
     distributions on the Class N Certificates in accordance with Section
     4.02(B)(II)(xxix).

                                       -7-

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

                  Section 1.01      DEFINED TERMS.

                  Whenever used in this Agreement or in the Preliminary
Statement, the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article. Unless otherwise
specified, interest on the Floating Rate Certificates will be calculated on the
basis of the actual number of days in the related Interest Accrual Period and a
360-day year. Interest on the Class N Certificates and the Class X Certificates
will be calculated on the basis of a 360-day year consisting of twelve 30-day
months.

                  "1933 Act":  The Securities Act of 1933, as amended.

                  "60+ Day Delinquent Loan": Each Mortgage Loan with respect to
which any portion of a Monthly Payment is, as of the last day of the prior
Collection Period, two months or more past due, each Mortgage Loan in
foreclosure, all REO Property and each Mortgage Loan for which the Mortgagor has
filed for bankruptcy after the Closing Date.

                  "Account": Either the Collection Account or the Distribution
Account.

                  "Accrued Certificate Interest": With respect to each
Distribution Date and each Class of Certificates and the Class B-1 Interest, the
Class B-4 Interest and the Class X/N Interest, an amount equal to the interest
accrued at the applicable rate set forth or described opposite such Class in the
table in the Preliminary Statement during the related Interest Accrual Period on
the Certificate Principal Balance (or Notional Amount) of such Class immediately
prior to such Distribution Date, reduced by such Class's Interest Percentage of
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls for such
Distribution Date allocated to such Certificates as provided in Section 1.03
hereof.

                  "Actuarial Mortgage Loan": Any Mortgage Loan other than a
Simple Interest Mortgage Loan.

                  "Adjustable-Rate Mortgage Loan": A Mortgage Loan which has a
rate at which interest accrues that adjusts based on an Index plus a related
Gross Margin, as set forth and subject to the limitations in the related
Mortgage Note.

                  "Adjustment Date": With respect to each Adjustable-Rate
Mortgage Loan, each

                                                        -8-

<PAGE>

adjustment date on which the Mortgage Interest Rate of an Adjustable-Rate
Mortgage Loan may change pursuant to the related Mortgage Note. The first
Adjustment Date following the Cut-off Date as to each Adjustable-Rate Mortgage
Loan is set forth in the Mortgage Loan Schedule.

                  "Advance": As to any Actuarial Mortgage Loan or REO Property,
any advance made by the Servicer in respect of any Distribution Date pursuant to
Section 4.07.

                  "Advance Facility": As defined in Section 3.30 hereof.

                  "Advance Facility Notice":  As defined in Section 3.30 hereof.

                  "Advance Financing Person": As defined in Section 3.30 hereof.

                  "Advance Reimbursement Amounts": As defined in Section 3.30
hereof.

                  "Adverse REMIC Event":  As defined in Section 9.01(f) hereof.

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

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

                  "Applicable Regulations": As to any Mortgage Loan, all
federal, state and local laws, statutes, rules and regulations applicable
thereto, including with respect to each FHA Loan, the FHA Regulations and the
related FHA Insurance Contract.

                  "Applied Realized Loss Amount": With respect to each
Distribution Date, the excess, if any, of (a) the aggregate Certificate
Principal Balance of the Class A Certificates and the Mezzanine Certificates
(after giving effect to all distributions on such Distribution Date) over (b)
the Pool Balance as of the end of the related Collection Period.

                  "Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage.

                                       -9-

<PAGE>

                  "Assumed Final Maturity Date": As to each Class of
Certificates, the date set forth as such in the Preliminary Statement.

                  "Available Funds": As to any Distribution Date, an amount
equal to the excess of (i) the sum of (a) the aggregate of the Monthly Payments
due during the related Collection Period and received by the Trustee one
Business Day prior to the related Distribution Date, (b) Liquidation Proceeds,
Insurance Proceeds, Principal Prepayments, Subsequent Recoveries, Substitution
Adjustment Amounts, the Purchase Price for any repurchased Mortgage Loan, the
Termination Price with respect to the termination of the Trust pursuant to
Section 10.01 hereof and other unscheduled recoveries of principal and interest
(excluding Prepayment Charges) in respect of the Mortgage Loans during the
related Prepayment Period, (c) the aggregate of any amounts received in respect
of an REO Property withdrawn from any REO Account and deposited in the
Collection Account for such Distribution Date, (d) any Compensating Interest for
such Distribution Date, and (e) the aggregate of any Advances made by the
Servicer for such Distribution Date over (ii) the sum of (a) amounts
reimbursable or payable to the Servicer pursuant to Section 3.05, (b) Stayed
Funds, (c) the Servicing Fee and (d) amounts deposited in the Collection Account
or the Distribution Account, as the case may be, in error.

                  "Balloon Mortgage Loan": A Mortgage Loan that provides for the
payment of the unamortized principal balance of such Mortgage Loan in a single
payment at the maturity of such Mortgage Loan that is substantially greater than
the preceding monthly payment.

                  "Balloon Payment": A payment of the unamortized principal
balance of a Mortgage Loan in a single payment at the maturity of such Mortgage
Loan that is substantially greater than the preceding Monthly Payment.

                  "Bankruptcy Code": Title 11 of the United States Code, as
amended.

                  "Book-Entry Certificates": Any of the Certificates that shall
be registered in the name of the Depository or its nominee, the ownership of
which is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant," or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Class A Certificates and the Mezzanine Certificates shall be
Book-Entry Certificates.

                  "Business Day": Any day other than a Saturday, a Sunday or a
day on which banking institutions in the State of Delaware, the State of New
York, the State of Texas or in the city in which the Corporate Trust Office of
the Trustee is located are authorized or obligated by law or executive order to
be closed.

                                      -10-

<PAGE>

                  "Certificate": Any Regular Certificate, Class N Certificate,
Class X Certificate or Residual Certificate.

                  "Certificate Custodian": Initially, U.S. Bank National
Association; thereafter any other Certificate Custodian acceptable to the
Depository and selected by the Trustee.

                  "Certificate Owner": With respect to each Book-Entry
Certificate, any beneficial owner thereof.

                  "Certificate Principal Balance": With respect to any Class of
Certificates (other than the Class N, Class X and Residual Certificates) and any
Distribution Date, the Original Class Certificate Principal Balance, reduced by
the sum of (i) all amounts actually distributed in respect of principal of such
Class on all prior Distribution Dates (taking into account any increases in the
Certificate Principal Balance thereof due to the receipt of any Subsequent
Recoveries as provided in Section 4.02) and (ii) Applied Realized Loss Amounts
allocated thereto. The Class N, Class X and Residual Certificates do not have a
Certificate Principal Balance. With respect to any Certificate (other than a
Class N, Class X or a Residual Certificate) of a Class and any Distribution
Date, the portion of the Certificate Principal Balance of such Class represented
by such Certificate equal to the product of the Percentage Interest evidenced by
such Certificate and the Certificate Principal Balance of such Class.

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

                  "Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or non-U.S. Person shall not be a Holder of a Residual
Certificate for any purpose hereof.

                  "Class": Collectively, Certificates or REMIC Regular Interests
which have the same priority of payment and bear the same class designation and
the form of which is identical except for variation in the Percentage Interest
evidenced thereby.

                  "Class A Applied Realized Loss Amount": As to any Class of
Class A Certificates and as of any Distribution Date, the lesser of (x) the
Certificate Principal Balance thereof (after taking into account the
distribution of the Principal Remittance Amount and the Extra Principal
Distribution Amount, as applicable, on such Distribution Date, but prior to the
application of the Class A Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class M-1 Applied Realized
Loss Amount, the Class M-2 Applied Realized Loss Amount, the Class M-3

                                      -11-

<PAGE>

Applied Realized Loss Amount, the Class B-1 Applied Realized Loss Amount, the
Class B-2 Applied Realized Loss Amount, the Class B-3 Applied Realized Loss
Amount and the Class B-4 Applied Realized Loss Amount, in each case as of such
Distribution Date.

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

                  "Class A Realized Loss Amortization Amount": As to any Class
of Class A Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid Realized Loss Amount for such Class of Class A Certificates as of such
Distribution Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the sum of the amounts described in Section 4.02(B)(i) through (xix)
hereof, in each case for such Distribution Date.

                  "Class AV-1 Certificate": Any one of the Certificates with an
"AV-1" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-1, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class AV-1 Certificate Margin": For each Distribution Date
(i) prior to the Optional Termination Date, 0.240% per annum, and (ii) on or
after the Optional Termination Date, 0.480% per annum.

                  "Class AV-1 Interest Carry Forward Amount": For any
Distribution Date, the Interest Carry Forward Amount for the Class AV-1
Certificates for such Distribution Date.

                  "Class AV-1 Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-1 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.

                  "Class AV-2 Certificate": Any one of the Certificates with an
"AV-2" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class AV-2 Certificate Margin": For each Distribution Date
(i) prior to the Optional Termination Date, 0.110% per annum, and (ii) on or
after the Optional Termination Date, 0.220% per annum.

                  "Class AV-2 Interest Carry Forward Amount": For any
Distribution Date, the Interest

                                      -12-

<PAGE>

Carry Forward Amount for the Class AV-2 Certificates for such Distribution Date.

                  "Class AV-2 Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-2 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.

                  "Class AV-3 Certificate": Any one of the Certificates with an
"AV-3" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-3, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class AV-3 Certificate Margin": For each Distribution Date
(i) prior to the Optional Termination Date, 0.210% per annum, and (ii) on or
after the Optional Termination Date, 0.420% per annum.

                  "Class AV-3 Interest Carry Forward Amount": For any
Distribution Date, the Interest Carry Forward Amount for the Class AV-2
Certificates for such Distribution Date.

                  "Class AV-3 Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-3 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.

                  "Class AV-4 Certificate": Any one of the Certificates with an
"AV-4" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class AV-4 Certificate Margin": For each Distribution Date
(i) prior to the Optional Termination Date, 0.420% per annum, and (ii) on or
after the Optional Termination Date, 0.840% per annum.

                  "Class AV-4 Interest Carry Forward Amount": For any
Distribution Date, the Interest Carry Forward Amount for the Class AV-4
Certificates for such Distribution Date.

                  "Class AV-4 Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-4 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.

                  "Class B Certificate": Any one of the Class B-1 Certificates,
the Class B-2

                                      -13-

<PAGE>

Certificates, the Class B-3 Certificates or the Class B-4 Certificates.

                  "Class B-1 Applied Realized Loss Amount": As to the Class B-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-1 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class B-2 Applied Realized Loss Amount, the Class B-3 Applied
Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in each
case as of such Distribution Date.

                  "Class B-1 Certificate": Any one of the Certificates with a
"B-1" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-1, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class B-1 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date,1.850% per annum, and (ii) on or after
the Optional Termination Date, 2.775% per annum.

                  "Class B-1 Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class B-1 Certificates and
representing a regular interest in REMIC 2.

                  "Class B-1 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-1 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class B-1 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balances of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates on such
Distribution Date) and (v) the Certificate Principal Balance of the Class B-1
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 90.40% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as

                                      -14-

<PAGE>

of the last day of the related Collection Period minus the product of 0.50% and
the Pool Balance on the Cut-off Date, but in no event less than zero.

                  "Class B-1 Realized Loss Amortization Amount": As to the Class
B-1 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(i) through (xxiii) hereof, in each
case for such Distribution Date.

                  "Class B-2 Applied Realized Loss Amount": As to the Class B-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-2 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class B-3 Applied Realized Loss Amount and the Class B-4 Applied
Realized Loss Amount, in each case as of such Distribution Date.

                  "Class B-2 Certificate": Any one of the Certificates with a
"B-2" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class B-2 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date, 2.000% per annum, and (ii) on or after
the Optional Termination Date, 3.000% per annum.

                  "Class B-2 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-2 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class B-2 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balances of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates

                                      -15-

<PAGE>

on such Distribution Date), (v) the Certificate Principal Balance of the Class
B-1 Certificates (after taking into account distributions of principal on the
Class B-1 Certificates on such Distribution Date) and (vi) the Certificate
Principal Balance of the Class B-2 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 92.90% and (ii)
the Pool Balance as of the last day of the related Collection Period and (B) the
Pool Balance as of the last day of the related Collection Period minus the
product of 0.50% and the Pool Balance on the Cut-off Date, but in no event less
than zero.

                  "Class B-2 Realized Loss Amortization Amount": As to the Class
B-2 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(i) through (xxiv) hereof, in each
case for such Distribution Date.

                  "Class B-3 Applied Realized Loss Amount": As to the Class B-3
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-3 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
Class B-4 Applied Realized Loss Amount, in each case, as of such Distribution
Date.

                  "Class B-3 Certificate": Any one of the Certificates with a
"B-3" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-3, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class B-3 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date, 3.250% per annum, and (ii) on or after
the Optional Termination Date, 4.875% per annum.

                  "Class B-3 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-3 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class B-3 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balances of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the

                                      -16-

<PAGE>

Certificate Principal Balance of the Class M-1 Certificates (after taking into
account distributions of principal on the Class M-1 Certificates on such
Distribution Date), (iii) the Certificate Principal Balance of the Class M-2
Certificates (after taking into account distributions of principal on the Class
M-2 Certificates on such Distribution Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account distributions
of principal on the Class M-3 Certificates on such Distribution Date), (v) the
Certificate Principal Balance of the Class B-1 Certificates (after taking into
account distributions of principal on the Class B-1 Certificates on such
Distribution Date), (vi) the Certificate Principal Balance of the Class B-2
Certificates (after taking into account distributions of principal on the Class
B-2 Certificates on such Distribution Date) and (vi) the Certificate Principal
Balance of the Class B-3 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 95.40% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the Pool
Balance as of the last day of the related Collection Period minus the product of
0.50% and the Pool Balance on the Cut-off Date, but in no event less than zero.

                  "Class B-3 Realized Loss Amortization Amount": As to the Class
B-3 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(i) through (xxv) hereof, in each
case for such Distribution Date.

                  "Class B-4 Applied Realized Loss Amount": As to the Class B-4
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-4 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the Applied
Realized Loss Amount as of such Distribution Date.

                  "Class B-4 Certificate": Any one of the Certificates with a
"B-4" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-4, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class B-4 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date, 2.500% per annum, and (ii) on or after
the Optional Termination Date, 3.750% per annum.

                  "Class B-4 Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class B-4 Certificates and
representing a regular interest in REMIC 2.

                                      -17-

<PAGE>

                  "Class B-4 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-4 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class B-4 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balances of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates on such
Distribution Date), (v) the Certificate Principal Balance of the Class B-1
Certificates (after taking into account distributions of principal on the Class
B-1 Certificates on such Distribution Date), (vi) the Certificate Principal
Balance of the Class B-2 Certificates (after taking into account distributions
of principal on the Class B-2 Certificates on such Distribution Date), (vii) the
Certificate Principal Balance of the Class B-3 Certificates (after taking into
account distributions of principal on the Class B-3 Certificates on such
Distribution Date) and (viii) the Certificate Principal Balance of the Class B-4
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 97.90% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date, but in no event less than zero.

                  "Class B-4 Realized Loss Amortization Amount": As to the Class
B-4 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(i) through (xxvi) hereof, in each
case for such Distribution Date.

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

                  "Class M-1 Applied Realized Loss Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class M-1 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class M-2 Applied Realized Loss

                                      -18-

<PAGE>

Amount, the Class M-3 Applied Realized Loss Amount, the Class B-1 Applied
Realized Loss Amount, the Class B-2 Applied Realized Loss Amount, the Class B-3
Applied Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in
each case as of such Distribution Date.

                  "Class M-1 Certificate": Any one of the Certificates with an
"M-1" designated on the face thereof substantially in the form annexed hereto as
Exhibit C-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class M-1 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date, 0.520% per annum, and (ii) on or after
the Optional Termination Date, 0.780% per annum.

                  "Class M-1 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
M-1 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class M-1 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balances of the Class A Certificates (after taking into account
distributions of principal on the Class A Certificates on such Distribution
Date) and (ii) the Certificate Principal Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 73.90% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date, but in no event less than zero.

                  "Class M-1 Realized Loss Amortization Amount": As to the Class
M-1 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M- 1 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(B)(i) through (xx) hereof, in each
case for such Distribution Date.

                  "Class M-2 Applied Realized Loss Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class M-2 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class M-3 Applied Realized Loss

                                      -19-

<PAGE>

Amount, the Class B-1 Applied Realized Loss Amount, the Class B-2 Applied
Realized Loss Amount, the Class B-3 Applied Realized Loss Amount and the Class
B-4 Applied Realized Loss Amount, in each case as of such Distribution Date.

                  "Class M-2 Certificate": Any one of the Certificates with an
"M-2" designated on the face thereof substantially in the form annexed hereto as
Exhibit C-3, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class M-2 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date, 1.200% per annum, and (ii) on or after
the Optional Termination Date, 1.800% per annum.

                  "Class M-2 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
M-2 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class M-2 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balances of the Class A Certificates (after taking into account
distributions of principal on the Class A Certificates on such Distribution
Date), (ii) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account distributions of principal on the Class M-1
Certificates on such Distribution Date) and (iii) the Certificate Principal
Balance of the Class M-2 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 83.90% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the Pool
Balance as of the last day of the related Collection Period minus the product of
0.50% and the Pool Balance on the Cut-off Date, but in no event less than zero.

                  "Class M-2 Realized Loss Amortization Amount": As to the Class
M-2 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M- 2 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(B)(i) through (xxi) hereof, in each
case for such Distribution Date.

                  "Class M-3 Applied Realized Loss Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class M-3 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss

                                      -20-

<PAGE>

Amount as of such Distribution Date over (ii) the sum of the Class B-1 Applied
Realized Loss Amount, the Class B-2 Applied Realized Loss Amount, the Class B-3
Applied Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in
each case as of such Distribution Date.

                  "Class M-3 Certificate": Any one of the Certificates with an
"M-3" designated on the face thereof substantially in the form annexed hereto as
Exhibit C-4, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.

                  "Class M-3 Certificate Margin": For each Distribution Date (i)
prior to the Optional Termination Date, 1.450% per annum, and (ii) on or after
the Optional Termination Date, 2.175% per annum.

                  "Class M-3 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
M-3 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.

                  "Class M-3 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balances of the Class A Certificates (after taking into account
distributions of principal on the Class A Certificates on such Distribution
Date), (ii) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account distributions of principal on the Class M-1
Certificates on such Distribution Date), (iii) the Certificate Principal Balance
of the Class M-2 Certificates (after taking into account distributions of
principal on the Class M-2 Certificates on such Distribution Date) and (iv) the
Certificate Principal Balance of the Class M-3 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 87.40% and
(ii) the Pool Balance as of the last day of the related Collection Period and
(B) the Pool Balance as of the last day of the related Collection Period minus
the product of 0.50% and the Pool Balance on the Cut-off Date, but in no event
less than zero.

                  "Class M-3 Realized Loss Amortization Amount": As to the Class
M-3 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M- 3 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(B)(i) through (xxii) hereof, in
each case for such Distribution Date.

                  "Class N Certificate": Any one of the Class N Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-6, representing
the right to distributions as set forth herein and therein. The Class N

                                      -21-

<PAGE>

Certificates shall not represent an interest in any REMIC.

                  "Class R Certificate": The Class R Certificate executed by the
Trustee, and authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit C-1-1 and evidencing the
ownership of the Class R-1 Interest and the Class R-2 Interest.

                  "Class R-X Certificate": The Class R-X Certificate executed by
the Trustee, and authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit C-1-2 and evidencing the
ownership of the Class R-3 Interest, the Class R-4 Interest and the Class R-5
Interest.

                  "Class R-1 Interest": The uncertificated residual interest in
REMIC 1.

                  "Class R-2 Interest": The uncertificated residual interest in
REMIC 2.

                  "Class R-3 Interest": The uncertificated residual interest in
REMIC 3.

                  "Class R-4 Interest": The uncertificated residual interest in
REMIC 4.

                  "Class R-5 Interest": The uncertificated residual interest in
REMIC 5.

                  "Class X Certificate": Any one of the Class X Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-5, representing
the right to distributions as set forth herein and therein.

                  "Class X/N Certificate": An uncertificated certificate in
REMIC 5 held by the Trustee on behalf of the holders of the Class X and Class N
Certificates and representing a regular interest in REMIC 5.

                  "Class X/N Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class X and Class N
Certificates and representing a regular interest in REMIC 2.

                  "Class X Distributable Amount": With respect to any
Distribution Date, the excess of (i) the aggregate of amounts distributable on
the Class X/N Certificates for such Distribution Date, over (ii) the aggregate
of amounts distributable to the Class N Certificates pursuant to Section
4.02(B).

                  "Closing Date": April 12, 2004.

                                      -22-

<PAGE>

                  "Code": The Internal Revenue Code of 1986, as it may be
amended from time to time.

                  "Collection Account": The account or accounts created and
maintained by the Servicer pursuant to Section 3.04, which shall be entitled
"Collection Account, Litton Loan Servicing LP, as Servicer for the Trust under
the Pooling and Servicing Agreement dated as of March 1, 2004 among Citigroup
Mortgage Loan Trust Inc., as Depositor, Credit-Based Asset Servicing and
Securitization LLC, as Seller, Litton Loan Servicing LP, as Servicer and U.S.
Bank National Association, as Trustee, in trust for registered Holders of
2004-CB3 Trust, C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB3," and which must be an Eligible Account.

                  "Collection Period": With respect to any Distribution Date,
the period from the second day of the calendar month preceding the month in
which such Distribution Date occurs through the first day of the month in which
such Distribution Date occurs.

                  "Combined Loan-to-Value Ratio": As of any date and Mortgage
Loan, the fraction, expressed as a percentage, the numerator of which is the
Principal Balance of the Mortgage Loan plus the principal balance of any related
senior mortgage loan, and the denominator of which is the Value of the related
Mortgaged Property.

                  "Compensating Interest":  As defined in Section 3.23 hereof.

                  "Condemnation Proceeds": All awards or settlements in respect
of a taking of a Mortgaged Property by exercise of the power of eminent domain
or condemnation.

                  "Conventional Mortgage Loan": Any Mortgage Loan that is not an
FHA Loan.

                  "Corporate Trust Office": With respect to the Trustee, the
principal corporate trust office of the Trustee at which at any particular time
its corporate trust business in connection with this Agreement shall be
administered, which office at the date of the execution of this instrument is
located at 60 Livingston Avenue, St. Paul, Minnesota 55107, Attention:
Structured Finance, CMLT C-BASS 2004-CB3, or at such other address as the
Trustee may designate from time to time by notice to the Certificateholders, the
Depositor, the Servicer and the Seller.

                  "Corresponding Certificate": With respect to each REMIC 1
Regular Interest set or REMIC II Regular Interest forth below, the corresponding
Regular Certificate set forth in the table below:

                                      -23-

<PAGE>

               REMIC 1 REGULAR INTEREST           REGULAR CERTIFICATE
            ------------------------------------------------------------
                        LT1AV1                         Class AV-1
                        LT1AV2                         Class AV-2
                        LT1AV3                         Class AV-3
                        LT1AV4                         Class AV-4
                        LT1M1                          Class M-1
                        LT1M2                          Class M-2
                        LT1M3                          Class M-3
              LT1B1, Class B-1 Interest                Class B-1
                        LT1B2                          Class B-2
                        LT1B3                          Class B-3
              LT1B4, Class B-4 Interest                Class B-4
                  Class X/N Interest             Class X/N Certificates

                  "Custodial Agreement": The Custodial Agreement, dated as of
March 1, 2004, among the Trustee, the Servicer and the Custodian, as the same
may be amended or supplemented pursuant to the terms thereof.

                  "Custodian": The Bank of New York, a New York banking
corporation, or any successor custodian appointed pursuant to the terms of the
Custodial Agreement.

                  "Cut-off Date": March 1, 2004.

                  "Cut-off Date Principal Balance": With respect to any Mortgage
Loan, the unpaid principal balance thereof as of the Cut-off Date after
application of funds received or advanced on or before such date (or as of the
applicable date of substitution with respect to an Eligible Substitute Mortgage
Loan).

                  "Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.

                  "Defective Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Eligible Substitute Mortgage Loans.

                  "Deferred Interest": With respect to any Mortgage Loan
identified on the Mortgage Loan Schedule as having the possibility of negative
amortization, the current portion of interest not currently paid by the
Mortgagor that is added to the principal balance of such Mortgage Loan.

                                      -24-

<PAGE>

                  "Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, which valuation results from a proceeding initiated under the Bankruptcy
Code.

                  "Definitive Certificates": As defined in Section 5.02(c)
hereof.

                  "Delinquent": Any Mortgage Loan, the Monthly Payment due on a
Due Date with respect to which such monthly payment is not made by the close of
business on the next scheduled Due Date for such Mortgage Loan.

                  "Depositor": Citigroup Mortgage Loan Trust Inc., a Delaware
corporation, or any successor in interest.

                  "Depository": The initial depository shall be The Depository
Trust Company, whose nominee is Cede & Co., or any other organization registered
as a "clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(3) of the Uniform Commercial Code of
the State of New York.

                  "Depository Agreement": With respect to any Book-Entry
Certificates, the agreement among the Depositor, the Trustee and the initial
Depository, to be dated on or about the Closing Date.

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

                  "Determination Date": With respect to any Distribution Date,
the 10th day of the calendar month in which such Distribution Date occurs or, if
such 10th day is not a Business Day, the Business Day immediately preceding such
10th day.

                  "Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon or any use
of such REO Property in a trade or business conducted by the Trust other than
through an Independent Contractor; PROVIDED, HOWEVER, that the Trustee (or the
Servicer under this Agreement) shall not be considered to Directly Operate an
REO Property solely because the Trustee

                                      -25-

<PAGE>

(or the Servicer under this Agreement) establishes rental terms, chooses
tenants, enters into or renews leases, deals with taxes and insurance, or makes
decisions as to repairs or capital expenditures with respect to such REO
Property.

                  "Disqualified Organization": A "disqualified organization"
under Section 860E of the Code, which as of the Closing Date is any of: (i) the
United States, any state or political subdivision thereof, any possession of the
United States, any foreign government, any international organization, or any
agency or instrumentality of any of the foregoing, (ii) any organization (other
than a cooperative described in Section 521 of the Code) which is exempt from
the tax imposed by Chapter 1 of the Code unless such organization is subject to
the tax imposed by Section 511 of the Code, (iii) any organization described in
Section 1381(a)(2)(C) of the Code, or (iv) any other Person so designated by the
Trustee based upon an Opinion of Counsel provided by nationally recognized
counsel to the Trustee that the holding of an ownership interest in a Residual
Certificate by such Person may cause the Trust Fund or any Person having an
ownership interest in any Class of Certificates (other than such Person) to
incur liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the transfer of an ownership interest in a Residual
Certificate to such Person. A corporation will not be treated as an
instrumentality of the United States or of any state or political subdivision
thereof if all of its activities are subject to tax and a majority of its board
of directors is not selected by a governmental unit. The term "United States,"
"state" and "international organization" shall have the meanings set forth in
Section 7701 of the Code.

                  "Distribution Account": The trust account or accounts created
and maintained by the Trustee pursuant to Section 3.04(b) which shall be
entitled "Distribution Account, U.S. Bank National Association, as Trustee, in
trust for the registered Holders of 2004-CB3 Trust, C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB3" and which must be an Eligible
Account.

                  "Distribution Date": The 25th day of any calendar month, or if
such 25th day is not a Business Day, the Business Day immediately following such
25th day, commencing in April 2004.

                  "Distribution Information": The items calculated and reported
by the Trustee pursuant to Section 4.06(a)(i), (ii), (iii) and (xiv) through
(xxii) and any other information included in the Monthly Statement aggregated
and/or calculated by the Trustee from (a) information contained in the
Remittance Report or (b) other information furnished to the Trustee by the
Servicer pursuant to Section 4.07.

                  "Due Date": With respect to each Mortgage Loan and any
Distribution Date, the day of the calendar month in which such Distribution Date
occurs on which the Monthly Payment for

                                      -26-

<PAGE>

such Mortgage Loan was due, exclusive of any grace period.

                  "Eligible Account": Any of (i) an account or accounts
maintained with a federal or state chartered depository institution or trust
company the short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the short-term unsecured debt obligations of such holding
company) are rated "A-1" (or the equivalent) by each of the Rating Agencies at
the time any amounts are held on deposit therein, (ii) an account or accounts
the deposits in which are fully insured by the FDIC (to the limits established
by such corporation), the uninsured deposits in which account are otherwise
secured such that, as evidenced by an Opinion of Counsel delivered to the
Trustee and to each Rating Agency, the Certificateholders will have a claim with
respect to the funds in such account or a perfected first priority security
interest against such collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution with which such account is
maintained, (iii) a trust account or accounts maintained with the trust
department of a federal or state chartered depository institution, national
banking association or trust company acting in its fiduciary capacity or (iv) an
account otherwise acceptable to each Rating Agency without reduction or
withdrawal of their then current ratings of the Certificates as evidenced by a
letter from each Rating Agency to the Trustee. Eligible Accounts may bear
interest.

                  "Eligible Substitute Mortgage Loan": A mortgage loan
substituted for a Defective Mortgage Loan pursuant to the terms of this
Agreement which must, on the date of such substitution, (i) have an outstanding
principal balance, after application of all scheduled payments of principal and
interest due during or prior to the month of substitution, not in excess of, and
not more than 5% less than, the outstanding principal balance of the Defective
Mortgage Loan as of the Due Date in the calendar month during which the
substitution occurs, (ii) have a Mortgage Interest Rate, with respect to a
Fixed-Rate Mortgage Loan, not less than the Mortgage Interest Rate of the
Defective Mortgage Loan and not more than 1% in excess of the Mortgage Interest
Rate of such Defective Mortgage Loan, (iii) if an Adjustable-Rate Mortgage Loan,
have a Maximum Loan Rate not less than the Maximum Loan Rate for the Defective
Mortgage Loan, (iv) if an Adjustable-Rate Mortgage Loan, have a Minimum Loan
Rate not less than the Minimum Loan Rate of the Defective Mortgage Loan, (v) if
an Adjustable-Rate Mortgage Loan, have a Gross Margin equal to or greater than
the Gross Margin of the Defective Mortgage Loan, (vi) if an Adjustable-Rate
Mortgage Loan, have a next Adjustment Date not more than two months later than
the next Adjustment Date on the Defective Mortgage Loan, an Eligible Substitute
Mortgage Loan must have all Adjustment Dates occurring during the same Interest
Accrual Period during which Adjustment Dates occur with respect to the
substituted Mortgage Loan, (vii) have a remaining term to maturity not greater
than (and not more than one year less than) that of the Defective Mortgage Loan,
(viii) be current as of the date of substitution, (ix) have a Combined
Loan-to-Value Ratio as of the date of substitution equal to or lower than the
Combined Loan-to-Value Ratio of the Defective Mortgage Loan as of such date, (x)

                                      -27-

<PAGE>

have a risk grading determined by the Seller at least equal to the risk grading
assigned on the Defective Mortgage Loan, (xi) have been reunderwritten by the
Seller in accordance with the same underwriting criteria and guidelines as the
Defective Mortgage Loan and (xii) conform to each representation and warranty
set forth in Section 2.04 hereof applicable to the Defective Mortgage Loan. In
the event that one or more mortgage loans are substituted for one or more
Defective Mortgage Loans, the amounts described in clause (i) hereof shall be
determined on the basis of aggregate principal balances, the Mortgage Interest
Rates described in clause (ii) hereof shall be determined on the basis of
weighted average Mortgage Interest Rates, the risk gradings described in clause
(x) hereof shall be satisfied as to each such mortgage loan, the terms described
in clause (vii) hereof shall be determined on the basis of weighted average
remaining term to maturity, the Combined Loan-to-Value Ratios described in
clause (ix) hereof shall be satisfied as to each such mortgage loan and, except
to the extent otherwise provided in this sentence, the representations and
warranties described in clause (xii) hereof must be satisfied as to each
Eligible Substitute Mortgage Loan or in the aggregate, as the case may be.

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

                  "ERISA Restricted Certificates": Any of the Mezzanine
Certificates, Class N, Class X and Residual Certificates.

                  "Escrow Account": The account or accounts created and
maintained pursuant to Section 3.06.

                  "Escrow Payments": The amounts constituting ground rents,
taxes, assessments, water rates, mortgage insurance premiums, fire and hazard
insurance premiums and other payments required to be escrowed by the Mortgagor
with the mortgagee pursuant to any Mortgage Loan.

                  "Estate in Real Property": A fee simple estate in a parcel of
real property.

                  "Expense Fee Rate": The sum of (i) the Trustee Fee Rate and
(ii) the Servicing Fee Rate.

                  "Extended Period":  As defined in Section 9.04(b).

                  "Extra Principal Distribution Amount": As of any Distribution
Date, the lesser of (x) the Monthly Excess Cashflow Amount for such Distribution
Date and (y) the Overcollateralization Deficiency for such Distribution Date.

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

                                      -28-

<PAGE>

                  "FHA": The Federal Housing Administration, an agency within
HUD.

                  "FHA Approved Mortgagee": Those institutions which are
approved by FHA to act as servicer and mortgagee of record pursuant to FHA
Regulations.

                  "FHA Insurance Contract" or "FHA Insurance": The contractual
obligation of FHA respecting the insurance of an FHA Loan pursuant to the
National Housing Act, as amended.

                  "FHA Loan": A Mortgage Loan which is the subject of an FHA
Insurance Contract as evidenced by a Mortgage Insurance Certificate.

                  "FHA Regulations": Regulations promulgated by HUD under the
National Housing Act, codified in 24 Code of Federal Regulations, and other HUD
issuances relating to FHA Loans, including the related handbooks, circulars,
notices and mortgagee letters.

                  "Fidelity Bond": Shall have the meaning assigned thereto in
Section 3.12.

                  "Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Seller or the Servicer pursuant to or as contemplated by
Section 2.03 or 10.01), a determination made by the Servicer that all Insurance
Proceeds, Liquidation Proceeds and other payments or recoveries which the
Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered. The Servicer shall
maintain records, prepared by a Servicing Officer, of each Final Recovery
Determination made thereby.

                  "Fitch": Fitch Ratings and its successors, and if such company
shall for any reason no longer perform the functions of a securities rating
agency, "Fitch" shall be deemed to refer to any other "nationally recognized
statistical rating organization" as set forth on the most current list of such
organizations released by the Securities and Exchange Commission.

                  "Fixed-Rate Mortgage Loan": A Mortgage Loan which has a
constant annual rate at which interest accrues in accordance with the provisions
of the related Mortgage Note.

                  "Foreclosure Price": The amount reasonably expected to be
received from the sale of the related Mortgaged Property net of any expenses
associated with foreclosure proceedings.

                  "Gross Margin": With respect to each Adjustable-Rate Mortgage
Loan, the fixed percentage set forth in the related Mortgage Note that is added
to the Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Interest

                                      -29-

<PAGE>

Rate for such Mortgage Loan.

                  "Group I Enhancement Amount": As of any Distribution Date, an
amount equal to the excess of (x) the aggregate Principal Balance of the Group I
Mortgage Loans as of the last day of the related Collection Period over (y) the
Certificate Principal Balance of the Class AV-1 Certificates.

                  "Group I Interest Remittance Amount": As of any Determination
Date, the sum, without duplication, of (i) all interest due and collected or
advanced with respect to the related Collection Period on the Group I Mortgage
Loans (less the Servicing Fee, amounts available for reimbursement of Advances
and Servicing Advances pursuant to Section 3.05 and expenses reimbursable
pursuant to Section 6.03), (ii) all Compensating Interest paid by the Servicer
on such Determination Date with respect to the Group I Mortgage Loans and (iii)
the portion of any payment in connection with any substitution, Purchase Price,
Termination Price or Net Liquidation Proceeds relating to interest with respect
to the Group I Mortgage Loans received during the related Prepayment Period.

                  "Group I Mortgage Loans": A Fixed-Rate Mortgage Loan or
Adjustable-Rate Mortgage Loan assigned to Loan Group I with a Principal Balance
at origination that conforms to Fannie Mae and Freddie Mac loan limits.

                  "Group I Principal Remittance Amount": With respect to any
Distribution Date, the sum (less amounts available for reimbursement of Advances
and Servicing Advances pursuant to Section 3.05 and expenses reimbursable
pursuant to Section 6.03) of: (i) each payment of principal on a Group I
Mortgage Loan due during the related Collection Period and received by the
Servicer on or prior to the related Determination Date, and any Advances with
respect thereto, (ii) all full and partial Principal Prepayments on the Group I
Mortgage Loans received by the Servicer during the related Prepayment Period,
(iii) the Net Liquidation Proceeds allocable to principal on the Group I
Mortgage Loans and any Subsequent Recoveries on the Group I Mortgage Loans
actually collected by the Servicer during the related Prepayment Period, (iv)
with respect to Defective Mortgage Loans in Loan Group I repurchased with
respect to such Prepayment Period, the portion of the Purchase Price allocable
to principal, (v) any Substitution Adjustment Amounts with respect to the Group
I Mortgage Loans received on or prior to the previous Determination Date and not
yet distributed and (vi) on the Distribution Date on which the Trust is to be
terminated in accordance with Section 10.01 hereof, that portion of the
Termination Price in respect of principal on the Group I Mortgage Loans.

                  "Group I Senior Excess Interest Amount": With respect to any
Distribution Date, an amount equal to the excess, if any, of (x) the Group I
Interest Remittance Amount multiplied by a fraction, the numerator of which is
the Certificate Principal Balance of the Class AV-1 Certificates

                                      -30-

<PAGE>

(immediately prior to such Distribution Date) and the denominator of which is
the Principal Balance of the Group I Mortgage Loans as of the last day of the
preceding Collection Period over (y) the sum of (i) the amount of any
distributions of interest pursuant to Section 4.01(II) and (ii) the portion
allocated to the Group I Senior Excess Interest Amount of the excess, if any, of
(a) the aggregate Accrued Certificate Interest for the Mezzanine Certificates
over (b) the Interest Remittance Amount multiplied by a fraction, the numerator
of which is the sum of the aggregate Certificate Principal Balance of the
Mezzanine Certificates (immediately prior to such Distribution Date) and the
Overcollateralization Amount and the denominator of which is the Principal
Balance of the Mortgage Loans as of the last day of the preceding Collection
Period. For purposes of the foregoing, the shortfall described in clause (y)(ii)
will be allocated in the following order: first, to the Group II Senior Excess
Interest Amount and second, to the Group I Senior Excess Interest Amount.

                  "Group I Senior Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the Certificate Principal Balance of the
Class AV-1 Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 61.90% and (ii) the Principal Balance of the
Group I Mortgage Loans as of the last day of the related Collection Period and
(B) the Principal Balance of the Group I Mortgage Loans as of the last day of
the related Collection Period minus the product of (i) 0.50% and (ii) the
Principal Balance of the Group I Mortgage Loans on the Cut-off Date, but in no
event less than zero.

                  "Group I Targeted Enhancement Amount": With respect to any
Distribution Date (i) prior to the Stepdown Date, $55,843,650, (ii) on or after
the Stepdown Date and on which a Trigger Event is in effect, the Group I
Targeted Enhancement Amount for the immediately preceding Distribution Date and
(iii) on or after the Stepdown Date and on which a Trigger Event is not in
effect, an amount equal to the Group I Enhancement Amount assuming the entire
Group I Senior Principal Distribution Amount had been distributed in full.

                  "Group II Certificates": Collectively, the Class AV-2
Certificates, the Class AV-3 Certificates and the Class AV-4 Certificates.

                  "Group II Enhancement Amount": As of any Distribution Date, an
amount equal to the excess of (x) the aggregate Principal Balance of the Group
II Mortgage Loans as of the last day of the related Collection Period over (y)
the aggregate Certificate Principal Balance of the Group II Certificates.

                  "Group II Interest Remittance Amount": As of any Determination
Date, the sum, without duplication, of (i) all interest due and collected or
advanced with respect to the related Collection Period on the Group II Mortgage
Loans (less the Servicing Fee, amounts available for

                                      -31-

<PAGE>

reimbursement of Advances and Servicing Advances pursuant to Section 3.05 and
expenses reimbursable pursuant to Section 6.03), (ii) all Compensating Interest
paid by the Servicer on such Determination Date with respect to the Group II
Mortgage Loans and (iii) the portion of any payment in connection with any
substitution, Purchase Price, Termination Price or Net Liquidation Proceeds
relating to interest with respect to the Group II Mortgage Loans received during
the related Prepayment Period.

                  "Group II Mortgage Loans": A Fixed-Rate Mortgage Loan or
Adjustable-Rate Mortgage Loan assigned to Loan Group II with a Principal Balance
at origination that may or may not conform to Fannie Mae and Freddie Mac loan
limits.

                  "Group II Principal Remittance Amount": With respect to any
Distribution Date, the sum (less amounts available for reimbursement of Advances
and Servicing Advances pursuant to Section 3.05 and expenses reimbursable
pursuant to Section 6.03) of: (i) each payment of principal on a Group II
Mortgage Loan due during the related Collection Period and received by the
Servicer on or prior to the related Determination Date, and any Advances with
respect thereto, (ii) all full and partial Principal Prepayments on the Group II
Mortgage Loans received by the Servicer during the related Prepayment Period,
(iii) the Net Liquidation Proceeds allocable to principal on the Group II
Mortgage Loans and any Subsequent Recoveries on the Group II Mortgage Loans
actually collected by the Servicer during the related Prepayment Period, (iv)
with respect to Defective Mortgage Loans in Loan Group II repurchased with
respect to such Prepayment Period, the portion of the Purchase Price allocable
to principal, (v) any Substitution Adjustment Amounts with respect to the Group
II Mortgage Loans received on or prior to the previous Determination Date and
not yet distributed and (vi) on the Distribution Date on which the Trust is to
be terminated in accordance with Section 10.01 hereof, that portion of the
Termination Price in respect of principal on the Group II Mortgage Loans.

                  "Group II Senior Excess Interest Amount": With respect to any
Distribution Date, an amount equal to the excess, if any, of (x) the Group II
Interest Remittance Amount multiplied by a fraction, the numerator of which is
the aggregate Certificate Principal Balance of the Group II Certificates
(immediately prior to such Distribution Date) and the denominator of which is
the Principal Balance of the Group II Mortgage Loans as of the last day of the
preceding Collection Period over (y) the sum of (i) the amount of any
distributions of interest pursuant to Section 4.01(I) and (ii) the portion
allocated to the Group II Senior Excess Interest Amount of the excess, if any,
of (a) the aggregate Accrued Certificate Interest for the Mezzanine Certificates
over (b) the Interest Remittance Amount multiplied by a fraction, the numerator
of which is the sum of the aggregate Certificate Principal Balance of the
Mezzanine Certificates (immediately prior to such Distribution Date) and the
Overcollateralization Amount and the denominator of which is the Principal
Balance of the Mortgage Loans as of the last day of the preceding Collection
Period. For purposes of the foregoing, the shortfall described in clause (y)(ii)
will be allocated in the following order: first, to

                                      -32-

<PAGE>

the Group II Senior Excess Interest Amount and second, to the Group I Senior
Excess Interest Amount.

                  "Group II Senior Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the aggregate Certificate Principal Balance
of the Group II Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) the product of (i) 61.90% and (ii) the Principal Balance
of the Group II Mortgage Loans as of the last day of the related Collection
Period and (B) the Principal Balance of the Group II Mortgage Loans as of the
last day of the related Collection Period minus the product of (i) 0.50% and
(ii) the Principal Balance of the Group II Mortgage Loans on the Cut-off Date,
but in no event less than zero.

                  "Group II Targeted Enhancement Amount": With respect to any
Distribution Date, (i) prior to the Stepdown Date, $19,020,714, (ii) on or after
the Stepdown Date and on which a Trigger Event is in effect, the Group II
Targeted Enhancement Amount for the immediately preceding Distribution Date and
(iii) on or after the Stepdown Date and on which a Trigger Event is not in
effect, an amount equal to the Group II Enhancement Amount assuming the entire
Group II Senior Principal Distribution Amount had been distributed in full.

                  "Highest Priority": As of any date of determination, the Class
of Mezzanine Certificates or Class A Certificates then outstanding with a
Certificate Principal Balance greater than zero, with the highest priority for
payments pursuant to Section 4.02, in the following order: Class A, Class M-1,
Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4.

                  "HUD": The United States Department of Housing and Urban
Development, or any successor thereto and including the Federal Housing
Commissioner and the Secretary of Housing and Urban Development where
appropriate under the FHA Regulations.

                  "Independent": When used with respect to any specified Person,
any such Person who (i) is in fact independent of the Depositor, the Servicer
and their respective Affiliates, (ii) does not have any direct financial
interest in or any material indirect financial interest in the Depositor or the
Servicer or any Affiliate thereof, and (iii) is not connected with the Depositor
or the Servicer or any Affiliate thereof as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions;
provided, however, that a Person shall not fail to be Independent of the
Depositor or the Servicer or any Affiliate thereof merely because such Person is
the beneficial owner of 1% or less of any Class of securities issued by the
Depositor or the Servicer or any Affiliate thereof, as the case may be.

                  "Independent Contractor": Either (i) any Person (other than
the Servicer) that would

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<PAGE>

be an "independent contractor" with respect to the Trust Fund within the meaning
of Section 856(d)(3) of the Code if the Trust Fund were a real estate investment
trust (except that the ownership tests set forth in that section shall be
considered to be met by any Person that owns, directly or indirectly, 35 percent
or more of any Class of Certificates), so long as the Trust Fund does not
receive or derive any income from such Person and provided that the relationship
between such Person and the Trust Fund is at arm's length, all within the
meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any other Person
(including the Servicer) if the Trustee has received an Opinion of Counsel,
which Opinion of Counsel shall be an expense of the Trust Fund, to the effect
that the taking of any action in respect of any REO Property by such Person,
subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code), or cause any income
realized in respect of such REO Property to fail to qualify as Rents from Real
Property.

                  "Index": With respect to each Adjustable-Rate Mortgage Loan
and with respect to each related Adjustment Date, the index as specified in the
related Mortgage Note.

                  "Initial Certificate Principal Balance": With respect to any
Certificate of a Class other than a Class N, Class X or Residual Certificate,
the amount designated "Initial Certificate Principal Balance" on the face
thereof.

                  "Initial Notional Amount": With respect to any Class N
Certificate, the amount designated "Initial Notional Amount" on the face
thereof.

                  "Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a Mortgage Loan, to the extent such
proceeds are not to be applied to the restoration of the related Mortgaged
Property or released to the Mortgagor in accordance with the procedures that the
Servicer would follow in servicing mortgage loans held for its own account,
subject to the terms and conditions of the related Mortgage Note and Mortgage.

                  "Interest Accrual Period": With respect to any Distribution
Date and (i) with respect to the Class A Certificates and the Mezzanine
Certificates, the period from the preceding Distribution Date to the day prior
to the current Distribution Date (or, in the case of the first Distribution
Date, the period from the Closing Date through April 25, 2004), and (ii) with
respect to the Class N and Class X Certificates, the calendar month immediately
preceding the month in which such Distribution Date occurs.

                  "Interest Carry Forward Amount": For any Class of Certificates
(other than the Class

                                      -34-

<PAGE>

X and Residual Certificates) and any Distribution Date, the sum of (a) the
excess, if any, of the Accrued Certificate Interest and any Interest Carry
Forward Amount for the prior Distribution Date, over the amount in respect of
interest actually distributed on such Class on such prior Distribution Date and
(b) interest on such excess at the applicable Pass-Through Rate for the actual
number of days elapsed on the basis of a 360-day year since the prior
Distribution Date.

                  "Interest Percentage": With respect to any Class of
Certificates, the Class B-1 Interest, the Class B-4 Interest and the Class X/N
Interest and any Distribution Date, the ratio (expressed as a decimal carried to
six places) of the Accrued Certificate Interest for such Class to the sum of the
Accrued Certificate Interest for all such Classes, in each case with respect to
such Distribution Date.

                  "Interest Remittance Amount": For any Distribution Date, the
sum of (i) the Group I Interest Remittance Amount and (ii) the Group II Interest
Remittance Amount for such Distribution Date.

                  "Late Collections": With respect to any Mortgage Loan, all
amounts received subsequent to the Determination Date immediately following any
related Collection Period, whether as late payments of Monthly Payments or as
Insurance Proceeds, Liquidation Proceeds or otherwise, which represent late
payments or collections of principal and/or interest due (without regard to any
acceleration of payments under the related Mortgage and Mortgage Note) but
delinquent on a contractual basis for such Collection Period and not previously
recovered.

                  "LIBOR": With respect to the Class A Certificates and the
Mezzanine Certificates and each Interest Accrual Period, the rate determined by
the Trustee on the related LIBOR Determination Date on the basis of the offered
rate for one month United States dollar deposits, as such rate appears on the
Telerate Page 3750, as of 11:00 a.m. (London time) on such LIBOR Determination
Date. If no such quotations are available on an LIBOR Determination Date, LIBOR
for the related Interest Accrual Period will be established by the Trustee as
follows:

                  (i) If on such LIBOR Determination Date two or more Reference
         Banks provide such offered quotations, LIBOR for the related Interest
         Accrual Period shall be the arithmetic mean of such offered quotations
         (rounded upwards if necessary to the nearest whole multiple of 0.001%);

                  (ii) If on such LIBOR Determination Date fewer than two
         Reference Banks provide such offered quotations, LIBOR for the related
         Interest Accrual Period shall be the arithmetic mean of the rates
         quoted by one or more major banks in New York City, selected by the
         Trustee after consultation with the Depositor, as of 11:00 A.M., New
         York City time, on such date for loans in U.S. Dollars to leading
         European banks for a period of one month

                                      -35-

<PAGE>

         in amounts approximately equal to the aggregate Certificate Principal
         Balance of the Floating Rate Certificates; and

                  (iii) If no such quotations can be obtained, LIBOR for the
         related Interest Accrual Period shall be LIBOR for the prior
         Distribution Date.

                  "LIBOR Business Day": Any day on which banks in London,
England and The City of New York are open and conducting transactions in foreign
currency and exchange.

                  "LIBOR Carryover Amount": For any Distribution Date and any
Class A Certificate or Mezzanine Certificate, the excess of (i) the amount of
interest accrued on such Certificate based on the related Pass-Through Rate
(without regard to the related Rate Cap), over (ii) the amount of interest
accrued on such Certificate based on the related Rate Cap, together with the
unpaid portion of any such excess from prior Distribution Dates (and interest
accrued thereon at the then applicable Pass-Through Rate (without regard to the
related Rate Cap) on such Certificate.

                  "LIBOR Carryover Reserve Account": The reserve account
established and maintained pursuant to Section 3.29.

                  "LIBOR Determination Date": With respect to any Interest
Accrual Period for the Class A Certificates and the Mezzanine Certificates, the
second LIBOR Business Day preceding the first day of such Interest Accrual
Period.

                  "Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Servicer has determined, in accordance
with the servicing procedures specified herein, as of the end of the related
Prepayment Period, that all Liquidation Proceeds and Insurance Proceeds which it
expects to recover with respect to the liquidation of the Mortgage Loan or
disposition of the related REO Property have been recovered.

                  "Liquidation Event": With respect to any Mortgage Loan, any of
the following events: (i) such Mortgage Loan is paid in full; (ii) a Final
Recovery Determination is made as to such Mortgage Loan; or (iii) such Mortgage
Loan is removed from the Trust Fund by reason of its being purchased, sold or
replaced pursuant to or as contemplated by Section 2.03 or Section 10.01. With
respect to any REO Property, either of the following events: (i) a Final
Recovery Determination is made as to such REO Property; or (ii) such REO
Property is removed from the Trust Fund by reason of its being sold or purchased
pursuant to Section 3.13 or Section 10.01.

                  "Liquidation Proceeds": The amount (other than amounts
received in respect of the rental of any REO Property prior to REO Disposition)
received by the Servicer in connection with

                                      -36-

<PAGE>

(i) the taking of all or a part of a Mortgaged Property by exercise of the power
of eminent domain or condemnation or (ii) the liquidation of a defaulted
Mortgage Loan by means of a trustee's sale, foreclosure sale or otherwise.

                  "Liquidation Report": The report with respect to a Liquidated
Mortgage Loan in such form and containing such information as is agreed to by
the Servicer and the Trustee.

                  "Loan Group": Either Loan Group I or Loan Group II, as the
context requires.

                  "Loan Group I": The Group I Mortgage Loans.

                  "Loan Group II": The Group II Mortgage Loans.

                  "Losses":  As defined in Section 9.03.

                  "Lost Note Affidavit": With respect to any Mortgage Loan as to
which the original Mortgage Note has been permanently lost or destroyed and has
not been replaced, an affidavit from the Seller certifying that the original
Mortgage Note has been lost, misplaced or destroyed (together with a copy of the
related Mortgage Note and indemnifying the Trust against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note) in
the form of Exhibit H hereto.

                  "Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting Rights.

                  "Majority Class R Certificateholders": The Holders of Residual
Certificates evidencing at least a 51% Percentage Interest in the applicable
Class of Residual Certificates.

                  "Marker Rate": With respect to the Class X/N Interest and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the Uncertificated REMIC 1 Pass- Through Rates for REMIC 1 Regular Interest
LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1 Regular Interest LT1AV3, REMIC
1 Regular Interest LT1AV4, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular
Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1,
REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular
Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ, with the rate on each such
REMIC 1 Regular Interest (other than REMIC 1 Regular Interest LT1ZZ) subject to
a cap equal to the lesser of (i) LIBOR as of the related LIBOR Determination
Date, plus the related Certificate Margin and (ii) the related Rate Cap for such
Distribution Date, and with the rate on REMIC 1 Regular Interest LT1ZZ subject
to a cap of zero for the purpose of this calculation; provided, however, that
for this

                                      -37-

<PAGE>

purpose, calculations of the Uncertificated REMIC 1 Pass-Through Rate and the
related caps with respect to each such REMIC 1 Regular Interest (other than
REMIC 1 Regular Interest LT1ZZ) shall be multiplied by a fraction, the numerator
of which is 30 and the denominator of which is the actual number of days elapsed
in the related Interest Accrual Period.

                  "Maximum Loan Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
maximum Mortgage Interest Rate thereunder.

                  "Maximum LT1ZZ Uncertificated Accrued Interest Deferral
Amount": With respect to any Distribution Date, the excess of (a) accrued
interest at the Uncertificated REMIC 1 Pass- Through Rate applicable to REMIC 1
Regular Interest LT1ZZ for such Distribution Date on a balance equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ minus the
REMIC 1 Overcollateralized Amount, in each case for such Distribution Date, over
(b) Uncertificated Accrued Interest on REMIC 1 Regular Interest LT1AV1, REMIC 1
Regular Interest LT1AV2, REMIC 1 Regular Interest LT1AV3, REMIC 1 Regular
Interest LT1AV4, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
Interest LT1B2, REMIC 1 Regular Interest LT1B3 and REMIC 1 Regular Interest
LT1B4 with the rate on each such REMIC 1 Regular Interest subject to a cap equal
to the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
related Certificate Margin and (ii) the related Rate Cap for such Distribution
Date for the purpose of this calculation; provided, however, that for this
purpose, calculations of the Uncertificated REMIC 1 Pass-Through Rate and the
related caps with respect to each such REMIC 1 Regular Interest shall be
multiplied by a fraction, the numerator of which is 30 and the denominator of
which is the actual number of days elapsed in the related Interest Accrual
Period.

                  "Mezzanine Certificates": Together, the Class M Certificates
and the Class B Certificates.

                  "Minimum Loan Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Interest Rate thereunder.

                  "Monthly Excess Cashflow Amount": The sum of (i) the Monthly
Excess Interest Amount and (ii) the Overcollateralization Release Amount.

                  "Monthly Excess Interest Amount": With respect to each
Distribution Date, the amount, if any, by which the Interest Remittance Amount
for such Distribution Date exceeds the aggregate amount distributed on such
Distribution Date pursuant to Section 4.01(I) through Section 4.01(III)(i)
through (vii).

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<PAGE>

                  "Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient Valuation and/or
Debt Service Reduction with respect to such Mortgage Loan and (ii) any reduction
in the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Servicer pursuant to Section 3.01; and (c) on the assumption that all other
amounts, if any, due under such Mortgage Loan are paid when due.

                  "Monthly Statement": The statement prepared and distributed by
the Trustee pursuant to Section 4.06(a).

                  "Moody's": Moody's Investors Service, Inc. and its successors,
and if such company shall for any reason no longer perform the functions of a
securities rating agency, "Moody's" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Securities and Exchange
Commission.

                  "Mortgage": The mortgage, deed of trust or other instrument
creating a first or second lien on, or first or second priority security
interest in, a Mortgaged Property securing a Mortgage Note.

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

                  "Mortgage Insurance Certificate": The certificate evidencing
an FHA Insurance Contract.

                  "Mortgage Interest Rate": With respect to each Mortgage Loan,
the annual rate at which interest accrues on such Mortgage Loan from time to
time in accordance with the provisions of the related Mortgage Note, which rate
(i) in the case of each Fixed-Rate Mortgage Loan shall remain constant at the
rate set forth in the Mortgage Loan Schedule as the Mortgage Interest Rate in
effect immediately following the Cut-off Date and (ii) in the case of each
Adjustable-Rate Mortgage Loan (A) as of any date of determination until the
first Adjustment Date following the Cut- off Date shall be the rate set forth in
the Mortgage Loan Schedule as the Mortgage Interest Rate in effect immediately
following the Cut-off Date and (B) as of any date of determination thereafter
shall be the rate as adjusted on the most recent Adjustment Date, to equal the
sum, rounded to the nearest 0.125% as provided in the Mortgage Note, of the
Index, determined as set forth in the related Mortgage Note, plus the related
Gross Margin subject to the limitations set forth in the related

                                      -39-

<PAGE>

Mortgage Note. With respect to each Mortgage Loan that becomes an REO Property,
as of any date of determination, the annual rate determined in accordance with
the immediately preceding sentence as of the date such Mortgage Loan became an
REO Property.

                  "Mortgage Loan": Each mortgage loan transferred and assigned
to the Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to time
held as a part of the Trust Fund, the Mortgage Loans so held being identified in
the Mortgage Loan Schedule.

                  "Mortgage Loan Purchase Agreement": The agreement between the
Seller and the Depositor, dated as of April 8, 2004, regarding the transfer of
the Mortgage Loans by the Seller to or at the direction of the Depositor.

                  "Mortgage Loan Schedule": As of any date (i) with respect to
the Mortgage Loans, the list of such Mortgage Loans included in the Trust Fund
on such date, separately identifying the Group I Mortgage Loans and the Group II
Mortgage Loans, attached hereto as Exhibit D. The Mortgage Loan Schedule shall
be prepared by the Seller and shall set forth the following information with
respect to each Mortgage Loan:

                  (1) the Seller's Mortgage Loan identifying number;

                  (2) the city, state, and zip code of the Mortgaged Property;

                  (3) the type of Residential Dwelling constituting the
         Mortgaged Property or a designation that the Mortgaged Property is a
         multi-family property;

                  (4) the occupancy status of the Mortgaged Property at
         origination;

                  (5) the original months to maturity;

                  (6) the date of origination;

                  (7) the first payment date;

                  (8) the stated maturity date;

                  (9) the stated remaining months to maturity;

                  (10) the original principal amount of the Mortgage Loan;

                                      -40-

<PAGE>

                  (11) the Principal Balance of each Mortgage Loan as of the
         Cut-off Date;

                  (12) [reserved];

                  (13) the Mortgage Interest Rate of the Mortgage Loan as of the
         Cut-off Date;

                  (14) the current principal and interest payment of the
         Mortgage Loan as of the Cut- off Date;

                  (15) the contractual interest paid to date of the Mortgage
         Loan;

                  (16) if the Mortgage Loan is not owner-financed, the Combined
         Loan-to-Value Ratio at origination;

                  (17) a code indicating the loan performance status of the
         Mortgage Loan as of the Cut-off Date;

                  (18) a code indicating whether the Mortgage Loan is a Simple
         Interest Mortgage Loan or an Actuarial Mortgage Loan;

                  (19) a code indicating whether the Mortgaged Property is in
         bankruptcy or in its forbearance period as of the Cut-off Date;

                  (20) a code indicating whether the Mortgage Loan is
         conventional or insured by the FHA;

                  (21) with respect to each Adjustable-Rate Mortgage Loan, a
         code indicating the Index that is associated with such Mortgage Loan,
         the Gross Margin, the Periodic Rate Cap, the Minimum Loan Rate, the
         Maximum Loan Rate, the first Adjustment Date immediately following the
         Cut-off Date, the rate adjustment frequency and the payment adjustment
         frequency;

                  (22) a code indicating whether the Mortgage Loan has a
         Prepayment Charge and the type of Prepayment Charge;

                  (23) a code indicating whether the Mortgage Loan is
         owner-financed;

                  (24) a code indicating whether the Mortgage Loan is subject to
         negative amortization; and

                                      -41-

<PAGE>

                  (25) a code indicating whether the Mortgage Loan is a second
         lien.

                  The Mortgage Loan Schedule shall set forth the following
information, as of the Cut- off Date, with respect to the Mortgage Loans in the
aggregate, for the Group I Mortgage Loans and for the Group II Mortgage Loans:
(1) the number of Mortgage Loans; (2) the current Principal Balance of the
Mortgage Loans; (3) the weighted average Mortgage Interest Rate of the Mortgage
Loans; and (4) the weighted average maturity of the Mortgage Loans. The Mortgage
Loan Schedule shall be amended from time to time by the Seller in accordance
with the provisions of this Agreement. With respect to any Eligible Substitute
Mortgage Loan, Cut-off Date shall refer to the related Cut-off Date for such
Mortgage Loan, determined in accordance with the definition of Cut- off Date
herein.

                  "Mortgage Note": The original executed note or other evidence
of indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage
Loan.

                  "Mortgage Pool": The pool of Mortgage Loans, identified on
Exhibit D from time to time, and any REO Properties acquired in respect thereof.

                  "Mortgaged Property": The underlying property securing a
Mortgage Loan, including any REO Property, consisting of an Estate in Real
Property improved by a Residential Dwelling or multi-family dwelling.

                  "Mortgagor":  The obligor on a Mortgage Note.

                  "Net Liquidation Proceeds": With respect to any Liquidated
Mortgage Loan or any other disposition of related Mortgaged Property (including
REO Property) the related Liquidation Proceeds net of Advances, Servicing
Advances, Servicing Fees and any other accrued and unpaid servicing fees
received and retained in connection with the liquidation of such Mortgage Loan
or Mortgaged Property.

                  "Net Mortgage Interest Rate": With respect to any Mortgage
Loan, the Mortgage Interest Rate borne by such Mortgage Loan minus the Expense
Fee Rate.

                  "New Lease": Any lease of REO Property entered into on behalf
of the Trust, including any lease renewed or extended on behalf of the Trust if
the Trust has the right to renegotiate the terms of such lease.

                  "Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan that, in
the good faith business judgment of

                                      -42-

<PAGE>

the Servicer, will not or, in the case of a proposed Advance or Servicing
Advance, would not be ultimately recoverable from Late Collections on such
Mortgage Loan as provided herein.

                  "Notional Amount": Immediately prior to any Distribution Date,
with respect to the Class X/N Interest, the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular Interests. With respect to the Class N
Certificates, an amount equal to the Original Class N Notional Amount reduced by
the aggregate distributions made to the Class N Certificates pursuant to Section
4.02(B)(II)(xxix).

                  "Offered Certificates": The Class A Certificates and the
Mezzanine Certificates (other than the Class B-4 Certificates).

                  "Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), or by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries of the Servicer, the Seller or the
Depositor, as applicable.

                  "Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be a salaried counsel for the Depositor or the Servicer
except that any opinion of counsel relating to (a) the qualification of any
REMIC as a REMIC or (b) compliance with the REMIC Provisions must be an opinion
of Independent counsel.

                  "Optional Termination Date": The first Distribution Date on
which the Servicer or an Affiliate of the Servicer may opt to terminate the
Mortgage Pool pursuant to Section 10.01.

                  "Original Class N Notional Amount": The Notional Amount of the
Class N Certificates on the Closing Date, as set forth opposite such Class in
the Preliminary Statement.

                  "Original Class Certificate Principal Balance": With respect
to each Class of Certificates, the Certificate Principal Balance thereof on the
Closing Date, as set forth opposite such Class in the Preliminary Statement,
except with respect to the Class N, Class X and Residual Certificates, which
have an Original Class Certificate Principal Balance of zero.

                  "Overcollateralization Amount": As of any Distribution Date,
the excess of (x) the Pool Balance as of the last day of the immediately
preceding Collection Period over (y) the aggregate Certificate Principal
Balances of the Class A Certificates and the Mezzanine Certificates (after
taking into account all distributions of principal on such Distribution Date).

                  "Overcollateralization Deficiency": As of any Distribution
Date, the excess, if any,

                                      -43-

<PAGE>

of (x) the Targeted Overcollateralization Amount for such Distribution Date over
(y) the Overcollateralization Amount for such Distribution Date, calculated for
this purpose after taking into account the reduction on such Distribution Date
of the aggregate Certificate Principal Balance of the Class A Certificates and
the Mezzanine Certificates resulting from the distribution of the Principal
Remittance Amount on such Distribution Date, but prior to taking into account
any Applied Realized Loss Amounts on such Distribution Date.

                  "Overcollateralization Release Amount": With respect to any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, the lesser of (x) the Principal Remittance Amount for such Distribution
Date and (y) the excess, if any, of (i) the Overcollateralization Amount for
such Distribution Date (assuming that 100% of the Principal Remittance Amount is
applied as a principal distribution on the Offered Certificates and the Class
B-4 Certificates on such Distribution Date), over (ii) the Targeted
Overcollateralization Amount for such Distribution Date.

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

                  "Pass-Through Rate": Any of the Class AV-1 Pass-Through Rate,
the Class AV-2 Pass-Through Rate, the Class AV-3 Pass-Through Rate, the Class
AV-4 Pass-Through Rate, the Class M-1 Pass-Through Rate, the Class M-2
Pass-Through Rate, the Class M-3 Pass-Through Rate, the Class B-1 Pass-Through
Rate, the Class B-2 Pass-Through Rate, the Class B-3 Pass-Through Rate and the
Class B-4 Pass-Through Rate. With respect to the Class N Certificates, the Pass-
Through Rate is 10.00% per annum. With respect to the Class X/N Interest and any
Distribution Date, a per annum rate equal to the percentage equivalent of a
fraction, the numerator of which is the sum of the amounts calculated pursuant
to clauses (A) through (M) below, and the denominator of which is the aggregate
of the Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA,
REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1
Regular Interest LT1AV3, REMIC 1 Regular Interest LT1AV4, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular
Interest LT1B3, REMIC 1 Regular Interest LT1B4 and REMIC 1 Regular Interest
LT1ZZ. For purposes of calculating the Pass- Through Rate for the Class X/N
Interest, the numerator is equal to the sum of the following components:

                  (A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AA minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AA;

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<PAGE>

                  (B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV1;

                  (C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV2;

                  (D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV3;

                  (E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV4;

                  (F) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1M1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M1;

                  (G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1M2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M2;

                  (H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1M3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M3;

                  (I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B1;

                  (J) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B2;

                  (K) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B3;

                                      -45-

<PAGE>

                  (L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B4; and

                  (M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1ZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ.

                  "Paying Agent": Any paying agent appointed pursuant to Section
5.05.

                  "Percentage Interest": With respect to any Certificate (other
than a Class N, Class X or Residual Certificate), a fraction, expressed as a
percentage, the numerator of which is the Initial Certificate Principal Balance,
as the case may be, represented by such Certificate and the denominator of which
is the Original Class Certificate Principal Balance of the related Class. With
respect to a Class N Certificate, the undivided percentage interest obtained by
dividing the Initial Notional Amount evidenced by such Certificate by the
Original Class N Notional Amount. With respect to a Class X or Residual
Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%.

                  "Periodic Rate Cap": With respect to each Adjustable-Rate
Mortgage Loan and any Adjustment Date therefor, the fixed percentage set forth
in the related Mortgage Note, which is the maximum amount by which the Mortgage
Interest Rate for such Mortgage Loan may increase or decrease (without regard to
the Maximum Loan Rate or the Minimum Loan Rate) on such Adjustment Date from the
Mortgage Interest Rate in effect immediately prior to such Adjustment Date.

                  "Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued or managed by the Depositor, the Servicer, the
Trustee or any of their respective Affiliates or for which an Affiliate of the
Trustee serves as an advisor:

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

                  (ii) (A) demand and time deposits in, certificates of deposit
         of, bankers' acceptances issued by or federal funds sold by any
         depository institution or trust company (including the Trustee or its
         agents acting in their respective commercial capacities)

                                      -46-

<PAGE>

         incorporated under the laws of the United States of America or any
         state thereof and subject to supervision and examination by federal
         and/or state authorities, so long as, at the time of such investment or
         contractual commitment providing for such investment, such depository
         institution or trust company or its ultimate parent has a short term
         uninsured debt rating in one of the two highest available rating
         categories of S&P (i.e., A-1+ and A-1) and Moody's and the highest
         available rating category of Fitch and provided that each such
         investment has an original maturity of no more than 365 days and (B)
         any other demand or time deposit or deposit which is fully insured by
         the FDIC;

                  (iii) repurchase obligations with a term not to exceed 30 days
         with respect to any security described in clause (i) above and entered
         into with a depository institution or trust company (acting as
         principal) rated A-1 or higher by S&P and Fitch and rated A2 or higher
         by Moody's, PROVIDED, HOWEVER, that collateral transferred pursuant to
         such repurchase obligation must be of the type described in clause (i)
         above and must (A) be valued daily at current market prices plus
         accrued interest or (B) pursuant to such valuation, be equal, at all
         times, to 105% of the cash transferred by the Trustee in exchange for
         such collateral and (C) be delivered to the Trustee or, if the Trustee
         is supplying the collateral, an agent for the Trustee, in such a manner
         as to accomplish perfection of a security interest in the collateral by
         possession of certificated securities;

                  (iv) securities bearing interest or sold at a discount that
         are issued by any corporation incorporated under the laws of the United
         States of America or any State thereof and that are rated by each
         Rating Agency in its highest long-term unsecured rating categories at
         the time of such investment or contractual commitment providing for
         such investment;

                  (v) commercial paper (including both non-interest-bearing
         discount obligations and interest-bearing obligations payable on demand
         or on a specified date not more than 30 days after the date of
         acquisition thereof) that is rated by each Rating Agency in its highest
         short-term unsecured debt rating available at the time of such
         investment;

                  (vi) units of money market funds registered under the
         Investment Company Act of 1940 including funds managed or advised by
         the Trustee or affiliates thereof having the highest rating category by
         the applicable Rating Agency; and

                  (vii) if previously confirmed in writing to the Trustee, any
         other demand, money market or time deposit, or any other obligation,
         security or investment, as may be acceptable to the Rating Agencies in
         writing as a permitted investment of funds backing securities having
         ratings equivalent to its highest initial rating of the Class A
         Certificates;

                                      -47-

<PAGE>

PROVIDED, that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of the
yield to maturity at par of the underlying obligations.

                  "Permitted Transferee": Any transferee of a Residual
Certificate other than a Disqualified Organization or a non-U.S. Person.

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

                  "Pool Balance": As of any date of determination, the aggregate
Principal Balance of the Mortgage Loans.

                  "Prepayment Assumption": As set forth in the Prospectus
Supplement.

                  "Prepayment Charge": With respect to any Prepayment Period,
any prepayment premium, fee or charge payable by the a Mortgagor in connection
with any Principal Prepayment pursuant to the terms of the related Mortgage
Note.

                  "Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan that was during the related Prepayment
Period the subject of a Principal Prepayment in full that was applied by the
Servicer to reduce the outstanding principal balance of such loan on a date
preceding the related Due Date, an amount equal to interest at the applicable
Mortgage Interest Rate (net of the Servicing Fee Rate) on the amount of such
Principal Prepayment for the number of days commencing on the date on which the
prepayment is applied and ending on the last day of the related Prepayment
Period.

                  "Prepayment Period": With respect to any Distribution Date,
the calendar month preceding the month in which such Distribution Date occurs.

                  "Principal Balance": As to any Mortgage Loan and any day,
other than a Liquidated Mortgage Loan, the related Cut-off Date Principal
Balance, minus all collections credited against the principal balance of any
such Mortgage Loan and the principal portion of Advances plus, Deferred
Interest, if any. For purposes of this definition, a Liquidated Mortgage Loan
shall be deemed to have a Principal Balance equal to the Principal Balance of
the related Mortgage Loan as of the final recovery of related Liquidation
Proceeds and a Principal Balance of zero thereafter. As

                                      -48-

<PAGE>

to any REO Property and any day, the Principal Balance of the related Mortgage
Loan immediately prior to such Mortgage Loan becoming REO Property minus any REO
Principal Amortization received with respect thereto on or prior to such day.

                  "Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.

                  "Principal Remittance Amount": With respect to any
Distribution Date, the sum of (i) the Group I Principal Remittance Amount and
(ii) the Group II Principal Remittance Amount for such Distribution Date.

                  "Private Certificates": Any of the Class B-4, Class N, Class X
and Residual Certificates.

                  "Property Insurance Proceeds": Proceeds of any title policy,
hazard policy or other insurance policy covering a Mortgage Loan, to the extent
such proceeds are received by the Servicer and are not to be applied to the
restoration of the related Mortgaged Property or released to the Mortgagor in
accordance with the Servicer's servicing procedures, subject to the terms and
conditions of the related Mortgage Note and Mortgage.

                  "Prospectus Supplement": That certain Prospectus Supplement
dated April 8, 2004 relating to the public offering of the Offered Certificates.

                  "Purchase Price": With respect to any Mortgage Loan or REO
Property to be purchased pursuant to or as contemplated by Section 2.03 or
10.01, and as confirmed by an Officers' Certificate from the Servicer to the
Trustee, an amount equal to the sum of (i) 100% of the Principal Balance thereof
as of the date of purchase (or such other price as provided in Section 10.01),
(ii) in the case of (x) a Mortgage Loan, accrued interest on such Principal
Balance at the applicable Mortgage Interest Rate in effect from time to time
from the Due Date as to which interest was last covered by a payment by the
Mortgagor or an Advance by the Servicer, which payment or Advance had as of the
date of purchase been distributed pursuant to Section 4.01 and Section 4.02,
through the end of the calendar month in which the purchase is to be effected,
and (y) an REO Property, its fair market value, determined in good faith by the
Servicer, (iii) any unreimbursed Servicing Advances and Advances and any unpaid
Servicing Fees allocable to such Mortgage Loan or REO Property, (iv) any amounts
previously withdrawn from the Collection Account in respect of such Mortgage
Loan or REO Property pursuant to Section 3.13, and (v) in the case of a Mortgage
Loan required to be purchased pursuant to Section 2.03, expenses reasonably
incurred or to be incurred

                                      -49-

<PAGE>

by the Servicer or the Trustee in respect of the breach or defect giving rise to
the purchase obligation, including any costs and damages incurred by the Trust
Fund in connection with any violation by such loan of any predatory or abusive
lending law.

                  "Qualified Insurer": Any insurance company acceptable to
Fannie Mae or Freddie Mac.

                  "Rate Cap": With respect to the Class AV-1 Certificates and
any Distribution Date, a per annum rate equal to the product of (i) the average
of the Net Mortgage Interest Rates of the Group I Mortgage Loans, weighted on
the basis of the Principal Balances of the Group I Mortgage Loans as of the
first day of the related Collection Period (or, in the case of the first
Distribution Date, the Cut-off Date) and (ii) a fraction, the numerator of which
is 30 and the denominator of which is the actual number of days elapsed in the
related Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the
Uncertificated REMIC 1 Pass-Through Rate on REMIC 1 Regular Interest LT1SUB,
weighted on the basis of the Uncertificated Principal Balance of such REMIC 1
Regular Interest.

                  With respect to the Group II Certificates and any Distribution
Date, a per annum rate equal to the product of (i) the average of the Net
Mortgage Interest Rates of the Group II Mortgage Loans, weighted on the basis of
the Principal Balances of the Group II Mortgage Loans as of the first day of the
related Collection Period (or, in the case of the first Distribution Date, the
Cut-off Date) and (ii) a fraction, the numerator of which is 30 and the
denominator of which is the actual number of days elapsed in the related
Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the
Uncertificated REMIC 1 Pass-Through Rate on REMIC 1 Regular Interest LT2BSUB,
weighted on the basis of the Uncertificated Principal Balance of such REMIC 1
Regular Interest.

                  With respect to the Mezzanine Certificates and any
Distribution Date, a per annum rate equal to the product of (i) the average of
the Net Mortgage Interest Rates of the Mortgage Loans, weighted in proportion to
the results of subtracting from the aggregate Principal Balance of each Loan
Group the current Certificate Principal Balance of the related Class of Class A
Certificates, and (ii) a fraction, the numerator of which is 30 and the
denominator of which is the actual number of days elapsed in the related
Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the
Uncertificated REMIC 1 Pass-Through Rates on (a) REMIC 1 Regular Interest
LT1SUB, subject to a cap and a floor equal to the Expense Fee Rates of the Group
I Mortgage Loans and (b) REMIC 1 Regular Interest LT2SUB, subject to a cap and a
floor equal to the Expense Fee Rates of the Group II Mortgage Loans, weighted on
the basis of the Uncertificated Principal Balance of each such REMIC 1 Regular
Interest.

                                      -50-

<PAGE>

                  "Rating Agency or Rating Agencies": Fitch, Moody's and S&P, or
their respective successors. If such agencies or their successors are no longer
in existence, "Rating Agencies" shall be such nationally recognized statistical
rating organizations as set forth on the most current list of such organizations
released by the Securities and Exchange Commission and designated by the
Depositor, notice of which designation shall be given to the Trustee and the
Servicer.

                  "Realized Loss": With respect to a Liquidated Mortgage Loan,
the amount by which the remaining unpaid principal balance of the Mortgage Loan
exceeds the amount of Net Liquidation Proceeds applied to the principal balance
of the related Mortgage Loan.

                  "Realized Loss Amortization Amount": Any of the Class M-1
Realized Loss Amortization Amount, the Class M-2 Realized Loss Amortization
Amount, the Class M-3 Realized Loss Amortization Amount, the Class B-1 Realized
Loss Amortization Amount, the Class B-2 Realized Loss Amortization Amount, the
Class B-3 Realized Loss Amortization Amount and the Class B-4 Realized Loss
Amortization Amount.

                  "Record Date": With respect to the Class A Certificates and
the Mezzanine Certificates, the Business Day immediately preceding such
Distribution Date; PROVIDED, HOWEVER, that if any such Certificate becomes a
Definitive Certificate, the Record Date for such Certificate shall be the last
Business Day of the month immediately preceding the month in which the related
Distribution Date occurs. With respect to the Class X Certificates, the Class N
Certificates and the Residual Certificates and the first Distribution Date, the
Closing Date, and with respect to each Distribution Date following the first
Distribution Date, the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.

                  "Reference Banks": Those banks (i) with an established place
of business in London, England, (ii) not controlling, under the control of or
under common control with the Depositor or the Trustee, (iii) whose quotations
appear on the Telerate Page 3750 on the relevant LIBOR Determination Date and
(iv) which have been designated as such by the Trustee; PROVIDED, HOWEVER, that
if fewer than two of such banks provide a LIBOR rate, then any leading banks
selected by the Trustee which are engaged in transactions in United States
dollar deposits in the international Eurocurrency market.

                  "Regular Certificate": Any of the Offered Certificates, the
Class B-3 Certificates and Class X/N Certificates.

                  "Related Documents": With respect to any Mortgage Loan, the
related Mortgage Note, Mortgage and other documents required by Section 2.01.

                                      -51-

<PAGE>

                  "Relief Act":  The Servicemembers Civil Relief Act.

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

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

                  "REMIC 1": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to which a REMIC election is to be made consisting of: (i) such
Mortgage Loans as from time to time are subject to this Agreement, together with
the Mortgage Files relating thereto, and together with all collections thereon
and proceeds thereof, (ii) any REO Property, together with all collections
thereon and proceeds thereof, (iii) the Trustee's rights with respect to the
Mortgage Loans under all insurance policies, required to be maintained pursuant
to this Agreement and any proceeds thereof, (iv) the Depositor's rights under
the Mortgage Loan Purchase Agreement (including any security interest created
thereby) and (v) the Collection Account, the Distribution Account (subject to
the last sentence of this definition) and any REO Account and such assets that
are deposited therein from time to time and any investments thereof, together
with any and all income, proceeds and payments with respect thereto.
Notwithstanding the foregoing, however, a REMIC election will not be made with
respect to the LIBOR Carryover Reserve Account.

                  "REMIC 1 Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) the sum of the
aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) the Uncertificated REMIC 1 Pass- Through Rate for
REMIC 1 Regular Interest LT1AA minus the Marker Rate, divided by (b) 12.

                  "REMIC 1 Marker Allocation Percentage": 50% of any amount
payable or loss attributable from the Mortgage Loans, which shall be allocated
to REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AV1, REMIC 1
Regular Interest LT1AV2, REMIC 1 Regular Interest LT1AV3, REMIC 1 Regular
Interest LT1AV4, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular Interest LT1B4
and REMIC 1 Regular Interest LT1ZZ.

                                      -52-

<PAGE>

                  "REMIC 1 Overcollateralization Target Amount": 0.50% of the
Targeted Overcollateralization Amount.

                  "REMIC 1 Overcollateralized Amount": With respect to any date
of determination, (i) 0.50% of the aggregate Uncertificated Principal Balances
of the REMIC 1 Regular Interests minus (ii) the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest
LT1AV2, REMIC 1 Regular Interest LT1AV3, REMIC 1 Regular Interest LT1AV4, REMIC
1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular
Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2,
REMIC 1 Regular Interest LT1B3 and REMIC 1 Regular Interest LT1B4, in each case
as of such date of determination.

                  "REMIC 1 Principal Loss Allocation Amount": With respect to
any Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) 1 minus a fraction, the numerator of which is two
times the aggregate of the Uncertificated Principal Balances of REMIC 1 Regular
Interest LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1 Regular Interest
LT1AV3, REMIC 1 Regular Interest LT1AV4, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest
LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest LT1B3 and REMIC
1 Regular Interest LT1B4 and the denominator of which is the aggregate of the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AV1, REMIC 1
Regular Interest LT1AV2, REMIC 1 Regular Interest LT1AV3, REMIC 1 Regular
Interest LT1AV4, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular Interest LT1B4
and REMIC 1 Regular Interest LT1ZZ.

                  "REMIC 1 Regular Interest LT1AA": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AA
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1AV1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AV1
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial

                                      -53-

<PAGE>

Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

                  "REMIC 1 Regular Interest LT1AV2": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AV2
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1AV3": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AV3
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1AV4": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AV4
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1B1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1B1
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1B2": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1B2
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1B3": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC

                                      -54-

<PAGE>

1. REMIC 1 Regular Interest LT1B3 shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in effect from time to time, and shall
be entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Principal
Balance as set forth in the Preliminary Statement hereto.

                  "REMIC 1 Regular Interest LT1B4": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1B4
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1M1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M1
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1M2": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M2
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1M3": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M3
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1SUB": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1SUB
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                                      -55-

<PAGE>

                  "REMIC 1 Regular Interest LT1GRP": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1GRP
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT2SUB": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT2SUB
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT2GRP": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT2GRP
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1XX": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1XX
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1ZZ": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1ZZ
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interests": REMIC 1 Regular Interest LT1AA,
REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1
Regular Interest LT1AFV3, REMIC 1 Regular Interest LT1AV4, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1B1, REMIC 1 Regular

                                      -56-

<PAGE>

Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular Interest LT1B4,
REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1
Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP, REMIC 1 Regular
Interest LT1XX and REMIC 1 Regular Interest LT1ZZ.

                  "REMIC 1 Sub WAC Allocation Percentage": 50% of any amount
payable or loss attributable from the Mortgage Loans, which shall be allocated
to REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1
Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1 Regular
Interest LT1XX.

                  "REMIC 1 Subordinated Balance Ratio": The ratio among the
Uncertificated Principal Balances of each REMIC 1 Regular Interest ending with
the designation "SUB,", equal to the ratio among, with respect to each such
REMIC 1 Regular Interest, the excess of (x) the aggregate Principal Balance of
the Mortgage Loans in the related Loan Group over (y) the current Certificate
Principal Amount of the Class A Certificates in the related Loan Group.

                  "REMIC 2": The segregated pool of assets consisting of all of
the REMIC 1 Regular Interests conveyed in trust to the Trustee, for the benefit
of the Holders of the regular interests and the Class R Certificate (in respect
of the Class R-2 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.

                  "REMIC 2 Regular Interests": The Class B-1 Interest, the Class
B-4 Interest and the Class X/N Interest.

                  "REMIC 3": The segregated pool of assets consisting of the
Class B-1 Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class B-1 Certificates and the Class R-X Certificate (in respect
of the Class R-3 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.

                  "REMIC 4": The segregated pool of assets consisting of the
Class B-4 Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class B-4 Certificates and the Class R-X Certificate (in respect
of the Class R-4 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.

                  "REMIC 5": The segregated pool of assets consisting of the
Class X/N Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class N Certificates and the Class X Certificates and the Class
R-X Certificate (in respect of the Class R-5 Interest), pursuant to Article II
hereunder, and all amounts deposited therein, with respect to which a separate
REMIC election is to be made.

                                      -57-

<PAGE>

                  "REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits which appear at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations and rulings promulgated thereunder, as the foregoing
may be in effect from time to time.

                  "REMIC Regular Interests": The REMIC 1 Regular Interests and
the REMIC 2 Regular Interests.

                  "Remittance Report": A report prepared by the Servicer and
delivered to the Trustee pursuant to Section 4.07, containing the information
attached hereto as Exhibit M.

                  "Rents from Real Property": With respect to any REO Property,
gross income of the character described in Section 856(d) of the Code.

                  "REO Disposition": The sale or other disposition of an REO
Property on behalf of the Trust Fund.

                  "REO Principal Amortization": With respect to any REO
Property, for any calendar month, the aggregate of all amounts received in
respect of such REO Property during such calendar month, whether in the form of
rental income, sale proceeds (including, without limitation, that portion of the
Termination Price paid in connection with a purchase of all of the Mortgage
Loans and REO Properties pursuant to Section 10.01 that is allocable to such REO
Property) or otherwise, net of any portion of such amounts (i) payable pursuant
to Section 3.13 in respect of the proper operation, management and maintenance
of such REO Property or (ii) payable or reimbursable to the Servicer pursuant to
Section 3.13 for unpaid Servicing Fees in respect of the related Mortgage Loan
and unreimbursed Servicing Advances and Advances in respect of such REO Property
or the related Mortgage Loan.

                  "REO Property": A Mortgaged Property acquired by the Servicer
on behalf of the Trust Fund through foreclosure or deed-in-lieu of foreclosure,
as described in Section 3.13.

                  "Request for Release": A release signed by a Servicing
Officer, in the form of Exhibit E attached hereto.

                  "Residential Dwelling": Any one of the following: (i) a
one-family dwelling, (ii) a two- to four-family dwelling, (iii) a one-family
dwelling unit in a Fannie Mae eligible condominium project, (iv) a one-family
dwelling in a planned unit development, which is not a co-operative, or (v) a
mobile or manufactured home (as defined in 42 United States Code, Section
5402(6)).

                                      -58-

<PAGE>

                  "Residual Certificates": The Class R Certificates and the
Class R-X Certificates.

                  "Residual Interest": The sole Class of "residual interests" in
each REMIC within the meaning of Section 860G(a)(2) of the Code.

                  "Responsible Officer": Any officer assigned to the Corporate
Trust Division (or any successor thereto) of the Trustee, including any Vice
President, Assistant Vice President, Trust Officer, any Assistant Secretary, any
trust officer or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
in each case having direct responsibility for the administration of this
Agreement.

                  "S&P": Standard & Poor's, a division of The McGraw-Hill
Companies, Inc., and its successors, and if such company shall for any reason no
longer perform the functions of a securities rating agency, "S&P" shall be
deemed to refer to any other "nationally recognized statistical rating
organization" as set forth on the most current list of such organizations
released by the Securities and Exchange Commission.

                  "Seller": Credit-Based Asset Servicing and Securitization LLC,
or its successor in interest, in its capacity as seller under the Mortgage Loan
Purchase Agreement.

                  "Senior Enhancement Percentage": For any Distribution Date,
the percentage obtained by dividing (x) the sum of (i) the aggregate Certificate
Principal Balances of the Mezzanine Certificates and (ii) the
Overcollateralization Amount, in each case before taking into account the
distribution of the Principal Remittance Amount and the Extra Principal
Distribution Amount on such Distribution Date by (y) the Pool Balance as of the
last day of the related Collection Period.

                  "Senior Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the aggregate Certificate Principal Balance of the
Class A Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 61.90% and (ii) the Principal Balance of the
Mortgage Loans as of the last day of the related Collection Period and (B) the
Principal Balance of the Mortgage Loans as of the last day of the related
Collection Period minus the product of (i) 0.50% and (ii) the Principal Balance
of the Mortgage Loans on the Cut-off Date, but in no event less than zero. Any
distribution of the Group I Senior Principal Distribution Amount or the Group II
Senior Principal Distribution Amount to the Holders of the related Class of
Class A Certificates will be deemed to also be a distribution in respect of the
Senior Principal Distribution Amount but in no event will the Senior Principal
Distribution Amount be less than the sum of the Group I Senior Principal
Distribution Amount and the Group II Senior Principal Distribution Amount.

                                      -59-

<PAGE>

                  "Servicer": Litton Loan Servicing LP, a Delaware limited
partnership, or any successor servicer appointed as herein provided, in its
capacity as Servicer hereunder.

                  "Servicer Affiliate": A Person (i) controlling, controlled by
or under common control with the Servicer or which is 50% or more owned by the
Servicer and (ii) which is qualified to service residential mortgage loans.

                  "Servicer Event of Termination": One or more of the events
described in Section 7.01.

                  "Servicer Remittance Date": With respect to any Distribution
Date, one Business Day prior to such Distribution Date.

                  "Servicing Advances": All customary, reasonable and necessary
"out of pocket" costs and expenses incurred by the Servicer in the performance
of its servicing obligations, including, but not limited to, the cost of (i) the
preservation, restoration and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property, (iv) compliance with the
obligations under Section 3.08 and (v) rebating any points and fees that are to
be reimbursed to a Mortgagor due to a Principal Prepayment.

                  "Servicing Fee": With respect to each Mortgage Loan (including
each REO Property) and for any calendar month, an amount equal to one month's
interest (or in the event of any payment of interest which accompanies a
Principal Prepayment in full made by the Mortgagor during such calendar month,
interest for the number of days covered by such payment of interest) at the
Servicing Fee Rate on the same principal amount on which interest on such
Mortgage Loan accrues for such calendar month.

                  "Servicing Fee Rate": With respect to each Mortgage Loan,
0.50% per annum.

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

                  "Servicing Rights Pledgee": One or more lenders, selected by
the Servicer, to which the Servicer may pledge and assign all of its right,
title and interest in, to and under this Agreement, including Wachovia Bank,
National Association as the representative of certain lenders.

                  "Servicing Standard": Shall mean the standards set forth in
Section 3.01.

                                      -60-

<PAGE>

                  "Simple Interest Method": The method of allocating a payment
to principal and interest, pursuant to which the portion of such payment that is
allocated to interest is equal to the product of the fixed rate of interest
multiplied by the unpaid principal balance multiplied by the period of time
elapsed since the preceding payment of interest was made and divided by either
360 or 365, as specified in the related Mortgage Note, and the remainder of such
payment is allocated to principal.

                  "Simple Interest Mortgage Loan": Any Mortgage Loan under which
the portion of a payment allocable to interest and the portion of such payment
allocable to principal is determined in accordance with the Simple Interest
Method.

                  "Special Hazard Losses": Realized Losses that result from
direct physical damage to Mortgaged Properties caused by natural disasters and
other hazards (i) which are not covered by hazard insurance policies (such as
earthquakes) and (ii) for which claims have been submitted and rejected by the
related hazard insurer and any shortfall in insurance proceeds for partial
damage due to the application of the co-insurance clauses contained in hazard
insurance policies.

                  "Startup Day":  As defined in Section 9.01(b) hereof.

                  "Stayed Funds": Any payment required to be made under the
terms of the Certificates and this Agreement but which is not remitted by the
Servicer because the Servicer is the subject of a proceeding under the
Bankruptcy Code and the making of such remittance is prohibited by Section 362
of the Bankruptcy Code.

                  "Stepdown Date": The earlier to occur of (x) the Distribution
Date on which the aggregate Certificate Principal Balance of the Class A
Certificates is zero and (y) the later to occur of (A) the Distribution Date in
April 2007 and (B) the first Distribution Date on which the Senior Enhancement
Percentage is greater than or equal to 38.10%.

                  "Subsequent Recoveries": As of any Distribution Date, amounts
received by the Servicer (net of any expenses permitted to be reimbursed
pursuant to Section 3.05) or surplus amounts held by the Servicer to cover
estimated expenses (including, but not limited to, recoveries in respect of the
representations and warranties made by the Seller pursuant to the Mortgage Loan
Purchase Agreement) specifically related to a Mortgage Loan that was the subject
of a Final Recover Determination or an REO Disposition prior to the related
Prepayment Period that resulted in a Realized Loss.

                  "Substitution Adjustment Amount": As defined in Section
2.03(d) hereof.

                                      -61-

<PAGE>

                  "Targeted Overcollateralization Amount": As of any
Distribution Date, (x) prior to the Stepdown Date, 1.05% of the aggregate
Cut-off Date Principal Balance of the Mortgage Loans, (y) on and after the
Stepdown Date provided that a Trigger Event is not in effect, the lesser of (i)
1.05% of the aggregate Cut-off Date Principal Balance of the Mortgage Loans and
(ii) the greater of (A) 2.10% of the Pool Balance as of the last day of the
related Collection Period and (B) 0.50% of the aggregate Cut-off Date Principal
Balance of the Mortgage Loans and (z) on or after the Stepdown Date and if a
Trigger Event is in effect, the Targeted Overcollateralization Amount for the
immediately preceding Distribution Date.

                  "Tax Matters Person": The tax matters person appointed
pursuant to Section 9.01(e) hereof.

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

                  "Telerate Page 3750": The display page currently so designated
on the Bridge Telerate Service (or such other page as may replace the Telerate
Page 3750 page on that service for the purpose of displaying London interbank
offered rates of major banks).

                  "Termination Price":  As defined in Section 10.01(a) hereof.

                  "Trigger Event": With respect to any Distribution Date a
Trigger Event is in effect, if (i) the three-month rolling average of 60+ Day
Delinquent Loans equals or exceeds 43.00% of the Senior Enhancement Percentage
or (ii) the aggregate amount of Realized Losses incurred since the Cut-off Date
through the last day of the related Collection Period (reduced by the amount of
Subsequent Recoveries received since the Cut-off Date through the last day of
the related Collection Period) divided by the initial Pool Balance exceeds the
applicable percentages set forth below with respect to such Distribution Date:

               DISTRIBUTION DATE OCCURRING IN          PERCENTAGE
               ------------------------------          ----------
               April 2007 through March 2008              3.00%
               April 2008 through March 2009              4.75%
               April 2009 through March 2010              6.25%

                                      -62-

<PAGE>

               April 2010 and thereafter                  7.00%

                  "Trust":  2004-CB3 Trust, the trust created hereunder.

                  "Trust Fund": All of the assets of the Trust, which is the
trust created hereunder consisting of REMIC 1, REMIC 2, REMIC 3, REMIC 4, REMIC
5 and the LIBOR Carryover Reserve Account.

                  "Trustee": U.S. Bank National Association, a national banking
association, or any successor Trustee appointed as herein provided.

                  "Trustee Fee": With respect to any Distribution Date, the
product of (x) one twelfth of the Trustee Fee Rate and (y) the aggregate of the
Principal Balances of all Mortgage Loans as of the opening of business on the
first day of the related Collection Period.

                  "Trustee Fee Rate": With respect to any Distribution Date,
0.0065% per annum.

                  "Uncertificated Accrued Interest": With respect to each REMIC
Regular Interest on each Distribution Date, an amount equal to one month's
interest at the related Uncertificated Pass- Through Rate on the Uncertificated
Principal Balance of such REMIC Regular Interest. In each case, Uncertificated
Accrued Interest will be reduced by any Prepayment Interest Shortfalls and
Relief Act Interest Shortfalls (allocated to such REMIC Regular Interests based
on their respective entitlements to interest irrespective of any Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution
Date).

                  "Uncertificated Principal Balance": With respect to each REMIC
Regular Interest, the amount of such REMIC Regular Interest outstanding as of
any date of determination. As of the Closing Date, the Uncertificated Principal
Balance of each REMIC Regular Interest shall equal the amount set forth in the
Preliminary Statement hereto as its initial Uncertificated Principal Balance. On
each Distribution Date, the Uncertificated Principal Balance of each REMIC
Regular Interest shall be reduced by all distributions of principal made on such
REMIC Regular Interest on such Distribution Date pursuant to Section 4.03 and,
if and to the extent necessary and appropriate, shall be further reduced on such
Distribution Date by Realized Losses as provided in Section 4.03, and the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ shall be
increased by interest deferrals as provided in Section 4.03. The Uncertificated
Principal Balance of each REMIC Regular Interest that has an Uncertificated
Principal Balance shall never be less than zero.

                  "Uncertificated REMIC 1 Pass-Through Rate": With respect to
REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular
Interest LT1AV2, REMIC

                                      -63-

<PAGE>

1 Regular Interest LT1AV3, REMIC 1 Regular Interest LT1AV4, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular
Interest LT1B3, REMIC 1 Regular Interest LT1B4, REMIC 1 Regular Interest LT1ZZ,
REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT2SUB and REMIC 1
Regular Interest LT1XX, the weighted average of the Net Mortgage Interest Rates
of the Mortgage Loans. With respect to REMIC 1 Regular Interest LT1GRP, the
weighted average of the Net Mortgage Interest Rates of the Group I Mortgage
Loans. With respect REMIC 1 Regular Interest LT2GRP, the weighted average of the
Net Mortgage Interest Rates of the Group II Mortgage Loans.

                  "Underwriters": Citigroup Global Markets Inc. and J.P. Morgan
Securities Inc., as underwriters with respect to the Offered Certificates.

                  "United States Person" or "U.S. Person": (i) A citizen or
resident of the United States, (ii) a corporation, partnership or other entity
treated as a corporation or partnership for United States federal income tax
purposes organized in or under the laws of the United States or any state
thereof or the District of Columbia (unless, in the case of a partnership,
Treasury regulations provide otherwise) or (iii) an estate the income of which
is includible in gross income for United States tax purposes, regardless of its
source, or (iv) a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons have authority to control all substantial decisions of the trust.
Notwithstanding the preceding sentence, to the extent provided in Treasury
regulations, certain Trusts in existence on August 20, 1996, and treated as
United States persons prior to such date, that elect to continue to be treated
as United States persons will also be a U.S. Person.

                  "Unpaid Realized Loss Amount": For any Class of Class A
Certificate or Mezzanine Certificate and as to any Distribution Date, the excess
of (x) the aggregate Applied Realized Loss Amounts applied with respect to such
Class for all prior Distribution Dates over (y) the aggregate Realized Loss
Amortization Amounts with respect to such Class for all prior Distribution Dates
and reduced by the amount of the increase in the related Certificate Principal
Balance due to the receipt of Subsequent Recoveries as provided in Section 4.02.

                  "Value": With respect to any Mortgaged Property, the value
thereof as determined by an independent appraisal made at the time of the
origination of the related Mortgage Loan or the sale price, if the appraisal is
not available; except that, with respect to any Mortgage Loan that is a purchase
money mortgage loan, the lesser of (i) the value thereof as determined by an
independent appraisal made at the time of the origination of such Mortgage Loan,
if any, and (ii) the sales price of the related Mortgaged Property.

                                      -64-

<PAGE>

                  "Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. The Voting Rights
allocated among Holders of the Offered Certificates and the Class B-4
Certificates shall be 98%, and shall be allocated among each such Class
according to the fraction, expressed as a percentage, the numerator of which is
the aggregate Certificate Principal Balance of all the Certificates of such
Class then outstanding and the denominator of which is the aggregate Certificate
Principal Balance of all the Offered Certificates and the Class B-4 Certificates
then outstanding. The Voting Rights allocated to each such Class of Certificates
shall be allocated among all holders of each such Class in proportion to the
outstanding Certificate Principal Balance of such Certificates; PROVIDED,
HOWEVER, that any Certificate registered in the name of the Servicer, the
Depositor, the Trustee or any of its respective affiliates shall not be included
in the calculation of Voting Rights; provided that only such Certificates as are
known by a Responsible Officer of the Trustee to be so registered will be so
excluded. The percentage of all the Voting Rights allocated among the Holders of
the Class X Certificate shall be 2%. The Class N and Residual Certificates shall
have no Voting Rights.

                  "Written Order to Authenticate": A written order by which the
Depositor directs the Trustee to execute, authenticate and deliver the
Certificates.

                  Section 1.02      ACCOUNTING.

                  Unless otherwise specified herein, for the purpose of any
definition or calculation, whenever amounts are required to be netted,
subtracted or added or any distributions are taken into account such definition
or calculation and any related definitions or calculations shall be determined
without duplication of such functions.

                  Section 1.03      ALLOCATION OF CERTAIN INTEREST SHORTFALLS.

                  For purposes of calculating the amount of the Accrued
Certificate Interest for the Class A Certificates, the Mezzanine Certificates
and the Class X/N Interest for any Distribution Date, (1) the aggregate amount
of any Prepayment Interest Shortfalls and any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, among the Class X/N Interest on a PRO RATA basis based on, and
to the extent of, one month's interest at the then applicable Pass-Through Rate
on the Notional Amount thereof and, thereafter, among the Class A Certificates
and the Mezzanine Certificates on a PRO RATA basis based on, and to the extent
of, one month's interest at the then applicable respective Pass-Through Rate on
the respective Certificate Principal Balance of each such Certificate and (2)
the aggregate amount of any Realized Losses and LIBOR Carryover Amounts incurred
for any Distribution Date shall be allocated among the Class X/N Interest on a
PRO RATA basis based on, and to the extent of, one month's interest at the then
applicable Pass-Through Rate on the Notional Amount thereof.

                                      -65-

<PAGE>

                  For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC 1 Regular Interests for any Distribution Date:

                  (A) the REMIC 1 Marker Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls and the REMIC 1 Marker Allocation
Percentage of the aggregate amount of any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, to Uncertificated Accrued Interest payable to REMIC 1 Regular
Interest LT1AA and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount
equal to the REMIC 1 Interest Loss Allocation Amount, 98% and 2%, respectively,
and thereafter among REMIC 1 Regular Interest LTAV1, REMIC 1 Regular Interest
LTAV2, REMIC 1 Regular Interest LTAV3, REMIC 1 Regular Interest LTAV4, REMIC 1
Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest LTB2, REMIC 1
Regular Interest LT1B3, REMIC 1 Regular Interest LTB4 and REMIC I Regular
Interest LT1ZZ PRO RATA based on, and to the extent of, one month's interest at
the then applicable respective Uncertificated REMIC 1 Pass-Through Rate on the
respective Uncertificated Principal Balance of each such REMIC 1 Regular
Interest; and

                  (B) the REMIC I Sub WAC Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls and the REMIC I Sub WAC Allocation
of the aggregate amount of any Percentage Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, to Uncertificated Accrued Interest payable to REMIC 1 Regular
Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1 Regular Interest
LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1 Regular Interest LT1XX, PRO
RATA based on, and to the extent of, one month's interest at the then applicable
respective Uncertificated REMIC 1 Pass- Through Rate on the respective
Uncertificated Principal Balance of each such REMIC 1 Regular Interest.

                  For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC 1 Regular Interests for any Distribution Date,
the aggregate amount of any Prepayment Interest Shortfalls and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated to the Class B-1 Interest to the extent
allocated to the Class B-1 Certificates, to the Class B-4 Interest to the extent
allocated to the Class B-4 Certificates and to the Class X/N Certificates to the
extent allocated to the Class X/N Interest.

                                      -66-

<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

                  Section 2.01      CONVEYANCE OF MORTGAGE LOANS.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, on behalf of the Trust, without recourse for the benefit of the
Certificateholders all the right, title and interest of the Depositor, including
any security interest therein for the benefit of the Depositor, in and to (i)
each Mortgage Loan identified on the Mortgage Loan Schedule, including the
related Cut-off Date Principal Balance, all interest accruing thereon after the
Cut-off Date and all collections in respect of interest and principal due after
the Cut-off Date; (ii) property which secured each such Mortgage Loan and which
has been acquired by foreclosure or deed in lieu of foreclosure; (iii) its
interest in any insurance policies in respect of the Mortgage Loans; (iv) all
proceeds of any of the foregoing; (v) the rights of the Depositor under the
Mortgage Loan Purchase Agreement and (vi) all other assets included or to be
included in the Trust Fund; PROVIDED, HOWEVER, so long as the Servicer is an FHA
Approved Mortgagee, the Commissioner of HUD shall have no obligation to
recognize or deal with any person other than the Servicer with respect to FHA
Insurance. Such assignment includes all interest and principal due to the
Depositor or the Servicer after the Cut off Date with respect to the Mortgage
Loans.

                  In connection with such transfer and assignment, the Seller,
on behalf of the Depositor, does hereby deliver or cause to be delivered to, and
deposit with the Trustee, or its designated agent (the "Custodian"), the
following documents or instruments with respect to each Mortgage Loan (a
"Mortgage File") so transferred and assigned:

         (i)      the original Mortgage Note, endorsed either (A) in blank or
                  (B) in the following form: "Pay to the order of U.S. Bank
                  National Association, as Trustee under the Pooling and
                  Servicing Agreement, dated as of March 1, 2004, among
                  Credit-Based Asset Servicing and Securitization LLC, Citigroup
                  Mortgage Loan Trust Inc., Litton Loan Servicing LP and U.S.
                  Bank National Association, Citigroup Mortgage Loan Trust,
                  C-BASS Mortgage Loan Asset-Backed Certificates, Series
                  2004-CB3, without recourse," or with respect to any lost
                  Mortgage Note, an original Lost Note Affidavit, together with
                  a copy of the related Mortgage Note;

         (ii)     the original Mortgage with evidence of recording thereon, and
                  the original recorded power of attorney, if the Mortgage was
                  executed pursuant to a power of attorney,

                                      -67-

<PAGE>

                  with evidence of recording thereon or, if such Mortgage or
                  power of attorney has been submitted for recording but has not
                  been returned from the applicable public recording office, has
                  been lost or is not otherwise available, a copy of such
                  Mortgage or power of attorney, as the case may be, certified
                  to be a true and complete copy of the original submitted for
                  recording;

         (iii)    an original Assignment of Mortgage, in form and substance
                  acceptable for recording. The Mortgage shall be assigned
                  either (A) in blank or (B) to "U.S. Bank National Association,
                  as Trustee under the Pooling and Servicing Agreement, dated as
                  of March 1, 2004, among Credit-Based Asset Servicing and
                  Securitization LLC, Citigroup Mortgage Loan Trust Inc., Litton
                  Loan Servicing LP and U.S. Bank National Association,
                  Citigroup Mortgage Loan Trust, C-BASS Mortgage Loan
                  Asset-Backed Certificates, Series 2004-CB3, without recourse";

         (iv)     an original or a certified copy of any intervening assignment
                  of Mortgage showing a complete chain of assignments;

         (v)      the original or a certified copy of lender's title insurance
                  policy;

         (vi)     the original or copies of each assumption, modification,
                  written assurance or substitution agreement, if any; and

         (vii)    for each FHA Loan, the original Mortgage Insurance
                  Certificate.

                  If any of the documents referred to in Section 2.01(ii), (iii)
or (iv) above has as of the Closing Date been submitted for recording but either
(x) has not been returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original of such
document, the obligations of the Seller to deliver such documents shall be
deemed to be satisfied upon (1) delivery to the Trustee or the Custodian no
later than the Closing Date, of a copy of each such document certified by the
Seller in the case of (x) above or the applicable public recording office in the
case of (y) above to be a true and complete copy of the original that was
submitted for recording and (2) if such copy is certified by the Seller,
delivery to the Trustee or the Custodian, promptly upon receipt thereof of
either the original or a copy of such document certified by the applicable
public recording office to be a true and complete copy of the original. The
Seller shall deliver or cause to be delivered to the Trustee or the Custodian
promptly upon receipt thereof any other documents constituting a part of a
Mortgage File received with respect to any Mortgage Loan, including, but not
limited to, any original documents evidencing an assumption or modification of
any Mortgage Loan.

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<PAGE>

                  Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File, the
Seller shall have 120 days to cure such defect or 150 days following the Closing
Date, in the case of missing Mortgages or Assignments or deliver such missing
document to the Trustee or the Custodian. If the Seller does not cure such
defect or deliver such missing document within such time period, the Seller
shall either repurchase or substitute for such Mortgage Loan in accordance with
Section 2.03.

                  The Servicer shall cause the Assignments of Mortgage which
were delivered in blank to be completed and shall cause all Assignments referred
to in Section 2.01(iii) hereof and, to the extent necessary, in Section 2.01(iv)
hereof to be recorded. The Servicer shall be required to deliver such
assignments for recording within 30 days of the Closing Date. The Servicer shall
furnish the Trustee, or its designated agent, with a copy of each Assignment of
Mortgage submitted for recording. In the event that any such Assignment is lost
or returned unrecorded because of a defect therein, the Servicer shall promptly
have a substitute Assignment prepared or have such defect cured, as the case may
be, and thereafter cause each such Assignment to be duly recorded.

                  In the event that any Assignments of Mortgage are not recorded
or are improperly recorded, the Servicer shall have no liability for its failure
to receive or act on notices not received related to such Assignment of
Mortgage.

                  In the event that any Mortgage Note is endorsed in blank as of
the Closing Date, promptly following the Closing Date the Servicer shall cause
to be completed such endorsements in the following form: "Pay to the order of
U.S. Bank National Association, as Trustee under the Pooling and Servicing
Agreement, dated as of March 1, 2004, among Credit-Based Asset Servicing and
Securitization LLC, Citigroup Mortgage Loan Trust Inc., Litton Loan Servicing LP
and U.S. Bank National Association, Citigroup Mortgage Loan Trust, C-BASS
Mortgage Loan Asset-Backed Certificates, Series 2004-CB3, without recourse."

                  The Depositor herewith delivers to the Trustee executed copies
of the Mortgage Loan Purchase Agreement.

                  The parties hereto understand and agree that it is not
intended that any Mortgage Loan be included in the Trust that is a "High-Cost
Home Loan" as defined by the Homeownership and Equity Protection Act of 1994 or
any other applicable predatory or abusive lending laws.

                  Section 2.02      ACCEPTANCE BY THE TRUSTEE.

                  The Trustee acknowledges the receipt of, subject to the
provisions of Section 2.01 and subject to the review described below and any
exceptions noted on the exception report

                                      -69-

<PAGE>

described in the next paragraph below, the documents referred to in Section 2.01
above and all other assets included in the definition of "Trust Fund" and
declares that it holds and will hold such documents and the other documents
delivered to it constituting a Mortgage File, and that it holds or will hold all
such assets and such other assets included in the definition of "Trust Fund" in
trust for the exclusive use and benefit of all present and future
Certificateholders.

                  The Trustee agrees to execute and deliver (or cause the
Custodian to execute and deliver) to the Depositor on or prior to the Closing
Date an acknowledgment of receipt of the original Mortgage Note (with any
exceptions noted), substantially in the form attached as Exhibit F-3 hereto.

                  The Trustee agrees, for the benefit of the Certificateholders,
to review (or cause the Custodian to review) each Mortgage File within 60 days
after the Closing Date (or, with respect to any document delivered after the
Startup Day, within 60 days of receipt and with respect to any Qualified
Substitute Mortgage, within 60 days after the assignment thereof) and to certify
(or cause the Custodian to certify) in substantially the form attached hereto as
Exhibit F-1 that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in the exception report annexed thereto as not being covered by such
certification), (i) all documents required to be delivered to it pursuant to
Section 2.01 of this Agreement are in its possession, (ii) such documents have
been reviewed by it and have not been mutilated, damaged or torn and relate to
such Mortgage Loan, (iii) based on its examination and only as to the foregoing,
the information set forth in the Mortgage Loan Schedule that corresponds to
items (1), (2), (3), (5) (13) and (26) (but only as to whether the Mortgage Loan
as a Prepayment Charge) of the Mortgage Loan Schedule accurately reflects
information set forth in the Mortgage File, (iv) all Assignments of Mortgage or
intervening assignments of mortgage, as applicable, have been submitted for
recording and (v) each Mortgage Note has been endorsed as provided in Section
2.01(i) of this Agreement and each Mortgage has been assigned in accordance with
Section 2.01(iii) of this Agreement. It is herein acknowledged that, in
conducting such review, the Trustee (or the Custodian, as applicable) is under
no duty or obligation to inspect, review or examine any such documents,
instruments, certificates or other papers to determine that they are genuine,
enforceable, or appropriate for the represented purpose or that they have
actually been recorded or that they are other than what they purport to be on
their face.

                  Prior to the first anniversary date of this Agreement the
Trustee shall deliver (or cause the Custodian to deliver) to the Depositor and
the Servicer a final certification in the form annexed hereto as Exhibit F-2
evidencing the completeness of the Mortgage Files, with any applicable
exceptions noted thereon.

                  If in the process of reviewing the Mortgage Files and making
or preparing, as the case may be, the certifications referred to above, the
Trustee (or the Custodian, as applicable) finds any

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<PAGE>

document or documents constituting a part of a Mortgage File to be missing or
defective in any material respect, at the conclusion of its review the Trustee,
upon its notification by the Custodian, if applicable, shall so notify the
Seller, the Depositor and the Servicer. In addition, upon the discovery by the
Seller, Depositor, the Trustee or the Servicer (or upon receipt by the Trustee
of written notification of such breach) of a breach of any of the
representations and warranties made by the Seller in the related Mortgage Loan
Purchase Agreement in respect of any Mortgage Loan which materially adversely
affects such Mortgage Loan or the interests of the related Certificateholders in
such Mortgage Loan, the party discovering such breach shall give prompt written
notice to the other parties.

                  The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage Loans and the
Related Documents, conveying good title thereto free and clear of any liens and
encumbrances, from the Depositor to the Trustee and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee, on behalf
of the Trust, a first priority perfected security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans and the
Related Documents, and that this Agreement shall constitute a security agreement
under applicable law.

                  Section 2.03 REPURCHASE OR SUBSTITUTION OF MORTGAGE LOANS BY
                               THE SELLER.

                  (a) Upon discovery or receipt of written notice of any
materially defective document in, or that a document is missing from, a Mortgage
File or of the breach by the Seller of any representation, warranty or covenant
under the Mortgage Loan Purchase Agreement or in Section 2.04 in respect of any
Mortgage Loan which materially adversely affects the value of such Mortgage Loan
or the interest therein of the Certificateholders, the Trustee (or the
Custodian, as applicable) shall promptly notify the Seller and the Servicer of
such defect, missing document or breach and request that the Seller deliver such
missing document or cure such defect or breach within 120 days or 150 days
following the Closing Date, in the case of missing Mortgages or Assignments from
the date the Seller was notified of such missing document, defect or breach, and
if the Seller does not deliver such missing document or cure such defect or
breach in all material respects during such period, the Trustee shall enforce
the Seller's obligation under the Mortgage Loan Purchase Agreement and inform
the Seller of its obligation to repurchase such Mortgage Loan from the Trust
Fund at the Purchase Price on or prior to the Determination Date following the
expiration of such 120 day period (subject to Section 2.03(e)); provided that,
in connection with any such breach that could not reasonably have been cured
within such 120 day or 150 day period, if the Seller shall have commenced to
cure such breach within such 120 day or 150 day period, the Seller shall be
permitted to proceed thereafter diligently and expeditiously to cure the same
within the additional period

                                      -71-

<PAGE>

provided under the Mortgage Loan Purchase Agreement. The Purchase Price for the
repurchased Mortgage Loan shall be deposited in the Collection Account, and the
Trustee, upon receipt of written certification from the Servicer of such
deposit, shall release to the Seller the related Mortgage File and shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as the Seller shall furnish to it and as
shall be necessary to vest in the Seller any Mortgage Loan released pursuant
hereto and the Trustee shall have no further responsibility with regard to such
Mortgage File. In lieu of repurchasing any such Mortgage Loan as provided above,
the Seller may cause such Mortgage Loan to be removed from the Trust Fund (in
which case it shall become a Defective Mortgage Loan) and substitute one or more
Eligible Substitute Mortgage Loans in the manner and subject to the limitations
set forth in Section 2.03(d). It is understood and agreed that the obligation of
the Seller to cure or to repurchase (or to substitute for) any Mortgage Loan as
to which a document is missing, a material defect in a constituent document
exists or as to which such a breach has occurred and is continuing shall
constitute the sole remedy against the Seller respecting such omission, defect
or breach available to the Trustee on behalf of the Certificateholders.

                  (b) [Reserved].

                  (c) Within 90 days of the earlier of discovery by the Servicer
or receipt of notice by the Servicer of the breach of any representation,
warranty or covenant of the Servicer set forth in Section 2.05 which materially
and adversely affects the interests of the Certificateholders in any Mortgage
Loan, the Servicer shall cure such breach in all material respects.

                  (d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the last Business Day that is within two years after the Closing Date. As to
any Defective Mortgage Loan for which the Seller substitutes an Eligible
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Seller delivering to the Trustee, for such Eligible Substitute Mortgage Loan or
Loans, the Mortgage Note, the Mortgage, the Assignment to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon, as are
required by Section 2.01, together with an Officers' Certificate providing that
each such Eligible Substitute Mortgage Loan satisfies the definition thereof and
specifying the Substitution Adjustment Amount (as described below), if any, in
connection with such substitution. The Trustee shall acknowledge receipt for
such Eligible Substitute Mortgage Loan or Loans and, within ten Business Days
thereafter, shall review such documents as specified in Section 2.02 and deliver
(or cause the Custodian to deliver) to the Servicer, with respect to such
Eligible Substitute Mortgage Loan or Loans, a certification substantially in the
form attached hereto as Exhibit F-1, with any applicable exceptions noted
thereon. Within one year of the date of substitution, the Trustee shall deliver
(or cause the Custodian to deliver) to the Servicer a certification
substantially in the form of Exhibit F-2 hereto with respect

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<PAGE>

to such Eligible Substitute Mortgage Loan or Loans, with any applicable
exceptions noted thereon. Monthly Payments due with respect to Eligible
Substitute Mortgage Loans in the month of substitution are not part of the Trust
Fund and will be retained by the Seller. For the month of substitution,
distributions to Certificateholders will reflect the collections and recoveries
in respect of such Defective Mortgage Loan in the Collection Period preceding
the month of substitution and the Depositor or the Seller, as the case may be,
shall thereafter be entitled to retain all amounts subsequently received in
respect of such Defective Mortgage Loan. The Seller shall give or cause to be
given written notice to the Certificateholders that such substitution has taken
place, shall amend the Mortgage Loan Schedule to reflect the removal of such
Defective Mortgage Loan from the terms of this Agreement and the substitution of
the Eligible Substitute Mortgage Loan or Loans and shall deliver a copy of such
amended Mortgage Loan Schedule to the Trustee and the Custodian. Upon such
substitution, such Eligible Substitute Mortgage Loan or Loans shall constitute
part of the Mortgage Pool and shall be subject in all respects to the terms of
this Agreement and, in the case of a substitution effected by the Seller, the
Mortgage Loan Purchase Agreement, including, in the case of a substitution
effected by the Seller all applicable representations and warranties thereof
included in the Mortgage Loan Purchase Agreement and all applicable
representations and warranties thereof set forth in Section 2.04, in each case
as of the date of substitution.

                  For any month in which the Seller substitutes one or more
Eligible Substitute Mortgage Loans for one or more Defective Mortgage Loans, the
Servicer will determine the amount (the "Substitution Adjustment Amount"), if
any, by which the aggregate Purchase Price of all such Defective Mortgage Loans
exceeds the aggregate, as to each such Eligible Substitute Mortgage Loan, of the
principal balance thereof as of the date of substitution, together with one
month's interest on such principal balance at the applicable Net Mortgage
Interest Rate. On the date of such substitution, the Seller will deliver or
cause to be delivered to the Servicer for deposit in the Collection Account an
amount equal to the Substitution Adjustment Amount, if any, and the Trustee,
upon receipt of the related Eligible Substitute Mortgage Loan or Loans and
certification by the Servicer of such deposit, shall release to the Seller the
related Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, representation or
warranty, as the Seller shall deliver to it and as shall be necessary to vest
therein any Defective Mortgage Loan released pursuant hereto.

                  In addition, the Seller shall obtain at its own expense and
deliver to the Trustee an Opinion of Counsel to the effect that such
substitution will not cause (a) any federal tax to be imposed on the Trust Fund,
including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(l) of the Code or on "contributions after
the startup date" under Section 860G(d)(l) of the Code, or (b) any REMIC to fail
to qualify as a REMIC at any time that any Certificate is outstanding. If such
Opinion of Counsel can not be delivered, then such substitution may only be
effected at such time as the required Opinion of Counsel can be given.

                                      -73-

<PAGE>

                  (e) Upon discovery by the Seller, the Servicer or the Trustee
that any Mortgage Loan does not constitute a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code, the party discovering such fact shall
within two Business Days give written notice thereof to the other parties. In
connection therewith, the Seller shall repurchase or, subject to the limitations
set forth in Section 2.03(d), substitute one or more Eligible Substitute
Mortgage Loans for the affected Mortgage Loan within 90 days of the earlier of
discovery or receipt of such notice with respect to such affected Mortgage Loan.
In addition, upon discovery that a Mortgage Loan is defective in a manner that
would cause it to be a "defective obligation" within the meaning of Treasury
regulations relating to REMICs, the Seller shall cure the defect or make the
required purchase or substitution no later than 90 days after the discovery of
the defect. Any such repurchase or substitution shall be made in the same manner
as set forth in Section 2.03(a), if made by the Seller. The Trustee shall
reconvey to the Seller the Mortgage Loan to be released pursuant hereto in the
same manner, and on the same terms and conditions, as it would a Mortgage Loan
repurchased for breach of a representation or warranty.

                  Notwithstanding anything to the contrary contained herein, the
parties hereto acknowledge that the functions of the Trustee with respect to the
custody, acceptance, inspection and release of the Mortgage Files pursuant to
Sections 2.01, 2.02 and 2.03 and preparation and delivery of the certifications
in the form of Exhibit F-1, Exhibit F-2 and Exhibit F-3 shall be performed by
the Custodian pursuant to the terms and conditions of the Custodial Agreement.
The fees and expenses of the Custodian shall be paid by the Servicer.

                  Section 2.04 REPRESENTATIONS AND WARRANTIES OF THE SELLER WITH
                               RESPECT TO THE MORTGAGE LOANS.

                  The Seller hereby represents and warrants to the Trustee for
the benefit of the Certificateholders and the Depositor that as of the Closing
Date or as of such other date specifically provided herein:

                  (a) The representations and warranties made by the Seller
pursuant to Section 3.01 of the Mortgage Loan Purchase Agreement are hereby
being made to the Trustee and are true and correct as of the Closing Date.

                  (b) Any written agreement between the Mortgagor in respect of
a Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved the application of the Seller's underwriting standards
or some assessment of the Mortgagor's ability to repay the Modified Mortgage
Loan.

                                      -74-

<PAGE>

                  With respect to the representations and warranties set forth
in this Section 2.04 that are made to the best of the Seller's knowledge or as
to which the Seller has no knowledge, if it is discovered by the Depositor, the
Seller, the Servicer, the Trustee or the Custodian that the substance of such
representation and warranty is inaccurate and such inaccuracy materially and
adversely affects the value of the related Mortgage Loan or the interest therein
of the Certificateholders then, notwithstanding the Seller's lack of knowledge
with respect to the substance of such representation and warranty being
inaccurate at the time the representation or warranty was made, such inaccuracy
shall be deemed a breach of the applicable representation or warranty.

                  Upon discovery by the Depositor, the Seller, the Servicer, the
Trustee or the Custodian of a breach of any of the representations and
warranties contained in this Section that materially and adversely affects the
value of any Mortgage Loan or the interest therein of the Certificateholders,
the party discovering the breach shall give prompt written notice to the others
and in no event later than two Business Days from the date of such discovery.
Within ninety days of its discovery or its receipt of notice of any such missing
or materially defective documentation or any such breach of a representation or
warranty, the Seller shall promptly deliver such missing document or cure such
defect or breach in all material respects, or in the event such defect or breach
cannot be cured, the Seller shall repurchase the affected Mortgage Loan or cause
the removal of such Mortgage Loan from the Trust Fund and substitute for it one
or more Eligible Substitute Mortgage Loans, in either case, in accordance with
Section 2.03.

                  It is understood and agreed that the representations and
warranties set forth in this Section 2.04 shall survive delivery of the Mortgage
Files to the Trustee and shall inure to the benefit of the Certificateholders
and the Depositor notwithstanding any restrictive or qualified endorsement or
assignment. It is understood and agreed that the obligations of the Seller set
forth in Section 2.03(a) to cure, substitute for or repurchase a Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement constitute the sole remedies
available to the Depositor and to the Certificateholders or to the Trustee on
their behalf respecting a breach of the representations and warranties contained
in this Section 2.04.

                  Section 2.05 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
                               SERVICER.

                  The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of the Certificateholders and to the Depositor that as
of the Closing Date or as of such date specifically provided herein:

                  (i) The Servicer is duly organized, validly existing, and in
         good standing under the laws of the jurisdiction of its formation and
         has all licenses necessary to carry on its business as now being
         conducted, except for such licenses, certificates and permits the

                                      -75-

<PAGE>

         absence of which, individually or in the aggregate, would not have a
         material adverse effect on the ability of the Servicer to conduct its
         business as it is presently conducted, and is licensed, qualified and
         in good standing in the states where the Mortgaged Property is located
         if the laws of such state require licensing or qualification in order
         to conduct business of the type conducted by the Servicer or to ensure
         the enforceability or validity of each Mortgage Loan; the Servicer has
         the power and authority to execute and deliver this Agreement and to
         perform in accordance herewith; the execution, delivery and performance
         of this Agreement (including all instruments of transfer to be
         delivered pursuant to this Agreement) by the Servicer and the
         consummation of the transactions contemplated hereby have been duly and
         validly authorized; this Agreement evidences the valid, binding and
         enforceable obligation of the Servicer, subject to applicable
         bankruptcy, insolvency, reorganization, moratorium or other similar
         laws affecting the enforcement of creditors' rights generally; and all
         requisite corporate action has been taken by the Servicer to make this
         Agreement valid and binding upon the Servicer in accordance with its
         terms;

                  (ii) The consummation of the transactions contemplated by this
         Agreement are in the ordinary course of business of the Servicer and
         will not result in the breach of any term or provision of the
         certificate of formation or the partnership agreement of the Servicer
         or result in the breach of any term or provision of, or conflict with
         or constitute a default under or result in the acceleration of any
         obligation under, any agreement, indenture or loan or credit agreement
         or other instrument to which the Servicer or its property is subject,
         or result in the violation of any law, rule, regulation, order,
         judgment or decree to which the Servicer or its property is subject;

                  (iii) The Servicer is an approved seller/servicer of
         conventional mortgage loans for Fannie Mae, and is an FHA Approved
         Mortgagee in good standing to service mortgages and has not been
         suspended as a mortgagee or servicer by the FHA and has the facilities,
         procedures and experienced personnel necessary for the sound servicing
         of mortgage loans of the same type as the Mortgage Loans. The Servicer
         is, and shall remain for as long as it is servicing the Mortgage Loans
         hereunder, in good standing as a FHA Approved Mortgagee and to service
         mortgage loans for HUD, Fannie Mae or Freddie Mac, and no event has
         occurred, including but not limited to a change in insurance coverage,
         which would make the Servicer unable to comply with HUD, Fannie Mae,
         Freddie Mac or FHA eligibility requirements or which would require
         notification to any of HUD, Fannie Mae, Freddie Mac or FHA;

                  (iv) This Agreement, and all documents and instruments
         contemplated hereby which are executed and delivered by the Servicer,
         constitute and will constitute valid, legal and binding obligations of
         the Servicer, enforceable in accordance with their respective

                                      -76-

<PAGE>

         terms, except as the enforcement thereof may be limited by applicable
         bankruptcy laws and general principles of equity;

                  (v) The Servicer does not believe, nor does it have any reason
         or cause to believe, that it cannot perform each and every covenant
         contained in this Agreement;

                  (vi) There is no action, suit, proceeding or investigation
         pending or, to its knowledge, threatened against the Servicer that,
         either individually or in the aggregate, may result in any material
         adverse change in the business, operations, financial condition,
         properties or assets of the Servicer, or in any material impairment of
         the right or ability of the Servicer to carry on its business
         substantially as now conducted, or in any material liability on the
         part of the Servicer, or that would draw into question the validity or
         enforceability of this Agreement or of any action taken or to be taken
         in connection with the obligations of the Servicer contemplated herein,
         or that would be likely to impair materially the ability of the
         Servicer to perform under the terms of this Agreement;

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

                  (viii) Neither this Agreement nor any information, certificate
         of an officer, statement furnished in writing or report delivered to
         the Trustee by the Servicer in connection with the transactions
         contemplated hereby contains or will contain any untrue statement of a
         material fact or omits or will omit to state a material fact necessary
         in order to make the statements contained therein, in light of the
         circumstances under which they were made, not misleading; and

                  (ix) The Servicer has accurately and fully reported, and will
         continue to accurately and fully report, its borrower credit files to
         each of the credit repositories in a timely manner.

                  It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.05 shall survive delivery
of the Mortgage Files to the Trustee and shall inure to the benefit of the
Trustee, the Depositor and the Certificateholders. Upon discovery by any of the
Depositor, the Servicer, the Seller or the Trustee of a breach of any of the
foregoing representations, warranties and covenants which materially and
adversely affects the value of any Mortgage Loan or the interests therein of the
Certificateholders, the party discovering such breach shall give prompt written
notice (but in no event later than two Business Days following such discovery)
to the other

                                      -77-

<PAGE>

parties hereto.

                  Section 2.06 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR.

                  The Depositor represents and warrants to the Trust and the
Trustee on behalf of the Certificateholders as follows:

                  (i) This agreement constitutes a legal, valid and binding
         obligation of the Depositor, enforceable against the Depositor in
         accordance with its terms, except as enforceability may be limited by
         applicable bankruptcy, insolvency, reorganization, moratorium or other
         similar laws now or hereafter in effect affecting the enforcement of
         creditors' rights in general and except as such enforceability may be
         limited by general principles of equity (whether considered in a
         proceeding at law or in equity);

                  (ii) Immediately prior to the sale and assignment by the
         Depositor to the Trustee on behalf of the Trust of each Mortgage Loan,
         the Depositor had good and marketable title to each Mortgage Loan
         (insofar as such title was conveyed to it by the Seller) subject to no
         prior lien, claim, participation interest, mortgage, security interest,
         pledge, charge or other encumbrance or other interest of any nature;

                  (iii) As of the Closing Date, the Depositor has transferred
         all right, title interest in the Mortgage Loans to the Trustee on
         behalf of the Trust;

                  (iv) The Depositor has not transferred the Mortgage Loans to
         the Trustee on behalf of the Trust with any intent to hinder, delay or
         defraud any of its creditors;

                  (v) The Depositor has been duly incorporated and is validly
         existing as a corporation in good standing under the laws of the State
         of Delaware, with full corporate power and authority to own its assets
         and conduct its business as presently being conducted;

                  (vi) The Depositor is not in violation of its certificate of
         incorporation or by-laws or in default in the performance or observance
         of any material obligation, agreement, covenant or condition contained
         in any contract, indenture, mortgage, loan agreement, note, lease or
         other instrument to which the Depositor is a party or by which it or
         its properties may be bound, which default might result in any material
         adverse changes in the financial condition, earnings, affairs or
         business of the Depositor or which might materially and adversely
         affect the properties or assets, taken as a whole, of the Depositor;

                  (vii) The execution, delivery and performance of this
         Agreement by the Depositor,

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<PAGE>

         and the consummation of the transactions contemplated thereby, do not
         and will not result in a material breach or violation of any of the
         terms or provisions of, or, to the knowledge of the Depositor,
         constitute a default under, any indenture, mortgage, deed of trust,
         loan agreement or other agreement or instrument to which the Depositor
         is a party or by which the Depositor is bound or to which any of the
         property or assets of the Depositor is subject, nor will such actions
         result in any violation of the provisions of the articles of
         incorporation or by-laws of the Depositor or, to the best of the
         Depositor's knowledge without independent investigation, any statute or
         any order, rule or regulation of any court or governmental agency or
         body having jurisdiction over the Depositor or any of its properties or
         assets (except for such conflicts, breaches, violations and defaults as
         would not have a material adverse effect on the ability of the
         Depositor to perform its obligations under this Agreement);

                  (viii) To the best of the Depositor's knowledge without any
         independent investigation, no consent, approval, authorization, order,
         registration or qualification of or with any court or governmental
         agency or body of the United States or any other jurisdiction is
         required for the issuance of the Certificates, or the consummation by
         the Depositor of the other transactions contemplated by this Agreement,
         except such consents, approvals, authorizations, registrations or
         qualifications as (a) may be required under State securities or Blue
         Sky laws, (b) have been previously obtained or (c) the failure of which
         to obtain would not have a material adverse effect on the performance
         by the Depositor of its obligations under, or the validity or
         enforceability of, this Agreement; and

                  (ix) There are no actions, proceedings or investigations
         pending before or, to the Depositor's knowledge, threatened by any
         court, administrative agency or other tribunal to which the Depositor
         is a party or of which any of its properties is the subject: (a) which
         if determined adversely to the Depositor would have a material adverse
         effect on the business, results of operations or financial condition of
         the Depositor; (b) asserting the invalidity of this Agreement or the
         Certificates; (c) seeking to prevent the issuance of the Certificates
         or the consummation by the Depositor of any of the transactions
         contemplated by this Agreement, as the case may be; (d) which might
         materially and adversely affect the performance by the Depositor of its
         obligations under, or the validity or enforceability of, this
         Agreement.

                  Section 2.08 REPRESENTATIONS AND WARRANTIES OF THE SELLER.

                  The Seller hereby represents and warrants to the Trust and the
Trustee on behalf of the Certificateholders that as of the Closing Date or as of
such date specifically provided herein:

                  (i) The Seller is duly organized, validly existing and in good
         standing as a limited

                                      -79-

<PAGE>

         liability company under the laws of the State of Delaware and has the
         power and authority to own its assets and to transact the business in
         which it is currently engaged. The Seller is duly qualified to do
         business and is in good standing in each jurisdiction in which the
         character of the business transacted by it or properties owned or
         leased by it requires such qualification and in which the failure to so
         qualify would have a material adverse effect on (a) its business,
         properties, assets or condition (financial or other), (b) the
         performance of its obligations under this Agreement, (c) the value or
         marketability of the Mortgage Loans, or (d) its ability to foreclose on
         the related Mortgaged Properties.

                  (ii) The Seller has the power and authority to make, execute,
         deliver and perform this Agreement and to consummate all of the
         transactions contemplated hereunder and has taken all necessary action
         to authorize the execution, delivery and performance of this Agreement.
         When executed and delivered, this Agreement will constitute the
         Seller's legal, valid and binding obligations enforceable in accordance
         with its terms, except as enforcement of such terms may be limited by
         (1) bankruptcy, insolvency, reorganization, receivership, moratorium or
         similar laws affecting the enforcement of creditors' rights generally
         and by the availability of equitable remedies, (2) general equity
         principles (regardless of whether such enforcement is considered in a
         proceeding in equity or at law) or (3) public policy considerations
         underlying the securities laws, to the extent that such policy
         considerations limit the enforceability of the provisions of this
         Agreement which purport to provide indemnification from securities laws
         liabilities.

                  (iii) The Seller holds all necessary licenses, certificates
         and permits from all governmental authorities necessary for conducting
         its business as it is presently conducted, except for such licenses,
         certificates and permits the absence of which, individually or in the
         aggregate, would not have a material adverse effect on the ability of
         the Seller to conduct its business as it is presently conducted. It is
         not required to obtain the consent of any other party or any consent,
         license, approval or authorization from, or registration or declaration
         with, any governmental authority, bureau or agency in connection with
         the execution, delivery, performance, validity or enforceability of
         this Agreement, except for such consents, licenses, approvals or
         authorizations, or registrations or declarations as shall have been
         obtained or filed, as the case may be, prior to the Closing Date.

                  (iv) The execution, delivery and performance of this Agreement
         by the Seller will not conflict with or result in a breach of, or
         constitute a default under, any provision of any existing law or
         regulation or any order or decree of any court applicable to the Seller
         or any of its properties or any provision of its Limited Liability
         Company Agreement, or constitute a material breach of, or result in the
         creation or imposition of any lien, charge or encumbrance upon any of
         its properties pursuant to any mortgage, indenture, contract or

                                      -80-

<PAGE>

         other agreement to which it is a party or by which it may be bound.

                  (v) No certificate of an officer, written statement or report
         delivered pursuant to the terms hereof by the Seller contains any
         untrue statement of a material fact or omits to state any material fact
         necessary to make the certificate, statement or report not misleading.

                  (vi) The transactions contemplated by this Agreement are in
         the ordinary course of the Seller's business.

                  (vii) The Seller is not insolvent, nor will the Seller be made
         insolvent by the transfer of the Mortgage Loans to the Depositor, nor
         is the Seller aware of any pending insolvency.

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

                  (ix) There are no actions or proceedings against, or
         investigations of, the Seller pending or, to its knowledge, threatened,
         before any court, administrative agency or other tribunal (i) that, if
         determined adversely, would prohibit the Seller from entering into this
         Agreement, (ii) seeking to prevent the consummation of any of the
         transactions contemplated by this Agreement or (iii) that, if
         determined adversely, would prohibit or materially and adversely affect
         the Seller's performance of any of its respective obligations under, or
         the validity or enforceability of, this Agreement.

                  (x) The Seller did not transfer the Mortgage Loans to the
         Depositor with any intent to hinder, delay or defraud any of its
         creditors.

                  (xi) The Seller acquired title to the Mortgage Loans in good
         faith, without notice of any adverse claims.

                  (xii) The transfer, assignment and conveyance of the Mortgage
         Notes and the Mortgages by the Seller to the Depositor are not subject
         to the bulk transfer laws or any similar statutory provisions in effect
         in any applicable jurisdiction.

                                      -81-

<PAGE>

                  Section 2.09      COVENANTS OF THE SELLER.

                  (a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Depositor, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Depositor, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; PROVIDED, HOWEVER, that nothing in this Section 2.09 shall prevent
or be deemed to prohibit the Seller from suffering to exist upon any of the
Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.

                  (b) The Seller hereby covenants that neither it nor any
Affiliate of the Seller will directly solicit any Mortgagor hereunder to
refinance the related Mortgage Loan. For the purposes of the foregoing, neither
the Seller nor any Affiliate of the Seller shall be deemed to directly solicit
any Mortgagor if the Seller responds to a request from a Mortgagor regarding a
refinancing or if the Mortgagor receives marketing materials which are generally
disseminated.

                  Section 2.10. CONVEYANCE OF REMIC 1 REGULAR INTERESTS AND
                                ACCEPTANCE OF REMIC 1 BY THE TRUSTEE; ISSUANCE
                                OF CERTIFICATES.

                  (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the assets described in the definition of REMIC 1 for the
benefit of the holders of the REMIC 1 Regular Interests (which are
uncertificated) and the Class R Certificates (in respect of the Class R-1
Interest). The Trustee acknowledges receipt of the assets described in the
definition of REMIC 1 and declares that it holds and will hold the same in trust
for the exclusive use and benefit of the holders of the REMIC 1 Regular
Interests and the Class R Certificates (in respect of the Class R-1 Interest).
The interests evidenced by the Class R-1 Interest, together with the REMIC 1
Regular Interests, constitute the entire beneficial ownership interest in REMIC
1.

                  (b) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the REMIC 1 Regular Interests for the benefit of the holders
of the Regular Certificates, the REMIC 2 Regular Interests (which are
uncertificated) and

                                      -82-

<PAGE>

the Class R Certificates (in respect of the Class R-2 Interest). The Trustee
acknowledges receipt of the REMIC 1 Regular Interests and declares that it holds
and will hold the same in trust for the exclusive use and benefit of the holders
of the Regular Certificates, the REMIC 2 Regular Interests and the Class R
Certificates (in respect of the Class R-2 Interest). The interests evidenced by
the Class R-2 Interest, together with the Certificates and the REMIC 2 Regular
Interests, constitute the entire beneficial ownership interest in REMIC 2.

                  (c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 1 and the acceptance by the Trustee thereof, pursuant to
Section 2.01 and Section 2.02 and (ii) the assignment and delivery to the
Trustee of REMIC 2 (including the Residual Interest therein represented by the
Class R-2 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.10(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R Certificates in
authorized denominations evidencing the Class R-1 Interest and the Class R-2
Interest, the Class A Certificates, the Class M-1 Certificates, the Class M-2
Certificates, the Class M-3 Certificates, the Class B-1 Interest, the Class B-2
Certificates, the Class B-3 Certificates, the Class B-4 Interest and the Class
X/N Interest.

                  Section 2.11. CONVEYANCE OF CLASS B-1 INTEREST AND ACCEPTANCE
                                OF REMIC 3 BY THE TRUSTEE; ISSUANCE OF THE
                                CLASS B-1 CERTIFICATES.

                  (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the Class B-1 Interest for the benefit of the holders of the
Class B-1 Certificates. The Trustee acknowledges receipt of the Class B-1
Interest (which is uncertificated) and declares that it holds and will hold the
same in trust for the exclusive use and benefit of the holders of the Class B-1
Certificates. The Class R-3 Interest, together with the Class B-1 Certificates,
constitute the entire beneficial ownership interest in REMIC 3.

                  (b) In exchange for the Class B-1 Interest and, concurrently
with the assignment to the Trustee thereof, pursuant to the written request of
the Depositor executed by an officer of the Depositor, the Trustee has executed,
authenticated and delivered to or upon the order of the Depositor, the Class B-1
Certificates in authorized denominations evidencing (together with the Class R-3
Interest) the entire beneficial ownership interest in REMIC 3.

                  (c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 3 (including the Residual Interest therein represented by the
Class R-3 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.11(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to

                                      -83-

<PAGE>

or upon the order of the Depositor, the Class R-3 Interest.

                  Section 2.12. CONVEYANCE OF CLASS B-4 INTEREST AND ACCEPTANCE
                                OF REMIC 4 BY THE TRUSTEE; ISSUANCE OF THE
                                CLASS B-4 CERTIFICATES.

                  (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the Class B-4 Interest for the benefit of the holders of the
Class B-4 Certificates. The Trustee acknowledges receipt of the Class B-4
Interest (which is uncertificated) and declares that it holds and will hold the
same in trust for the exclusive use and benefit of the holders of the Class B-4
Certificates. The Class R-4 Interest, together with the Class B-4 Certificates,
constitute the entire beneficial ownership interest in REMIC 4.

                  (b) In exchange for the Class B-4 Interest and, concurrently
with the assignment to the Trustee thereof, pursuant to the written request of
the Depositor executed by an officer of the Depositor, the Trustee has executed,
authenticated and delivered to or upon the order of the Depositor, the Class B-4
Certificates in authorized denominations evidencing (together with the Class R-4
Interest) the entire beneficial ownership interest in REMIC 4.

                  (c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 4 (including the Residual Interest therein represented by the
Class R-4 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.12(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R-4 Interest.

                  Section 2.13. CONVEYANCE OF CLASS X/N INTEREST AND ACCEPTANCE
                                OF REMIC 5 BY THE TRUSTEE; ISSUANCE OF THE
                                CLASS X/N CERTIFICATES.

                  (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the Class X/N Interest for the benefit of the holders of the
Class X/N Certificates. The Trustee acknowledges receipt of the Class X/N
Interest (which is uncertificated) and declares that it holds and will hold the
same in trust for the exclusive use and benefit of the holders of the Class X/N
Certificates. The Class R-5 Interest, together with the Class X Certificates,
constitute the entire beneficial ownership interest in REMIC 5.

                  (b) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 4 (including the Residual Interest therein represented by the
Class R-5 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.13(a), the Trustee, pursuant to the written request of

                                      -84-

<PAGE>

the Depositor executed by an officer of the Depositor, has executed,
authenticated and delivered to or upon the order of the Depositor, the Class R-5
Interest.

                                      -85-

<PAGE>

                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                                OF THE TRUST FUND

                  Section 3.01      SERVICER TO ACT AS SERVICER.

                  The Servicer, as independent contract servicer, shall service
and administer the Mortgage Loans in accordance with this Agreement and the
normal and usual standards of practice of prudent mortgage servicers, and shall
have full power and authority, acting alone, to do or cause to be done any and
all things in connection with such servicing and administration which the
Servicer may deem necessary or desirable and consistent with the terms of this
Agreement including, in the case of FHA Loans, taking all actions that a
mortgagee is permitted or required to take by the FHA (the "Servicing
Standards").

                  Consistent with the terms of this Agreement, the Servicer may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor if in the Servicer's reasonable and prudent
determination such waiver, modification, postponement or indulgence is not
materially adverse to the Certificateholders; PROVIDED, HOWEVER, that the
Servicer shall not make future advances and (unless the Mortgagor is in default
with respect to the Mortgage Loan or such default is, in the judgment of the
Servicer, reasonably foreseeable) the Servicer shall not permit any modification
with respect to any Mortgage Loan that would (i) change the Mortgage Interest
Rate, defer or forgive the payment thereof of any principal or interest
payments, reduce the outstanding principal amount (except for actual payments of
principal) or extend the final maturity date with respect to such Mortgage Loan,
(ii) in the case of FHA Loans, affect the FHA Insurance Contract with respect to
such Mortgage Loan, (iii) affect adversely the status of any REMIC as a REMIC or
(iv) cause any REMIC to be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions. Notwithstanding the foregoing,
the Servicer shall not permit any modification with respect to any Mortgage Loan
that would both (x) effect an exchange or reissuance of such Mortgage Loan under
Section 1.860G-2(b) of the Treasury Regulations and (y) cause any REMIC
constituting part of the Trust Fund to fail to qualify as a REMIC under the Code
or the imposition of any tax on "prohibited transactions" or "contributions"
after the Startup Day under the REMIC Provisions. Without limiting the
generality of the foregoing, the Servicer shall continue, and is hereby
authorized and empowered to execute and deliver on behalf of itself, and the
Trustee, all instruments of satisfaction or cancellation, or of partial or full
release, discharge and all other comparable instruments, with respect to the
Mortgage Loans and with respect to the Mortgaged Property. The Servicer shall
make all required Servicing Advances and shall service and administer the
Mortgage Loans in accordance with Applicable Regulations, and shall provide to
the Mortgagor any reports

                                      -86-

<PAGE>

required to be provided to them thereby. If reasonably required by the Servicer,
the Trustee shall furnish the Servicer with a power of attorney substantially in
the form of Exhibit P hereto and other documents necessary or appropriate to
enable the Servicer to carry out its servicing and administrative duties under
this Agreement and the Trustee shall have no liability with respect to any
misuse of such power of attorney and shall be indemnified by the Servicer for
any costs, liabilities or expenses incurred by the Trustee in connection
therewith.

                  Notwithstanding anything in this Agreement to the contrary,
the Servicer shall be prohibited from foreclosing on any Mortgage Loan based on
the delinquency status thereof as of the Cut-off Date.

                  In servicing and administering FHA Loans, the Servicer shall
comply strictly with the National Housing Act and the FHA Regulations, and
administrative guidelines issued thereunder or pursuant thereto (insofar as the
same apply to any Mortgage Loan) and, to the extent permitted hereunder,
promptly discharge all of the obligations of the mortgagee thereunder and under
each Mortgage including the timely giving of notices, the essence hereof being
that the full benefits of each FHA Insurance Contract inure to the Trustee, on
behalf of the Certificateholders.

                  In servicing and administering the Mortgage Loans, the
Servicer shall employ procedures including collection procedures and exercise
the same care that it customarily employs and exercises in servicing and
administering mortgage loans for its own account giving due consideration to
accepted mortgage servicing practices of prudent lending institutions, the FHA
Insurance Contracts, where applicable, and the Certificateholders' reliance on
the Servicer.

                  The Servicer shall give prompt notice to the Trustee of any
action, of which the Servicer has actual knowledge, which action purports to (i)
assert a claim against the Trust Fund or (ii) assert jurisdiction over the Trust
Fund.

                  Notwithstanding anything in this Agreement to the contrary, in
the event of a Principal Prepayment in full of a Mortgage Loan, the Servicer may
not waive any Prepayment Charge or portion thereof required by the terms of the
related Mortgage Note unless (i) the Servicer determines that such waiver would
maximize recovery of Liquidation Proceeds for such Mortgage Loan, taking into
account the value of such Prepayment Charge, (ii) (A) the enforceability thereof
is limited (1) by bankruptcy, insolvency, moratorium, receivership, or other
similar law relating to creditors' rights generally or (2) due to acceleration
in connection with a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by applicable law or (iii) the
Servicer has not been provided with information sufficient to enable it to
collect the Prepayment Charge. In the event of a Principal Prepayment in full
with respect to any Mortgage Loan, the Servicer shall deliver to the Trustee an
Officer's Certificate substantially in the form of

                                      -87-

<PAGE>

Exhibit N no later than the date on which the Servicer delivers the Remittance
Report to the Trustee and the Trustee will make such Officer's Certificate
available on its website to the Class X Certificateholders. If the Servicer has
waived or does not collect all or a portion of a Prepayment Charge relating to a
Principal Prepayment in full due to any action or omission of the Servicer,
other than as provided above, the Servicer shall, within 90 days of the date on
which the Principal Prepayment in full is remitted to the Trustee, deliver to
the Trustee the amount of such Prepayment Charge (or such portion thereof as had
been waived for deposit) into the Distribution Account for distribution in
accordance with the terms of this Agreement.

                  The Trustee shall make available on its website to the
Depositor and the owner of the Class N and Class X Certificates, on a monthly
basis, a statement setting forth the amounts received with respect to Prepayment
Charges.

                  Section 3.02      COLLECTION OF MORTGAGE LOAN PAYMENTS.

                  Continuously from the date hereof until the principal and
interest on all Mortgage Loans are paid in full, the Servicer will diligently
collect all payments due under each Mortgage Loan when the same shall become due
and payable and shall, to the extent such procedures shall be consistent with
this Agreement and Applicable Regulations, follow such collection procedures as
it follows with respect to mortgage loans comparable to the Mortgage Loans and
held for its own account. Further, the Servicer will take special care in
ascertaining and estimating annual ground rents, taxes, assessments, water
rates, fire and hazard insurance premiums, mortgage insurance premiums, and all
other charges that, as provided in the Mortgage, will become due and payable to
that end that the installments payable by the Mortgagors will be sufficient to
pay such charges as and when they become due and payable.

                  Section 3.03      REALIZATION UPON DEFAULTED MORTGAGE LOANS.

                  In the event that any payment due under any Conventional
Mortgage Loan is not paid when the same becomes due and payable, or in the event
the Mortgagor fails to perform any other covenant or obligation under the
Mortgage Loan and such failure continues beyond any applicable grace period, the
Servicer shall take such action as it shall deem to be in the best interest of
the Certificateholders. In the event that any payment due under any FHA Loan
becomes delinquent, the Servicer shall take all such actions as are in the best
interests of the Certificateholders and permitted under any applicable FHA loss
mitigation proceedings, including, but not limited to, requesting the FHA to
accept an assignment of such FHA Loan, and, upon the Servicer's determination
that foreclosure is in the best interest of the Certificateholders, commencing
foreclosure proceedings. With respect to any defaulted Mortgage Loan, the
Servicer shall have the right to review the status of the related forbearance
plan and, subject to the second paragraph of Section 3.01, may modify

                                      -88-

<PAGE>

such forbearance plan; including, extending the Mortgage Loan repayment date for
a period of one year or reducing the Mortgage Interest Rate up to 50 basis
points.

                  In connection with a foreclosure or other conversion, the
Servicer shall exercise such rights and powers vested in it hereunder and use
the same degree of care and skill in its exercise as prudent mortgage servicers
would exercise or use under the circumstances in the conduct of their own
affairs and consistent with Applicable Regulations and the servicing standards
set forth in the Fannie Mae Guide, including, without limitation, advancing
funds for the payment of taxes and insurance premiums with respect to first lien
Mortgage Loans.

                  Notwithstanding the foregoing provisions of this Section 3.03,
with respect to any Mortgage Loan as to which the Servicer has received actual
notice of, or has actual knowledge of, the presence of any toxic or hazardous
substance on the related Mortgaged Property, the Servicer shall not either (i)
obtain title to such Mortgaged Property as a result of or in lieu of foreclosure
or otherwise, or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property if, as a result of any such action, the
Trust Fund would be considered to hold title to, to be a mortgagee-in-possession
of, or to be an owner or operator of such Mortgaged Property within the meaning
of the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or any comparable law, unless the Servicer
has also previously determined, based on its reasonable judgment and a prudent
report prepared by a Person who regularly conducts environmental audits using
customary industry standards, that:

                  A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic interest of
the Certificateholders to take such actions as are necessary to bring the
Mortgaged Property into compliance therewith; and

                  B. there are no circumstances present at such Mortgaged
Property relating to the use, management or disposal of any hazardous
substances, hazardous materials, hazardous wastes, or petroleum-based materials
for which investigation, testing, monitoring, containment, clean-up or
remediation could be required under any federal, state or local law or
regulation, or that if any such materials are present for which such action
could be required, that it would be in the best economic interest of the
Certificateholders to take such actions with respect to the affected Mortgaged
Property.

                  The cost of the environmental audit report contemplated by
this Section 3.03 shall be advanced by the Servicer, subject to the Servicer's
right to be reimbursed therefor from the Collection Account as provided in
Section 3.05(ii).

                  If the Servicer determines, as described above, that it is in
the best economic interest

                                      -89-

<PAGE>

of the Certificateholders to take such actions as are necessary to bring any
such Mortgaged Property into compliance with applicable environmental laws, or
to take such action with respect to the containment, clean-up or remediation of
hazardous substances, hazardous materials, hazardous wastes, or petroleum-based
materials affecting any such Mortgaged Property, then the Servicer shall take
such action as it deems to be in the best economic interest of the
Certificateholders. The cost of any such compliance, containment, cleanup or
remediation shall be advanced by the Servicer, subject to the Servicer's right
to be reimbursed therefor from the Collection Account as provided in Section
3.05(ii).

                  Section 3.04      COLLECTION ACCOUNT AND DISTRIBUTION ACCOUNT.

                  (a) The Servicer shall segregate and hold all funds collected
and received pursuant to each Mortgage Loan separate and apart from any of its
own funds and general assets and shall establish and maintain one or more
Collection Accounts. Each Collection Account shall be an Eligible Account.

                  The Servicer shall deposit in the Collection Account on a
daily basis within two Business Days of receipt, and retain therein, the
following payments and collections received or made by it after the Cut-off Date
with respect to the Mortgage Loans:

                  (i) all payments on account of principal, including Principal
         Prepayments, on the Mortgage Loans;

                  (ii) all payments on account of interest on the Mortgage Loans
         adjusted to the Mortgage Interest Rate less the Servicing Fee Rate;

                  (iii) all proceeds from a Final Recovery Determination;

                  (iv) all Insurance Proceeds including amounts required to be
         deposited pursuant to Section 3.10, other than proceeds to be held in
         the Escrow Account and applied to the restoration or repair of the
         Mortgaged Property or released to the Mortgagor in accordance with the
         Servicer's normal servicing procedures, the loan documents or
         applicable law;

                  (v) all Condemnation Proceeds affecting any Mortgaged Property
         which are not released to the Mortgagor in accordance with the
         Servicer's normal servicing procedures, the loan documents or
         applicable law;

                  (vi) all Subsequent Recoveries; and

                                      -90-

<PAGE>

                  (vi) any amounts required to be deposited by the Servicer in
         connection with any REO Property pursuant to Section 3.13.

                  Any interest paid on funds deposited in the Collection
Account, subject to Section 3.25, shall accrue to the benefit of the Servicer
and the Servicer shall be entitled to retain and withdraw such interest from the
Collection Account pursuant to Section 3.05(v). The foregoing requirements for
deposit from the Collection Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of late payment charges, prepayment charges that are not Prepayment
Charges, and assumption fees need not be deposited by the Servicer in the
Collection Account.

                  (b) On behalf of the Trust Fund and the Trustee, the Trustee
         shall establish and maintain one or more accounts (such account or
         accounts, the "Distribution Account"), held in trust for the benefit of
         the Certificateholders. On behalf of the Trust Fund, the Servicer shall
         deliver to the Trustee in immediately available funds for deposit in
         the Distribution Account by the close of business New York time on the
         Servicer Remittance Date, that portion of the Available Funds
         (calculated without regard to the references in the definition thereof
         to amounts that may be deposited to the Distribution Account from a
         different source as provided herein) then on deposit in the Collection
         Account.

                  (c) Funds in the Collection Account and the Distribution
         Account may be invested in Permitted Investments in accordance with the
         provisions set forth in Section 3.25. The Servicer shall give notice to
         the Trustee of the location of the Collection Account maintained by it
         when established and prior to any change thereof. The Trustee shall
         give notice to the Servicer and the Depositor of the location of the
         Distribution Account when established and prior to any change thereof.

                  (d) In the event the Servicer shall deliver to the Trustee for
         deposit in the Distribution Account any amount not required to be
         deposited therein, it may at any time request that the Trustee withdraw
         such amount from the Distribution Account and remit to the Servicer any
         such amount, any provision herein to the contrary notwithstanding. In
         addition, the Servicer shall deliver to the Trustee from time to time
         for deposit, and the Trustee shall so deposit, in the Distribution
         Account in respect of REMIC 1:

                  (i) any Advances, as required pursuant to Section 4.07;

                  (ii) any Stayed Funds, as soon as permitted by the federal
         bankruptcy court having jurisdiction in such matters;

                                      -91-

<PAGE>

                  (iii) any Prepayment Charges or amounts in connection with the
         waiver of such Prepayment Charges, in each case required to be
         deposited pursuant to Section 3.01;

                  (iv) any amounts required to be deposited in the Distribution
         Account pursuant to Sections 2.03, 3.04, 3.15, 3.16, 3.23 or 4.07; and

                  (v) any amounts required to be deposited by the Servicer
         pursuant to Section 3.11 in connection with the deductible clause in
         any blanket hazard insurance policy, such deposit being made from the
         Servicer's own funds, without reimbursement therefor.

                  (e) Promptly upon receipt of any Stayed Funds, whether from
         the Servicer, a trustee in bankruptcy, or federal bankruptcy court or
         other source, the Trustee shall notify the Servicer of such receipt and
         deposit such funds in the Distribution Account, subject to withdrawal
         thereof as permitted hereunder.

                  Section 3.05 PERMITTED WITHDRAWALS FROM THE COLLECTION
                               ACCOUNT.

                  The Servicer may, from time to time, withdraw from the
Collection Account for the following purposes:

                  (i) to remit to the Trustee for deposit in the Distribution
         Account the amounts required to be so remitted pursuant to Section
         3.04(b) or permitted to be so remitted pursuant to the first sentence
         of Section 3.04(d);

                  (ii) to reimburse itself for (x) Advances and Servicing
         Advances; the Servicer's right to reimburse itself pursuant to this
         subclause (ii) being limited to amounts received on the related
         Mortgage Loan which represent payments of (a) principal and/or interest
         respecting which any such Advance was made or (b) Condemnation
         Proceeds, Insurance Proceeds or Liquidation Proceeds respecting which
         any such Servicing Advance was made or (y) any unreimbursed Advances
         made pursuant to Section 4.07(b) to the extent of funds held in the
         Collection Account for future distribution that were not included in
         Available Funds for the preceding Distribution Date;

                  (iii) to reimburse itself for unreimbursed Servicing Advances,
         any unpaid Servicing Fees and for unreimbursed Advances to the extent
         that such amounts are deemed to be Nonrecoverable Advances, and to
         reimburse itself for such amounts to the extent that such amounts are
         nonrecoverable from the disposition of REO Property pursuant to Section
         3.03 or Section 3.13 hereof;

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                  (iv) to reimburse itself for any amounts paid pursuant to
         Section 3.03 (and not otherwise previously reimbursed);

                  (v) to pay to itself as servicing compensation (a) any
         interest earned on funds in the Collection Account (all such interest
         to be withdrawn monthly not later than each Servicer Remittance Date)
         and (b) the Servicing Fee from that portion of any payment or recovery
         as to interest to a particular Mortgage Loan to the extent not retained
         pursuant to Section 3.04(ii);

                  (vi) to pay or reimburse itself or any other party for any
         amounts payable or paid pursuant to Section 3.26 or Section 6.03 (and
         not otherwise previously reimbursed); and

                  (vii) to clear and terminate the Collection Account upon the
         termination of this Agreement.

                  The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Servicer shall deposit in the
Collection Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Collection Account, any provision herein
to the contrary notwithstanding.

                  Section 3.06 ESTABLISHMENT OF ESCROW ACCOUNTS; DEPOSITS IN
                               ESCROW ACCOUNTS.

                  The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan which constitute Escrow Payments
separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Escrow Accounts, in the form of time deposit
or demand accounts. A copy of such letter agreement shall be furnished to the
Trustee upon request. The Escrow Account shall be an Eligible Account.

                  The Servicer shall deposit in the Escrow Account or Accounts
on a daily basis within two Business Days of receipt, and retain therein, (i)
all Escrow Payments collected on account of the Mortgage Loans, for the purpose
of effecting timely payment of any such items as required under the terms of
this Agreement, and (ii) all Insurance Proceeds which are to be applied to the
restoration or repair of any Mortgaged Property. The Servicer shall make
withdrawals therefrom only to effect such payments as are required under this
Agreement, and for such other purposes as shall be set forth in, or in
accordance with, Section 3.07. The Servicer shall be entitled to retain any
interest paid on funds deposited in the Escrow Account by the depository
institution other than interest on escrowed funds required by law to be paid to
the Mortgagor and, to the extent required by the related Mortgage Loan or
Applicable Regulations, the Servicer shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account is non-interest bearing or
that interest paid thereon is

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insufficient for such purposes.

                  Section 3.07 PERMITTED WITHDRAWALS FROM ESCROW ACCOUNT.

                  Withdrawals from the Escrow Account may be made by the
Servicer (i) to effect timely payments of ground rents, taxes, assessments,
water rates, fire, flood and hazard insurance premiums, and comparable items,
(ii) to reimburse the Servicer for any Servicing Advance made by the Servicer
with respect to a related Mortgage Loan but only from amounts received on the
related Mortgage Loan which represent late payments or Late Collections of
Escrow Payments thereunder, (iii) to refund to the Mortgagor any funds as may be
determined to be overages, (iv) for transfer to the Collection Account in
accordance with the terms of this Agreement, (v) for application to restoration
or repair of the Mortgaged Property, (vi) to pay to the Servicer, or to the
Mortgagor to the extent required by the related Mortgage Loan or Applicable
Regulations, any interest paid on the funds deposited in the Escrow Account,
(vii) to clear and terminate the Escrow Account on the termination of this
Agreement, (viii) to transfer to the Collection Account any insurance proceeds,
or (ix) in the case of FHA Loans, for transfer to the Collection Account, fire
and hazard insurance proceeds and Escrow Payments with respect to any Mortgage
Loan where the FHA has directed application of such funds as a credit against
the proceeds of the FHA Insurance Contract. As part of its servicing duties, the
Servicer shall pay to the Mortgagor interest on funds in the Escrow Account, to
the extent required by the related Mortgage Loan or Applicable Regulations, and
to the extent that interest earned on funds in the Escrow Account is
insufficient, shall pay such interest from its own funds, without any
reimbursement therefor.

                  In the event the Servicer shall deposit in the Escrow Account
any amount not required to be deposited therein, it may at any time withdraw
such amount from the Escrow Account, any provision herein to the contrary
notwithstanding.

                  Section 3.08 PAYMENT OF TAXES, INSURANCE AND OTHER CHARGES;
                               COLLECTIONS THEREUNDER.

                  With respect to each first lien Mortgage Loan, the Servicer
shall maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates and other charges which are or may become a lien upon
the Mortgaged Property and fire, flood and hazard insurance coverage and shall
obtain, from time to time, all bills for the payment of such charges (including
renewal premiums) and shall effect payment thereof prior to the applicable
penalty or termination date and at a time appropriate for securing maximum
discounts allowable, employing for such purpose deposits of the Mortgagor in the
Escrow Account which shall have been estimated and accumulated by the Servicer
in amounts sufficient for such purposes, as allowed under the terms of the
Mortgage or Applicable Regulations. To the extent that a Mortgage does not
provide for Escrow Payments,

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the Servicer (i) shall determine whether any such payments are made by the
Mortgagor in a manner and at a time that is necessary to avoid the loss of the
Mortgaged Property due to a tax sale or the foreclosure as a result of a tax
lien and (ii) shall ensure that all insurance required to be maintained on the
Mortgaged Property pursuant to this Agreement is maintained. If any such payment
has not been made and the Servicer receives notice of a tax lien with respect to
the Mortgage Loan being imposed, the Servicer will, to the extent required to
avoid loss of the Mortgaged Property, advance or cause to be advanced funds
necessary to discharge such lien on the Mortgaged Property. The Servicer assumes
full responsibility for the payment of all such bills and shall effect payments
of all such bills irrespective of the Mortgagor's faithful performance in the
payment of same or the making of the Escrow Payments and shall make Servicing
Advances from its own funds to effect such payments.

                  Section 3.09      TRANSFER OF ACCOUNTS.

                  The Servicer may transfer the Collection Account or the Escrow
Account to a different depository institution from time to time. Upon such
transfer, the Servicer shall deliver to the Trustee and the Depositor, a
certification or letter agreement, as the case may be, as required pursuant to
Sections 3.04 and 3.06.

                  Section 3.10      MAINTENANCE OF HAZARD INSURANCE.

                  The Servicer shall cause to be maintained for each first lien
Mortgage Loan fire and hazard insurance with extended coverage as is customary
in the area where the Mortgaged Property is located in an amount which is at
least equal to the lesser of (i) the amount necessary to fully compensate for
any damage or loss to the improvements which are a part of such property on a
replacement cost basis, (ii) the Principal Balance of the Mortgage Loan, in each
case in an amount not less than such amount as is necessary to prevent the
Mortgagor and/or the Mortgagee from becoming a co-insurer or (iii) the amount
required under applicable HUD/FHA regulations. If the Mortgaged Property is in
an area identified in the Federal Register by the Flood Emergency Management
Agency as having special flood hazards and flood insurance has been made
available, the Servicer will cause to be maintained a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration with a generally acceptable insurance carrier, in an amount
representing coverage not less than the least of (i) the Principal Balance of
the Mortgage Loan, (ii) the maximum insurable value of the improvements securing
such Mortgage Loan or (iii) the maximum amount of insurance which is available
under the Flood Disaster Protection Act of 1973, as amended. The Servicer shall
also maintain on the REO Property for the benefit of the Certificateholders, (x)
fire and hazard insurance with extended coverage in an amount which is at least
equal to the replacement cost of the improvements which are a part of such
property, (y) public liability insurance and, (z) to the extent required and
available under the Flood Disaster

                                      -95-

<PAGE>

Protection Act of 1973, as amended, flood insurance in an amount as provided
above. Any amounts collected by the Servicer under any such policies other than
amounts to be deposited in the Escrow Account and applied to the restoration or
repair of the Mortgaged Property or REO Property, or released to the Mortgagor
in accordance with the Servicer's normal servicing procedures, shall be
deposited in the Collection Account, subject to withdrawal pursuant to Section
3.05. It is understood and agreed that no earthquake or other additional
insurance is required to be maintained by the Servicer or the Mortgagor or
maintained on property acquired in respect of the Mortgage Loan, other than
pursuant to such Applicable Regulations as shall at any time be in force and as
shall require such additional insurance. All such policies shall be endorsed
with standard mortgagee clauses with loss payable to the Servicer and shall
provide for at least thirty days prior written notice of any cancellation,
reduction in the amount of or material change in coverage to the Servicer. The
Servicer shall not interfere with the Mortgagor's freedom of choice in selecting
either his insurance carrier or agent, PROVIDED, HOWEVER, that the Servicer
shall not accept any such insurance policies from insurance companies unless
such companies currently reflect a general policy rating of B:VI or better in
Best's Key Rating Guide and are licensed to do business in the state wherein the
property subject to the policy is located.

                  Section 3.11 MAINTENANCE OF MORTGAGE IMPAIRMENT INSURANCE
                               POLICY.

                  In the event that the Servicer shall obtain and maintain a
blanket policy issued by an insurer that has a general policy rating of B:VI or
better in Best's Key Rating Guide insuring against hazard losses on all of the
Mortgage Loans, then, to the extent such policy provides coverage in an amount
equal to the amount required pursuant to Section 3.10 and otherwise complies
with all other requirements of Section 3.10, it shall conclusively be deemed to
have satisfied its obligations as set forth in Section 3.10, it being understood
and agreed that such policy may contain a deductible clause, in which case the
Servicer shall, in the event that there shall not have been maintained on the
related Mortgaged Property or REO Property a policy complying with Section 3.10,
and there shall have been a loss which would have been covered by such policy,
deliver to the Trustee for deposit in the Distribution Account the amount not
otherwise payable under the blanket policy because of such deductible clause,
which amount shall not be reimbursable to the Servicer from the Trust Fund. In
connection with its activities as servicer of the Mortgage Loans, the Servicer
agrees to prepare and present, on behalf of the Trustee, claims under any such
blanket policy in a timely fashion in accordance with the terms of such policy.
Upon request of the Trustee, the Servicer shall cause to be delivered to the
Trustee a certified true copy of such policy and a statement from the insurer
thereunder that such policy shall in no event be terminated or materially
modified without thirty days prior written notice to the Trustee.

                  Section 3.12 FIDELITY BOND, ERRORS AND OMISSIONS INSURANCE.

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                  The Servicer shall maintain, at its own expense, a blanket
fidelity bond (the "Fidelity Bond") and an errors and omissions insurance
policy, with broad coverage with financially responsible companies on all
officers, employees or other persons acting in any capacity with regard to the
Mortgage Loans to handle funds, money, documents and papers relating to the
Mortgage Loans. The Fidelity Bond and errors and omissions insurance shall be in
the form of the Mortgage Banker's Blanket Bond and shall protect and insure the
Servicer against losses, including forgery, theft, embezzlement, fraud, errors
and omissions and negligent acts of such persons. Such Fidelity Bond shall also
protect and insure the Servicer against losses in connection with the failure to
maintain any insurance policies required pursuant to this Agreement and the
release or satisfaction of a Mortgage Loan without having obtained payment in
full of the indebtedness secured thereby. No provision of this Section 3.12
requiring the Fidelity Bond and errors and omissions insurance shall diminish or
relieve the Servicer from its duties and obligations as set forth in this
Agreement. The minimum coverage under any such bond and insurance policy shall
be at least equal to the corresponding amounts required by Fannie Mae in the
Fannie Mae MBS Selling and Servicing Guide or by Freddie Mac in the Freddie Mac
Servicer's Guide. Upon request of the Trustee, the Servicer shall cause to be
delivered to the requesting party a certified true copy of the Fidelity Bond and
errors and omissions insurance policy and a statement from the surety and the
insurer that such Fidelity Bond and errors and omissions insurance policy shall
in no event be terminated or materially modified without thirty days' prior
written notice to the Trustee.

                  Section 3.13 TITLE, MANAGEMENT AND DISPOSITION OF REO
                               PROPERTY.

                  (a) In the event that title to a Mortgaged Property is
acquired in foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale shall be taken (pursuant to a limited power of attorney to
be provided by the Trustee to the Servicer) in the name of the Trustee, on
behalf of the Certificateholders, or in the event the Trustee is not authorized
or permitted to hold title to real property in the state where the REO Property
is located, or would be adversely affected under the "doing business" or tax
laws of such state by so holding title, the deed or certificate of sale shall be
taken in the name of such Person or Persons as shall be consistent with an
Opinion of Counsel obtained by the Servicer from an attorney duly licensed to
practice law in the state where the REO Property is located. Any Person or
Persons holding such title other than the Trustee shall acknowledge in writing
that such title is being held as nominee for the benefit of the Trustee.

                  (b) In the event that the Trust Fund acquires any REO Property
as aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such REO Property before the end of
the third calendar year beginning after the year of its acquisition by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or, at the expense of the
Trust Fund, request from the Internal Revenue Service, more than 60 days before
the day on which the above-mentioned grace period would otherwise expire, an
extension of the above-

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<PAGE>

mentioned grace period, unless the Servicer obtains an Opinion of Counsel,
addressed to the Servicer and the Trustee, to the effect that the holding by the
Trust Fund of such REO Property subsequent to such period will not: (i) result
in the imposition of any tax on "prohibited transactions" as defined in Section
860F of the Code; or (ii) cause any REMIC constituting any part of the Trust
Fund to fail to qualify as a REMIC at any time that any Certificates are
outstanding, in which case the Trust Fund may continue to hold such REO Property
(subject to any conditions contained in such Opinion of Counsel). The Servicer
shall be entitled to be reimbursed from the Collection Account for any costs
incurred in obtaining such Opinion of Counsel, as provided in Section 3.05.

                  Subject to compliance with applicable laws and regulations as
shall at any time be in force, and notwithstanding any other provisions of this
Agreement, no REO Property acquired by the Trust Fund shall be rented (or
allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would: (i) cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code; or (ii) subject any REMIC constituting part of
the Trust Fund to the imposition of any federal income taxes on the income
earned from such REO Property, including any taxes imposed by reason of Sections
860F or 860G(c) of the Code, unless the Servicer has agreed to indemnify and
hold harmless the Trust Fund with respect to the imposition of any such taxes.

                  The Servicer shall manage, conserve, protect and operate each
REO Property for the Certificateholders and the Trust Fund solely for the
purpose of its prompt disposition and sale in a manner which does not cause such
REO Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code or result in the receipt by the related REMIC of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure property" which
is subject to taxation under the REMIC Provisions. The Servicer shall cause each
REO Property to be inspected promptly upon the acquisition of title thereto and
shall cause each REO Property to be inspected at least annually thereafter. The
Servicer shall make or cause to be made a written report of each such
inspection. Such reports shall be retained in the Mortgage Servicing File and
copies thereof shall be forwarded by the Servicer to the Trustee upon request.
The Servicer shall attempt to sell the same (and may temporarily rent the same)
on such terms and conditions as the Servicer deems to be in the best interest of
the Certificateholders and the Trust Fund.

                  With respect to each REO Property, the Servicer shall account
separately for each REO Property with respect to all funds collected and
received in connection with the operation of such REO Property.

                  The Servicer shall deposit or cause to be deposited, on a
daily basis, within two Business Days of receipt, in the Collection Account, all
revenues received with respect to each REO

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<PAGE>

Property and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of the related REO Property, including the cost of
maintaining any hazard insurance pursuant to Section 3.10 hereof and the fees of
any managing agent acting on behalf of the Servicer.

                  The Servicer shall furnish to the Trustee, on each Servicer
Remittance Date, an operating statement for each REO Property covering the
operation of each REO Property for the previous month. Such operating statement
shall be accompanied by such other information as the Trustee shall reasonably
request.

                  The Servicer shall use its best efforts to dispose of the REO
Property as promptly as is practically consistent with protecting the
Certificateholders' interests.

                  Each REO Disposition shall be carried out by the Servicer at
such price and upon such terms and conditions as the Servicer deems to be in the
best interest of the Certificateholders. If as of the date title to any REO
Property was acquired by the Servicer there were outstanding unreimbursed
Servicing Advances with respect to the REO Property, the Servicer, upon an REO
Disposition of such REO Property, shall be entitled to reimbursement for any
related unreimbursed Servicing Advances from proceeds received in connection
with such REO Disposition. The proceeds from the REO Disposition, net of any
payment to the Servicer as provided above, shall be deposited in the Collection
Account for distribution on the succeeding Servicer Remittance Date in
accordance with Section 4.01 and Section 4.02.

                  Any REO Disposition shall be for cash only (unless changes in
the REMIC Provisions made subsequent to the Startup Day allow a sale for other
consideration and an Opinion of Counsel is obtained by the Servicer to the
effect that such sale shall not cause any REMIC constituting part of the Trust
Fund to fail to qualify as a REMIC).

                  Section 3.14 DUE-ON-SALE CLAUSES; ASSUMPTION AND SUBSTITUTION
                               AGREEMENTS.

                  When a Mortgaged Property has been or is about to be conveyed
by the Mortgagor, the Servicer shall, to the extent it has knowledge of such
conveyance or prospective conveyance, exercise its rights to accelerate the
maturity of the related Mortgage Loan under any "due-on-sale" clause contained
in the related Mortgage or Mortgage Note; PROVIDED, HOWEVER, that the Servicer
shall not exercise any such right if the "due-on-sale" clause, in the reasonable
belief of the Servicer, is not enforceable under applicable law. An Opinion of
Counsel at the expense of the Servicer (which expense shall constitute a
Servicing Advance) delivered to the Trustee and the Depositor to the foregoing
effect shall conclusively establish the reasonableness of such belief. In such
event, the Servicer shall make reasonable efforts to enter into an assumption
and modification agreement with the Person to whom such property has been or is
about to be conveyed, pursuant to which such

                                      -99-

<PAGE>

Person becomes liable under the Mortgage Note and, unless prohibited by
applicable law or the Mortgage, the Mortgagor remains liable thereon. If the
foregoing is not permitted under applicable law, the Servicer is authorized to
enter into a substitution of liability agreement with such Person, pursuant to
which the original Mortgagor is released from liability and such Person is
substituted as Mortgagor and becomes liable under the Note. The Mortgage Loan,
as assumed, shall conform in all respects to the requirements, representations
and warranties of this Agreement. The Servicer shall notify the Trustee that any
such assumption or substitution agreement has been completed by forwarding to
the Trustee (or the Custodian, as the case may be) the original copy of such
assumption or substitution agreement (indicating the Mortgage File to which it
relates) which copy shall be added by the Trustee (or the Custodian, as the case
may be) to the related Mortgage File and which shall, for all purposes, be
considered a part of such Mortgage File to the same extent as all other
documents and instruments constituting a part thereof. The Servicer shall be
responsible for recording any such assumption or substitution agreements. In
connection with any such assumption or substitution agreement, the Monthly
Payment on the related Mortgage Loan shall not be changed but shall remain as in
effect immediately prior to the assumption or substitution, the stated maturity
or outstanding principal amount of such Mortgage Loan shall not be changed nor
shall any required monthly payments of principal or interest be deferred or
forgiven. Any fee collected by the Servicer for consenting to any such
conveyance or entering into an assumption or substitution agreement shall be
retained by or paid to the Servicer as additional servicing compensation.

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

                  Section 3.15      NOTIFICATION OF ADJUSTMENTS.

                  On each Adjustment Date, the Servicer shall make Mortgage
Interest Rate adjustments for each Adjustable-Rate Mortgage Rate Loan in
compliance with the requirements of the related Mortgage and Mortgage Note and
Applicable Regulations. The Servicer shall execute and deliver the notices
required by each Mortgage and Mortgage Note and Applicable Regulations regarding
Mortgage Interest Rate adjustments. The Servicer also shall provide timely
notification to the Trustee of all applicable data and information regarding
such Mortgage Interest Rate adjustments and the Servicer's methods of
implementing such Mortgage Interest Rate adjustments. Upon the discovery by the
Servicer or the Trustee that the Servicer has failed to adjust or has
incorrectly adjusted a Mortgage Interest Rate or a Monthly Payment pursuant to
the terms of the related Mortgage Note and Mortgage, the Servicer shall deliver
to the Trustee for deposit in the Distribution Account from its own funds the
amount of any interest loss caused thereby without reimbursement therefor;
PROVIDED, HOWEVER, the Servicer shall be held harmless with respect to any

                                      -100-

<PAGE>

Mortgage Interest Rate adjustments made by any servicer prior to the Servicer.

                  Section 3.16 OPTIONAL PURCHASES OF MORTGAGE LOANS BY SERVICER.

                  The Servicer (or an affiliate of the Servicer) may, at its
option, repurchase a Mortgage Loan or REO Property which becomes 120 or more
days Delinquent or for which the Servicer has accepted a deed in lieu of
foreclosure, during the period commencing on the first day of the calendar
quarter succeeding the calendar quarter in which the Initial Delinquency Date
occurred with respect to such Mortgage Loan and ending on the last Business Day
of such calendar quarter. If the Servicer (or an affiliate of the Servicer) does
not exercise its purchase right with respect to a Mortgage Loan during the
period specified in the preceding sentence, such Mortgage Loan shall thereafter
again become eligible for purchase pursuant to the preceding sentence only after
the Mortgage Loan ceases to be 120 days or more Delinquent and thereafter
becomes 120 days Delinquent again. The "Initial Delinquency Date" of a Mortgage
Loan shall mean the date on which the Mortgage Loan first became 120 days
Delinquent. Prior to repurchase pursuant to this Section 3.16, the Servicer
shall be required to continue to make monthly advances pursuant to Section 4.07.
The Servicer shall not use any procedure in selecting Mortgage Loans to be
repurchased which is materially adverse to the interests of the
Certificateholders. The Servicer shall purchase such (i) delinquent Mortgage
Loan at a price equal to the Principal Balance of the Mortgage Loan plus accrued
interest thereon at the Mortgage Interest Rate from the date to which interest
has last been paid to the Trust Fund to the date of purchase plus any
unreimbursed Servicing Advances and Advances or (ii) REO Property at its fair
market value as determined in good faith by the Servicer. Any such repurchase of
a Mortgage Loan or REO Property pursuant to this Section 3.16 shall be
accomplished by delivery to the Trustee for deposit in the Distribution Account
of the amount of the purchase price. The Trustee shall immediately effectuate
the conveyance of such delinquent Mortgage Loan or REO Property to the Servicer
to the extent necessary, including the prompt delivery of all documentation to
the Servicer.

                  Section 3.17 TRUSTEE TO COOPERATE; RELEASE OF FILES.

                  (a) Upon the payment in full of any Mortgage Loan (including
any liquidation of such Mortgage Loan through foreclosure or otherwise, or the
receipt by the Servicer of a notification that payment in full will be escrowed
in a manner customary for such purposes), the Servicer shall deliver to the
Trustee (or the Custodian as the case may be) two executed copies of a completed
"Request for Release" in the form of Exhibit E. Upon receipt of such Request for
Release of Documents, the Trustee (or the Custodian as the case may be) shall
promptly release the related Mortgage File, in trust to (i) the Servicer, or
(ii) such other party identified in the related Request for Release. Upon any
such payment in full, or the receipt of such notification that such funds have
been placed in escrow, the Servicer shall direct the Trustee in writing to
execute an instrument of satisfaction (or assignment of Mortgage without
recourse) regarding the Mortgaged Property relating

                                      -101-

<PAGE>

to such Mortgage, which instrument of satisfaction or assignment, as the case
may be, shall be delivered to the Person or Persons entitled thereto against
receipt therefor of payment in full, it being understood and agreed that no
expense incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the Collection Account.
In lieu of executing any such satisfaction or assignment, as the case may be,
the Servicer may prepare and submit to the Trustee a satisfaction (or assignment
without recourse, if requested by the Person or Persons entitled thereto) in
form for execution by the Trustee with all requisite information completed by
the Servicer; in such event, the Trustee shall execute and acknowledge such
satisfaction or assignment, as the case may be, and deliver the same with the
related Mortgage File, as aforesaid.

                  (b) From time to time and as appropriate in the servicing of
any Mortgage Loan, including, without limitation, foreclosure or other
comparable conversion of a Mortgage Loan or collection under any insurance
policy relating to a Mortgage Loan, the Trustee shall (except in the case of the
payment or liquidation pursuant to which the related Mortgage File is released
to an escrow agent or an employee, agent or attorney of the Trustee), upon
written request of the Servicer and delivery to the Trustee (or the Custodian,
as the case may be) of two executed copies of a "Request for Release" in the
form of Exhibit E signed by a Servicing Officer, release the related Mortgage
File to the Servicer and shall execute such documents as shall be necessary to
the prosecution of any such proceedings, including, without limitation, an
assignment without recourse, representation or warranty of the related Mortgage
to the Servicer. Such receipt shall obligate the Servicer to return the Mortgage
File to the Trustee (or the Custodian, as the case may be) when the need
therefor by the Servicer no longer exists unless the Mortgage Loan shall be
liquidated, in which case, upon receipt of a Request for Release evidencing such
liquidation, the receipt shall be released by the Trustee (or the Custodian, as
the case may be) to the Servicer.

                  (c) Subject to Section 3.01, the Servicer shall have the right
to accept applications of Mortgagors for consent to (i) partial releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division of properties
subject to Mortgages and (iv) second mortgage subordination agreements. No
application for approval shall be considered by the Servicer unless: (w) it has
received an Opinion of Counsel, addressed to the Trustee (which opinion shall
not be an expense of the Trustee or the Trust Fund) that such sale, disposition,
substitution, acquisition or contribution will not affect adversely the status
of any REMIC constituting part of the Trust Fund as a REMIC or cause any REMIC
constituting part of the Trust Fund to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions; (x) the
provisions of the related Note and Mortgage have been complied with; (y) the
Combined Loan-to-Value Ratio and debt-to- income ratio after any release does
not exceed the maximum Combined Loan-to-Value Ratio and debt-to-income ratio
established in accordance with the underwriting standards of the Mortgage Loans;
and (z) the lien priority of the related Mortgage is not affected. Upon receipt
by the Trustee

                                      -102-

<PAGE>

of a Servicing Officer's certificate setting forth the action proposed to be
taken in respect of a particular Mortgage Loan and certifying that the criteria
set forth in the immediately preceding sentence have been satisfied, the Trustee
shall execute and deliver to the Servicer the consent or partial release so
requested by the Servicer. A proposed form of consent or partial release, as the
case may be, shall accompany any Servicing Officer's certificate delivered by
the Servicer pursuant to this paragraph.

                  Section 3.18      SERVICING COMPENSATION.

                  As compensation for its activities hereunder, the Servicer
shall be entitled to retain the amount of the Servicing Fee with respect to each
Mortgage Loan (including REO Properties). The Servicer shall be entitled to
retain additional servicing compensation in the form of release fees, bad check
charges, assumption fees, modification or extension fees, late payment charges,
customary real estate referral fees or any other service-related fees, Insurance
Proceeds and Liquidation Proceeds not required to be deposited in the Collection
Account and similar items, to the extent collected from Mortgagors.

                  Section 3.19      ANNUAL STATEMENT AS TO COMPLIANCE.

                  (a) The Servicer, at its own expense, will deliver to the
Trustee and the Depositor, not later than March 15th of each calendar year
commencing in 2005, a Servicing Officer's certificate stating, as to each signer
thereof, that (i) a review of the activities of the Servicer during such
preceding calendar year (or such shorter period in the case of the first such
report) and of performance under this Agreement has been made under such
officers' supervision, and (ii) to the best of such officers' knowledge, based
on such review, the Servicer has fulfilled all its obligations under this
Agreement for such year, or, if there has been a default in the fulfillment of
all such obligations, specifying each such default known to such officers and
the nature and status thereof including the steps being taken by the Servicer to
remedy such default.

                  (b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and their receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

                  Section 3.20 ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS'
                               REPORTS.

                  (a) Not later than March 15th of each calendar year commencing
in 2005, the Servicer, at its expense, shall cause a nationally recognized firm
of independent certified public

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accountants to furnish to the Trustee and the Depositor a report stating that
(i) it has obtained a letter of representation regarding certain matters from
the management of the Servicer which includes an assertion that the Servicer has
complied with certain minimum residential mortgage loan servicing standards,
identified in either the Uniform Single Attestation Program for Mortgage Bankers
established by the Mortgage Bankers Association of America or the Audit Program
for Mortgages serviced by Freddie Mac, with respect to the servicing of
residential mortgage loans during the most recently completed calendar year and
(ii) on the basis of an examination conducted by such firm in accordance with
standards established by the American Institute of Certified Public Accountants,
such representation is fairly stated in all material respects, subject to such
exceptions and other qualifications that may be appropriate. Immediately upon
receipt of such report, the Servicer shall furnish a copy of such report to the
Trustee, the Depositor and each Rating Agency. Copies of such statement shall be
provided by the Trustee to any Certificateholder upon request at the Servicer's
expense, provided that such statement is delivered by the Servicer to the
Trustee.

                  (b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and its receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

                  Section 3.21 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION
                               REGARDING THE MORTGAGE LOANS.

                  The Servicer shall provide to the Trustee, Certificateholders
or Certificate Owners that are federally insured savings and loan associations,
the Office of Thrift Supervision, the FDIC and the supervisory agents and
examiners of each of the foregoing (which, in the case of supervisory agents and
examiners, may be required by applicable state and federal regulations) access
to the documentation regarding the Mortgage Loans, such access being afforded
without charge but only upon reasonable request and during normal business hours
at the offices of the Servicer designated by it.

                  Section 3.22 COMMISSION REPORTING.

                  (a) The Trustee and the Servicer shall reasonably cooperate
with the Depositor in connection with satisfying the reporting requirements
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
Trustee shall prepare and file (via the Securities and Exchange Commission's
Electronic Data Gathering and Retrieval System) on behalf of the Trust Fund any
Forms 8-K and 10-K (and the Servicer shall sign any Form 10-K) customary for
similar securities as required by the Exchange Act and the Rules and Regulations
of the Securities and

                                      -104-

<PAGE>

Exchange Commission thereunder.

                  (b) Each Form 8-K shall be filed by the Trustee within 15 days
after each Distribution Date, with a copy of the statement to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
March 30th of each year (or such earlier date as may be required by the Exchange
Act and the Rules and Regulations of the Securities and Exchange Commission),
the Trustee shall file a Form 10-K, in substance as required by applicable law
or applicable Security and Exchange Commission staff's interpretations. Such
Form 10-K shall include as exhibits the Servicer's annual statement of
compliance described under Section 3.19 and the accountant's report described
under Section 3.20, in each case to the extent they have been timely delivered
to the Trustee. The Trustee shall have no liability with respect to (a) any
failure to properly prepare or file such periodic reports resulting from or
relating to the Trustee's inability or failure to obtain any information not
resulting from its own negligence, willful misconduct or bad faith or (b) any
inaccuracy in such periodic reports resulting from incorrect information
provided to the Trustee by the Servicer in a Remittance Report or otherwise. The
Form 10-K shall also include a certification in the form attached hereto as
Exhibit O-1 (the "Certification"), which shall be signed by the senior officer
of the Servicer in charge of servicing.

                  (c) In addition, the Trustee shall sign a certification (in
the form attached hereto as Exhibit O-2) for the benefit of the Servicer and its
officers, directors and Affiliates regarding certain aspects of the
Certification (the "Trustee Certification") (provided, however, that the Trustee
shall not undertake an analysis of the accountant's report attached as an
exhibit to the Form 10-K). Such certification shall be delivered to the Servicer
no later than the 20th day prior to the latest date on which the Form 10-K is
permitted to be filed, without regard to extension (or if such day is not a
Business Day, the immediately preceding Business Day) and the Servicer shall
deliver the Certification to be filed to the Trustee no later than the 10th day
prior to the latest date on which the Form 10-K is permitted to be filed,
without regard to extension (or if such day is not a Business Day, the
immediately preceding Business Day).

                  In addition, (i) the Trustee shall, subject to the provisions
of Sections 8.01 and 8.02 hereof, indemnify and hold harmless the Depositor, the
Servicer and each of its officers, directors and Affiliates from and against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of or
based upon (a) a breach of the Trustee's obligations under this Section 3.22(b),
(b) the Trustee's negligence, bad faith or willful misconduct in connection
therewith or (c) any inaccuracy in the Trustee Certification and (ii) the
Servicer shall indemnify and hold harmless the Depositor, the Trustee and their
respective officers, directors and Affiliates from and against any actual
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of or
based upon (a) the failure of the Servicer

                                      -105-

<PAGE>

to timely deliver the Certification or (b) any material misstatement in the
Certification. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Depositor, then (i) the Trustee agrees that it
shall contribute to the amount paid or payable by the Depositor as a result of
the losses, claims, damages or liabilities of the Depositor in such proportion
as is appropriate to reflect the relative fault of the Depositor on the one hand
and the Trustee on the other in connection with a breach of the Trustee's
obligations under this Section 3.22(b) or the Trustee's negligence, bad faith or
willful misconduct in connection therewith and (ii) the Servicer agrees that it
shall contribute to the amount paid or payable by the Depositor as a result of
the losses, claims, damages or liabilities of the Depositor in such proportion
as is appropriate to reflect the relative fault of the Depositor on the one hand
and the Servicer on the other in connection with a breach of the Servicer's
obligations under this Section 3.22(b) or the Servicer's negligence, bad faith
or willful misconduct in connection therewith.

                  (d) Upon any filing with the Securities and Exchange
Commission, the Trustee shall promptly deliver to the Depositor and the Servicer
a copy of any executed report, statement or information.

                  (e) Prior to January 30th of the first year in which the
Trustee is able to do so under applicable law, the Trustee shall file a Form 15
Suspension Notification with respect to the Trust Fund.

                  (f) To the extent that, following the Closing Date, the
Depositor certifies that reports and certifications differing from those
required under this Section 3.22 comply with the reporting requirements under
the Exchange Act, the Trustee and the Servicer hereby agree that they will
reasonably cooperate to amend the provisions of this Section 3.22 in order to
comply with such amended reporting requirements and such amendment of this
Section 3.22. Any such amendment may result in the reduction of the reports
filed by the Depositor under the Exchange Act. Notwithstanding the foregoing,
the parties hereto shall not be obligated to enter into any amendment pursuant
to this Section 3.22 that adversely affects its obligations and immunities under
this Agreement.

                  Section 3.23 OBLIGATIONS OF THE SERVICER IN RESPECT OF
                               COMPENSATING INTEREST.

                  Not later than the close of business on each Servicer
Remittance Date, the Servicer shall deliver to the Trustee for deposit in the
Distribution Account an amount ("Compensating Interest") equal to the lesser of
(A) the aggregate of the Prepayment Interest Shortfalls on the Actuarial
Mortgage Loans for the related Distribution Date resulting from Principal
Prepayments in full on the Actuarial Mortgage Loans during the related
Prepayment Period and (B) 50% of its aggregate Servicing Fee received in the
related Collection Period. Compensating Interest shall be

                                      -106-

<PAGE>

applied to offset any Prepayment Interest Shortfalls on the Actuarial Mortgage
Loans. The Servicer shall not have the right to reimbursement for any amounts
remitted to the Trustee in respect of Compensating Interest. Such amounts so
remitted shall be included in the Available Funds and distributed therewith on
the next Distribution Date. The Servicer shall not be obligated to pay
Compensating Interest with respect to Prepayment Interest Shortfalls on Simple
Interest Mortgage Loans or Relief Act Interest Shortfalls.

                  Section 3.24 OBLIGATIONS OF THE SERVICER IN RESPECT OF
                               MORTGAGE INTEREST RATES AND MONTHLY PAYMENTS.

                  In the event that a shortfall in any collection on or
liability with respect to any Mortgage Loan results from or is attributable to
adjustments to Mortgage Interest Rates, Monthly Payments or Principal Balances
that were made by the Servicer in a manner not consistent with the terms of the
related Mortgage Note and this Agreement, the Servicer, upon discovery or
receipt of notice thereof, immediately shall deliver to the Trustee for deposit
in the Distribution Account from its own funds the amount of any such shortfall
and shall indemnify and hold harmless the Trust Fund, the Trustee, the Depositor
and any successor servicer in respect of any such liability. Such indemnities
shall survive the termination or discharge of this Agreement.

                  Section 3.25 INVESTMENT OF FUNDS IN THE COLLECTION ACCOUNT AND
                               THE DISTRIBUTION ACCOUNT.

                  (a) The Servicer may direct any depository institution
maintaining the Collection Account (for purposes of this Section 3.25, an
"Investment Account"), to invest the funds in such Investment Account in one or
more Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if a Person other than the Trustee is the
obligor thereon, and (ii) no later than the date on which such funds are
required to be withdrawn from such account pursuant to this Agreement, if the
Trustee is the obligor thereon. All such Permitted Investments shall be held to
maturity, unless payable on demand. Any investment of funds in an Investment
Account shall be made in the name of the Trustee or the Servicer, as applicable
(in its capacity as such) or in the name of a nominee of the Trustee. The
Trustee shall be entitled to sole possession (except with respect to investment
direction of funds held in the Collection Account) over each such investment and
the income thereon, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the Trustee or its agent, together
with any document of transfer necessary to transfer title to such investment to
the Trustee or its nominee. In the event amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Trustee shall at the direction of the Servicer:

                                      -107-

<PAGE>

                  (x) consistent with any notice required to be given
         thereunder, demand that payment thereon be made on the last day such
         Permitted Investment may otherwise mature hereunder in an amount equal
         to the lesser of (1) all amounts then payable thereunder and (2) the
         amount required to be withdrawn on such date; and

                  (y) demand payment of all amounts due thereunder promptly upon
         determination by a Responsible Officer of the Trustee that such
         Permitted Investment would not constitute a Permitted Investment in
         respect of funds thereafter on deposit in the Investment Account.

                  (b) All income and gain realized from the investment of funds
in the Collection Account shall be for the benefit of the Servicer. The Servicer
shall deposit in the Collection Account the amount of any loss incurred in
respect of any such Permitted Investment made with funds in such account
immediately upon realization of such loss.

                  (c) Except as otherwise expressly provided in this Agreement,
if any default occurs in the making of a payment due under any Permitted
Investment, or if a default occurs in any other performance required under any
Permitted Investment, the Trustee may and, subject to Section 8.01 and Section
8.02(a)(v), upon the request of the Holders of Certificates representing more
than 50% of the Voting Rights allocated to any Class of Certificates, shall take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate proceedings.

                  The Trustee shall not in any way be held liable by reason of
any insufficiency in any Account held by the Trustee resulting from any
investment loss on any Permitted Investment included therein (except to the
extent that the Trustee is the obligor and has defaulted thereon).

                  Section 3.26      LIABILITY OF SERVICER; INDEMNIFICATION.

                  (a) Subject to clause (b) below and Section 6.03, the Servicer
(except the Trustee if it is required to succeed the Servicer hereunder)
indemnifies and holds the Trustee, the Seller, the Depositor and each
Certificateholder harmless against any and all claims, losses, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments, and any other
costs, fees and expenses that the Trustee, the Depositor and any
Certificateholder may sustain in any way related to the failure of the Servicer
to perform its duties and service the Mortgage Loans in compliance with the
Servicing Standards. The Servicer shall immediately notify the Trustee, the
Depositor and each Certificateholder if a claim is made that may result in such
claims, losses, penalties, fines, forfeitures, legal fees or related costs,
judgments, or any other costs, fees and expenses, and the Servicer shall assume
(with the consent of the Trustee) the defense of any such claim and pay all
expenses in connection therewith, including reasonable counsel fees, and
promptly pay, discharge and satisfy any

                                      -108-

<PAGE>

judgment or decree which may be entered against the Servicer, the Trustee, the
Depositor and/or Certificateholder in respect of such claim. The provisions of
this Section 3.26 shall survive the termination of this Agreement and the
payment of the outstanding Certificates.

                  (b) None of the Depositor, the Seller, the Servicer, or any of
the directors, officers, employees or agents of the Depositor, the Seller or the
Servicer shall be under any liability to the Trust Fund or the
Certificateholders for any action taken, or for refraining from the taking of
any action, in good faith pursuant to this Agreement, or for errors in judgment;
PROVIDED, HOWEVER, that this provision shall not protect the Depositor, the
Seller or the Servicer or any such Person against any breach of warranties or
representations made herein, or against any specific liability imposed on the
Servicer for a breach of the Servicing Standard, or against any liability which
would otherwise be imposed by reason of its respective willful misfeasance, bad
faith, fraud or negligence in the performance of its duties or by reasons of
negligent disregard of its respective obligations or duties hereunder.

                  The Depositor, the Servicer, the Seller and any director,
officer, employee or agent of the Depositor, the Seller or the Servicer, may
rely in good faith on any document of any kind which, prima facie, is properly
executed and submitted by any appropriate Person with respect to any matters
arising hereunder. The Depositor, the Servicer, the Seller, and any director,
officer, employee or agent of the Depositor, the Seller or the Servicer shall be
indemnified and held harmless by the Trust Fund against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement
or the Certificates, other than any loss, liability or expense incurred in
connection with any legal action incurred by reason of its respective
misfeasance, bad faith, fraud or negligence, a breach of a representation or
warranty hereunder or (in the case of the Servicer) a breach of the Servicing
Standard in the performance of its respective duties or by reason of negligent
disregard of its respective obligations or duties hereunder. Neither the
Depositor, the Seller nor the Servicer shall be under any obligation to appear
in, prosecute or defend any legal action unless such action is related to its
respective duties under this Agreement and in its opinion does not expose it to
any expense or liability; PROVIDED, HOWEVER, that the Depositor, the Seller or
the Servicer may in its discretion undertake any action related to its
obligations hereunder which it may deem necessary or desirable with respect to
this Agreement and the rights and duties of the parties hereto and the interests
of the Certificateholders hereunder.

                  Section 3.27 REPORTS OF FORECLOSURE AND ABANDONMENT OF
                               MORTGAGED PROPERTIES.

                  On or before the last day of February of each year beginning
in 2005, the Servicer shall file the reports of foreclosure and abandonment of
any Mortgaged Property required by Section 6050J of the Code with the Internal
Revenue Service and provide an Officer's Certificate certifying its compliance
with this Section 3.27 to the Trustee. The reports from the Servicer shall be in
form

                                      -109-

<PAGE>

and substance sufficient to meet the reporting requirements imposed by such
Section 6050J.

                  Section 3.28 PROTECTION OF ASSETS.

                  (a) Except for transactions and activities entered into in
connection with the securitization that is the subject of this Agreement, the
Trust is not authorized and has no power to:

                  (1) borrow money or issue debt;

                  (2) merge with another entity, reorganize, liquidate or sell
assets; or

                  (3) engage in any business or activities.

                  (b) Each party to this Agreement agrees that it will not file
an involuntary bankruptcy petition against the Trustee or the Trust Fund or
initiate any other form of insolvency proceeding until after the Certificates
have been paid.

                  Section 3.29. LIBOR CARRYOVER RESERVE ACCOUNT.

                  No later than the Closing Date, the Trustee shall establish
and maintain with itself a separate, segregated trust account titled, "LIBOR
Carryover Reserve Account, U.S. Bank National Association, as Trustee, in trust
for the registered Holders of 2004-CB3 Trust, C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB3." On the Closing Date, the Depositor will deposit,
or cause to be deposited, into the LIBOR Carryover Reserve Account $1,000.

                  On each Distribution Date as to which there is a LIBOR
Carryover Amount payable to the Offered Certificates and/or the Class B-4
Certificates, the Trustee has been directed by the Class X/N Certificateholders
to, and therefore will, deposit into the LIBOR Carryover Reserve Account the
amounts described in Section 4.02(B)(xxviii), rather than distributing such
amounts to the Class X/N Certificateholders. On each such Distribution Date, the
Trustee shall hold all such amounts for the benefit of the Holders of the
Offered Certificates and the Class B-4 Certificates, and will distribute such
amounts to the Holders of the Offered Certificates and/or the Class B-4
Certificates in the amounts and priorities set forth in Section 4.02(B). If no
LIBOR Carryover Amounts are payable on a Distribution Date, the Trustee shall
deposit into the LIBOR Carryover Reserve Account on behalf of the Class X/N
Certificateholders, from amounts otherwise distributable to the Class X/N
Certificateholders, an amount such that when added to other amounts already on
deposit in the LIBOR Carryover Reserve Account, the aggregate amount on deposit
therein is equal to $1,000.

                                      -110-

<PAGE>

                  For federal and state income tax purposes, the Class X/N
Certificateholders will be deemed to be the owners of the LIBOR Carryover
Reserve Account and all amounts deposited into the LIBOR Carryover Reserve
Account shall be treated as amounts distributed by REMIC 5 to the Holders of the
Class X/N Certificates. Upon the termination of the Trust, or the payment in
full of the Offered Certificates and the Class B-4 Certificates, all amounts
remaining on deposit in the LIBOR Carryover Reserve Account will be released by
the Trust and distributed to the Class X/N Certificateholders or their
designees. The LIBOR Carryover Reserve Account will be part of the Trust but not
part of any REMIC and any payments to the Holders of the Offered Certificates or
the Class B-4 Certificates of LIBOR Carryover Amounts will not be payments with
respect to a "regular interest" in a REMIC within the meaning of Code Section
860(G)(a)(1).

                  By accepting a Class X/N Certificate, each Class X/N
Certificateholder hereby agrees to direct the Trustee, and the Trustee hereby is
directed, to deposit into the LIBOR Carryover Reserve Account the amounts
described above on each Distribution Date as to which there is any LIBOR
Carryover Amount rather than distributing such amounts to the Class X/N
Certificateholders. By accepting a Class X/N Certificate, each Class X/N
Certificateholder further agrees that such direction is given for good and
valuable consideration, the receipt and sufficiency of which is acknowledged by
such acceptance.

                  Amounts on deposit in the LIBOR Carryover Reserve Account
shall remain uninvested.

                  For federal tax return and information reporting, the value of
the right of the Offered Certificateholders and the Class B-4 Certificateholders
to receive payments from the LIBOR Carryover Reserve Account in respect of any
LIBOR Carryover Amount may be obtained from the Trustee upon request.

                  Section 3.30.     ADVANCE FACILITY.

                  (a) The Servicer is hereby authorized to enter into a
financing or other facility (any such arrangement, an "Advance Facility"), the
documentation for which complies with Section 3.30(e) below, under which (1) the
Servicer assigns or pledges its rights under this Agreement to be reimbursed for
any or all Advances and/or Servicing Advances to (i) a Person, which may be a
special-purpose bankruptcy-remote entity (an "SPV"), (ii) a Person, which may
simultaneously assign or pledge such rights to an SPV or (iii) a lender (a
"Lender"), which, in the case of any Person or SPV of the type described in
either of the preceding clauses (i) or (ii), may directly or through other
assignees and/or pledgees, assign or pledge such rights to a Person, which may
include a trustee acting on behalf of holders of debt instruments (any such
Person or any such Lender, an "Advance Financing Person"), and/or (2) an Advance
Financing Person agrees to fund all the Advances and/or

                                      -111-

<PAGE>

Servicing Advances required to be made by the Servicer pursuant to this
Agreement. No consent of the Trustee, Certificateholders or any other party
shall be required before the Servicer may enter into an Advance Facility nor
shall the Trustee or the Certificateholders be a third party beneficiary of any
obligation of an Advance Financing Person to the Servicer. Notwithstanding the
existence of any Advance Facility under which an Advance Financing Person agrees
to fund Advances and/or Servicing Advances, (A) the Servicer (i) shall remain
obligated pursuant to this Agreement to make Advances and/or Servicing Advances
pursuant to and as required by this Agreement and (ii) shall not be relieved of
such obligations by virtue of such Advance Facility and (B) neither the Advance
Financing Person nor any Servicer's Assignee (as hereinafter defined) shall have
any right to proceed against or otherwise contact any Mortgagor for the purpose
of collecting any payment that may be due with respect to any related Mortgage
Loan or enforcing any covenant of such Mortgagor under the related Mortgage Loan
documents.

                  (b) If the Servicer enters into an Advance Facility, the
Servicer and the related Advance Financing Person shall deliver to the Trustee
at the address set forth in Section 11.05 hereof a written notice (an "Advance
Facility Notice"), stating (a) the identity of the Advance Financing Person and
(b) the identity of the Person (the "Servicer's Assignee") that will, subject to
Section 3.30(c) hereof, have the right to make withdrawals from the Collection
Account pursuant to Section 3.05 hereof to reimburse previously unreimbursed
Advances and/or Servicing Advances ("Advance Reimbursement Amounts"). Advance
Reimbursement Amounts (i) shall consist solely of amounts in respect of Advances
and/or Servicing Advances for which the Servicer would be permitted to reimburse
itself in accordance with Section 3.05 hereof, assuming the Servicer had made
the related Advance(s) and/or Servicing Advance(s) and (ii) shall not consist of
amounts payable to a successor Servicer in accordance with Section 3.05 hereof
to the extent permitted under Section 3.30(e) below.

                  (c) Notwithstanding the existence of an Advance Facility, the
Servicer, on behalf of the Advance Financing Person, shall be entitled to
receive reimbursements of Advances and/or Servicing Advances in accordance with
Section 3.05 hereof, which entitlement may be terminated by the Advance
Financing Person pursuant to a written notice to the Trustee in the manner set
forth in Section 11.05 hereof. Upon receipt of such written notice, the Servicer
shall no longer be entitled to receive reimbursement for any Advance
Reimbursement Amounts and the Servicer's Assignee shall immediately have the
right to receive from the Collection Account all Advance Reimbursement Amounts.
Notwithstanding the foregoing, and for the avoidance of doubt, (i) the Servicer
and/or the Servicer's Assignee shall only be entitled to reimbursement of
Advance Reimbursement Amounts hereunder pursuant to Section 3.05 of this
Agreement and shall not otherwise be entitled to make withdrawals of, or
receive, Advance Reimbursement Amounts that shall be deposited in the
Distribution Account pursuant to Section 3.04(b) hereof, and (ii) none of the
Trustee or the Certificateholders shall have any right to, or otherwise be
entitled to, receive any Advance

                                      -112-

<PAGE>

Reimbursement Amounts to which the Servicer or Servicer's Assignee, as
applicable, shall be entitled pursuant to Section 3.05 hereof. An Advance
Facility may be terminated by the joint written direction of the Servicer and
the related Advance Financing Person. Written notice of such termination shall
be delivered to the Trustee in the manner set forth in Section 11.05 hereof. The
Trustee shall have no duty or liability with respect to the calculation of any
Advance Reimbursement Amount and shall be entitled to rely without independent
investigation on the Advance Facility Notice and on such Servicer's report of
the amount of Advance Reimbursement Amounts and Servicing Advance Reimbursement
Amounts that were included in the remittance from such Servicer to the Trustee
pursuant to Section 4.07. Such Servicer shall maintain and provide to any
successor Servicer a detailed accounting on a loan-by-loan basis as to amounts
advanced by, pledged or assigned to, and reimbursed to any Advance Financing
Person. The successor Servicer shall be entitled to rely on any such information
provided by the predecessor Servicer, and the successor Servicer shall not be
liable for any errors in such information.

                  (d) [Reserved].

                  (e) As between a predecessor Servicer and its Advance
Financing Person, on the one hand, and a successor Servicer and its Advance
Financing Person, if any, on the other hand, Advance Reimbursement Amounts on a
loan-by-loan basis with respect to each Mortgage Loan as to which a Advance
and/or Servicing Advance shall have been made and be outstanding shall be
allocated on a "first-in, first out" basis. In the event the Servicer's Assignee
shall have received some or all of an Advance Reimbursement Amount related to
Advances and/or Servicing Advances that were made by a Person other than such
predecessor Servicer or its related Advance Financing Person in error, then such
Servicer's Assignee shall be required to remit any portion of such Advance
Reimbursement Amount to each Person entitled to such portion of such Advance
Reimbursement Amount. Without limiting the generality of the foregoing, the
Servicer shall remain entitled to be reimbursed by the Advance Financing Person
for all Advances and/or Servicing Advances funded by the Servicer to the extent
the related Advance Reimbursement Amounts have not been assigned or pledged to
such Advance Financing Person or Servicer's Assignee.

                  (f) For purposes of any certification of a Servicing Officer
of the Servicer made pursuant to Section 4.07(d), any Nonrecoverable Advance
referred to therein may have been made by the Servicer or any predecessor
Servicer. In making its determination that any Advance or Servicing Advance
theretofore made has become a Nonrecoverable Advance, the Servicer shall apply
the same criteria in making such determination regardless of whether such
Advance or Servicing Advance shall have been made by the Servicer or any
predecessor Servicer

                  (g) The Trustee shall not, as a result of the existence of any
Advance Facility, have any additional responsibility to track or monitor Advance
Reimbursement Amounts or any

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Advance Facility, and, except as expressly provided in Section 3.30(c) above, is
not and shall not be obligated to make any payment with respect to any Advance
Reimbursement Amount. The Servicer hereby indemnifies the Trustee, the Trust
Fund and any successor Servicer, as applicable, from and against any claims,
losses, liabilities or damages resulting from any claim by the related Advancing
Person, except to the extent that such claim, loss, liability or damage resulted
from or arose out of negligence, recklessness or willful misconduct on the part
of the Trustee or the successor Servicer, or failure by the successor Servicer
or the Trustee to remit funds as required by this Agreement or the commission of
an act or omission to act by the successor Servicer or the Trustee, and the
passage of any applicable cure or grace period, such that a Servicer Event of
Termination under this Agreement occurs or such entity is subject to termination
for cause under this Agreement

                                      -114-

<PAGE>

                                   ARTICLE IV

                                  FLOW OF FUNDS

                  Section 4.01 INTEREST DISTRIBUTIONS.

                  (I) On each Distribution Date, the Trustee shall withdraw from
the Distribution Account the Group II Interest Remittance Amount and apply it in
the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Trustee may conclusively
rely):

                  (i) to the Trustee, the portion of the Trustee Fee related to
the Group II Mortgage Loans for such Distribution Date;

                  (ii) concurrently, to the Holders of the Group II
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Accrued Certificate Interest for such Distribution Date;

                  (iii) concurrently, to the Holders of the Group II
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Interest Carry Forward Amount for the Group II Certificates;

                  (iv) to the Holders of the Class AV-1 Certificates, the
applicable Accrued Certificate Interest for such Class for such Distribution
Date, to the extent remaining undistributed after the distribution of the Group
I Interest Remittance Amount as set forth in Section 4.01(II); and

                  (v) to the Holders of the Class AV-1 Certificates, the
applicable Interest Carry Forward Amount for the Class AV-1 Certificates, to the
extent remaining undistributed after the distribution of the Group I Interest
Remittance Amount as set forth in Section 4.01(II).

                  (II) On each Distribution Date, the Trustee shall withdraw
from the Distribution Account the Group I Interest Remittance Amount and apply
it in the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Trustee may conclusively
rely):

                  (i) to the Trustee, the portion of the Trustee Fee related to
the Group I Mortgage Loans for such Distribution Date;

                  (ii) to the Holders of the Class AV-1 Certificates, the
applicable Accrued

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Certificate Interest for such Distribution Date;

                  (iii) to the Holders of the Class AV-1 Certificates, the
applicable Interest Carry Forward Amount for the Class AV-1 Certificates;

                  (iv) concurrently, to the Holders of the Group II
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Accrued Certificate Interest for such Classes for such
Distribution Date, to the extent remaining undistributed after the distribution
of the Group II Interest Remittance Amount as set forth in Section 4.01(I); and

                  (v) concurrently, to the Holders of the Group II Certificates,
on a PRO RATA basis based on the entitlement of each such Class, the applicable
Interest Carry Forward Amount for the Group II Certificates, to the extent
remaining undistributed after the distribution of the Group II Interest
Remittance Amount as set forth in Section 4.01(I).

                  (III) On each Distribution Date, the Trustee shall withdraw
from the Distribution Account the remaining Interest Remittance Amount and apply
it in the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Trustee may conclusively
rely):

                  (i) to the Holders of the Class M-1 Certificates, the Accrued
         Certificate Interest thereon for such Distribution Date;

                  (ii) to the Holders of the Class M-2 Certificates, the Accrued
         Certificate Interest thereon for such Distribution Date;

                  (iii) to the Holders of the Class M-3 Certificates, the
         Accrued Certificate Interest thereon for such Distribution Date;

                  (iv) to the Holders of the Class B-1 Certificates, the Accrued
         Certificate Interest thereon for such Distribution Date;

                  (v) to the Holders of the Class B-2 Certificates, the Accrued
         Certificate Interest thereon for such Distribution Date;

                  (vi) to the Holders of the Class B-3 Certificates, the Accrued
         Certificate Interest thereon for such Distribution Date;

                  (vii) to the Holders of the Class B-4 Certificates, the
         Accrued Certificate Interest

                                      -116-

<PAGE>

         thereon for such Distribution Date; and

                  (viii) the amount, if any, of the Interest Remittance Amount
         remaining after application with respect to the priorities set forth
         above will be applied as described under Section 4.02(B) hereof.

                  With respect to any distributions to be made on the Class B-1
Certificates or the Class B-4 Certificates pursuant to this Section 4.01, such
distributions will be made first, on the Class B-1 Interest or the Class B-4
Interest, as applicable, and then, on the related Class of Certificates.

                  Section 4.02 DISTRIBUTIONS OF PRINCIPAL AND MONTHLY EXCESS
                               CASHFLOW AMOUNTS.

                  (A) Distributions of Principal:

                  I. On each Distribution Date (a) prior to the Stepdown Date or
(b) on which a Trigger Event is in effect, distributions in respect of principal
to the extent of the Group I Principal Remittance Amount will be made to the
Holders of the Class AV-1 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero.

                  II. On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the Group II Principal Remittance Amount will be made
to the Holders of the Group II Certificates (allocated among the Group II
Certificates in the priority described below), until the Certificate Principal
Balances thereof have been reduced to zero.

                  III. On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the Principal Remittance Amount remaining
undistributed for such Distribution Date will be made in the following amounts
and order of priority:

                  (i) if, following the distribution of the Group I Principal
Remittance Amount as set forth in Section 4.02(A)(I), the Group I Enhancement
Amount is less than the Group I Targeted Enhancement Amount, to the Holders of
the Class AV-1 Certificates, until the Group I Enhancement Amount is equal to
the Group I Targeted Enhancement Amount;

                  (ii) if, following the distribution of the Group II Principal
Remittance Amount as set forth in Section 4.02(A)(II), the Group II Enhancement
Amount is less than the Group II Targeted Enhancement Amount, to the Holders of
the Group II Certificates (allocated among the Group II Certificates in the
priority described below), until the Group II Enhancement Amount is equal to the

                                      -117-

<PAGE>

Group II Targeted Enhancement Amount;

                  (iii) to the Holders of the Group II Certificates (allocated
among the Group II Certificates in the priority described below) and the Class
AV-1 Certificates, in that order, until the Certificate Principal Balances
thereof have been reduced to zero;

                  (iv) to the Holders of the Class M-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;

                  (v) to the Holders of the Class M-2 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;

                  (vi) to the Holders of the Class M-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;

                  (vii) to the Holders of the Class B-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;

                  (viii) to the Holders of the Class B-2 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;

                  (ix) to the Holders of the Class B-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; and

                  (x) to the Holders of the Class B-4 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero.

                  IV. On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the Group I Principal Remittance Amount will be
made to the Holders of the Class AV-1 Certificates in an amount equal to the
Group I Senior Principal Distribution Amount, until the Certificate Principal
Balance thereof has been reduced to zero.

                  V. On each Distribution Date (a) on or after the Stepdown Date
and (b) on which a Trigger Event is not in effect, distributions in respect of
principal to the extent of the Group II Principal Remittance Amount will be made
to the Holders of the Group II Certificates (allocated among the Group II
Certificates in the priority described below) in an amount equal to the Group II
Senior Principal Distribution Amount, until the Certificate Principal Balances
thereof have been reduced to zero.

                                      -118-

<PAGE>

                  VI. On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the Principal Remittance Amount (as reduced by the
amount of Overcollateralization Release Amount, if any) remaining undistributed
for such Distribution Date will be made in the following amounts and order of
priority:

                  (i) if, following the distribution of the Group I Principal
Remittance Amount as set forth in Section 4.02(A)(IV), any portion of the Group
I Senior Principal Distribution Amount remains undistributed, to the Holders of
the Class AV-1 Certificates, until the Group I Senior Principal Distribution
Amount has been distributed in full;

                  (ii) if, following the distribution of the Group II Principal
Remittance Amount as set forth in Section 4.02(A)(V), any portion of the Group
II Senior Principal Distribution Amount remains undistributed, to the Holders of
the Group II Certificates (allocated among the Group II Certificates in the
priority described below), until the Group II Senior Principal Distribution
Amount has been distributed in full;

                  (iii) to the Holders of the Group II Certificates (allocated
among the Group II Certificates in the priority described below) and the Class
AV-1 Certificates, in that order, until the Senior Principal Distribution Amount
has been distributed in full;

                  (iv) to the Holders of the Class M-1 Certificates, the Class
M-1 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero;

                  (v) to the Holders of the Class M-2 Certificates, the Class
M-2 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero;

                  (vi) to the Holders of the Class M-3 Certificates, the Class
M-3 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero;

                  (vii) to the Holders of the Class B-1 Certificates, the Class
B-1 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero;

                  (viii) to the Holders of the Class B-2 Certificates, the Class
B-2 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero;

                  (ix) to the Holders of the Class B-3 Certificates, the Class
B-3 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero; and

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<PAGE>

                  (x) to the Holders of the Class B-4 Certificates, the Class
B-4 Principal Distribution Amount, until the Certificate Principal Balance
thereof has been reduced to zero.

                  With respect to the Group II Certificates, all principal
distributions will be distributed sequentially, first, to the Holders of the
Class AV-2 Certificates, until the Certificate Principal Balance of the Class
AV-2 Certificates has been reduced to zero, second, to the Holders of the Class
AV-3 Certificates, until the Certificate Principal Balance of the Class AV-3
Certificates has been reduced to zero and third, to the Holders of the Class
AV-4 Certificates, until the Certificate Principal Balance of the Class AV-4
Certificates has been reduced to zero; provided, however, on any Distribution
Date on which the aggregate Certificate Principal Balance of the Subordinate
Certificates has been reduced to zero, notwithstanding anything contained herein
to the contrary, all distributions of principal to the Group II Certificates
will be distributed concurrently, on a PRO RATA basis based on the Certificate
Principal Balance of each such Class.

                  (B) On each Distribution Date, any Monthly Excess Cashflow
Amount shall be distributed, to the extent available, in the following order of
priority on such Distribution Date:

                  (I) TO THE EXTENT OF THE EXTRA PRINCIPAL DISTRIBUTION AMOUNT:

                  (i) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(I) and Section 4.02(A)(III), the Group I
Enhancement Amount is less than the Group I Targeted Enhancement Amount, to the
Holders of the Class AV-1 Certificates, to the extent of the Group I Senior
Excess Interest Amount, until the Group I Enhancement Amount is equal to the
Group I Targeted Enhancement Amount and (B) if, on any Distribution Date after
the Stepdown Date on which a Trigger Event is not in effect, following the
distribution of the Principal Remittance Amount as set forth in Section
4.02(A)(IV) and Section 4.02(A)(VI), any portion of the Group I Senior Principal
Distribution Amount remains undistributed, to the Holders of the Class AV-1
Certificates, to the extent of the Group I Senior Excess Interest Amount, until
the Group I Senior Principal Distribution Amount has been distributed in full;

                  (ii) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(II) and Section 4.02(A)(III), the Group II
Enhancement Amount is less than the Group II Targeted Enhancement Amount, to the
Holders of the Group II Certificates (allocated among the Group II Certificates
in the priority described under Section 4.02(A)), to the extent of the Group II
Senior Excess Interest Amount, until the Group II Enhancement Amount is equal to
the Group II Targeted Enhancement Amount and (B) if, on any

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<PAGE>

Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distribution of the Principal Remittance Amount as set
forth in Section 4.02(A)(V) and Section 4.02(A)(VI), any portion of the Group II
Senior Principal Distribution Amount remains undistributed, to the Holders of
the Group II Certificates (allocated among the Group II Certificates in the
priority described under Section 4.02(A)), to the extent of the Group II Senior
Excess Interest Amount, until the Group II Senior Principal Distribution Amount
has been distributed in full;

                  (iii) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(I) and Section 4.02(A)(III) and the distribution in
Section 4.02(B)(I)(i), the Group I Enhancement Amount is less than the Group I
Targeted Enhancement Amount, to the Holders of the Class AV-1 Certificates,
until the Group I Enhancement Amount is equal to the Group I Targeted
Enhancement Amount and (B) if, on any Distribution Date after the Stepdown Date
on which a Trigger Event is not in effect, following the distribution of the
Principal Remittance Amount as set forth in Section 4.02(A)(IV) and Section
4.02(A)(VI) and the distribution in Section 4.02(B)(I)(i), any portion of the
Group I Senior Principal Distribution Amount remains undistributed, to the
Holders of the Class AV-1 Certificates, until the Group I Senior Principal
Distribution Amount has been distributed in full;

                  (iv) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(II) and Section 4.02(A)(III) and the distribution
in Section 4.02(B)(I)(ii) above, the Group II Enhancement Amount is less than
the Group II Targeted Enhancement Amount, to the Holders of the Group II
Certificates (allocated among the Group II Certificates in the priority
described under Section 4.02(A)), until the Group II Enhancement Amount is equal
to the Group II Targeted Enhancement Amount and (B) if, on any Distribution Date
after the Stepdown Date on which a Trigger Event is not in effect, following the
distribution of the Principal Remittance Amount as set forth in Section
4.02(A)(V) and Section 4.02(A)(VI) and the distribution in Section
4.02(B)(I)(ii), any portion of the Group II Senior Principal Distribution Amount
remains undistributed, to the Holders of the Group II Certificates (allocated
among the Group II Certificates in the priority described under Section
4.02(A)), until the Group II Senior Principal Distribution Amount has been
distributed in full;

                  (v) (A) on any Distribution Date prior to the Stepdown Date or
any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Group II Certificates (allocated among the Group
II Certificates in the priority described under Section 4.02(A)) and the Class
AV-1 Certificates, in that order, until the Certificate Principal Balances
thereof have been reduced to zero and (B) on any Distribution Date after the
Stepdown Date on which a Trigger Event is not in effect, to the Holders of the
Group II Certificates (allocated among

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<PAGE>

the Group II Certificates in the priority described under Section 4.02(A)) and
the Class AV-1 Certificates, in that order, until the Senior Principal
Distribution Amount has been distributed in full;

                  (vi) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class M-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distributions in Section 4.02(A)(VI), any portion of the
Class M-1 Principal Distribution Amount remains undistributed, to the Holders of
the Class M-1 Certificates, until the Class M-1 Principal Distribution Amount
has been distributed in full;

                  (vii) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class M-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distributions in Section 4.02(A)(VI), any portion of the
Class M-2 Principal Distribution Amount remains undistributed, to the Holders of
the Class M-2 Certificates, until the Class M-2 Principal Distribution Amount
has been distributed in full;

                  (viii) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class M-3 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distributions in Section 4.02(A)(VI), any portion of the
Class M-3 Principal Distribution Amount remains undistributed, to the Holders of
the Class M-3 Certificates, until the Class M-3 Principal Distribution Amount
has been distributed in full;

                  (ix) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class B-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distributions in Section 4.02(A)(VI), any portion of the
Class B-1 Principal Distribution Amount remains undistributed, to the Holders of
the Class B-1 Certificates, until the Class B-1 Principal Distribution Amount
has been distributed in full;

                  (x) (A) on any Distribution Date prior to the Stepdown Date or
any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class B-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following

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<PAGE>

the distributions in Section 4.02(A)(VI), any portion of the Class B-2 Principal
Distribution Amount remains undistributed, to the Holders of the Class B-2
Certificates, until the Class B-2 Principal Distribution Amount has been
distributed in full;

                  (xi) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class B-3 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distributions in Section 4.02(A)(VI), any portion of the
Class B-3 Principal Distribution Amount remains undistributed, to the Holders of
the Class B-3 Certificates, until the Class B-3 Principal Distribution Amount
has been distributed in full;

                  (xii) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Class B-4 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distributions in Section 4.02(A)(VI), any portion of the
Class B-4 Principal Distribution Amount remains undistributed, to the Holders of
the Class B-4 Certificates, until the Class B-4 Principal Distribution Amount
has been distributed in full;

                  II. TO THE EXTENT OF ANY REMAINING MONTHLY EXCESS CASHFLOW
AMOUNT:

                  (xiii) to fund the Interest Carry Forward Amount for the Class
M-1 Certificates, if any;

                  (xiv) to fund the Interest Carry Forward Amount for the Class
M-2 Certificates, if any;

                  (xv) to fund the Interest Carry Forward Amount for the Class
M-3 Certificates, if any;

                  (xvi) to fund the Interest Carry Forward Amount for the Class
B-1 Certificates, if any;

                  (xvii) to fund the Interest Carry Forward Amount for the Class
B-2 Certificates, if any;

                  (xviii) to fund the Interest Carry Forward Amount for the
Class B-3 Certificates, if any;

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<PAGE>

                  (xix) to fund the Interest Carry Forward Amount for the Class
B-4 Certificates, if any;

                  (xx) to each Class of Class A Certificates, on a PRO RATA
basis based on the Certificate Principal Balance of each such Class (after
taking into account all distributions of principal to the Class A Certificates
on such Distribution Date), to fund the Class A Realized Loss Amortization
Amount for such Distribution Date;

                  (xxi) to fund the Class M-1 Realized Loss Amortization Amount
for such Distribution Date;

                  (xxii) to fund the Class M-2 Realized Loss Amortization Amount
for such Distribution Date;

                  (xxiii) to fund the Class M-3 Realized Loss Amortization
Amount for such Distribution Date;

                  (xxiv) to fund the Class B-1 Realized Loss Amortization Amount
for such Distribution Date;

                  (xxv) to fund the Class B-2 Realized Loss Amortization Amount
for such Distribution Date;

                  (xxvi) to fund the Class B-3 Realized Loss Amortization Amount
for such Distribution Date;

                  (xxvii) to fund the Class B-4 Realized Loss Amortization
Amount for such Distribution Date;

                  (xxviii) to the LIBOR Carryover Reserve Account for
distribution to the Offered Certificates and the Class B-4 Certificates, the
aggregate amount of any LIBOR Carryover Amount;

                  (xxix) from amounts distributed on the Class X/N Certificates,
to the Class N Certificates, (A) the Accrued Certificate Interest for the Class
N Certificates, (B) the unpaid Interest Carry Forward Amount for the Class N
Certificates and (C) any remaining Monthly Excess Cashflow Amount to reduce the
Class N Notional Amount, until the Class N Notional Amount has been reduced to
zero;

                  (xxx) from amounts distributed on the Class X/N Certificates,
to the Class X

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<PAGE>

Certificates, the Class X Distributable Amount for such Distribution Date; and

                  (xxxi) any remaining amounts to the Holders of the Residual
Certificates (in respect of the Class R-1 Interest, the Class R-2 Interest, the
Class R-3 Interest, the Class R-4 Interest and the Class R-5 Interest, as
applicable).

                  Following the foregoing distributions, an amount equal to the
amount of Subsequent Recoveries deposited into the Collection Account pursuant
to Section 3.04(a) shall be applied to increase the Certificate Principal
Balance of the Class of Certificates with the Highest Priority up to the extent
of such Realized Losses previously allocated to that Class of Certificates
pursuant to Section 4.03. An amount equal to the amount of any remaining
Subsequent Recoveries shall be applied to increase the Certificate Principal
Balance of the Class of Certificates with the next Highest Priority, up to the
amount of such Realized Losses previously allocated to that Class of
Certificates pursuant to Section 4.03. Holders of such Certificates will not be
entitled to any distribution in respect of interest on the amount of such
increases for any Interest Accrual Period preceding the Distribution Date on
which such increase occurs. Any such increases shall be applied to the
Certificate Principal Balance of each Certificate of such Class in accordance
with its respective Percentage Interest.

                  With respect to any distributions to be made on the Class B-1
Certificates, the Class B-4 Certificates, the Class N Certificates or the Class
X Certificates pursuant to this Section 4.02, such distributions will be made
first, on the Class B-1 Interest, the Class B-4 Interest or the Class X/N
Interest, as applicable, and then, on the related Class of Certificates.

                  (c) On each Distribution Date, all Prepayment Charges
(including amounts deposited in connection with the full or partial waiver of
such Prepayment Charges pursuant to Section 3.01) shall be allocated to the
Class N Certificates in the priority set forth under Section 4.02(B)(xxix) for
so long as the Notional Amount of the Class N Certificates is greater than zero,
and to the Class X Certificates after the Class N Notional Amount has been
reduced to zero.

                  (d) On each Distribution Date, after making the distributions
of the Available Funds as set forth above, the Trustee will withdraw from the
LIBOR Carryover Reserve Account, to the extent of amounts remaining on deposit
therein, the amount of any LIBOR Carryover Amount for such Distribution Date and
distribute such amount in the following order of priority:

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<PAGE>

                           (1) to the Class A Certificates, on a on a PRO RATA
         basis based on the LIBOR Carryover Amount for each such Class;

                           (2) to the Class M-1 Certificates;

                           (3) to the Class M-2 Certificates;

                           (4) to the Class M-3 Certificates;

                           (5) to the Class B-1 Certificates;

                           (6) to the Class B-2 Certificates;

                           (7) to the Class B-3 Certificates; and

                           (8) to the Class B-4 Certificates.

                  Section 4.03      ALLOCATION OF LOSSES.

                  (a) All Realized Losses on the Mortgage Loans allocated to any
Regular Certificate shall be allocated by the Trustee on each Distribution Date
as follows: first, to the Accrued Certificate Interest on the Class X/N Interest
as provided in Section 1.03 (after the allocation thereto of any Prepayment
Interest Shortfalls or Relief Act Interest Shortfalls as provided in Section
1.03); second, to the Overcollateralization Amount, until the
Overcollateralization Amount has been reduced to zero; third, to the Class B-4
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; fourth, to the Class B-3 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; fifth, to the Class B-2 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero; sixth,
to the Class B-1 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero; seventh, to the Class M-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; eighth, to the
Class M-2 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero, ninth, to the Class M-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and tenth, to each Class of
Class A Certificates, on a PRO RATA basis based on the Certificate Principal
Balance of each such Class, until the Certificate Principal Balances thereof
have been reduced to zero. All Realized Losses to be allocated to the
Certificate Principal Balances of all Classes on any Distribution Date shall be
so allocated after the actual distributions to be made on such date as provided
above. All references above to the Certificate Principal Balance of any Class of
Certificates shall be to the Certificate Principal Balance of such Class
immediately prior to the relevant Distribution Date, before reduction thereof by
any Realized Losses, in each case to be

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allocated to such Class of Certificates, on such Distribution Date.

                  Any allocation of Realized Losses to a Class A Certificate and
a Mezzanine Certificate on any Distribution Date shall be made by reducing the
Certificate Principal Balance thereof by the amount so allocated.

                  (b)(i) The REMIC 1 Marker Percentage of all Realized Losses on
the Mortgage Loans shall be allocated by the Trustee on each Distribution Date
to the following REMIC 1 Regular Interests in the specified percentages, as
follows: first, to Uncertificated Accrued Interest payable to REMIC 1 Regular
Interest LT1AA and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount
equal to the REMIC 1 Interest Loss Allocation Amount, 98% and 2%, respectively;
second, to the Uncertificated Principal Balances of REMIC 1 Regular Interest
LT1AA and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount equal to the
REMIC 1 Principal Loss Allocation Amount, 98% and 2%, respectively; third, to
the Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1B4 has been reduced to zero; fourth, to the Uncertificated Principal
Balances of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1B3 and
REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B3 has been
reduced to zero; fifth, to the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1B2 and REMIC 1 Regular
Interest LT1ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC 1 Regular Interest LT1B2 has been reduced to zero; sixth to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1B1 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1B1 has been reduced to zero; seventh, to the Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest
LT1M3 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%, respectively, until
the Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M3 has been
reduced to zero; eighth to the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1M2 and REMIC 1 Regular
Interest LT1ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC 1 Regular Interest LT1M2 has been reduced to zero; ninth to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1M1 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1M1 has been reduced to zero and tenth, to the Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AA, 98%, REMIC 1 Regular
Interest LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1 Regular Interest
LT1AV3, REMIC 1 Regular Interest LT1AV4, 1% pro rata and REMIC 1 Regular
Interest LT1ZZ, 1%, respectively, until the Uncertificated Principal Balances of
REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1

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Regular Interest LT1AV3 and REMIC 1 Regular Interest LT1AV4 have been reduced to
zero.

                  (ii) The REMIC 1 Sub WAC Allocation Percentage of all Realized
Losses shall be applied after all distributions have been made on each
Distribution Date first, so as to keep the Uncertificated Principal Balance of
each REMIC 1 Regular Interest ending with the designation "GRP" equal to 0.01%
of the aggregate Principal Balance of the Mortgage Loans in the related Loan
Group; second, to each REMIC 1 Regular Interest ending with the designation
"SUB," so that the Uncertificated Principal Balance of each such REMIC 1 Regular
Interest is equal to 0.01% of the excess of (x) the aggregate Principal Balance
of the Mortgage Loans in the related Loan Group over (y) the current Certificate
Principal Balance of the Class A Certificate in the related Loan Group (except
that if any such excess is a larger number than in the preceding distribution
period, the least amount of Realized Losses shall be applied to such REMIC 1
Regular Interests such that the REMIC 1 Subordinated Balance Ratio is
maintained); and third, any remaining Realized Losses shall be allocated to
REMIC 1 Regular Interest LT1XX.

                  (c) Special Hazard Losses will be allocated as described
above, except that if the aggregate amount of such losses, as of any date of
determination, exceeds the greatest of (i) 1.0% of the Principal Balance of the
Mortgage Loans as of the Cut-off Date, (ii) two times the amount of the
Principal Balance of the largest Mortgage Loan as of the date of determination
and (iii) an amount equal to the current Principal Balances of the Mortgage
Loans in the largest zip-code concentration in the State of California as of the
date of determination, such excess losses will be allocated among all the
outstanding Classes of Certificates, including the Class B-1 Interest, the Class
B-4 Interest and the Class X/N Interest, PRO RATA, based on their respective
Certificate Principal Balances or Notional Amount, as applicable.

                  Section 4.04      METHOD OF DISTRIBUTION.

                  The Trustee shall make distributions in respect of a
Distribution Date to each Certificateholder of record on the related Record Date
(other than as provided in Section 10.01 respecting the final distribution), in
the case of Certificateholders of the Certificates, by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Trustee in writing at least five Business
Days prior to the Record Date immediately prior to such Distribution Date and is
the registered owner of such Certificates the aggregate initial Certificate
Principal Balance or Notional Amount of which is in excess of $5,000,000, or by
check mailed by first class mail to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, provided that
the Trustee may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Distributions among Certificateholders shall be made in
proportion to the Percentage Interests evidenced by the Certificates held by
such Certificateholders.

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                  Section 4.05      DISTRIBUTIONS ON BOOK-ENTRY CERTIFICATES.

                  Each distribution with respect to a Book-Entry Certificate
shall be paid to the Depository, which shall credit the amount of such
distribution to the accounts of its Depository Participants in accordance with
its normal procedures. Each Depository Participant shall be responsible for
disbursing such distribution to the Certificate Owners that it represents and to
each indirect participating brokerage firm (a "brokerage firm" or "indirect
participating firm") for which it acts as agent. Each brokerage firm shall be
responsible for disbursing funds to the Certificate Owners that it represents.
All such credits and disbursements with respect to a Book Entry Certificate are
to be made by the Depository and the Depository Participants in accordance with
the provisions of the Certificates. None of the Trustee, the Depositor, the
Servicer or the Seller shall have any responsibility therefor except as
otherwise provided by applicable law.

                  Section 4.06      STATEMENTS.

                  (a) On each Distribution Date, based, as applicable, on the
Mortgage Loan information contained in the Remittance Report, the Trustee shall
(i) prepare and forward by mail to each Holder of the Regular Certificates and
(ii) make available on its website at www.usbank.com/abs for access by each
Holder of the Regular Certificates, a statement as to the distributions made on
such Distribution Date:

                  (i) the amount of the distribution made on such Distribution
         Date to the Holders of each Class of Certificates allocable to
         principal or reduction of Notional Amount, separately identified;

                  (ii) the amount of the distribution made on such Distribution
         Date to the Holders of each Class of Certificates allocable to interest
         or Class X Distributable Amount, separately identified;

                  (iii) the Overcollateralization Amount, the
         Overcollateralization Release Amount, the Overcollateralization
         Deficiency and the Overcollateralization Target Amount as of such
         Distribution Date and the Monthly Excess Interest Amount and Monthly
         Excess Cashflow Amount for such Distribution Date;

                  (iv) [reserved];

                  (v) the aggregate amount of Advances for the related
         Collection Period;

                  (vi) the Pool Balance at the close of business at the end of
         the related Collection

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         Period;

                  (vii) the number, weighted average remaining term to maturity
         and weighted average Mortgage Interest Rate of the Mortgage Loans as of
         the related Due Date;

                  (viii) the number and aggregate unpaid Principal Balance of
         Mortgage Loans (a) 30 to 59 days past due on a contractual basis, (b)
         60 to 89 days past due on a contractual basis, (c) 90 or more days past
         due on a contractual basis, (d) as to which foreclosure proceedings
         have been commenced and (e) in bankruptcy as of the close of business
         on the last day of the calendar month preceding such Distribution Date;

                  (ix) with respect to any Mortgage Loan that became an REO
         Property during the preceding calendar month, the loan number of such
         Mortgage Loan, the unpaid principal balance and the Principal Balance
         of such Mortgage Loan as of the date it became an REO Property;

                  (x) the book value of any REO Property as of the close of
         business on the last Business Day of the calendar month preceding the
         Distribution Date, and, cumulatively, the total number and cumulative
         principal balance of all REO Properties as of the close of business of
         the last day of the preceding Collection Period;

                  (xi) the aggregate amount of Principal Prepayments made during
         the related Prepayment Period;

                  (xii) the aggregate amount of Prepayment Charges collected
         (including amounts deposited in connection with the full or partial
         waiver of such Prepayment Charges pursuant to Section 3.01) during the
         related Collection Period and the amounts thereof allocable to the
         Class N Certificates and the Class X Certificates;

                  (xiii) the aggregate amount of Realized Losses incurred during
         the related Collection Period and the cumulative amount of Realized
         Losses;

                  (xiv) the Certificate Principal Balance or Notional Amount, as
         applicable, of each Class of Certificates, after giving effect to the
         distributions, and allocations of Realized Losses or Applied Realized
         Loss Amounts, as applicable, made on such Distribution Date, separately
         identifying any reduction thereof due to allocations of Realized Losses
         or Applied Realized Loss Amounts;

                  (xv) the Accrued Certificate Interest in respect of each Class
         of Offered

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<PAGE>

         Certificates and the Class B-4 Certificates for such Distribution Date,
         and the respective portions thereof, if any, remaining unpaid following
         the distributions made in respect of such Certificates on such
         Distribution Date and the amount of any LIBOR Carryover Amounts;

                  (xvi) the aggregate amount of any Prepayment Interest
         Shortfalls for such Distribution Date, to the extent not covered by
         payments by the Servicer pursuant to Section 3.23;

                  (xvii) the amount of the Trustee Fee paid;

                  (xviii) the LIBOR Carryover Amounts distributed on such
         Distribution Date and the amounts remaining after giving effect to
         distributions thereof on such Distribution Date;

                  (xix) any Overcollateralization Deficiency after giving effect
         to the distribution of principal on such Distribution Date;

                  (xx) whether a Trigger Event has occurred and is continuing,
         and the cumulative Realized Losses, as a percentage of the original
         Pool Balance;

                  (xxi) the Available Funds;

                  (xxii) the rate at which interest accrues for each Class of
         Certificates for such Distribution Date;

                  (xxiii) the Liquidation Report for such Distribution Date;

                  (xxiv) the aggregate Principal Balance of Mortgage Loans
         purchased by the Servicer or Seller during the related Collection
         Period and indicating the Section of this Agreement requiring or
         allowing the purchase of each such Mortgage Loan; and

                  (xxv) the aggregate Principal Balance of the Mortgage Loans
         repurchased by the Servicer (or an affiliate) during the related
         Collection Period in connection with Section 3.16.

                  The Trustee may fully rely upon and shall have no liability
with respect to information with respect to the Mortgage Loans provided by the
Servicer.

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

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<PAGE>

                  (b) Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Certificateholder of a Regular Certificate, if requested
in writing by such Person, such information as is reasonably necessary to
provide to such Person a statement containing the information set forth in
subclauses (i), (ii), (xv) and (xx) above, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be prepared and furnished
by the Trustee to Certificateholders pursuant to any requirements of the Code as
are in force from time to time.

                  (c) On each Distribution Date, the Trustee shall forward to
the Residual Certificateholders a copy of the reports forwarded to the Regular
Certificateholders in respect of such Distribution Date with such other
information as the Trustee deems necessary or appropriate. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be prepared and furnished to Residual
Certificateholders by the Trustee pursuant to any requirements of the Code as
from time to time in force.

                  Section 4.07      REMITTANCE REPORTS; ADVANCES.

                  (a) On the second Business Day following each Determination
Date but in no event less than four Business Days prior to the related
Distribution Date, the Servicer shall deliver to the Trustee by telecopy (or by
such other means as the Servicer and the Trustee may agree from time to time) a
Remittance Report with respect to the related Distribution Date. On the same
date, the Servicer shall forward to the Trustee by overnight mail a computer
readable magnetic tape or diskette or in such other medium as may be agreed
between the Servicer and the Trustee containing the information set forth in
such Remittance Report with respect to the related Distribution Date. Not later
than the close of business New York time on the Servicer Remittance Date, the
Servicer shall deliver or cause to be delivered to the Trustee in addition to
the information provided on the Remittance Report, such other information
reasonably available to it with respect to the Mortgage Loans as the Trustee may
reasonably request or order in order for the Trustee to perform the calculations
necessary to make the distributions contemplated by Section 4.01, 4.02 and 4.03
and to prepare the statements to Certificateholders contemplated by Section
4.06. The Trustee shall not be responsible to recompute, recalculate or verify
any information provided to it by the Servicer.

                  (b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.07(d), (i) the aggregate
amount of Monthly Payments (net of the related Servicing Fee and other than the
portion of the Monthly Payment representing principal on any second lien
Mortgage Loan), due during the related Collection Period in respect of the
Actuarial Mortgage Loans, which Monthly Payments were delinquent on a
contractual basis as of the close of

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<PAGE>

business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related
Prepayment Period and as to which such REO Property an REO Disposition did not
occur during the related Prepayment Period, an amount equal to the excess, if
any, of only the interest portion of the Monthly Payments (net of the related
Servicing Fee) that would have been due on the related Due Date in respect of
the related Mortgage Loans, over the net income from such REO Property deposited
in the Collection Account pursuant to Section 3.13 for distribution on such
Distribution Date. For purposes of the preceding sentence, the Monthly Payment
on each Balloon Mortgage Loan with a delinquent Balloon Payment is equal to the
assumed monthly payment that would have been due on the related Due Date based
on the original principal amortization schedule for the such Balloon Mortgage
Loan. The Servicer shall not be obligated to make any Advance with respect to
Simple Interest Mortgage Loans.

                  On or before the close of business New York time on the
Servicer Remittance Date, the Servicer shall remit in immediately available
funds to the Trustee for deposit in the Distribution Account an amount equal to
the aggregate amount of Advances, if any, to be made in respect of the Mortgage
Loans and REO Properties for the related Distribution Date either (i) from its
own funds or (ii) from the Collection Account, to the extent of funds held
therein for future distribution (in which case it will cause to be made an
appropriate entry in the records of the Collection Account that amounts held for
future distribution have been, as permitted by this Section 4.07, used by the
Servicer in discharge of any such Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of Advances to be made
by the Servicer with respect to the Mortgage Loans and REO Properties. In
addition, the Servicer shall have the right to reimburse itself for any Advances
previously made from the Collection Account, to the extent of funds held therein
for future distribution. Any amounts held for future distribution and so used
shall be appropriately reflected in the Servicer's records and replaced by the
Servicer by deposit in the Collection Account on or before any future Servicer
Remittance Date to the extent that the Available Funds for the related
Distribution Date (determined without regard to Advances to be made on the
Servicer Remittance Date) shall be less than the total amount that would be
distributed to the Classes of Certificateholders pursuant to Section 4.01 and
4.02 on such Distribution Date if such amounts held for future distributions had
not been so used to make Advances. The Trustee will provide notice to the
Servicer by telecopy by the close of business on any Servicer Remittance Date in
the event that the amount remitted by the Servicer to the Trustee on such date
is less than the Advances required to be made by the Servicer for the related
Distribution Date, as set forth in the related Remittance Report.

                  (c) The obligation of the Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until the earlier of such time as such Mortgage Loan is paid in full by
the Mortgagor or disposed of by the Trust, or until the recovery of all
Liquidation Proceeds thereon.

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<PAGE>

                  (d) Notwithstanding anything herein to the contrary, no
Advance or Servicing Advance shall be required to be made hereunder by the
Servicer if such Advance would, if made, constitute a Nonrecoverable Advance.
The determination by the Servicer that it has made a Nonrecoverable Advance or
that any proposed Advance, if made, would constitute a Nonrecoverable Advance,
shall be evidenced by an Officers' Certificate of the Servicer delivered to the
Depositor and the Trustee.

                  Section 4.08      REMIC DISTRIBUTIONS.

                  (a) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 1
to REMIC 2 on account of the REMIC 1 Regular Interests or withdrawn from the
Distribution Account and distributed to the Holders of the Class R Certificates
(in respect of the Class R-1 Interest), as the case may be:

                  (i) to Holders of REMIC 1 Regular Interest LT1AA, REMIC 1
         Regular Interest LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1
         Regular Interest LT1AV3, REMIC 1 Regular Interest LT1AV4, REMIC 1
         Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular
         Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
         Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular
         Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ, PRO RATA, in an
         amount equal to (A) the Uncertificated Accrued Interest for such
         Distribution Date, plus (B) any amounts in respect thereof remaining
         unpaid from previous Distribution Dates. Amounts payable as
         Uncertificated Accrued Interest in respect of REMIC 1 Regular Interest
         LT1ZZ shall be reduced and deferred when the REMIC 1 Overcollateralized
         Amount is less than the REMIC 1 Overcollateralization Target Amount, by
         the lesser of (x) the amount of such difference and (y) the Maximum
         LT1ZZ Uncertificated Accrued Interest Deferral Amount and such amount
         will be payable to the Holders of REMIC 1 Regular Interest LT1AV1,
         REMIC 1 Regular Interest LT1AV2, REMIC 1 Regular Interest LT1AV3, REMIC
         1 Regular Interest LT1AV4, REMIC 1 Regular Interest LT1M1, REMIC 1
         Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
         Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular
         Interest LT1B3 and REMIC 1 Regular Interest LT1B4 in the same
         proportion as the Overcollateralization Deficiency is allocated to the
         Corresponding Certificates and the Uncertificated Principal Balance of
         REMIC 1 Regular Interest LT1ZZ shall be increased by such amount;

                  (ii) to Holders of REMIC 1 Regular Interest LT1SUB, REMIC 1
         Regular Interest LT1GRP, REMIC 1 Regular Interest LT2SUB, REMIC 1
         Regular Interest LT2GRP and REMIC 1 Regular Interest LT1XX, PRO RATA,
         in an amount equal to (A) the Uncertificated Accrued Interest for such
         Distribution Date, plus (B) any amounts in respect thereof

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<PAGE>

         remaining unpaid from previous Distribution Dates;

                  (iii) to the Holders of REMIC 1 Regular Interests, in an
         amount equal to the remainder of the REMIC 1 Marker Allocation
         Percentage of Available Funds for such Distribution Date after the
         distributions made pursuant to clause (i) above, allocated as follows:

                           (a) to the Holders of REMIC 1 Regular Interest LT1AA,
                  98.00% of such remainder, until the Uncertificated Principal
                  Balance of such Uncertificated REMIC 1 Regular Interest is
                  reduced to zero;

                           (b) to the Holders of REMIC 1 Regular Interest
                  LT1AV1, REMIC 1 Regular Interest LT1AV2, REMIC 1 Regular
                  Interest LT1AV3, REMIC 1 Regular Interest LT1AV4, REMIC 1
                  Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC
                  1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1,
                  REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest LT1B3
                  and REMIC 1 Regular Interest LT1B4, 1.00% of such remainder,
                  in the same proportion as principal payments are allocated to
                  the Corresponding Certificates, until the Uncertificated
                  Principal Balances of such REMIC 1 Regular Interests are
                  reduced to zero; then

                           (c) to the Holders of REMIC 1 Regular Interest LT1ZZ,
                  1.00% of such remainder, until the Uncertificated Principal
                  Balance of such REMIC 1 Regular Interest is reduced to zero;

provided, however, that (i) 98.00% and (ii) 2.00% of any principal payments that
are attributable to an Overcollateralization Release Amount shall be allocated
to Holders of (i) REMIC 1 Regular Interest LT1AA and (ii) REMIC 1 Regular
Interest LT1ZZ, respectively; and

                  (iv) to the Holders of REMIC 1 Regular Interests, in an amount
         equal to the remainder of the REMIC 1 Sub WAC Allocation Percentage of
         Available Funds for such Distribution Date after the distributions made
         pursuant to clause (i) above, such that distributions of principal
         shall be deemed to be made to the REMIC 1 Regular Interests first, so
         as to keep the Uncertificated Principal Balance of each REMIC 1 Regular
         Interest ending with the designation "GRP" equal to 0.01% of the
         aggregate Principal Balance of the Mortgage Loans in the related Loan
         Group; second, to each REMIC 1 Regular Interest ending with the
         designation "SUB," so that the Uncertificated Principal Balance of each
         such REMIC 1 Regular Interest is equal to 0.01% of the excess of (x)
         the aggregate Principal Balance of the Mortgage Loans in the related
         Loan Group over (y) the current Certificate

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<PAGE>

         Principal Balance of the Class A Certificate in the related Loan Group
         (except that if any such excess is a larger number than in the
         preceding distribution period, the least amount of principal shall be
         distributed to such REMIC 1 Regular Interests such that the REMIC 1
         Subordinated Balance Ratio is maintained); and third, any remaining
         principal to REMIC 1 Regular Interest LT1XX.

                  Notwithstanding the distributions pursuant to this Section
4.08, distribution of funds shall be made only in accordance with Section 4.01
and Section 4.02.

                  (c) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 3 on account of the Class B-1 Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-3 Interest), as the case may be:

                  (i) to the Holders of the Class B-1 Interest, in an amount
         equal to (A) the Accrued Certificate Interest for such Distribution
         Date, plus (B) any amounts in respect thereof remaining unpaid from
         previous Distribution Dates; and

                  (ii) to the Holders of the Class B-1 Interest, until the
         Certificate Principal Balance of the Class B-1 Interest is reduced to
         zero.

                  (d) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 4 on account of the Class B-4 Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-4 Interest), as the case may be:

                  (i) to the Holders of the Class B-4 Interest, in an amount
         equal to (A) the Accrued Certificate Interest for such Distribution
         Date, plus (B) any amounts in respect thereof remaining unpaid from
         previous Distribution Dates; and

                  (ii) to the Holders of the Class B-4 Interest, until the
         Certificate Principal Balance of the Class B-4 Interest is reduced to
         zero.

                  (e) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 5 on account of the Class X/N Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-5 Interest), as the case may be:

                  (i) to the Holders of the Class X/N Interest, in an amount
         equal to (A) the

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<PAGE>

         Accrued Certificate Interest for such Distribution Date, plus (B) any
         amounts in respect thereof remaining unpaid from previous Distribution
         Dates; and

                  (ii) to the Holders of the Class X/N Interest, until the
         Certificate Principal Balance of the Class X/N Interest is reduced to
         zero.

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<PAGE>

                                    ARTICLE V

                                THE CERTIFICATES

                  Section 5.01      THE CERTIFICATES.

                  Each of the Class A Certificates, the Mezzanine Certificates,
the Class N Certificates, the Class X Certificates and the Residual Certificates
shall be substantially in the forms annexed hereto as exhibits, and shall, on
original issue, be executed by the Trustee and authenticated and delivered by
the Certificate Registrar to or upon the receipt of a Written Order to
Authenticate from the Depositor concurrently with the sale and assignment to the
Trustee of the Trust Fund. Each Class of the Class A Certificates and the
Mezzanine Certificates shall be initially evidenced by one or more Certificates
representing a Percentage Interest with a minimum dollar (or notional amount)
denomination of $25,000 and integral multiples of $1 in excess thereof. The
Class N, Class X and Residual Certificates are issuable only in minimum
Percentage Interests of 10%.

                  The Certificates shall be executed on behalf of the Trust by
manual or facsimile signature on behalf of the Trustee by a Responsible Officer.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures were affixed, authorized to sign on behalf of
the Trustee shall bind the Trust, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the authentication and delivery
of such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless such Certificate shall have been
manually authenticated by the Certificate Registrar substantially in the form
provided for herein, and such authentication upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. Subject to Section 5.02(c), the Class A Certificates
and the Mezzanine Certificates shall be Book-Entry Certificates. The Class N,
Class X and Residual Certificates shall not be Book-Entry Certificates but shall
be issued in fully registered certificate form.

                  Section 5.02 REGISTRATION OF TRANSFER AND EXCHANGE OF
                               CERTIFICATES.

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

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<PAGE>

limitations on liability and rights to indemnity as the Trustee, and the
provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05, 8.14, 8.15 and 8.16 shall
apply to the Certificate Registrar to the same extent as they apply to the
Trustee. Any Certificate Registrar appointed in accordance with this Section
5.02(a) may at any time resign by giving at least 30 days' advance written
notice of resignation to the Trustee, the Servicer and the Depositor, such
resignation to become effective upon appointment of a successor Certificate
Registrar.

                  Upon surrender for registration of transfer of any Certificate
at any office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of a Residual Certificate,
upon satisfaction of the conditions set forth below, the Trustee on behalf of
the Trust shall execute and the Certificate Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of the same aggregate Percentage Interest.

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

                  (b) Upon original issuance, the Book-Entry Certificates shall
be issued in the form of one or more typewritten certificates, to be delivered
to the Depository, the initial Depository, by, or on behalf of, the Depositor;
or to, and deposited with the Certificate Custodian, on behalf of the
Depository, if directed to do so pursuant to instructions from the Depository.
Except as provided in paragraph (c) below, the Book-Entry Certificates shall at
all times remain registered in the name of the Depository or its nominee and at
all times: (i) registration of such Certificates may not be transferred by the
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Certificates; (iii) ownership and transfers of
registration of such Certificates on the books of the Depository shall be
governed by applicable rules established by the Depository; (iv) the Depository
may collect its usual and customary fees, charges and expenses from its
Depository Participants; (v) the Trustee shall for all purposes deal with the
Depository as representative of the Certificate Owners of the Certificates for
purposes of exercising the rights of Holders under this Agreement, and requests
and directions for and votes of such representative shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; (vi)
the Trustee may rely and shall be

                                      -139-

<PAGE>

fully protected in relying upon information furnished by the Depository with
respect to its Depository Participants and furnished by the Depository
Participants with respect to indirect participating firms and Persons shown on
the books of such indirect participating firms as direct or indirect Certificate
Owners; and (vii) the direct participants of the Depository shall have no rights
under this Agreement under or with respect to any of the Certificates held on
their behalf by the Depository, and the Depository may be treated by the Trustee
and its agents, employees, officers and directors as the absolute owner of the
Certificates for all purposes whatsoever.

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

                  (c) If (i)(x) the Depository or the Depositor advises the
Trustee in writing that the Depository is no longer willing or able to discharge
properly its responsibilities as Depository and (y) the Trustee or the Depositor
is unable to locate a qualified successor or (ii) after the occurrence of a
Servicer Event of Termination, the Certificate Owners of each Class of
Book-Entry Certificates representing Percentage Interests of such Classes
aggregating not less than 51% advises the Trustee and Depository through the
Financial Intermediaries and the Depository Participants in writing that the
continuation of a book-entry system through the Depository to the exclusion of
definitive, fully registered certificates (the "Definitive Certificates") to
Certificate Owners is no longer in the best interests of the Certificate Owners.
Upon surrender to the Certificate Registrar of the Book-Entry Certificates by
the Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall, at the Depositor's expense, in the case of (ii)
above, or the Seller's expense, in the case of (i) and (iii) above, execute on
behalf of the Trust and the Certificate Registrar shall authenticate the
Definitive Certificates. Neither the Depositor nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates, the Trustee, the Certificate Registrar, the Servicer,
any Paying Agent and the Depositor shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.

                  (d) Except with respect to the initial transfer of the Private
Certificates by the Depositor, no transfer, sale, pledge or other disposition of
any Private Certificate shall be made unless such disposition is exempt from the
registration requirements of the Securities Act of 1933, as amended (the "1933
Act"), and any applicable state securities laws or is made in accordance with
the 1933 Act and laws. In the event of any such transfer, (i) unless such
transfer is made in reliance

                                      -140-

<PAGE>

upon Rule 144A (as evidenced by the investment letter delivered to the
Certificate Registrar, in substantially the form attached hereto as Exhibit J-2)
under the 1933 Act, the Certificate Registrar and the Depositor shall require a
written Opinion of Counsel (which may be in-house counsel) acceptable to and in
form and substance reasonably satisfactory to the Certificate Registrar and the
Depositor that such transfer may be made pursuant to an exemption, describing
the applicable exemption and the basis therefor, from the 1933 Act or is being
made pursuant to the 1933 Act, which Opinion of Counsel shall not be an expense
of the Certificate Registrar or the Depositor or (ii) the Certificate Registrar
shall require the transferor to execute a transferor certificate (in
substantially the form attached hereto as Exhibit L) and the transferee to
execute an investment letter (in substantially the form attached hereto as
Exhibit J-1) acceptable to and in form and substance reasonably satisfactory to
the Depositor and the Certificate Registrar certifying to the Depositor and the
Certificate Registrar the facts surrounding such transfer, which investment
letter shall not be an expense of the Certificate Registrar or the Depositor.
The Holder of a Private Certificate desiring to effect such transfer shall, and
does hereby agree to, indemnify the Certificate Registrar and the Depositor
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.

                  No transfer of an ERISA Restricted Certificate shall be made
unless the Certificate Registrar shall have received either (i) a representation
from the transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Certificate Registrar and the Depositor, (such requirement
is satisfied only by the Certificate Registrar's receipt of a representation
letter from the transferee substantially in the form of Exhibit I hereto, as
appropriate), to the effect that such transferee is not an employee benefit plan
or arrangement subject to Section 406 of ERISA or a plan subject to Section 4975
of the Code, nor a person acting on behalf of any such plan or arrangement nor
using the assets of any such plan or arrangement to effect such transfer or (ii)
(except in the case of a Residual, Class X or Class N Certificate) if the
purchaser is an insurance company, a representation that the purchaser is an
insurance company which is purchasing such Certificates with funds contained in
an "insurance company general account" (as such term is defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60") and that the
purchase and holding of such Certificates are covered under Sections I and III
of PTCE 95-60 or (iii) (except in the case of a Residual Certificate) in the
case of any such ERISA Restricted Certificate presented for registration in the
name of an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions of any subsequent
enactments), or a trustee of any such plan or any other person acting on behalf
of any such plan or arrangement or using such plan's or arrangement's assets, an
Opinion of Counsel satisfactory to the Certificate Registrar, to the effect that
the purchase and holding of such ERISA Restricted Certificate will not result in
a non-exempt prohibited transaction under ERISA and the Code and will not
subject the Servicer, the Trustee or the Certificate Registrar to any obligation
in addition to those expressly undertaken in this Agreement or to any liability.
For purposes of the

                                      -141-

<PAGE>

preceding sentence, the representation in (i) or (ii) shall be deemed to have
been made to the Certificate Registrar by the acceptance by a Certificate Owner
of the beneficial interest in any such Class of ERISA Restricted Certificates,
unless the Certificate Registrar shall have received from the transferee an
alternative representation acceptable in form and substance to the Depositor.
Notwithstanding anything else to the contrary herein, any purported transfer of
an ERISA Restricted Certificate to or on behalf of an employee benefit plan
subject to ERISA in violation of this paragraph as described above shall be void
and of no effect.

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

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

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

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

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

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

                  (iv) Any attempted or purported transfer of any Ownership
         Interest in a Residual Certificate in violation of the provisions of
         this Section shall be absolutely null and void and

                                      -142-

<PAGE>

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

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

                  (vi) If any Person other than a Permitted Transferee acquires
         any Ownership Interest in a Residual Certificate in violation of the
         restrictions in this Section, then the Trustee will provide to the
         Internal Revenue Service, and to the persons specified in Sections
         860E(e)(3) and (6) of the Code, information needed to compute the tax
         imposed under Section 860E(e)(5) of the Code on transfers of residual
         interests to disqualified organizations. The Trustee shall be entitled
         to reasonable compensation for providing such information from the
         person to whom it is provided.

                                      -143-

<PAGE>

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

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

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

                  Section 5.03 MUTILATED, DESTROYED, LOST OR STOLEN
                               CERTIFICATES.

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

                  Section 5.04 PERSONS DEEMED OWNERS.

                  The Servicer, the Depositor, the Trustee, the Certificate
Registrar, any Paying Agent and any agent of the Servicer, the Depositor, the
Certificate Registrar, any Paying Agent or the Trustee may treat the Person,
including a Depository, in whose name any Certificate is registered as the owner
of such Certificate for the purpose of receiving distributions pursuant to
Section 4.01 and Section 4.02 and for all other purposes whatsoever, and none of
the Servicer, the Trust, the Trustee

                                      -144-

<PAGE>

nor any agent of any of them shall be affected by notice to the contrary.

                  Section 5.05      APPOINTMENT OF PAYING AGENT.

                  The Paying Agent shall make distributions to
Certificateholders from the Distribution Account pursuant to Section 4.01 and
Section 4.02 and shall report the amounts of such distributions to the Trustee.
The duties of the Paying Agent may include the obligation (i) to withdraw funds
from the Collection Account pursuant to Section 3.05 and for the purpose of
making the distributions referred to above and (ii) to distribute statements and
provide information to Certificateholders as required hereunder. The Paying
Agent hereunder shall at all times be an entity duly incorporated and validly
existing under the laws of the United States of America or any state thereof,
authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by federal or state authorities. The Paying Agent
shall initially be the Trustee. The Trustee may appoint a successor to act as
Paying Agent, which appointment shall be reasonably satisfactory to the
Depositor and the Rating Agencies. The Trustee as Paying Agent shall be subject
to the same standards of care, limitations on liability and rights to indemnity
as the Trustee, and the provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05,
8.14, 8.15 and 8.16 shall apply to the Paying Agent to the same extent as they
apply to the Trustee. Any Paying Agent appointed in accordance with this Section
5.02(a) may at any time resign by giving at least 30 days' advance written
notice of resignation to the Trustee, the Servicer and the Depositor, such
resignation to become effective upon appointment of a successor Paying Agent.

                                      -145-

<PAGE>

                                   ARTICLE VI

                   THE SELLER, THE SERVICER AND THE DEPOSITOR

                  Section 6.01 LIABILITY OF THE SELLER, THE SERVICER AND THE
                                DEPOSITOR.

                  The Seller and the Servicer shall be liable in accordance
herewith only to the extent of the obligations specifically imposed upon and
undertaken by the Seller or Servicer, as the case may be, herein. The Depositor
shall be liable in accordance herewith only to the extent of the obligations
specifically imposed upon and undertaken by the Depositor.

                  Section 6.02 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
                               OBLIGATIONS OF, THE SELLER, THE SERVICER OR THE
                               DEPOSITOR.

                  Any entity into which the Seller, the Servicer or the
Depositor may be merged or consolidated, or any entity resulting from any
merger, conversion or consolidation to which the Seller, the Servicer or the
Depositor shall be a party, or any corporation succeeding to the business of the
Seller, the Servicer or the Depositor, shall be the successor of the Seller, the
Servicer or the Depositor, as the case may be, hereunder, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding; PROVIDED, HOWEVER, that
the successor Servicer shall satisfy all the requirements of Section 7.02 with
respect to the qualifications of a successor Servicer.

                  Section 6.03 LIMITATION ON LIABILITY OF THE SERVICER AND
                               OTHERS.

                  Neither the Servicer, the Depositor nor any of the directors
or officers or employees or agents of the Servicer or the Depositor shall be
under any liability to the Trust or the C.ertificateholders for any action taken
or for refraining from the taking of any action by the Servicer in good faith
pursuant to this Agreement, or for errors in judgment; PROVIDED, HOWEVER, that
this provision shall not protect the Servicer, the Depositor or any such Person
against any liability which would otherwise be imposed by reason of its willful
misfeasance, bad faith or gross negligence in the performance of duties of the
Servicer or the Depositor or by reason of its reckless disregard of its
obligations and duties of the Servicer or the Depositor hereunder; PROVIDED,
FURTHER, that this provision shall not be construed to entitle the Servicer to
indemnity in the event that amounts advanced by the Servicer to retire any
senior lien exceed Liquidation Proceeds (in excess of related liquidation
expenses) realized with respect to the related Mortgage Loan. The Servicer, the
Depositor and any director or officer or employee or agent of the Servicer or
the Depositor may rely in good faith on any document of any kind PRIMA FACIE
properly executed and submitted by any Person respecting any matters arising
hereunder. The Servicer, the Depositor and any director or

                                      -146-

<PAGE>

officer or employee or agent of the Servicer or the Depositor shall be
indemnified by the Trust and held harmless against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement
or the Certificates, other than any loss, liability or expense incurred by
reason of its willful misfeasance, bad faith or negligence in the performance of
duties hereunder or by reason of its reckless disregard of obligations and
duties hereunder. The Servicer or the Depositor may undertake any such action
which it may deem necessary or desirable in respect of this Agreement, and the
rights and duties of the parties hereto and the interests of the
Certificateholders hereunder. In such event, the reasonable legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust and the Servicer or the Depositor shall be
entitled to pay such expenses from the proceeds of the Trust or to be reimbursed
therefor pursuant to Section 3.05 upon presentation to the Trustee of
documentation of such expenses, costs and liabilities. The Servicer's right to
indemnity or reimbursement pursuant to this Section shall survive any
resignation or termination of the Servicer pursuant to Section 6.04 or 7.01 with
respect to any losses, expenses, costs or liabilities arising prior to such
resignation or termination (or arising from events that occurred prior to such
resignation or termination). This paragraph shall apply to the Servicer and the
Depositor solely in their capacities as Servicer and Depositor hereunder and in
no other capacities.

                  Section 6.04      SERVICER NOT TO RESIGN.

                  Subject to the provisions of Section 7.01 and Section 6.02,
the Servicer shall not resign from the obligations and duties hereby imposed on
it except (i) upon determination that the performance of its obligations or
duties hereunder are no longer permissible under applicable law or are in
material conflict by reason of applicable law with any other activities carried
on by it or its subsidiaries or Affiliates, the other activities of the Servicer
so causing such a conflict being of a type and nature carried on by the Servicer
or its subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of the following conditions: (a) the Servicer has proposed a
successor servicer to the Trustee in writing and such proposed successor
servicer is reasonably acceptable to the Trustee; and (b) each Rating Agency
shall have delivered a letter to the Trustee prior to the appointment of the
successor servicer stating that the proposed appointment of such successor
servicer as Servicer hereunder will not result in the reduction or withdrawal of
the then current rating of the Regular Certificates or the ratings that are in
effect; PROVIDED, HOWEVER, that no such resignation by the Servicer shall become
effective until such successor servicer or, in the case of (i) above, the
Trustee shall have assumed the Servicer's responsibilities and obligations
hereunder or the Trustee shall have designated a successor servicer in
accordance with Section 7.02. Any such resignation shall not relieve the
Servicer of responsibility for any of the obligations specified in Sections 7.01
and 7.02 as obligations that survive the resignation or termination of the
Servicer. Any such determination permitting the resignation of the Servicer
pursuant to clause (i) above shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. Any such determination

                                      -147-

<PAGE>

permitting the resignation of the Servicer shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trustee.

                  The Trustee and the Depositor hereby specifically (i) consent
to the pledge and assignment by the Servicer of all the Servicer's right, title
and interest in, to and under this Agreement to the Servicing Rights Pledgee,
for the benefit of certain lenders, and (ii) provided that no Servicer Event of
Termination exists, agree that upon delivery to the Trustee by the Servicing
Rights Pledgee of a letter signed by the Servicer whereunder the Servicer shall
resign as Servicer under this Agreement, the Trustee shall appoint the Servicing
Rights Pledgee or its designee as successor Servicer, provided that at the time
of such appointment, the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer pursuant to Section 7.02(a) and agrees to
be subject to the terms of this Agreement. If, pursuant to any provision hereof,
the duties of the Servicer are transferred to a successor, the entire amount of
the Servicing Fee and other compensation payable to the Servicer pursuant hereto
shall thereafter be payable to such successor.

                  Section 6.05      DELEGATION OF DUTIES.

                  In the ordinary course of business, the Servicer at any time
may delegate any of its duties hereunder to any Person, including any of its
Affiliates, who agrees to conduct such duties in accordance with standards
comparable to those set forth in Section 3.01. Such delegation shall not relieve
the Servicer of its liabilities and responsibilities with respect to such duties
and shall not constitute a resignation within the meaning of Section 6.04. The
Servicer shall provide the Trustee and the Rating Agencies with 60 days prior
written notice prior to the delegation of any of its duties to any Person other
than any of the Servicer's Affiliates or their respective successors and
assigns.

                                      -148-

<PAGE>

                                   ARTICLE VII

                                     DEFAULT

                  Section 7.01      SERVICER EVENTS OF TERMINATION.

                  (a) If any one of the following events ("Servicer Events of
Termination") shall occur and be continuing:

                  (i) (A) The failure by the Servicer to make any Advance; or
         (B) any other failure by the Servicer to deposit in the Collection
         Account or Distribution Account any deposit required to be made under
         the terms of this Agreement which continues unremedied for a period of
         one Business Day after the date upon which written notice of such
         failure shall have been given to the Servicer by the Trustee or by any
         Holder of a Regular Certificate evidencing at least 25% of the Voting
         Rights; or

                  (ii) The failure by the Servicer to make any required
         Servicing Advance which failure continues unremedied for a period of 30
         days, or the failure by the Servicer duly to observe or perform, in any
         material respect, any other covenants, obligations or agreements of the
         Servicer as set forth in this Agreement, which failure continues
         unremedied for a period of 30 days, after the date (A) on which written
         notice of such failure, requiring the same to be remedied, shall have
         been given to the Servicer by the Trustee or by any Holder of a Regular
         Certificate evidencing at least 25% of the Voting Rights or (B) actual
         knowledge of such failure by a Servicing Officer of the Servicer; or

                  (iii) The entry against the Servicer of a decree or order by a
         court or agency or supervisory authority having jurisdiction in the
         premises for the appointment of a trustee, conservator, receiver or
         liquidator in any insolvency, conservatorship, receivership,
         readjustment of debt, marshalling of assets and liabilities or similar
         proceedings, or for the winding up or liquidation of its affairs, and
         the continuance of any such decree or order unstayed and in effect for
         a period of 60 days; or

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

                                      -149-

<PAGE>

         winding-up or liquidation of its affairs, shall have been entered
         against the Servicer and such decree or order shall have remained in
         force undischarged, unbonded or unstayed for a period of 60 days; or
         the Servicer shall admit in writing its inability to pay its debts
         generally as they become due, file a petition to take advantage of any
         applicable insolvency or reorganization statute, make an assignment for
         the benefit of its creditors or voluntarily suspend payment of its
         obligations; or

                  (v) The aggregate amount of cumulative Realized Losses
         incurred since the Cut- off Date through the last day of the related
         Collection Period divided by the initial Pool Balance exceeds the
         applicable percentages set forth below with respect to such
         Distribution Date:

                DISTRIBUTION DATE OCCURRING IN            PERCENTAGE
                ------------------------------            ----------
                April 2007 through March 2008                5.00%
                April 2008 through March 2009                5.50%
                April 2009 through March 2010                7.00%
                April 2010 and thereafter                    8.00%

                  (b) Then, and in each and every such case, so long as a
Servicer Event of Termination shall not have been remedied within the applicable
grace period, (x) with respect solely to clause (i)(A) above, if such Advance is
not made by 2:00 P.M., New York time, on the Business Day immediately following
the Servicer Remittance Date, the Trustee may terminate all of the rights and
obligations of the Servicer under this Agreement and the Trustee, or a successor
servicer appointed in accordance with Section 7.02, shall immediately make such
Advance and assume, pursuant to Section 7.02, the duties of a successor Servicer
and (y) in the case of (i)(B), (ii), (iii), (iv) and (v) above, the Trustee
shall, at the direction of the Holders of each Class of Regular Certificates
evidencing Percentage Interests aggregating not less than 51%, by notice then
given in writing to the Servicer and the Trustee, terminate all of the rights
and obligations of the Servicer as servicer under this Agreement. Any such
notice to the Servicer shall also be given to each Rating Agency, the Depositor
and the Seller. On or after the receipt by the Servicer and the Trustee of such
written notice, all authority and power of the Servicer under this Agreement,
whether with respect to the Certificates or the Mortgage Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section;
and, without limitation, the Trustee is hereby authorized and empowered to
execute and deliver, on behalf of the Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement of each
Mortgage Loan and Related Documents or otherwise. The Servicer agrees to
cooperate with the Trustee (or the applicable successor Servicer) in effecting
the termination of the responsibilities and rights of the Servicer hereunder,
including, without limitation, the delivery to

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the successor Servicer of all documents and records requested by it to enable it
to assume the Servicer's functions under this Agreement within ten Business Days
subsequent to such notice, the transfer within one Business Day subsequent to
such notice to the Trustee (or the applicable successor Servicer) for the
administration by it of all cash amounts that shall at the time be held by the
Servicer and to be deposited by it in the Collection Account, the Distribution
Account, any REO Account or any Escrow Account or that have been deposited by
the Servicer in such accounts or thereafter received by the Servicer with
respect to the Mortgage Loans or any REO Property received by the Servicer. All
reasonable costs and expenses (including attorneys' fees) incurred in connection
with transferring the servicing to the successor Servicer and amending this
Agreement to reflect such succession as Servicer pursuant to this Section shall
be paid by the predecessor Servicer (or if the predecessor Servicer is the
Trustee, the initial Servicer) upon presentation of reasonable documentation of
such costs and expenses.

                  Section 7.02      TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.

                  (a) Within 90 days of the time the Servicer and the Trustee
receives a notice of termination or resignation pursuant to Section 7.01 or
6.04, the Trustee (or such other successor Servicer as is approved in accordance
with this Agreement) shall be the successor in all respects to the Servicer in
its capacity as servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof arising on and after its succession. As compensation therefor, the
Trustee (or such other successor Servicer) shall be entitled to such
compensation as the Servicer would have been entitled to hereunder if no such
notice of termination had been given. Notwithstanding the above, (i) if the
Trustee is unwilling to act as successor Servicer or (ii) if the Trustee is
legally unable so to act, the Trustee shall appoint or petition a court of
competent jurisdiction to appoint, any established housing and home finance
institution, bank or other mortgage loan or home equity loan servicer having a
net worth of not less than $50,000,000 as the successor to the Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder; PROVIDED, that the appointment of any
such successor Servicer will not result in the qualification, reduction or
withdrawal of the ratings assigned to the Certificates or the ratings that are
in effect by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The successor servicer shall be
entitled to withdraw from the Collection Account all costs and expenses
associated with the transfer of the servicing to the successor servicer. The
appointment of

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a successor servicer shall not affect any liability of the predecessor Servicer
which may have arisen under this Agreement prior to its termination as Servicer
to pay any deductible under an insurance policy pursuant to Section 3.12 or to
indemnify the parties indicated in Section 3.26 pursuant to the terms thereof,
nor shall any successor Servicer be liable for any acts or omissions of the
predecessor Servicer or for any breach by such Servicer of any of its
representations or warranties contained herein or in any related document or
agreement. The Trustee and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.

                  In the event of a Servicer Event of Termination,
notwithstanding anything to the contrary above, the Trustee and the Depositor
hereby agree that upon delivery to the Trustee by the Servicing Rights Pledgee
of a letter signed by the Servicer within ten Business Days of when notification
of such event shall have been provided to the Trustee, whereunder the Servicer
shall resign as Servicer under this Agreement, the Servicing Rights Pledgee or
its designee shall be appointed as successor Servicer (provided that at the time
of such appointment the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer set forth above) and the Servicing Rights
Pledgee agrees to be subject to the terms of this Agreement.

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

                  Section 7.03      WAIVER OF DEFAULTS.

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

                  Section 7.04      NOTIFICATION TO CERTIFICATEHOLDERS.

                  (a) On any termination or appointment of a successor the
Servicer pursuant to this

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Article VII or Section 6.04, the Trustee shall give prompt written notice
thereof to the Certificateholders at their respective addresses appearing in the
Certificate Register and each Rating Agency.

                  (b) No later than 60 days after the occurrence of any event
which constitutes or which, with notice or a lapse of time or both, would
constitute a Servicer Event of Termination for five Business Days after a
Responsible Officer of the Trustee becomes aware of the occurrence of such an
event, the Trustee shall transmit by mail to all Certificateholders notice of
such occurrence unless such default or Servicer Event of Termination shall have
been waived or cured. Such notice shall be given to the Rating Agencies promptly
after any such occurrence.

                  Section 7.05      SURVIVABILITY OF SERVICER LIABILITIES.

                  Notwithstanding anything herein to the contrary, upon
termination of the Servicer hereunder, any liabilities of the Servicer which
accrued prior to such termination shall survive such termination.

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                                  ARTICLE VIII

                                   THE TRUSTEE

                  Section 8.01      DUTIES OF TRUSTEE.

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

                  The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement; PROVIDED, HOWEVER, that the
Trustee shall not be responsible for the accuracy or content of any resolution,
certificate, statement, opinion, report, document, order or other instrument
furnished by the Servicer, the Seller or the Depositor hereunder. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Trustee shall notify the Certificateholders of such
instrument in the event that the Trustee, after so requesting, does not receive
a satisfactorily corrected instrument.

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

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

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<PAGE>

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

                  (iii) the Trustee shall not be liable with respect to any
         action taken, suffered or omitted to be taken by it in good faith in
         accordance with the direction of the Majority Certificateholders
         relating to the time, method and place of conducting any proceeding for
         any remedy available to the Trustee or exercising or omitting to
         exercise any trust or power conferred upon the Trustee under this
         Agreement; and

                  (iv) the Trustee shall not be charged with knowledge of any
         failure by the Servicer to comply with the obligations of the Servicer
         referred to in clauses (i) and (ii) of Section 7.01(a) or any Servicer
         Event of Termination unless a Responsible Officer of the Trustee at the
         applicable Corporate Trust Office obtains actual knowledge of such
         failure or the Trustee receives written notice of such failure from the
         Servicer or the Majority Certificateholders. In the absence of such
         receipt of such notice, the Trustee may conclusively assume that there
         is no Servicer Event of Termination.

                  The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee to perform, or be responsible for the manner of performance of, any
of the obligations of the Servicer under this Agreement, except with respect to
the Trustee during such time, if any, as the Trustee shall be the successor to,
and be vested with the rights, duties, powers and privileges of, the Servicer in
accordance with the terms of this Agreement.

                  The Trustee shall not have any duty (A) to see any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation statement evidencing a security
interest, or to see to the maintenance of any such recording or filing or
depositing or to any rerecording, refiling or redepositing of any thereof, (B)
to see to any insurance or (C) to see to the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of any kind
owing with respect to, assessed or levied against, any part of the Trust Fund
other than from funds available in the Distribution Account.

                  Section 8.02      CERTAIN MATTERS AFFECTING THE TRUSTEE.

                  (a) Except as otherwise provided in Section 8.01:

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

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

                  (iii) the Trustee shall not be under any obligation to
         exercise any of the rights or powers vested in it by this Agreement, or
         to institute, conduct or defend any litigation hereunder or in relation
         hereto, at the request, order or direction of the Certificateholders
         pursuant to the provisions of this Agreement, unless such
         Certificateholders shall have offered to the Trustee reasonable
         security or indemnity against the costs, expenses and liabilities which
         may be incurred therein or thereby; the right of the Trustee to perform
         any discretionary act enumerated in this Agreement shall not be
         construed as a duty, and the Trustee shall not be answerable for other
         than its negligence or willful misconduct in the performance of any
         such act;

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

                  (v) prior to the occurrence of a Servicer Event of Termination
         and after the curing of all Servicer Events of Termination which may
         have occurred, the Trustee shall not be bound to make any investigation
         into the facts or matters stated in any resolution, certificate,
         statement, instrument, opinion, report, notice, request, consent,
         order, approval, bond or other paper or documents, unless requested in
         writing to do so by the Majority Certificateholder; PROVIDED, HOWEVER,
         that if the payment within a reasonable time to the Trustee of the
         costs, expenses or liabilities likely to be incurred by it in the
         making of such investigation is, in the opinion of the Trustee, not
         reasonably assured to the Trustee by the security afforded to it by the
         terms of this Agreement, the Trustee may require reasonable indemnity
         against such cost, expense or liability as a condition to such
         proceeding. The reasonable expense of every such examination shall be
         paid by the Servicer or, if paid by the Trustee, shall be reimbursed by
         the Servicer upon demand. Nothing in this clause (v) shall derogate
         from the obligation of the Servicer to observe any applicable law
         prohibiting disclosure of information regarding the Mortgagors;

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<PAGE>

                  (vi) the Trustee shall not be accountable, shall have any
         liability or make any representation as to any acts or omissions
         hereunder of the Servicer until such time as the Trustee may be
         required to act as Servicer pursuant to Section 7.02;

                  (vii) the Trustee may execute any of the trusts or powers
         hereunder or perform any duties hereunder either directly or by or
         through agents or attorneys or a custodian and the Trustee shall not be
         responsible for any misconduct or negligence on the part of any such
         agent, attorney or custodian appointed by it with due care; and

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

                  Section 8.03 TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE
                               LOANS.

                  The recitals contained herein and in the Certificates (other
than the authentication of the Trustee on the Certificates) shall be taken as
the statements of the Seller, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the validity
or sufficiency of this Agreement or of the Certificates (other than the
signature of the Trustee and authentication of the Trustee on the Certificates)
or of any Mortgage Loan or Related Document. The Trustee shall not be
accountable for the use or application by the Servicer, or for the use or
application of any funds paid to the Servicer in respect of the Mortgage Loans
or deposited in or withdrawn from the Collection Account by the Servicer. The
Trustee shall not at any time have any responsibility or liability for or with
respect to the legality, validity and enforceability of any Mortgage or any
Mortgage Loan, or the perfection and priority of any Mortgage or the maintenance
of any such perfection and priority, or for or with respect to the sufficiency
of the Trust or its ability to generate the payments to be distributed to
Certificateholders under this Agreement, including, without limitation: the
existence, condition and ownership of any Mortgaged Property; the existence and
enforceability of any hazard insurance thereon (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 7.02); the validity of the
assignment of any Mortgage Loan to the Trustee or of any intervening assignment;
the completeness of any Mortgage Loan; the performance or enforcement of any
Mortgage Loan (other than if the Trustee shall assume the duties of the Servicer
pursuant to Section 7.02); the compliance by the Depositor, the Seller or the
Servicer with any warranty or representation made under this Agreement or in any
related document or the accuracy of any such warranty or representation prior to
the Trustee's receipt of notice or other discovery of any non-compliance
therewith or any breach thereof; any investment of monies by or at the direction
of the Servicer or any loss resulting therefrom, it being understood that the
Trustee shall remain responsible for any Trust property that it may hold in its
individual capacity; the acts or omissions of any of the Servicer (other than if
the Trustee shall assume the duties of the Servicer

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<PAGE>

pursuant to Section 7.02), or any Mortgagor; any action of the Servicer (other
than if the Trustee shall assume the duties of the Servicer pursuant to Section
7.02), taken in the name of the Trustee; the failure of the Servicer to act or
perform any duties required of it as agent of the Trustee hereunder; or any
action by the Trustee taken at the instruction of the Servicer (other than if
the Trustee shall assume the duties of the Servicer pursuant to Section 7.02);
PROVIDED, HOWEVER, that the foregoing shall not relieve the Trustee of its
obligation to perform its duties under this Agreement. The Trustee shall not
have any responsibility for filing any financing or continuation statement in
any public office at any time or to otherwise perfect or maintain the perfection
of any security interest or lien granted to it hereunder.

                  Section 8.04 TRUSTEE MAY OWN CERTIFICATES.

                  The Trustee in its individual or any other capacity may become
the owner or pledgee of Certificates with the same rights as it would have if it
were not Trustee and may transact any banking and trust business with the
Seller, the Servicer, the Depositor or their Affiliates.

                  Section 8.05 SELLER TO PAY TRUSTEE FEES AND EXPENSES.

                  The Trustee shall withdraw from the Distribution Account on
each Distribution Date and pay to itself its fees in an aggregate amount equal
to the Trustee Fee pursuant to Section 4.01 and, to the extent the sum of the
Group I Interest Remittance Amount and the Group II Interest Remittance Amount
is at any time insufficient for such purpose, the Seller shall pay such fees as
reasonable compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trusts hereby created and in the exercise
and performance of any of the powers and duties hereunder of the Trustee, and
the Seller will pay or reimburse the Trustee upon their request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from such party's negligence or bad faith or which is
the responsibility of Certificateholders or the Trustee hereunder.
Notwithstanding any other provision of this Agreement, including Section 2.03(a)
and Section 2.04, to the contrary, the Seller covenants and agrees to indemnify
the Trustee and its respective officers, directors, employees and agents from,
and hold each of them harmless against, any and all losses, liabilities,
damages, claims or expenses incurred in connection with any legal action
relating to this Agreement, the Certificates or incurred in connection with the
administration of the Trust, other than with respect to a party, any loss,
liability or expense incurred by reason of willful misfeasance, bad faith or
negligence of such party in the performance of their respective duties hereunder
or by reason of such party's reckless disregard of obligations and duties
hereunder. Anything in this Agreement to the contrary

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<PAGE>

notwithstanding, in no event shall the Trustee be liable for special, indirect
or consequential loss or damage of any kind whatsoever (including but not
limited to lost profits), even if the Trustee has been advised of the likelihood
of such loss or damage and regardless of the form of action. The Trustee and any
director, officer, employee or agent of the Trustee shall be indemnified, to the
extent not paid by the Seller pursuant to this Section, by the Trust Fund and
held harmless against any loss, liability or expense (not including expenses,
disbursements and advances incurred or made by the Trustee, in the ordinary
course of the Trustee's performance in accordance with the provisions of this
Agreement) incurred by the Trustee or such party arising out of or in connection
with the acceptance or administration of its duties under this Agreement, other
than any loss, liability or expense incurred by reason of willful misfeasance,
bad faith or negligence in the performance by the Trustee of its duties under
this Agreement or by reason of the reckless disregard of the Trustee's
obligations and duties under this Agreement. This section shall survive
termination of this Agreement or the resignation or removal of any Trustee
hereunder.

                  Section 8.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE.

                  The Trustee hereunder shall at all times be a Department of
Housing and Urban Development and Federal Housing Administration approved
mortgagee, an entity duly organized and validly existing under the laws of the
United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and a minimum long-term debt rating of BBB by Fitch and S&P
and a long term debt rating of at least A1 or better by Moody's, and subject to
supervision or examination by federal or state authority. If such entity
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.06, the combined capital and surplus of such entity
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The principal office of the Trustee
(other than the initial Trustee) shall be in a state with respect to which an
Opinion of Counsel has been delivered to such Trustee at the time such Trustee
is appointed Trustee to the effect that the Trust will not be a taxable entity
under the laws of such state. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 8.06, the Trustee
shall resign immediately in the manner and with the effect specified in Section
8.07.

                  Section 8.07 RESIGNATION OR REMOVAL OF TRUSTEE.

                  The Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Depositor, the
Servicer and each Rating Agency. Upon receiving such notice of resignation, the
Depositor shall promptly appoint a successor Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor Trustee. If no successor Trustee shall
have been so appointed

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<PAGE>

and having accepted appointment within 30 days after the giving of such notice
of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

                  If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Depositor, or if at any time the Trustee shall
be legally unable to act, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of their property shall be appointed, or any public
officer shall take charge or control of the Trustee or of their property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor may remove the Trustee. If the Depositor or the Servicer removes the
Trustee under the authority of the immediately preceding sentence, the Depositor
shall promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the Trustee so removed and
one copy to the successor Trustee.

                  The Majority Certificateholders may at any time remove the
Trustee by written instrument or instruments delivered to the Servicer, the
Depositor and the Trustee and any expenses incurred by the Trustee in connection
with such removal shall be reimbursed to it by the Majority Certificateholders
promptly upon demand therefor; the Depositor shall thereupon use its best
efforts to appoint a successor Trustee in accordance with this Section.

                  Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor Trustee as
provided in Section 8.08.

                  Section 8.08      SUCCESSOR TRUSTEE.

                  Any successor Trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Depositor, the Rating Agencies,
the Servicer and to its predecessor Trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor Trustee shall become effective, and such successor Trustee, without
any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as Trustee. The Depositor, the Servicer and the
predecessor Trustee shall execute and deliver such instruments and do such other
things as may reasonably be required for fully and certainly vesting and
confirming in the successor Trustee all such rights, powers, duties and
obligations.

                  No successor Trustee shall accept appointment as provided in
this Section 8.08 unless at the time of such acceptance such successor Trustee
shall be eligible under the provisions of Section 8.06 and the appointment of
such successor Trustee shall not result in a downgrading of the

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Regular Certificates by any Rating Agency, as evidenced by a letter from each
Rating Agency.

                  Upon acceptance of appointment by a successor Trustee as
provided in this Section 8.08, the successor Trustee shall mail notice of the
appointment of a successor Trustee hereunder to all Holders of Certificates at
their addresses as shown in the Certificate Register and to each Rating Agency.

                  Section 8.09 MERGER OR CONSOLIDATION OF TRUSTEE.

                  Any entity into which the Trustee may be merged or converted
or with which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such entity shall be eligible under the provisions of
Section 8.06 and 8.08, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.

                  Section 8.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.

                  Notwithstanding any other provisions of this Agreement, at any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust or any Mortgaged Property may at the time be
located, the Depositor and the Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity and for the
benefit of the Certificateholders, such title to the Trust, or any part thereof,
and, subject to the other provisions of this Section 8.10, such powers, duties,
obligations, rights and trusts as the Servicer and the Trustee may consider
necessary or desirable. Any such co-trustee or separate trustee shall be subject
to the written approval of the Servicer. If the Servicer shall not have joined
in such appointment within 15 days after the receipt by it of a request so to
do, or in the case a Servicer Event of Termination shall have occurred and be
continuing, the Trustee alone shall have the power to make such appointment. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor Trustee under Section 8.06, and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 8.08. The Servicer shall be responsible for the
fees of any co-trustee or separate trustee appointed hereunder.

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

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<PAGE>

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

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

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

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

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

                  Section 8.11 LIMITATION OF LIABILITY.

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                  The Certificates are executed by the Trustee, not in its
individual capacity but solely as Trustee of the Trust, in the exercise of the
powers and authority conferred and vested in it by this Agreement. Each of the
undertakings and agreements made on the part of the Trustee in the Certificates
is made and intended not as a personal undertaking or agreement by the Trustee
but is made and intended for the purpose of binding only the Trust.

                  Section 8.12 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
                               CERTIFICATES.

                  (a) All rights of action and claims under this Agreement or
the Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee for the benefit of all
Holders of such Certificates, subject to the provisions of this Agreement. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursement and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.

                  (b) The Trustee shall afford the Seller, the Depositor, the
Servicer and each Certificateholder upon reasonable notice during normal
business hours, access to all records maintained by the Trustee in respect of
its duties hereunder and access to officers of the Trustee responsible for
performing such duties. The Trustee shall cooperate fully with the Seller, the
Servicer, the Depositor and such Certificateholder and shall make available to
the Seller, the Servicer, the Depositor and such Certificateholder for review
and copying at the expense of the party requesting such copies, such books,
documents or records as may be requested with respect to the Trustee's duties
hereunder. The Seller, the Depositor, the Servicer and the Certificateholders
shall not have any responsibility or liability for any action or failure to act
by the Trustee and are not obligated to supervise the performance of the Trustee
under this Agreement or otherwise.

                  Section 8.13      SUITS FOR ENFORCEMENT.

                  In case a Servicer Event of Termination or other default by
the Servicer or the Seller hereunder shall occur and be continuing, the Trustee
may proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy, as the Trustee, being advised by counsel, and subject
to the foregoing, shall deem most effectual to protect and enforce any of the
rights of the Trustee and the Certificateholders.

                                      -163-

<PAGE>

                  Section 8.14 WAIVER OF BOND REQUIREMENT.

                  The Trustee shall be relieved of, and each Certificateholder
hereby waives, any requirement of any jurisdiction in which the Trust, or any
part thereof, may be located that the Trustee post a bond or other surety with
any court, agency or body whatsoever.

                  Section 8.15 WAIVER OF INVENTORY, ACCOUNTING AND APPRAISAL
                               REQUIREMENT.

                  The Trustee shall be relieved of, and each Certificateholder
hereby waives, any requirement of any jurisdiction in which the Trust, or any
part thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.

                  Section 8.16 COMPLIANCE WITH NATIONAL HOUSING ACT OF 1934.

                  In performing its duties hereunder with respect to FHA Loans,
the Trustee shall comply with all requirements of the National Housing Act of
1934, as amended.

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<PAGE>

                                   ARTICLE IX

                              REMIC ADMINISTRATION

                  Section 9.01.     REMIC ADMINISTRATION.

                  (a) REMIC elections as set forth in the Preliminary Statement
shall be made by the Trustee on Form 1066 or other appropriate federal tax or
information return for the taxable year ending on the last day of the calendar
year in which the Certificates are issued. The regular interests and residual
interest in each REMIC shall be as designated in the Preliminary Statement.

                  (b) The Closing Date is hereby designated as the "Startup Day"
of each REMIC within the meaning of section 860G(a)(9) of the Code.

                  (c) The Servicer shall pay any and all tax related expenses
(not including taxes) of each REMIC, including but not limited to any
professional fees or expenses related to audits or any administrative or
judicial proceedings with respect to each REMIC that involve the Internal
Revenue Service or state tax authorities, but only to the extent that (i) such
expenses are ordinary or routine expenses, including expenses of a routine audit
but not expenses of litigation (except as described in (ii)); or (ii) such
expenses or liabilities (including taxes and penalties) are attributable to the
negligence or willful misconduct of the Servicer in fulfilling its duties
hereunder. The Servicer shall be entitled to reimbursement of expenses to the
extent provided in clause (i) above from the Collection Account.

                  (d) The Trustee shall prepare, sign and file, all of the
REMICs' federal and state tax and information returns as the direct
representative each REMIC created hereunder. The expenses of preparing and
filing such returns shall be borne by the Trustee.

                  (e) The Holder of the Residual Certificate at any time holding
the largest Percentage Interest thereof shall be the "tax matters person" as
defined in the REMIC Provisions (the "Tax Matters Person") with respect to each
REMIC and shall act as Tax Matters Person for each REMIC. The Trustee, as agent
for the Tax Matters Person, shall perform on behalf of each REMIC all reporting
and other tax compliance duties that are the responsibility of such REMIC under
the Code, the REMIC Provisions, or other compliance guidance issued by the
Internal Revenue Service or any state or local taxing authority. Among its other
duties, if required by the Code, the REMIC Provisions, or other such guidance,
the Trustee, as agent for the Tax Matters Person, shall provide (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate to
any disqualified person or organization and (ii) to the Certificateholders such
information or reports as are required by the Code

                                      -165-

<PAGE>

or REMIC Provisions. The Trustee, as agent for the Tax Matters Person, shall
represent each REMIC in any administrative or judicial proceedings relating to
an examination or audit by any governmental taxing authority, request an
administrative adjustment as to any taxable year of any REMIC, enter into
settlement agreements with any government taxing agency, extend any statute of
limitations relating to any item of any REMIC and otherwise act on behalf of any
REMIC in relation to any tax matter involving the Trust.

                  (f) The Trustee, the Servicer and the Holders of Certificates
shall take any action or cause the REMIC to take any action necessary to create
or maintain the status of each REMIC as a REMIC under the REMIC Provisions and
shall assist each other as necessary to create or maintain such status. Neither
the Trustee, the Servicer nor the Holder of any Residual Certificate shall take
any action, cause any REMIC created hereunder to take any action or fail to take
(or fail to cause to be taken) any action that, under the REMIC Provisions, if
taken or not taken, as the case may be, could (i) endanger the status of such
REMIC as a REMIC or (ii) result in the imposition of a tax upon such REMIC
(including but not limited to the tax on prohibited transactions as defined in
Code Section 860F(a)(2) and the tax on prohibited contributions set forth on
Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event")
unless the Trustee and the Servicer have received an Opinion of Counsel (at the
expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such status or result in the imposition of
such a tax. In addition, prior to taking any action with respect to any REMIC
created hereunder or the assets therein, or causing such REMIC to take any
action, which is not expressly permitted under the terms of this Agreement, any
Holder of a Residual Certificate will consult with the Trustee and the Servicer,
or their respective designees, in writing, with respect to whether such action
could cause an Adverse REMIC Event to occur with respect to any REMIC, and no
such Person shall take any such action or cause any REMIC to take any such
action as to which the Trustee or the Servicer has advised it in writing that an
Adverse REMIC Event could occur.

                  (g) Each Holder of a Residual Certificate shall pay when due
any and all taxes imposed on each REMIC created hereunder by federal or state
governmental authorities. To the extent that such Trust taxes are not paid by a
Residual Certificateholder, the Trustee shall pay any remaining REMIC taxes out
of current or future amounts otherwise distributable to the Holder of the
Residual Certificate in the REMICs or, if no such amounts are available, out of
other amounts held in the Distribution Account, and shall reduce amounts
otherwise payable to Holders of regular interests in the related REMIC.

                  (h) The Trustee, as agent for the Tax Matters Person, shall,
for federal income tax purposes, maintain books and records with respect to each
REMIC created hereunder on a calendar year and on an accrual basis.

                                      -166-

<PAGE>

                  (i) No additional contributions of assets shall be made to any
REMIC created hereunder, except as expressly provided in this Agreement with
respect to Eligible Substitute Mortgage Loans.

                  (j) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any REMIC created hereunder will receive a fee or other
compensation for services.

                  (k) On or before April 15th of each calendar year beginning in
2005, the Servicer shall deliver to the Trustee and each Rating Agency an
Officers' Certificate stating the Servicer's compliance with the provisions of
this Section 9.01.

                  (j) The Trustee will apply for an Employee Identification
Number from the Internal Revenue Service via a Form SS-4 or other acceptable
method for all tax entities and shall complete the Form 8811.

                  (l) For federal income tax purposes, in the event that the
beneficial ownership of the Class N Certificates and the Class X Certificates is
held by separate persons for tax purposes, the Trustee shall treat the Class N
Certificates as debt of the Class X Certificateholders for federal income tax
purposes and shall not treat such Class of Certificates as an interest in any
REMIC created hereunder. In the event that the beneficial ownership of the Class
N Certificates and the Class X Certificates is held by the same person, the
Trustee shall treat the Class N Certificates as not having been issued for
federal income tax purposes so that the entire economic entitlement of the Class
N Certificates and Class X Certificates (excluding the Class X Certificates
right to receive amounts from the LIBOR Carryover Reserve Account) will
represent a "regular interest" in REMIC 4.

                  Section 9.02.     PROHIBITED TRANSACTIONS AND ACTIVITIES.

                  Neither the Seller, the Depositor, the Servicer nor the
Trustee shall sell, dispose of, or substitute for any of the Mortgage Loans,
except in a disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii)
the bankruptcy of the Trust Fund, (iii) the termination of any REMIC created
hereunder pursuant to Article X of this Agreement, (iv) a substitution pursuant
to Article II of this Agreement or (v) a repurchase of Mortgage Loans pursuant
to Article II of this Agreement, nor acquire any assets for any REMIC, nor sell
or dispose of any investments in the Distribution Account for gain, nor accept
any contributions to either REMIC after the Closing Date, unless it has received
an Opinion of Counsel (at the expense of the party causing such sale,
disposition, or substitution) that such disposition, acquisition, substitution,
or acceptance will not (a) affect adversely the status of any REMIC created
hereunder as a REMIC or of the interests therein other than the Residual
Certificates as the regular interests therein, (b) affect the distribution of
interest

                                      -167-

<PAGE>

or principal on the Certificates, (c) result in the encumbrance of the assets
transferred or assigned to the Trust Fund (except pursuant to the provisions of
this Agreement) or (d) cause any REMIC created hereunder to be subject to a tax
on prohibited transactions or prohibited contributions pursuant to the REMIC
Provisions.

                  Section 9.03. INDEMNIFICATION WITH RESPECT TO CERTAIN TAXES
                                AND LOSS OF REMIC STATUS.

                  In the event that any REMIC fails to qualify as a REMIC, loses
its status as a REMIC, or incurs federal, state or local taxes as a result of a
prohibited transaction or prohibited contribution under the REMIC Provisions due
to the negligent performance by the Servicer of its duties and obligations set
forth herein, the Servicer shall indemnify the Holder of the related Residual
Certificates against any and all losses, claims, damages, liabilities or
expenses ("Losses") resulting from such negligence; PROVIDED, HOWEVER, that the
Servicer shall not be liable for any such Losses attributable to the action or
inaction of the Trustee, the Depositor or the Holder of such Residual
Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which the
Servicer has relied. The foregoing shall not be deemed to limit or restrict the
rights and remedies of the Holder of such Residual Certificate now or hereafter
existing at law or in equity. Notwithstanding the foregoing, however, in no
event shall the Servicer have any liability (1) for any action or omission that
is taken in accordance with and in compliance with the express terms of, or
which is expressly permitted by the terms of, this Agreement, (2) for any Losses
other than arising out of a negligent performance by the Servicer of its duties
and obligations set forth herein, and (3) for any special or consequential
damages to Certificateholders (in addition to payment of principal and interest
on the Certificates).

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<PAGE>

                                    ARTICLE X

                                   TERMINATION

                  Section 10.01   TERMINATION.

                  (a) The respective obligations and responsibilities of the
Seller, the Servicer, the Depositor, the Trustee and the Certificate Registrar
created hereby (other than the obligation of the Trustee to make certain
payments to Certificateholders after the final Distribution Date and the
obligation of the Servicer to send certain notices as hereinafter set forth)
shall terminate upon notice to the Trustee upon the earliest of (i) the
Distribution Date on which the Certificate Principal Balance of each Class of
Certificates has been reduced to zero, (ii) the final payment or other
liquidation of the last Mortgage Loan in the Trust, and (iii) the optional
purchase by the Servicer or an Affiliate of the Servicer of the Mortgage Loans
as described below. Notwithstanding the foregoing, in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of Joseph P. Kennedy, the late ambassador of
the United States to the Court of St. James, living on the date hereof.

                  The Servicer or an Affiliate of the Servicer may, at its
option, terminate the Mortgage Loans in the Trust Fund and retire the Offered
Certificates and the Class B-4 Certificates on the next succeeding Distribution
Date upon which the aggregate current Pool Balance is less than 10% of the
aggregate Pool Balance of the Mortgage Loans as of the Cut-off Date by
purchasing all of the outstanding (i) Mortgage Loans in the Trust Fund at a
price equal to the sum of the outstanding Principal Balance of the Mortgage
Loans and except to the extent previously advanced by the Servicer, accrued and
unpaid interest thereon at the weighted average of the Mortgage Interest Rates
through the end of the Collection Period preceding the final Distribution Date
plus unreimbursed Servicing Advances, Advances and any unpaid Servicing Fees
allocable to such Mortgage Loans and (ii) REO Properties in the Trust Fund at a
price equal to their fair market value as determined in good faith by the
Servicer (the "Termination Price").

                  In connection with any such purchase pursuant to the preceding
paragraph, the Servicer shall deliver to the Trustee for deposit in the
Distribution Account all amounts then on deposit in the Collection Account (less
amounts permitted to be withdrawn by the Servicer pursuant to Section 3.07),
which deposit shall be deemed to have occurred immediately following such
purchase.

                  Any such purchase shall be accomplished by delivery to the
Trustee for deposit into the Distribution Account as part of Available Funds on
the Determination Date before such Distribution Date of the Termination Price.

                                      -169-

<PAGE>

                  (b) Notice of any termination, specifying the Distribution
Date (which shall be a date that would otherwise be a Distribution Date) upon
which the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee upon the Trustee receiving notice of such date from the Servicer, by
letter to the Certificateholders mailed not earlier than the 15th day of the
month preceding the month of such final distribution and not later than the 15th
day of the month of such final distribution specifying (1) the Distribution Date
upon which final distribution of the Certificates will be made upon presentation
and surrender of such Certificates at the office or agency of the Trustee
therein designated, (2) the amount of any such final distribution and (3) that
the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified.

                  (c) Upon presentation and surrender of the Certificates, the
Trustee shall cause to be distributed to the Holders of the Certificates on the
Distribution Date for such final distribution, in proportion to the Percentage
Interests of their respective Class and to the extent that funds are available
for such purpose, an amount equal to the amount required to be distributed to
such Holders in accordance with the provisions of Sections 4.01 and Section 4.02
for such Distribution Date.

                  (d) In the event that all Certificateholders shall not
surrender their Certificates for final payment and cancellation on or before
such final Distribution Date, the Trustee shall promptly following such date
cause all funds in the Distribution Account not distributed in final
distribution to Certificateholders to be withdrawn therefrom and credited to the
remaining Certificateholders by depositing such funds in a separate escrow
account for the benefit of such Certificateholders, and the Servicer (if the
Servicer has exercised its right to purchase the Mortgage Loans) or the Trustee
(in any other case) shall give a second written notice to the remaining
Certificateholders, to surrender their Certificates for cancellation and receive
the final distribution with respect thereto. If within nine months after the
second notice all the Certificates shall not have been surrendered for
cancellation, the Residual Certificateholders shall be entitled to all unclaimed
funds and other assets which remain subject hereto and the Trustee upon transfer
of such funds shall be discharged of any responsibility for such funds, and such
Certificateholders shall look to the Residual Certificateholders for payment.

                  Section 10.02 ADDITIONAL TERMINATION REQUIREMENTS.

                  (a) In the event that the Servicer exercises its purchase
option as provided in Section 10.01, the Trust shall be terminated in accordance
with the following additional requirements, unless the Trustee shall have been
furnished with an Opinion of Counsel to the effect that the failure of the Trust
to comply with the requirements of this Section will not (i) result in the
imposition of taxes on "prohibited transactions" of the Trust as defined in
Section 860F of the Code

                                      -170-

<PAGE>

or (ii) cause any REMIC constituting part of the Trust Fund to fail to qualify
as a REMIC at any time that any Certificates are outstanding:

                  (i) The Trustee shall designate a date within 90 days prior to
         the final Distribution Date as the date of adoption of plans of
         complete liquidation of each REMIC and shall specify such date in the
         final federal income tax return of each REMIC;

                  (ii) After the date of adoption of such plans of complete
         liquidation and at or prior to the final Distribution Date, the Trustee
         shall sell all of the assets of the Trust to the Servicer for cash; and

                  (iii) At the time of the making of the final payment on the
         Certificates, the Trustee shall distribute or credit, or cause to be
         distributed or credited in the following order of priority (A) (i) to
         the Holders of the Class A Certificates and (ii) to the Class M-1,
         Class M- 2, Class M-3, Class B-1, Class B-2, Class B3 and Class B-4
         Certificates, the related Certificate Principal Balance, as applicable,
         plus one month's interest thereon at the applicable Pass-Through Rate,
         (B) to the Class N and Class X Certificates in respect of the Class X/N
         Interest, the amount of any remaining Monthly Excess Cash Flow Amounts
         not previously distributed thereon, (C) to the remaining REMIC Regular
         Interests the amounts allocable thereto pursuant to Section 4.08 and
         (D) to the Class R and Class R-X Certificateholders, all cash on hand
         in respect of the related REMIC or REMICs after such payment (other
         than cash retained to meet claims) and the Trust shall terminate at
         such time.

                  (b) By their acceptance of Certificates, the Holders thereof
         hereby agree to appoint the Trustee as their attorney in fact to: (i)
         designate such date of adoption of plans of complete liquidation and
         (ii) to take such other action in connection therewith as may be
         reasonably required to carry out such plans of complete liquidation all
         in accordance with the terms hereof.

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<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

                  Section 11.01  AMENDMENT.

                  This Agreement may be amended from time to time by the Seller,
the Depositor, the Servicer and the Trustee; and without the consent of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or inconsistent with any other
provisions herein, (iii) to amend the provisions of Section 3.22 or (iv) to make
any other provisions with respect to matters or questions arising under this
Agreement, which shall not be inconsistent with the provisions of this
Agreement; PROVIDED, HOWEVER, that any such action listed in clause (i) through
(iv) above shall not adversely affect in any respect the interests of any
Certificateholder, as evidenced by (i) notice in writing to the Depositor, the
Servicer and the Trustee from the Rating Agencies that such action will not
result in the reduction or withdrawal of the rating of any outstanding Class of
Certificates with respect to which it is a Rating Agency, or (ii) an Opinion of
Counsel delivered to the Servicer and the Trustee.

                  In addition, this Agreement may be amended from time to time
by Seller, the Depositor, the Servicer and the Trustee, with the consent of the
Majority Certificateholders for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders of Certificates; PROVIDED,
HOWEVER, that no such amendment or waiver shall (x) reduce in any manner the
amount of, or delay the timing of, payments on the Certificates which are
required to be made on any Certificate without the consent of the Holder of such
Certificate, (y) adversely affect in any material respect the interests of the
Holders of any Class of Certificates (as evidenced by (i) notice in writing to
the Depositor, the Servicer and the Trustee from the Rating Agencies that such
action will not result in the reduction or withdrawal of the rating of any
outstanding Class of Certificates with respect to which it is a Rating Agency,
or (ii) an Opinion of Counsel delivered to the Servicer and the Trustee) in a
manner other than as described in clause (x) above, without the consent of the
Holders of Certificates of such Class evidencing at least a 66% Percentage
Interest in such Class, or (z) reduce the percentage of Voting Rights required
by clause (y) above without the consent of the Holders of all Certificates of
such Class then outstanding. Upon approval of an amendment, a copy of such
amendment shall be sent to the Rating Agencies. Prior to the execution of any
amendment to this Agreement, the Trustee shall be entitled to receive and rely
upon an Opinion of Counsel (at the expense of the Person seeking such amendment)
stating that the execution of such amendment is authorized or permitted by this
Agreement. The Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Trustee's own rights, duties or immunities under
this Agreement.

                                      -172-

<PAGE>

                  Notwithstanding any provision of this Agreement to the
contrary, the Trustee shall not consent to any amendment to this Agreement
unless it shall have first received an Opinion of Counsel, delivered by (and at
the expense of) the Person seeking such Amendment, to the effect that such
amendment will not result in the imposition of a tax on any REMIC constituting
part of the Trust Fund pursuant to the REMIC Provisions or cause any REMIC
constituting part of the Trust to fail to qualify as a REMIC at any time that
any Certificates are outstanding and that the amendment is being made in
accordance with the terms hereof.

                  Promptly after the execution of any such amendment the Trustee
shall furnish, at the expense of the Person that requested the amendment if such
Person is the Seller or the Servicer (but in no event at the expense of the
Trustee), otherwise at the expense of the Trust, a copy of such amendment and
the Opinion of Counsel referred to in the immediately preceding paragraph to the
Servicer and each Rating Agency.

                  It shall not be necessary for the consent of
Certificateholders under this Section 11.01 to approve the particular form of
any proposed amendment; instead it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable regulations as the Trustee may prescribe.

                  Section 11.02 RECORDATION OF AGREEMENT; COUNTERPARTS.

                  To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Servicer at the expense of the Trust, but only upon direction of
Certificateholders, accompanied by an Opinion of Counsel to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders.

                  For the purpose of facilitating the recordation of this
Agreement as herein provided and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
together constitute but one and the same instrument.

                  Section 11.03 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.

                  The death or incapacity of any Certificateholder shall not (i)
operate to terminate this Agreement or the Trust, (ii) entitle such
Certificateholder's legal representatives or heirs to claim

                                      -173-

<PAGE>

an accounting or to take any action or proceeding in any court for a partition
or winding up of the Trust, or (iii) otherwise affect the rights, obligations
and liabilities of the parties hereto or any of them.

                  Except as expressly provided for herein, no Certificateholder
shall have any right to vote or in any manner otherwise control the operation
and management of the Trust, or the obligations of the parties hereto, nor shall
anything herein set forth or contained in the terms of the Certificates be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.

                  No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as herein provided, and unless also the Holders
of Certificates entitled to at least 25% of the Voting Rights shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for 15 days after
its receipt of such notice, request and offer of indemnity, shall have neglected
or refused to institute any such action, suit or proceeding. It is understood
and intended, and expressly covenanted by each Certificateholder with every
other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, which priority or
preference is not otherwise provided for herein, or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 11.03 each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.

                  Section 11.04 GOVERNING LAW; JURISDICTION.

                  This Agreement shall be construed in accordance with the laws
of the State of New York, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws (without
regard to the conflicts of laws provisions thereof). With respect to any claim
arising out of this Agreement, each party irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in The City of New York, and
each party irrevocably waives any objection which it may have at any time to the
laying of venue of any suit, action or proceeding

                                      -174-

<PAGE>

arising out of or relating hereto brought in any such courts, irrevocably waives
any claim that any such suit, action or proceeding brought in any such court has
been brought in any inconvenient forum and further irrevocably waives the right
to object, with respect to such claim, suit, action or proceeding brought in any
such court, that such court does not have jurisdiction over such party, provided
that service of process has been made by any lawful means.

                  Section 11.05 NOTICES.

                  All directions, demands and notices hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by first class mail, postage prepaid, or by express delivery service,
to (a) in the case of the Seller, Credit-Based Asset Servicing and
Securitization LLC, 335 Madison Avenue, 19th Floor, New York, New York,
Attention: Director - Mortgage Finance (telecopy number (212) 850-7760), or such
other address or telecopy number as may hereafter be furnished to the Depositor
and the Trustee in writing by the Seller, (b) in the case of the Trustee, U.S.
Bank National Association, 60 Livingston Avenue, EP-MN-WS3D, St. Paul, Minnesota
55107-2292, Attn: Structured Finance--Citigroup C-BASS 2004-CB3, or such other
address as may hereafter be furnished to the Depositor, the Seller and the
Servicer in writing by the Trustee, (c) in the case of the Depositor, Citigroup
Mortgage Loan Trust Inc., 390 Greenwich Street, 4th Floor, New York, New York
10013 Attention: Mortgage Finance, or such other address as may be furnished to
the Seller, the Servicer and the Trustee in writing by the Depositor, and (d) in
the case of the Servicer, Litton Loan Servicing LP, 4828 Loop Central Drive,
Houston, Texas 77081, Attention: Janice McClure, or such other address as may be
furnished to the Seller, the Depositor and the Trustee in writing by the
Servicer. Any notice required or permitted to be mailed to a Certificateholder
shall be given by first class mail, postage prepaid, at the address of such
Holder as shown in the Certificate Register. Notice of any Servicer Event of
Termination shall be given by telecopy and by certified mail. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have duly been given when mailed, whether or not the
Certificateholder receives such notice. A copy of any notice required to be
telecopied hereunder shall also be mailed to the appropriate party in the manner
set forth above.

                  Section 11.06 SEVERABILITY OF PROVISIONS.

                  If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall for any reason whatsoever be held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.

                  Section 11.07 ARTICLE AND SECTION REFERENCES.

                                      -175-

<PAGE>

                  All article and section references used in this Agreement,
unless otherwise provided, are to articles and sections in this Agreement.

                  Section 11.08 NOTICE TO THE RATING AGENCIES.

                  (a) Each of the Trustee and the Servicer shall be obligated to
use its best reasonable efforts promptly to provide notice to the Rating
Agencies with respect to each of the following of which a Responsible Officer of
the Trustee or the Servicer, as the case may be, has actual knowledge:

                  (i) any material change or amendment to this Agreement;

                  (ii) the occurrence of any Servicer Event of Termination that
         has not been cured or waived;

                  (iii) the resignation or termination of the Servicer or the
         Trustee;

                  (iv) the final payment to Holders of the Certificates of any
         Class;

                  (v) any change in the location of any Account; and

                  (vi) if the Trustee is acting as successor Servicer pursuant
         to Section 7.02 hereof, any event that would result in the inability of
         the Trustee to make Advances.

                  (vii) In addition, the Servicer shall promptly furnish to each
         Rating Agency copies of the following:

                           (A) each annual statement as to compliance described
                  in Section 3.19 hereof;

                           (B) each annual independent public accountants'
                  servicing report described in Section 3.20 hereof; and

                           (C) each notice delivered pursuant to Section 7.01(a)
                  hereof which relates to the fact that the Servicer has not
                  made an Advance.

                  Any such notice pursuant to this Section 11.08 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
Moody's Investors Service, Inc., 99 Church Street, New York, New York

                                      -176-

<PAGE>

10007, Attention: Managing Director, Residential Mortgage-Backed Securities;
Fitch Ratings, One State Street Plaza, New York, New York 10004, Attention:
Managing Director, Residential Mortgage-Backed Securities; and Standard &
Poor's, a division of The McGraw-Hill Companies, Inc., 55 Water Street, New
York, New York 10041, Attention: Mortgage Surveillance Group.

                  Section 11.09 FURTHER ASSURANCES.

                  Notwithstanding any other provision of this Agreement, neither
the Regular Certificateholders nor the Trustee shall have any obligation to
consent to any amendment or modification of this Agreement unless they have been
provided reasonable security or indemnity against their out-of-pocket expenses
(including reasonable attorneys' fees) to be incurred in connection therewith.

                  Section 11.10 BENEFITS OF AGREEMENT.

                  Nothing in this Agreement or in the Certificates, expressed or
implied, shall give to any Person, other than the Certificateholders and the
parties hereto and their successors hereunder, any benefit or any legal or
equitable right, remedy or claim under this Agreement.

                  Section 11.11 ACTS OF CERTIFICATEHOLDERS.

                  (a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by the Certificateholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Certificateholders in
person or by agent duly appointed in writing; and such action shall become
effective when such instrument or instruments are delivered to the Trustee, the
Seller and the Servicer. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "act" of
the Certificateholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee and the Trust, if made in the manner provided in this Section 11.11.

                  (b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Whenever
such execution is by a signer acting in a capacity other than his or her
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.

                                      -177-

<PAGE>

                  (c) Any request, demand, authorization, direction, notice,
consent, waiver or other action by any Certificateholder shall bind every future
Holder of such Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee or the
Trust in reliance thereon, whether or not notation of such action is made upon
such Certificate.

                                      -178-

<PAGE>

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

                                      CITIGROUP MORTGAGE LOAN TRUST INC., as
                                      Depositor

                                      By:     /s/ PHILIP SEARES
                                            ----------------------------------
                                      Name:   Philip Seares
                                      Title:  Vice President

                                      CREDIT-BASED ASSET SERVICING AND
                                      SECURITIZATION LLC, as Seller

                                      By:     /s/ STEPHANIE SPARVERO
                                            ----------------------------------
                                      Name:   Stephanie Sparvero
                                      Title:  Vice President

                                      LITTON LOAN SERVICING LP, as Servicer

                                      By:      /s/ JANICE MCCLURE
                                            ----------------------------------
                                      Name:   Janice McClure
                                      Title:  Senior Vice President

                                      U.S. BANK NATIONAL ASSOCIATION, as Trustee

                                      By:     /s/ S. CHRISTOPHERSON
                                      ----------------------------------------
                                      Name:   S. Christopherson
                                      Title:  Vice President

<PAGE>

STATE OF NEW YORK     )
                      ) ss.:
COUNTY OF NEW YORK    )

                  On the ____ day of March, 2004 before me, a notary public in
and for said State, personally appeared ______________, known to me to be an
Assistant Vice President of Citigroup Mortgage Loan Trust Inc., a Delaware
corporation that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

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

                                  Notary Public

<PAGE>

STATE OF NEW YORK         )
                          ) ss.:
COUNTY OF NEW YORK        )

                  On the __th day of March 2004 before me, a notary public in
and for said State, personally appeared _______________ known to me to be a
______________ Credit-Based Asset Servicing and Securitization LLC, a limited
liability company that executed the within instrument, and also known to me to
be the person who executed it on behalf of said limited liability company, and
acknowledged to me that such limited liability company executed the within
instrument.

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

                                  Notary Public

<PAGE>

STATE OF NEW YORK    )
                     ) ss.:
COUNTY OF            )

                  On the __th day of March 2004 before me, a notary public in
and for said State, personally appeared ________________, known to me to be a
____________________ of U.S. Bank National Association, a national banking
association that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

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

                                  Notary Public

<PAGE>

STATE OF TEXAS     )
                   ) ss.:
COUNTY OF          )

                  On the __th day of March 2004 before me, a notary public in
and for said State, personally appeared ____________________, known to me to be
a ____________________ of Litton Loan Servicing LP, a Delaware limited
partnership, that executed the within instrument, and also known to me to be the
person who executed it on behalf of said limited partnership, and acknowledged
to me that such limited partnership executed the within instrument.

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

                                  Notary Public

<PAGE>

                                  EXHIBIT A-1

                         FORM OF CLASS AV-1 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

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

                                      A-1-1

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS AV-1

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>
<S>                                             <C>
Series 2004-CB3, Class AV-1                     Original Class Certificate Principal Balance of
                                                the Class AV-1 Certificates as of the Closing
Pass-Through Rate: Variable                     Date:  $237,294,000.00

Date of Pooling and Servicing Agreement         Initial Certificate Principal Balance:
and Cut-off Date: March 1, 2004                 $237,294,000.00

First Distribution Date: April 26, 2004         Servicer:  Litton Loan Servicing LP

No. 1                                           Trustee: U.S. Bank National Association

CUSIP: 17307G EK 0                              Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      A-1-2

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class AV-1 Certificates) in that certain beneficial ownership interest
evidenced by all the Class AV-1 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-1 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class AV-1 Pass-Through Rate on each Distribution Date
will be a rate per annum equal to the lesser of (i) the sum of one month LIBOR
plus the Class AV-1 Certificate Margin and (ii) the related Rate Cap for the
such Distribution Date. Interest will accrue on the Class AV-1 Certificates
during each Interest Accrual Period at the Class AV-1 Pass-Through Rate.

                                      A-1-3

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class AV-1 Certificates.

                  The Class AV-1 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Rights identified in the agreement. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose

                                      A-1-4

<PAGE>

name this Certificate is registered as the owner hereof for all purposes, and
none of the Depositor, the Servicer, the Trustee, the Certificate Registrar nor
any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      A-1-5

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                              U.S. BANK NATIONAL ASSOCIATION,
                                               as Trustee

                                              By:_______________________________
                                                        Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                              U.S. BANK NATIONAL ASSOCIATION,
                                               as Certificate Registrar

                                              By:_______________________________
                                                       Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      A-1-7

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      A-1-8

<PAGE>

                                   EXHIBIT A-2

                         FORM OF CLASS AV-2 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

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

                                      A-2-1

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS AV-2

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                       <C>
Series 2004-CB3, Class AV-2                               Original Class Certificate Principal Balance of
                                                          the Class AV-2 Certificates as of the Closing
Pass-Through Rate:  Variable                              Date:  $ 37,416,000.00

Date of Pooling and Servicing Agreement                   Initial Certificate Principal Balance:
and Cut-off Date: March 1, 2004                           $ 37,416,000.00

First Distribution Date: April 26, 2004                   Servicer:  Litton Loan Servicing LP

No. 1                                                     Trustee: U.S. Bank National Association

CUSIP: 17307G EL 8                                        Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      A-2-2

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class AV-2 Certificates) in that certain beneficial ownership interest
evidenced by all the Class AV-2 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-2 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-2 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-2
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class AV-2 Pass-Through Rate on each Distribution Date
will be a rate per annum equal to the lesser of (i) the sum of one month LIBOR
plus the Class AV-2 Certificate Margin and (ii) the related Rate Cap for the
such Distribution Date. Interest will accrue on the Class AV-2 Certificates
during each Interest Accrual Period at the Class AV-2 Pass-Through Rate.

                                      A-2-3

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class AV-2 Certificates.

                  The Class AV-2 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Rights identified in the agreement. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose

                                      A-2-4

<PAGE>

name this Certificate is registered as the owner hereof for all purposes, and
none of the Depositor, the Servicer, the Trustee, the Certificate Registrar nor
any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      A-2-5

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION,
                                             as Trustee

                                            By:________________________________
                                                      Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION,
                                             as Certificate Registrar

                                            By:________________________________
                                                     Authorized Signatory

Date of authentication: April __, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      A-2-7

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      A-2-8

<PAGE>

                                   EXHIBIT A-3

                         FORM OF CLASS AV-3 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

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

                                      A-3-1

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS AV-3

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                       <C>
Series 2004-CB3, Class AV-3                               Original Class Certificate Principal Balance of
                                                          the Class AV-3 Certificates as of the Closing
Pass-Through Rate:  Variable                              Date:  $ 34,168,000.00

Date of Pooling and Servicing Agreement                   Initial Certificate Principal Balance:
and Cut-off Date: March 1, 2004                           $ 34,168,000.00

First Distribution Date: April 26, 2004                   Servicer:  Litton Loan Servicing LP

No. 1                                                     Trustee: U.S. Bank National Association

CUSIP: 17307G  EM 6                                       Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      A-3-2

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class AV-3 Certificates) in that certain beneficial ownership interest
evidenced by all the Class AV-3 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-3 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-3 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-3
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class AV-3 Pass-Through Rate on each Distribution Date
will be a rate per annum equal to the lesser of (i) the sum of one month LIBOR
plus the Class AV-3 Certificate Margin and (ii) the related Rate Cap for the
such Distribution Date. Interest will accrue on the Class AV-3 Certificates
during each Interest Accrual Period at the Class AV-3 Pass-Through Rate.

                                      A-3-3

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class AV-3 Certificates.

                  The Class AV-3 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Rights identified in the agreement. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose

                                      A-3-4

<PAGE>

name this Certificate is registered as the owner hereof for all purposes, and
none of the Depositor, the Servicer, the Trustee, the Certificate Registrar nor
any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      A-3-5

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Certificate Registrar

                                            By:________________________________
                                                     Authorized Signatory

Date of authentication: April __, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                           (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      A-3-7

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      A-3-8

<PAGE>

                                   EXHIBIT A-4

                         FORM OF CLASS AV-4 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

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

                                      A-4-1

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS AV-4

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
                                        CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                       <C>
Series 2004-CB3, Class AV-4                               Original Class Certificate Principal Balance of
                                                          the Class AV-4 Certificates as of the Closing
Pass-Through Rate:  Variable                              Date:  $ 9,242,000.00

Date of Pooling and Servicing Agreement                   Initial Certificate Principal Balance:
and Cut-off Date: March 1, 2004                           $ 9,242,000.00

First Distribution Date: April 26, 2004                   Servicer:  Litton Loan Servicing LP

No. 1                                                     Trustee: U.S. Bank National Association

CUSIP: 17307G  EN 4                                       Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      A-4-2

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class AV-4 Certificates) in that certain beneficial ownership interest
evidenced by all the Class AV-4 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-4 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-4 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-4
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class AV-4 Pass-Through Rate on each Distribution Date
will be a rate per annum equal to the lesser of (i) the sum of one month LIBOR
plus the Class AV-4 Certificate Margin and (ii) the related Rate Cap for the
such Distribution Date. Interest will accrue on the Class AV-4 Certificates
during each Interest Accrual Period at the Class AV-4 Pass-Through Rate.

                                      A-4-3

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class AV-4 Certificates.

                  The Class AV-4 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Rights identified in the agreement. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose

                                      A-4-4

<PAGE>

name this Certificate is registered as the owner hereof for all purposes, and
none of the Depositor, the Servicer, the Trustee, the Certificate Registrar nor
any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      A-4-5

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Certificate Registrar

                                            By:________________________________
                                                    Authorized Signatory

Date of authentication: April __, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      A-4-7

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      A-4-8

<PAGE>

                                   EXHIBIT B-1

                          FORM OF CLASS B-1 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
         CLASS A CERTIFICATES AND THE CLASS M CERTIFICATES AS DESCRIBED
         IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

         EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY
         OR TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION
         LETTER STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE
         BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE
         EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
         OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
         "CODE"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON BEHALF OF OR
         INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS SET
         FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS
         USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL
         ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
         HEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
         REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
         SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO
         IN THE PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR. THE POOLING AND
         SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
         IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE

                                      B-1-1

<PAGE>

         NULL AND VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED
         TRANSFEREE.

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

                                      B-1-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS B-1

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                          <C>
Series 2004-CB3, Class B-1                                   Original Class Certificate Principal Balance of
                                                             the Class B-1 Certificates as of the Closing
Pass-Through Rate:  Variable                                 Date: $5,895,000.00

Date of Pooling and Servicing Agreement and                  Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                                  $ 5,895,000.00

First Distribution Date: April 26, 2004                      Servicer:  Litton Loan Servicing LP

No. 1                                                        Trustee: U.S. Bank National Association

CUSIP: 17307G  ES 3                                          Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      B-1-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class B-1 Certificates) in that certain beneficial ownership interest
evidenced by all the Class B-1 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-1 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class B-1 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class B-1 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class B-1 Certificates during
each Interest Accrual Period at the Class B-1 Pass-Through Rate.

                                      B-1-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class B-1 Certificates.

                  The Class B-1 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates and the Class M Certificates as described in the Pooling
and Servicing Agreement referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax

                                      B-1-5

<PAGE>

or other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      B-1-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Certificate Registrar

                                            By:________________________________
                                                     Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      B-1-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      B-1-9

<PAGE>

                                   EXHIBIT B-2

                          FORM OF CLASS B-2 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
         CERTIFICATES, THE CLASS M CERTIFICATES AND THE CLASS B-1 CERTIFICATES
         AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

         EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY
         OR TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION
         LETTER STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE
         BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE
         EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
         OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
         "CODE"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON BEHALF OF OR
         INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS SET
         FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS
         USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL
         ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
         THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY
         THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
         SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO
         IN THE PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR. THE POOLING AND
         SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
         IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE

                                      B-2-1

<PAGE>

         NULL AND VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED
         TRANSFEREE.

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

                                      B-2-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS B-2

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                          <C>
Series 2004-CB3, Class B-2                                 Original Class Certificate Principal Balance of
                                                           the Class B-2 Certificates as of the Closing
Pass-Through Rate:  Variable                               Date: $ 4,912,000.00

Date of Pooling and Servicing Agreement and                Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                                $ 4,912,000.00

First Distribution Date: April 26, 2004                    Servicer:  Litton Loan Servicing LP

No. 1                                                      Trustee: U.S. Bank National Association

CUSIP: 17307G  ET 1                                        Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      B-2-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class B-2 Certificates) in that certain beneficial ownership interest
evidenced by all the Class B-2 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-2 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-2 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-2
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class B-2 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class B-2 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class B-2 Certificates during
each Interest Accrual Period at the Class B-2 Pass-Through Rate.

                                      B-2-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class B-2 Certificates.

                  The Class B-2 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates, the Class M Certificates and the Class B-1 Certificates as
described in the Pooling and Servicing Agreement referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax

                                      B-2-5

<PAGE>

or other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      B-2-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                                U.S. BANK NATIONAL ASSOCIATION,
                                                  as Trustee

                                                By:_____________________________
                                                         Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                                U.S. BANK NATIONAL ASSOCIATION,
                                                  as Certificate Registrar

                                                By:____________________________
                                                       Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      B-2-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      B-2-9

<PAGE>

                                   EXHIBIT B-3

                          FORM OF CLASS B-3 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
         CERTIFICATES, THE CLASS M CERTIFICATES, THE CLASS B-1 CERTIFICATES AND
         THE CLASS B-2 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY
         OR TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION
         LETTER STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE
         BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE
         EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
         OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
         "CODE"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON BEHALF OF OR
         INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS SET
         FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS
         USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL
         ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
         THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY
         THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
         SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO
         IN THE PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR. THE POOLING AND
         SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
         IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE

                                      B-3-1

<PAGE>

         NULL AND VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED
         TRANSFEREE.

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

                                      B-3-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS B-3

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                          <C>
Series 2004-CB3, Class B-3                                 Original Class Certificate Principal Balance of
                                                           the Class B-3 Certificates as of the Closing
Pass-Through Rate:  Variable                               Date: $ 4,912,000.00

Date of Pooling and Servicing Agreement and                Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                                $ 4,912,000.00

First Distribution Date: April 26, 2004                    Servicer:  Litton Loan Servicing LP

No. 1                                                      Trustee: U.S. Bank National Association

CUSIP: 17307G  EU 8                                        Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      B-3-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class B-3 Certificates) in that certain beneficial ownership interest
evidenced by all the Class B-3 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-3 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-3 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-3
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class B-3 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class B-3 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class B-3 Certificates during
each Interest Accrual Period at the Class B-3 Pass-Through Rate.

                                      B-3-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class B-3 Certificates.

                  The Class B-3 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates, the Class M Certificates, the Class B-1 Certificates and
the Class B-2 Certificates as described in the Pooling and Servicing Agreement
referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax

                                      B-3-5

<PAGE>

or other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      B-3-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Trustee

                                            By:________________________________
                                                      Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Certificate Registrar

                                            By:________________________________
                                                    Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      B-3-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      B-3-9

<PAGE>

                                   EXHIBIT B-4

                          FORM OF CLASS B-4 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
         CERTIFICATES, THE CLASS M CERTIFICATES, THE CLASS B-1 CERTIFICATES, THE
         CLASS B-2 CERTIFICATES AND THE CLASS B-3 CERTIFICATES AS DESCRIBED IN
         THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

         THIS CLASS B-4 CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
         THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
         SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION
         OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE
         MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
         QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
         THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

         NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR
         OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE
         RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR THE
         CODE WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE
         PROCEDURES DESCRIBED HEREIN.

                                      B-4-1

<PAGE>

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

                                      B-4-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS B-4

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                          <C>
Series 2004-CB3, Class B-4                                 Original Class Certificate Principal Balance of
                                                           the Class B-4 Certificates as of the Closing
Pass-Through Rate:  Variable                               Date: $ 4,913,000.00

Date of Pooling and Servicing Agreement and                Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                                $ 4,913,000.00

First Distribution Date: April 26, 2004                    Servicer:  Litton Loan Servicing LP

No. 1                                                      Trustee: U.S. Bank National Association

CUSIP: 17307 GE V6                                         Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      B-4-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class B-4 Certificates) in that certain beneficial ownership interest
evidenced by all the Class B-4 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-4 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-4 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-4
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class B-4 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class B-4 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class B-4 Certificates during
each Interest Accrual Period at the Class B-4 Pass-Through Rate.

                                      B-4-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class B-4 Certificates.

                  The Class B-4 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates, the Class M Certificates, the Class B-1 Certificates, the
Class B-2 Certificates and the Class B-3 Certificates as described in the
Pooling and Servicing Agreement referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification

                                      B-4-5

<PAGE>

under applicable state securities laws, or is made in a transaction that does
not require such registration or qualification. In the event that a transfer is
to be made without registration or qualification, the Certificate Registrar
shall require, in order to assure compliance with such laws, either (i) that the
Certificateholder desiring to effect the transfer and such Certificateholder's
prospective transferee each execute a representation letter in the form
described by the Agreement certifying to the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Depositor and the Certificate
Registrar shall require an Opinion of Counsel satisfactory to them that such
transfer may be made without such registration or qualification, which Opinion
of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar nor the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and any Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.

                  No transfer of this Certificate or any interest herein may be
made to employee benefit plans and certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Keogh
plans and collective investment funds and separate accounts in which such plans,
accounts or arrangements are invested that are subject to the fiduciary
responsibility provisions of ERISA and Section 4975 of the Code ("Plans") or any
person who is directly or indirectly purchasing this Certificate or interest
herein on behalf of, as named fiduciary of, as trustee of, or with assets of a
Plan unless the opinion letter in section 5.02 of the Pooling and Servicing
Agreement is provided.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property

                                      B-4-6

<PAGE>

acquired in respect of such Mortgage Loans. The Agreement permits, but does not
require, the party designated in the Agreement to purchase from the Trust Fund
all Mortgage Loans and all property acquired in respect of any Mortgage Loan at
a price determined as provided in the Agreement. The exercise of such right will
effect early retirement of the Certificates; however, such right to purchase is
subject to the aggregate Principal Balance of the Mortgage Loans at the time of
purchase being 10% or less of the Cut-off Date Principal Balance of the Mortgage
Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      B-4-7

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Certificate Registrar

                                            By:________________________________
                                                    Authorized Signatory

Date of authentication: April        , 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      B-4-9

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                     B-4-10

<PAGE>

                                  EXHIBIT C-1-1

                           FORM OF CLASS R CERTIFICATE

         THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED
         STATES PERSON.

         FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
         "RESIDUAL INTEREST" IN SIX SEPARATE "REAL ESTATE MORTGAGE INVESTMENT
         CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
         AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").

         THIS CLASS R CERTIFICATE IS SUBORDINATE TO THE OFFERED
         CERTIFICATES AND THE CLASS B-4 CERTIFICATES OF THIS SERIES TO
         THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS R CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS
         UNTIL SUCH TIME AS DESCRIBED IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
         SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
         LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
         CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY
         IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
         QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
         THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

         NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR
         OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE
         RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR THE
         CODE WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE
         PROCEDURES DESCRIBED HEREIN.

         ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R
         CERTIFICATE MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE
         PROVIDES (1) AN AFFIDAVIT TO THE CERTIFICATE REGISTRAR THAT
         SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR
         POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY

                                     C-1-1-1

<PAGE>

         INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF
         THE FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED
         IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY
         CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX
         IMPOSED BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN
         SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE
         FOREGOING CLAUSES (A), (B) OR (C) BEING HEREINAFTER REFERRED TO AS A
         "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED
         ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE
         ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH TRANSFEREE SATISFIES
         CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF
         THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE
         CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS
         CLASS R CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A
         DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF
         NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED
         TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT
         LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH
         HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL
         BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE
         PROVISIONS OF SECTION 5.02(D) OF THE POOLING AND SERVICING AGREEMENT
         REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED ORGANIZATION IS
         PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS CLASS R
         CERTIFICATE.

                                     C-1-1-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                            SERIES 2004-CB3, CLASS R

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                          <C>
Series 2004-CB3, Class R                                    Servicer:  Litton Loan Servicing LP

Date of Pooling and Servicing Agreement and                 Trustee:  U.S. Bank National Association
Cut-off Date: March 1, 2004
                                                            Closing Date: April 12, 2004
First Distribution Date: April 26, 2004

No. 1

Percentage Interest:  100%
</TABLE>

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                     C-1-1-3

<PAGE>

                  This certifies that Residual Interest Investments, LP is the
registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class R Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Citigroup Mortgage Loan Trust Inc.
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), the Servicer, the Seller and the Trustee, a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class R Certificates on such Distribution Date pursuant to the
Agreement.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class R
Certificates the aggregate Percentage Interest of which is in excess of a 66%
Percentage Interest of the Class R Certificates, or by check mailed by first
class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Certificate
Registrar may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose as provided in the
Agreement.

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing the Percentage Interest specified on the face hereof.

                  The Class R Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to

                                     C-1-1-4

<PAGE>

Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction that does not require such
registration or qualification. In the event that a transfer is to be made
without registration or qualification, the Certificate Registrar shall require,
in order to assure compliance with such laws, either (i) that the
Certificateholder desiring to effect the transfer and such Certificateholder's
prospective transferee each execute a representation letter in the form
described by the Agreement certifying to the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Depositor and the Certificate
Registrar shall require an Opinion of Counsel satisfactory to them that such
transfer may be made without such registration or qualification, which Opinion
of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar nor the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer

                                     C-1-1-5

<PAGE>

of such Certificates without registration or qualification. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the Depositor, the Certificate Registrar and any
Servicer against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.

                  No transfer of this Certificate or any interest herein may be
made to employee benefit plans and certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Keogh
plans and collective investment funds and separate accounts in which such plans,
accounts or arrangements are invested that are subject to the fiduciary
responsibility provisions of ERISA and Section 4975 of the Code ("Plans") or any
person who is directly or indirectly purchasing this Certificate or interest
herein on behalf of, as named fiduciary of, as trustee of, or with assets of a
Plan.

                  The Holder of this Certificate, by its acceptance hereof,
shall be deemed for all purposes to have consented to the provisions of Section
5.02 of the Agreement and to any amendment of the Agreement deemed necessary by
counsel of the Depositor to ensure that the transfer of this Certificate to any
Person other than a Permitted Transferee or any other Person will not cause the
Trust to cease to qualify as eight separate REMICs or cause the imposition of a
tax upon the Trust.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                                     C-1-1-6

<PAGE>

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                     C-1-1-7

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Certificate Registrar

                                            By:________________________________
                                                     Authorized Signatory

Date of authentication: April       , 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                     C-1-1-9

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                    C-1-1-10

<PAGE>

                                  EXHIBIT C-1-2

                          FORM OF CLASS R-X CERTIFICATE

         THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED
         STATES PERSON.

         FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
         "RESIDUAL INTEREST" IN SIX SEPARATE "REAL ESTATE MORTGAGE INVESTMENT
         CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
         AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").

         THIS CLASS R-X CERTIFICATE IS SUBORDINATE TO THE OFFERED
         CERTIFICATES AND THE CLASS B-4 CERTIFICATES OF THIS SERIES TO
         THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS R-X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS
         UNTIL SUCH TIME AS DESCRIBED IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS R-X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
         THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
         SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION
         OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE
         MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
         QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
         THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

         NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR
         OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE
         RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR THE
         CODE WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE
         PROCEDURES DESCRIBED HEREIN.

         ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R-X
         CERTIFICATE MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE
         PROVIDES (1) AN AFFIDAVIT TO THE CERTIFICATE REGISTRAR THAT
         SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR
         POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY

                                     C-1-2-1

<PAGE>

         INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF
         THE FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED
         IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY
         CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX
         IMPOSED BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN
         SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE
         FOREGOING CLAUSES (A), (B) OR (C) BEING HEREINAFTER REFERRED TO AS A
         "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED
         ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE
         ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH TRANSFEREE SATISFIES
         CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF
         THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE
         CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS
         CLASS R-X CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A
         DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF
         NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED
         TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT
         LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH
         HOLDER OF A CLASS R- X CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
         SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH
         AND THE PROVISIONS OF SECTION 5.02(D) OF THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED
         ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS
         CLASS R-X CERTIFICATE.

                                     C-1-2-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
                           SERIES 2004-CB3, CLASS R-X

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                         <C>
Series 2004-CB3, Class R-X                                  Servicer:  Litton Loan Servicing LP

Date of Pooling and Servicing Agreement and                 Trustee:  U.S. Bank National Association
Cut-off Date: March 1, 2004
                                                            Closing Date: April 12, 2004
First Distribution Date: April 26, 2004

No. 1

Percentage Interest:  100%
</TABLE>

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                     C-1-2-3

<PAGE>

                  This certifies that Noelle J. Savarese is the registered owner
of a Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R-X Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class R-X Certificates on such Distribution Date pursuant to
the Agreement.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class R-X
Certificates the aggregate Percentage Interest of which is in excess of a 66%
Percentage Interest of the Class R-X Certificates, or by check mailed by first
class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Certificate
Registrar may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose as provided in the
Agreement.

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing the Percentage Interest specified on the face hereof.

                  The Class R-X Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to

                                     C-1-2-4

<PAGE>

Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction that does not require such
registration or qualification. In the event that a transfer is to be made
without registration or qualification, the Certificate Registrar shall require,
in order to assure compliance with such laws, either (i) that the
Certificateholder desiring to effect the transfer and such Certificateholder's
prospective transferee each execute a representation letter in the form
described by the Agreement certifying to the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Depositor and the Certificate
Registrar shall require an Opinion of Counsel satisfactory to them that such
transfer may be made without such registration or qualification, which Opinion
of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar nor the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer

                                     C-1-2-5

<PAGE>

of such Certificates without registration or qualification. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the Depositor, the Certificate Registrar and any
Servicer against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.

                  No transfer of this Certificate or any interest herein may be
made to employee benefit plans and certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Keogh
plans and collective investment funds and separate accounts in which such plans,
accounts or arrangements are invested that are subject to the fiduciary
responsibility provisions of ERISA and Section 4975 of the Code ("Plans") or any
person who is directly or indirectly purchasing this Certificate or interest
herein on behalf of, as named fiduciary of, as trustee of, or with assets of a
Plan unless the opinion letter in Section 5.02 of the Pooling and Servicing
Agreement is provided.

                  The Holder of this Certificate, by its acceptance hereof,
shall be deemed for all purposes to have consented to the provisions of Section
5.02 of the Agreement and to any amendment of the Agreement deemed necessary by
counsel of the Depositor to ensure that the transfer of this Certificate to any
Person other than a Permitted Transferee or any other Person will not cause the
Trust to cease to qualify as eight separate REMICs or cause the imposition of a
tax upon the Trust.

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

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase

                                     C-1-2-6

<PAGE>

is subject to the aggregate Principal Balance of the Mortgage Loans at the time
of purchase being 10% or less of the Cut-off Date Principal Balance of the
Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                     C-1-2-7

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Certificate Registrar

                                            By:________________________________
                                                    Authorized Signatory

Date of authentication: April       , 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                     C-1-2-9

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                    C-1-2-10

<PAGE>

                                   EXHIBIT C-2

                          FORM OF CLASS M-1 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
         CLASS A CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY
         OR TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION
         LETTER STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE
         BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE
         EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
         OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
         "CODE"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON BEHALF OF OR
         INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS SET
         FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS
         USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL
         ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
         THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY
         THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
         SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO
         IN THE PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR. THE POOLING AND
         SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
         IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE

                                      C-2-1

<PAGE>

         NULL AND VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED
         TRANSFEREE.

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

                                      C-2-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES

                           SERIES 2004-CB3, CLASS M-1

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                        <C>
Series 2004-CB3, Class M-1                                 Original Class Certificate Principal Balance of
                                                           the Class M-1 Certificates as of the Closing
Pass-Through Rate:  Variable                               Date:  $ 23,579,000.00

Date of Pooling and Servicing Agreement and                Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                                $ 23,579,000.00

First Distribution Date: April 26, 2004                    Servicer:  Litton Loan Servicing LP

No. 1                                                      Trustee: U.S. Bank National Association

CUSIP: 17307G  EP 9                                        Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      C-2-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class M-1 Certificates) in that certain beneficial ownership interest
evidenced by all the Class M-1 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class M-1 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class M-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class M-1 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class M-1 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class M-1 Certificates during
each Interest Accrual Period at a the Class M-1 Pass-Through Rate.

                                      C-2-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class M-1 Certificates.

                  The Class M-1 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates as described in the Pooling and Servicing Agreement
referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax

                                      C-2-5

<PAGE>

or other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      C-2-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Trustee

                                            By:________________________________
                                                      Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Certificate Registrar

                                            By:________________________________
                                                      Authorized Signatory

Date of authentication: April        , 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      C-2-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      C-2-9

<PAGE>

                                   EXHIBIT C-3

                          FORM OF CLASS M-2 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
         TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
         PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
         CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
         ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
         TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
         & CO., HAS AN INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
         CLASS A CERTIFICATES AND THE CLASS M-1 CERTIFICATES AS
         DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
         HEREIN.

         EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY
         OR TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION
         LETTER STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE
         BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE
         EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
         OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
         "CODE"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON BEHALF OF OR
         INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS SET
         FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS
         USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL
         ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
         THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY
         THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS
         SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO
         IN THE PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR. THE POOLING AND
         SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
         IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE

                                      C-3-1

<PAGE>

         NULL AND VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED
         TRANSFEREE.

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

                                      C-3-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES

                           SERIES 2004-CB3, CLASS M-2

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

                       CITIGROUP MORTGAGE LOAN TRUST INC.

<TABLE>
<CAPTION>

<S>                                                        <C>
Series 2004-CB3, Class M-2                                 Original Class Certificate Principal Balance of
                                                           the Class M-2 Certificates as of the Closing
Pass-Through Rate:  Variable                               Date:  $ 19,650,000.00

Date of Pooling and Servicing Agreement and                Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                                $ 19,650,000.00

First Distribution Date: April 26, 2004                    Servicer:  Litton Loan Servicing LP

No. 1                                                      Trustee: U.S. Bank National Association

CUSIP: 17307G EQ 7                                         Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      C-3-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class M-2 Certificates) in that certain beneficial ownership interest
evidenced by all the Class M-2 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-2 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class M-2 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class M-2
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class M-2 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class M-2 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class M-2 Certificates during
each Interest Accrual Period at a the Class M-2 Pass-Through Rate.

                                      C-3-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class M-2 Certificates.

                  The Class M-2 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates and the Class M-1 Certificates as described in the Pooling
and Servicing Agreement referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax

                                      C-3-5

<PAGE>

or other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      C-3-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Trustee

                                            By:________________________________
                                                      Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION,
                                              as Certificate Registrar

                                            By:________________________________
                                                    Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      C-3-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      C-3-9

<PAGE>

                                   EXHIBIT C-4

                          FORM OF CLASS M-3 CERTIFICATE

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
         REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
         CORPORATION ("DTC"), TO THE TRUSTEE OR ITS AGENT FOR
         REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
         CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
         IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
         OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
         REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE
         HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
         INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
         INTEREST HEREIN.

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
         CLASS A CERTIFICATES, THE CLASS M-1 CERTIFICATES AND THE
         CLASS M-2 CERTIFICATES AS DESCRIBED IN THE POOLING AND
         SERVICING AGREEMENT REFERRED TO HEREIN.

         EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND
         SERVICING AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY
         NOT BE PURCHASED BY OR TRANSFERRED TO ANY PERSON THAT HAS NOT
         DELIVERED A REPRESENTATION LETTER STATING EITHER (A) THAT THE
         TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER
         RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
         RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
         OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
         AMENDED (THE "CODE"), (COLLECTIVELY, A "PLAN"), AND IS NOT
         ACTING ON BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (B)
         SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE POOLING AND
         SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS USED TO
         PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL
         ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY
         INTEREST THEREIN SHALL BE DEEMED TO HAVE MADE THE
         REPRESENTATIONS REQUIRED BY THE REPRESENTATION LETTER
         REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
         SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER REFERRED TO IN
         THE PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR. THE
         POOLING AND SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED
         OR PURPORTED TRANSFER IN VIOLATION OF THESE TRANSFER
         RESTRICTIONS WILL BE

                                 C-4-1

<PAGE>

         NULL AND VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED
         TRANSFEREE.

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

                                 C-4-2

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES

                           SERIES 2004-CB3, CLASS M-3

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

<TABLE>
<CAPTION>
                       CITIGROUP MORTGAGE LOAN TRUST INC.

<S>                                             <C>
Series 2004-CB3, Class M-3                      Original Class Certificate Principal Balance of
                                                the Class M-3 Certificates as of the Closing
Pass-Through Rate:  Variable                    Date:  $ 6,877,000.00

Date of Pooling and Servicing Agreement and     Initial Certificate Principal Balance:
Cut-off Date: March 1, 2004                     $6,877,000.00

First Distribution Date: April 26, 2004         Servicer:  Litton Loan Servicing LP

No. 1                                           Trustee: U.S. Bank National Association

CUSIP: 17307G  ER 5                             Closing Date: April 12, 2004
</TABLE>

         DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
         BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH
         HEREIN.  ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
         BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
         SHOWN ABOVE.

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES.  THIS CERTIFICATE IS NOT
         GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      C-4-3

<PAGE>

                  This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the Original Class Certificate Principal Balance
of the Class M-3 Certificates) in that certain beneficial ownership interest
evidenced by all the Class M-3 Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-3 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class M-3 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class M-3
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.

                  The Class M-3 Pass-Through Rate on each Distribution Date will
be a rate per annum equal to the lesser of (i) the sum of one month LIBOR plus
the Class M-1 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date. Interest will accrue on the Class M-3 Certificates during
each Interest Accrual Period at a the Class M-3 Pass-Through Rate.

                                      C-4-4

<PAGE>

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class M-3 Certificates.

                  The Class M-3 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  This certificate is subordinated in right of payment to the
Class A Certificates, the Class M-1 Certificates and the Class M-2 Certificates
as described in the Pooling and Servicing Agreement referred to herein.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax

                                      C-4-5

<PAGE>

or other governmental charge that may be imposed in connection with any transfer
or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      C-4-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Trustee

                                            By:________________________________
                                                     Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                            U.S. BANK NATIONAL ASSOCIATION, as
                                              Certificate Registrar

                                            By:________________________________
                                                    Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      C-4-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      C-4-9

<PAGE>

                                   EXHIBIT C-5

                          FORM OF CLASS X CERTIFICATES

         FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
         REPRESENTS A DIRECT OR INDIRECT BENEFICIAL INTEREST IN A
         "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
         CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
         SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986,
         AS AMENDED (THE "CODE") AND IN CERTAIN OTHER PROPERTY.

         THIS CLASS X CERTIFICATE IS SUBORDINATE TO THE OFFERED
         CERTIFICATES AND THE CLASS B-4 CERTIFICATES OF THIS SERIES TO
         THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS
         UNTIL SUCH TIME AS DESCRIBED IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933
         ACT"), OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
         TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT
         SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
         TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
         QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF
         SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
         TO HEREIN.

         NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN
         OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE
         RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR THE
         CODE WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE
         PROCEDURES DESCRIBED HEREIN.

                                      C-5-1

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES

                            SERIES 2004-CB3, CLASS X

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

<TABLE>
<CAPTION>
                       CITIGROUP MORTGAGE LOAN TRUST INC.

<S>                                             <C>
Series 2004-CB3, Class X                        Servicer:  Litton Loan Servicing LP

Date of Pooling and Servicing Agreement and     Trustee:  U.S. Bank National Association
Cut-off Date: March 1, 2004
                                                Closing Date: April 12, 2004
First Distribution Date: April 26, 2004

No. 1

Percentage Interest:  100%
</TABLE>

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN ASSET BACKED FUNDING CORPORATION, THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
         NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      C-5-2

<PAGE>

                  This certifies that Citigroup Global Markets Inc. is the
registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class X Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Citigroup Mortgage Loan Trust Inc.
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), the Servicer, the Seller and the Trustee, a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class X Certificates on such Distribution Date pursuant to the
Agreement.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class X
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of a 66% Percentage Interest of the Class X Certificates, or by check
mailed by first class mail to the address of the Person entitled thereto, as
such name and address shall appear on the Certificate Register, provided that
the Certificate Registrar may deduct a reasonable wire transfer fee from any
payment made by wire transfer. Notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Trustee for that purpose as
provided in the Agreement.

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing the Percentage Interest specified on the face hereof.

                  The Class X Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to

                                      C-5-3

<PAGE>

Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction that does not require such
registration or qualification. In the event that a transfer is to be made
without registration or qualification, the Certificate Registrar shall require,
in order to assure compliance with such laws, either (i) that the
Certificateholder desiring to effect the transfer and such Certificateholder's
prospective transferee each execute a representation letter in the form
described by the Agreement certifying to the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Depositor and the Certificate
Registrar shall require an Opinion of Counsel satisfactory to them that such
transfer may be made without such registration or qualification, which Opinion
of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar nor the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer

                                      C-5-4

<PAGE>

of such Certificates without registration or qualification. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the Depositor, the Certificate Registrar and the
Servicer against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.

                  No transfer of this Certificate or any interest herein may be
made to employee benefit plans and certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Keogh
plans and collective investment funds and separate accounts in which such plans,
accounts or arrangements are invested that are subject to the fiduciary
responsibility provisions of ERISA and Section 4975 of the Code ("Plans") or any
person who is directly or indirectly purchasing this Certificate or interest
herein on behalf of, as named fiduciary of, as trustee of, or with assets of a
Plan unless the opinion letter in section 5.02 of the Pooling and Servicing
Agreement is provided.

                  No service charge will be made for any such registration of
transfer or exchange of Certificates, but the Trustee may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.

                  The Depositor, the Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                                      C-5-5

<PAGE>

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      C-5-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                              U.S. BANK NATIONAL ASSOCIATION,
                                                as Trustee

                                              By:_______________________________
                                                        Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                              U.S. BANK NATIONAL ASSOCIATION, as
                                                Certificate Registrar

                                              By:_______________________________
                                                       Authorized Signatory

Date of authentication: April ________, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM  - as tenants in common          UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT  - as tenants by the                                 under Uniform Gifts
           entireties                                        to Minors Act
                                                             ________________
JT TEN   - as joint tenants with right                             (State)
           of survivorship and not as
           tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      C-5-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      C-5-9

<PAGE>

                                   EXHIBIT C-6

                           FORM OF CLASS N CERTIFICATE

         FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
         REPRESENTS A DIRECT OR INDIRECT BENEFICIAL INTEREST IN A
         "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
         CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
         SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986,
         AS AMENDED (THE "CODE") AND IN CERTAIN OTHER PROPERTY.

         THIS CLASS N CERTIFICATE IS SUBORDINATE TO THE OFFERED
         CERTIFICATES AND THE CLASS B-4 CERTIFICATES OF THIS SERIES TO
         THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS N CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS
         UNTIL SUCH TIME AS DESCRIBED IN THE POOLING AND SERVICING
         AGREEMENT REFERRED TO HEREIN.

         THIS CLASS N CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933
         ACT"), OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
         TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT
         SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
         TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
         QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF
         SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
         TO HEREIN.

         NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN
         OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE
         RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR THE
         CODE WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE
         PROCEDURES DESCRIBED HEREIN.

                                      C-6-1

<PAGE>

                 C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES

                            SERIES 2004-CB3, CLASS N

evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by

<TABLE>
<CAPTION>
                       CITIGROUP MORTGAGE LOAN TRUST INC.

<S>                                             <C>
Series 2004-CB3, Class N                        Original Class N Notional Amount as of the
                                                Closing Date: $23,750,000.00
Pass-Through Rate: 10.00 % per annum
                                                Initial Notional Amount: $23,750,000.00
Date of Pooling and Servicing Agreement and
Cut-off Date: March 1, 2004                     Servicer:  Litton Loan Servicing LP

First Distribution Date:  April 26, 2004        Trustee:  U.S. Bank National Association

No. 1                                           Closing Date: April 12, 2004
</TABLE>

         THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
         INTEREST IN CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER,
         THE TRUSTEE OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
         NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED
         STATES.

                                      C-6-2

<PAGE>

                  This certifies that Citigroup Global Markets Inc. is the
registered owner of a Percentage Interest (obtained by dividing the Initial
Notional Amount of this Certificate by the Original Class N Notional Amount) in
that certain beneficial ownership interest evidenced by all the Class N
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Citigroup Mortgage
Loan Trust Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Servicer, the Seller and the Trustee,
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.

                  Pursuant to the terms of the Agreement, distributions will be
made on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class N Certificates on such Distribution Date pursuant to the
Agreement.

                  All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class N
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of a 66% Percentage Interest of the Class N Certificates, or by check
mailed by first class mail to the address of the Person entitled thereto, as
such name and address shall appear on the Certificate Register, provided that
the Certificate Registrar may deduct a reasonable wire transfer fee from any
payment made by wire transfer. Notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Trustee for that purpose as
provided in the Agreement.

                  This Certificate is one of a duly authorized issue of
Certificates designated as C- BASS Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing the Percentage Interest specified on the face hereof.

                  The Class N Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to

                                      C-6-3

<PAGE>

Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Seller and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies appointed by the Trustee as provided in
the Agreement, duly endorsed by, or accompanied by an assignment in the form
below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by, the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.

                  The Certificates are issuable in fully registered form only
without coupons in Classes and denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

                  No transfer of this Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the 1933
Act and effective registration or qualification under applicable state
securities laws, or is made in a transaction that does not require such
registration or qualification. In the event that a transfer is to be made
without registration or qualification, the Certificate Registrar shall require,
in order to assure compliance with such laws, either (i) that the
Certificateholder desiring to effect the transfer and such Certificateholder's
prospective transferee each execute a representation letter in the form
described by the Agreement certifying to the Certificate Registrar the facts
surrounding the transfer, or (ii) that the Depositor and the Certificate
Registrar shall require an Opinion of Counsel satisfactory to them that such
transfer may be made without such registration or qualification, which Opinion
of Counsel shall not be an expense of the Depositor, the Trustee or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar nor the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer

                                      C-6-4

<PAGE>

of such Certificates without registration or qualification. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the Depositor, the Certificate Registrar and the
Servicer against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.

                  No transfer of this Certificate or any interest herein may be
made to employee benefit plans and certain other retirement plans and
arrangements, including individual retirement accounts and annuities, Keogh
plans and collective investment funds and separate accounts in which such plans,
accounts or arrangements are invested that are subject to the fiduciary
responsibility provisions of ERISA and Section 4975 of the Code ("Plans") or any
person who is directly or indirectly purchasing this Certificate or interest
herein on behalf of, as named fiduciary of, as trustee of, or with assets of a
Plan unless the opinion letter in section 5.02 of the Pooling and Servicing
Agreement is provided.

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

                  The Depositor, the Servicer and the Trustee and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee
or the Certificate Registrar may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment to the Certificateholders of all
amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Principal Balance of the Mortgage Loans.

                                      C-6-5

<PAGE>

                  The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.

                  Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.

                                      C-6-6

<PAGE>

                  IN WITNESS WHEREOF, the Trustee has caused this Certificate to
be duly executed.

Dated: April ___, 2004

                                              U.S. BANK NATIONAL ASSOCIATION,
                                                as Trustee

                                              By:_______________________________
                                                        Authorized Officer

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Certificates referred to in the
within-mentioned Agreement.

                                              U.S. BANK NATIONAL ASSOCIATION, as
                                                Certificate Registrar

                                              By:_______________________________
                                                      Authorized Signatory

Date of authentication: April ___, 2004

<PAGE>

                                  ABBREVIATIONS

                  The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             (Cust) (Minor)
TEN ENT - as tenants by the                                  under Uniform Gifts
          entireties                                         to Minors Act
                                                             ________________
JT TEN  - as joint tenants with right                              (State)
          of survivorship and not as
          tenants in common

                  Additional abbreviations may also be used though not in the
above list.

                                   ASSIGNMENT
                                   ----------

                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto___________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________

Dated:

                                        _______________________________________
                                        Signature by or on behalf of assignor

                                        _______________________________________
                                        Signature Guaranteed

                                      C-6-8

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available__________________________________________________________
funds to_______________________________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.

                                      C-6-9

<PAGE>

                                    EXHIBIT D

                             MORTGAGE LOAN SCHEDULE

                            (Available Upon Request)

                                       D-1

<PAGE>

                                   SCHEDULE I

                             MORTGAGE LOAN SCHEDULE

                                [FILED BY PAPER]

<PAGE>

                                    EXHIBIT E

                    FORM OF REQUEST FOR RELEASE OF DOCUMENTS

To:      U.S. Bank National Association
         60 Livingston Avenue
          EP-MN-WS3D
         St. Paul, Minnesota 55107-2292

                  Re:      Pooling and Servicing Agreement dated as of
                           March 1, 2004 among Citigroup Mortgage Loan
                           Trust Inc., as depositor, Credit-Based Asset
                           Servicing and Securitization LLC, as seller,
                           Litton Loan Servicing LP, as servicer and U.S.
                           Bank National Association, as trustee
                           -------------------------------------

                  All capitalized terms used herein shall have the means
ascribed to them in the Pooling and Servicing Agreement (the "Agreement")
referenced above.

                  In connection with the administration of the Mortgage Loans
held by you as Trustee pursuant to the Agreement, we request the release, and
hereby acknowledge receipt, of the Trustee's Mortgage File for the Mortgage Loan
described below, for the reason indicated.

Mortgage Loan Number:

Mortgagor Name, Address & Zip Code:

Reason for Requesting Documents (check one):

_____    1.       Mortgage Paid in Full
                  ---------------------

_____    2.       Foreclosure
                  -----------

_____    3.       Substitution
                  ------------

_____    4.       Other Liquidation (Repurchases, etc.)
                  -------------------------------------

                                    E-1

<PAGE>

_____    5.       Nonliquidation            Reason:

                                                  By:________________________
                                                        (authorized signer)

                                                  Issuer:

                                                  Address:

Date:

Custodian
---------

The Bank of New York

                  Please acknowledge the execution of the above request by your
signature and date below:

         Signature                                      Date

Documents returned to Custodian:

         Custodian                                      Date

                                       E-2

<PAGE>

                                   EXHIBIT F-1

             FORM OF TRUSTEE'S OR CUSTODIAN'S INITIAL CERTIFICATION

                    SEE EXHIBIT 2A TO THE CUSTODIAL AGREEMENT

                                      F-1-1

<PAGE>

                                   EXHIBIT F-2

                      FORM OF TRUSTEE'S FINAL CERTIFICATION

                    SEE EXHIBIT 2B TO THE CUSTODIAL AGREEMENT

                                      F-2-1

<PAGE>

                                   EXHIBIT F-3

                        FORM OF RECEIPT OF MORTGAGE NOTE

                          [Bank of New York Letterhead]

                            ACKNOWLEDGMENT OF RECEIPT

                                                    April 12, 2004

U.S. Bank National Association,
as Trustee for C-BASS
Mortgage Loan Asset-Backed
Certificates, Series 2004-CB3
60 Livingston Ave, EP-MN-WS3D
St. Paul, Minnesota  55101-2292

                  Re:      Custodial Agreement dated as of March 1, 2004 among
                           U.S. Bank National Association, as Trustee, Litton
                           Loan Servicing LP, as Servicer, and The Bank of New
                           York, as Custodian

Ladies and Gentlemen:

         In accordance with the provisions of Section 4 of the above-referenced
Custodial Agreement, the undersigned, as the Custodian, hereby certifies as to
each Mortgage Loan in the Mortgage Schedule that (i) it has received the
original Mortgage Note with respect to each Mortgage Loan identified in the
Mortgage Loan Schedule attached hereto as Exhibit A and (ii) such Mortgage Note
has been reviewed by it and appears regular on its face and relates to such
Mortgage Loan. The Custodian makes no representations as to (i) the validity,
legality, enforceability, sufficiency, due authorization or genuineness of any
of the documents contained in each Custodial File or of any of the Mortgage
Loans or (ii) the collectability, insurability, effectiveness or suitability of
any such Mortgage Loan.

         The Custodian hereby confirms that it is holding each such Mortgage
Note as agent and bailee of, and custodian for the exclusive use and benefit,
and subject to the sole direction of the Trustee pursuant to the terms and
conditions of the Custodial Agreement.

         This Acknowledgment of Receipt is not divisible or negotiable.

         The Custodian will accept and act on instructions with respect to the
Mortgage Loans subject hereto upon surrender of this Trust Receipt and Initial
Certification at the office of the Subcustodian

                                      F-3-1

<PAGE>

at Bank of New York Western Trust Company, 700 South Flower Street, Suite 200,
Los Angeles, California 90017, Attention: Reginald Carter.

         Capitalized terms used herein shall have the meaning ascribed tot hem
in the Custodial Agreement.

                                              THE BANK OF NEW YORK,
                                              as Custodian

                                              By: _________________________

                                      F-3-2

<PAGE>

                                    EXHIBIT G

                    FORM OF MORTGAGE LOAN PURCHASE AGREEMENT

                                       G-1

<PAGE>

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

                       CITIGROUP MORTGAGE LOAN TRUST INC.

                                  as Purchaser

                                       and

               CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC

                                    as Seller

                        MORTGAGE LOAN PURCHASE AGREEMENT

                  Fixed Rate and Adjustable Rate Mortgage Loans

                 Citigroup Mortgage Loan Trust, Series 2004-CB3
                 C-BASS Mortgage Loan Asset-Backed Certificates

                            Dated as of April 8, 2004

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

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

                                    ARTICLE I

                                   DEFINITIONS
Section 1.01      Definitions..................................................1

                                   ARTICLE II

                SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01      Sale of Mortgage Loans.......................................2
Section 2.02      Obligations of Seller Upon Sale..............................2
Section 2.03      Payment of Purchase Price for the Mortgage Loans.  ..........4

                                   ARTICLE III

               REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01      Seller Representations and Warranties Relating to the
                  Mortgage Loans...............................................5
Section 3.02      Seller Representations and Warranties.......................16

                                   ARTICLE IV

                               SELLER'S COVENANTS
Section 4.01      Covenants of the Seller.....................................19

                                    ARTICLE V

                  OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS

                                   ARTICLE VI

                                   TERMINATION
Section 6.01      Termination.................................................20

                                   ARTICLE VII

                            MISCELLANEOUS PROVISIONS
Section 7.01      Amendment...................................................20
Section 7.02      Governing Law...............................................20

                                                i

<PAGE>

Section 7.03      Notices.....................................................20
Section 7.04      Severability of Provisions..................................21
Section 7.05      Counterparts................................................21
Section 7.06      Further Agreements..........................................21
Section 7.07      Intention of the Parties....................................21
Section 7.08      Successors and Assigns; Assignment of this Agreement........21
Section 7.09      Survival.  .................................................22

Schedule I        Mortgage Loan Schedule

                                       ii

<PAGE>

                  MORTGAGE LOAN PURCHASE AGREEMENT, dated as of April 8, 2004,
(the "AGREEMENT"), between CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC
("C-BASS" or the "SELLER") and CITIGROUP MORTGAGE LOAN TRUST INC. (the
"PURCHASER").

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

                  WHEREAS, the Seller is the owner of either the notes or other
evidence of indebtedness (the "MORTGAGE NOTES") or other evidence of ownership
so indicated on Schedule I hereto, and the other documents or instruments
constituting the Mortgage File (collectively, the "MORTGAGE LOANS"); and

                  WHEREAS, the Seller, as of the date hereof, owns the mortgages
(the "MORTGAGES") on the properties (the "MORTGAGED PROPERTIES") securing such
Mortgage Loans, including rights (a) to any property acquired by foreclosure or
deed in lieu of foreclosure or otherwise, and (b) to the proceeds of any
insurance policies covering the Mortgage Loans or the Mortgaged Properties or
the obligors on the Mortgage Loans; and

                  WHEREAS, the parties hereto desire that the Seller sell the
Mortgage Loans to the Purchaser and the Purchaser purchase the Mortgage Loans
from the Seller pursuant to the terms of this Agreement; and

                  WHEREAS, pursuant to the terms of a Pooling and Servicing
Agreement, dated as of March 1, 2004 (the "POOLING AND SERVICING AGREEMENT"),
among the Seller as seller, the Purchaser, as depositor, Litton Loan Servicing
LP ("Litton"), as servicer, and U.S. Bank National Association, as trustee (the
"Trustee"), the Purchaser will convey the Mortgage Loans to Citigroup Mortgage
Loan Trust, Series 2004-CB3.

                  NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

                  Section 1.01 DEFINITIONS. All capitalized terms used but not
defined herein and below shall have the meanings assigned thereto in the Pooling
and Servicing Agreement.

                  "CUSTODIAN": A custodian acceptable to the Trustee, which may
be the Trustee and which shall not be the Seller or any affiliate of the Seller.
The initial Custodian shall be The Bank of New York.

                  "INSURANCE AGREEMENT": With respect to any FHA Mortgage Loan,
the insurance contract issued by the FHA.

<PAGE>

                                   ARTICLE II

                SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE

                  Section 2.01      SALE OF MORTGAGE LOANS.

                  (a) The Seller does hereby agree to and does hereby sell,
assign, set over, and otherwise convey to the Purchaser, without recourse, on
the Closing Date, all its right, title and interest, in and to (i) each Mortgage
Loan and the related Cut-off Date Principal Balance thereof, including any
Related Documents, (ii) all payments on or collections in respect of the
Mortgage Loans due after the Cut-off Date; (iii) property which secured such
Mortgage Loan and which has been acquired by foreclosure or deed in lieu of
foreclosure; (iv) its interest in any insurance policies in respect of the
Mortgage Loans; and (v) all proceeds of any of the foregoing.

                  (b) The Seller, concurrently with the execution and delivery
of this Agreement does hereby sell, and in connection therewith hereby assigns
to the Purchaser, effective as of the Closing Date, without recourse, all
proceeds of the foregoing.

                  Section 2.02      OBLIGATIONS OF SELLER UPON SALE.

                  (a) In connection with any transfer pursuant to Section 2.01
hereof, the Seller further agrees, at its own expense, on or prior to the
Closing Date, (x) to indicate in its books and records that the Mortgage Loans
have been sold to the Purchaser pursuant to this Agreement and (y) to deliver to
the Purchaser and the Trustee a computer file containing a true and complete
list of all the Mortgage Loans specifying, among other things, for each Mortgage
Loan, as of the Cut-off Date, its account number and Cut-off Date Principal
Balance. Such file (the "MORTGAGE LOAN SCHEDULE") which is included as Exhibit D
to the Pooling and Servicing Agreement, shall also be marked as Schedule I to
this Agreement and is hereby incorporated into and made a part of this
Agreement.

                  In connection with such transfer and assignment, the Seller,
on behalf of the Purchaser, does hereby deliver or cause to be delivered to, and
deposit with the Trustee, or its designated agent (the "Custodian"), the
following documents or instruments with respect to each Mortgage Loan (a
"Mortgage File") so transferred and assigned:

                  (i) the original Mortgage Note, endorsed either (A) in blank
         or (B) in the following form: "Pay to the order of U.S. Bank National
         Association, as Trustee under the Pooling and Servicing Agreement,
         dated as of March 1, 2004, among Credit-Based Asset Servicing and
         Securitization LLC, Citigroup Mortgage Loan Trust Inc., Litton Loan
         Servicing LP and U.S. Bank National Association, Citigroup Mortgage
         Loan Trust, C-BASS Mortgage Loan Asset-Backed Certificates, Series
         2004-CB3, without recourse," or with respect to any lost Mortgage Note,
         an original lost note affidavit, together with a copy of the related
         Mortgage Note;

                  (ii) the original Mortgage with evidence of recording thereon,
         and the original

                                        2

<PAGE>

         recorded power of attorney, if the Mortgage was executed pursuant to a
         power of attorney, with evidence of recording thereon or, if such
         Mortgage or power of attorney has been submitted for recording but has
         not been returned from the applicable public recording office, has been
         lost or is not otherwise available, a copy of such Mortgage or power of
         attorney, as the case may be, certified to be a true and complete copy
         of the original submitted for recording;

                  (iii) an original Assignment of Mortgage, in form and
         substance acceptable for recording. The Mortgage shall be assigned
         either (A) in blank or (B) to "U.S. Bank National Association, as
         Trustee under the Pooling and Servicing Agreement, dated as of March 1,
         2004, among Credit-Based Asset Servicing and Securitization LLC,
         Citigroup Mortgage Loan Trust Inc., Litton Loan Servicing LP and U.S.
         Bank National Association, Citigroup Mortgage Loan Trust, C-BASS
         Mortgage Loan Asset-Backed Certificates, Series 2004-CB3, without
         recourse";

                  (iv) an original or a certified copy of any intervening
         assignment of Mortgage showing a complete chain of assignments;

                  (v) the original or a certified copy of lender's title
         insurance policy;

                  (vi) the original or copies of each assumption, modification,
         written assurance or substitution agreement, if any; and

                  (vii) for each FHA Loan, the original Mortgage Insurance
         Certificate.

                  If any of the documents referred to in Section 2.02(ii), (iii)
or (iv) above has as of the Closing Date been submitted for recording but either
(x) has not been returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original of such
document, the obligations of the Seller to deliver such documents shall be
deemed to be satisfied upon (1) delivery to the Trustee or the Custodian no
later than the Closing Date, of a copy of each such document certified by the
Seller in the case of (x) above or the applicable public recording office in the
case of (y) above to be a true and complete copy of the original that was
submitted for recording and (2) if such copy is certified by the Seller,
delivery to the Trustee or the Custodian, promptly upon receipt thereof of
either the original or a copy of such document certified by the applicable
public recording office to be a true and complete copy of the original. The
Seller shall deliver or cause to be delivered to the Trustee or the Custodian
promptly upon receipt thereof any other documents constituting a part of a
Mortgage File received with respect to any Mortgage Loan, including, but not
limited to, any original documents evidencing an assumption or modification of
any Mortgage Loan.

                  Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File, the
Seller shall have 120 days to cure such defect or 150 days following the Closing
Date, in the case of missing Mortgages or Assignments or deliver such missing
document to the Trustee or the Custodian. If the Seller does not cure such
defect or

                                        3

<PAGE>

deliver such missing document within such time period, the Seller shall either
repurchase or substitute for such Mortgage Loan in accordance with Section 3.01
hereof.

                  The Purchaser hereby acknowledges its acceptance of all right,
title and interest to the Mortgage Loans and other property, now existing and
hereafter created, conveyed to it pursuant to Section 2.01.

                  The parties hereto intend that the transaction set forth
herein be a sale by the Seller to the Purchaser of all the Seller's right, title
and interest in and to the Mortgage Loans and other property described above. In
the event the transaction set forth herein is deemed not to be a sale, the
Seller hereby grants to the Purchaser a security interest in all of the Seller's
right, title and interest in, to and under the Mortgage Loans and other property
described above, whether now existing or hereafter created, to secure all of the
Seller's obligations hereunder; and this Agreement shall constitute a security
agreement under applicable law. The Seller and the Purchaser shall, to the
extent consistent with this Agreement, take such actions as may be necessary to
ensure that, if this Agreement were deemed to create a security interest in the
Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of this Agreement.

                  (b) The Seller shall cause the Assignments of Mortgage which
were delivered in blank to be completed and shall cause all Assignments referred
to in Section 2.02(iii) hereof and, to the extent necessary, in Section 2.02(iv)
hereof to be recorded. The Seller shall be required to deliver such assignments
for recording within 30 days of the Closing Date. The Seller shall furnish the
Trustee, or its designated agent, with a copy of each assignment of Mortgage
submitted for recording. In the event that any such Assignment is lost or
returned unrecorded because of a defect therein, the Seller shall promptly have
a substitute Assignment prepared or have such defect cured, as the case may be,
and thereafter cause each such Assignment to be duly recorded.

                  In the event that any Mortgage Note is endorsed in blank as of
the Closing Date, promptly following the Closing Date the Seller shall cause to
be completed such endorsements in the following form: "Pay to the order of U.S.
Bank National Association, as Trustee under the Pooling and Servicing Agreement,
dated as of March 1, 2004, among Credit-Based Asset Servicing and Securitization
LLC, Citigroup Mortgage Loan Trust Inc., Litton Loan Servicing LP and U.S. Bank
National Association, Citigroup Mortgage Loan Trust, C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB3, without recourse."

                  Section 2.03 PAYMENT OF PURCHASE PRICE FOR THE MORTGAGE LOANS.
In consideration of the sale of the Mortgage Loans from the Seller to the
Purchaser on the Closing Date, the Purchaser agrees to pay to the Seller on the
Closing Date by transfer of immediately available funds, as directed by the
Seller, an amount equal to $382,908,348.50 in respect of the Mortgage Loans (the
"PURCHASE PRICE"), net of an expense reimbursement amount of $137,979.00 (the
"EXPENSE REIMBURSEMENT AMOUNT"), and to transfer to the Seller or its designee
on the Closing Date, (i) a portion of the Class B-1 Certificates and (ii) the
Class B-4, Class N, Class X, and Residual Certificates (collectively, the
"Private Certificates"). The Expense Reimbursement Amount shall reimburse the
Purchaser for the

                                        4

<PAGE>

Purchaser's Securities and Exchange Commission registration statement fees and
the Purchaser's registration statement administration fees allocable to the
Trust. The Seller shall pay, and be billed directly for, all expenses incurred
by the Purchaser in connection with the issuance of the Certificates, including,
without limitation, printing fees incurred in connection with the prospectus
relating to the Certificates, blue sky registration fees and expenses, fees and
reasonable expenses of Purchaser's counsel, fees of the rating agencies
requested to rate the Certificates, accountant's fees and expenses and the fees
and expenses of the Trustee and other out-of-pocket costs, if any. If the
Purchaser shall determine that the Expense Reimbursement Amount is not
sufficient to reimburse the Purchaser for all expenses incurred by it that are
subject to reimbursement by the Seller hereunder as described above, the Seller
shall promptly reimburse the Purchaser for such additional amounts upon written
notice by the Purchaser to the Seller.

                                   ARTICLE III

               REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH

                  Section 3.01 SELLER REPRESENTATIONS AND WARRANTIES RELATING TO
THE MORTGAGE LOANS. The Seller hereby represents and warrants to the Purchaser,
with respect to the Mortgage Loans, that as of the Closing Date or as of such
date specifically provided herein:

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

                  (b) There are no delinquent taxes, ground rents, water
charges, sewer rents, assessments, including assessments payable in future
installments, or other outstanding charges affecting the related Mortgaged
Property.

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

                  (d) The Mortgage Note and the Mortgage are not subject to any
right of rescission, set-off, counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of the Mortgage Note and the
Mortgage, or the exercise of any right thereunder, render the Mortgage
unenforceable, in whole or in part, or subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury and no such
right of rescission, set-off,

                                        5

<PAGE>

counterclaim or defense has been asserted with respect thereto.

                  (e) All buildings upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, pursuant to insurance policies conforming to the requirements of the
Pooling and Servicing Agreement. All such insurance policies contain a standard
mortgagee clause naming the Seller, its successors and assigns as mortgagee and
all premiums thereon have been paid. If upon origination of the Mortgage Loan,
the Mortgaged Property was in an area identified on a Flood Hazard Map or Flood
Insurance Rate Map issued by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available) a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect which policy conforms to the
requirements of the Federal National Mortgage Association ("FNMA") and the
Federal Home Loan Mortgage Corporation ("FHLMC"). The Mortgage obligates the
Mortgagor thereunder to maintain all such insurance at the Mortgagor's cost and
expense, and on the Mortgagor's failure to do so, authorizes the holder of the
Mortgage to maintain such insurance at the Mortgagor's cost and expense and to
seek reimbursement therefor from the Mortgagor. All acts required to be
performed to preserve the rights and remedies of the Trustee in any such
insurance policies have been performed, including, without limitation, any
necessary notifications of insurers and assignments of policies or interests
therein.

                  (f) As of the date of origination of the Mortgage Loan, any
and all requirements of any federal, state or local law, including, without
limitation, usury, truth in lending, real estate settlement procedures, consumer
credit protection, equal credit opportunity or disclosure laws applicable to the
origination of the Mortgage Loans have been complied with. Any and all
requirements of any federal, state or local law, including, without limitation,
usury, truth in lending, real estate settlement procedures, consumer credit
protection, equal credit opportunity or disclosure laws applicable to the
servicing of the Mortgage Loans have been complied with.

                  (g) The Mortgage has not been satisfied, canceled,
subordinated (other than with respect to second lien loans, the subordination to
the first lien loan) rescinded, in whole or in part, and the Mortgaged Property
has not been released from the lien of the Mortgage, in whole or in part, nor
has any instrument been executed that would effect any such satisfaction,
cancellation, subordination, rescission or release.

                  (h) The Mortgage is a valid, existing and enforceable first or
second lien on the Mortgaged Property, including all improvements on the
Mortgaged Property subject only to (1) the lien of current real property taxes
and assessments not yet due and payable, (2) covenants, conditions and
restrictions, rights of way, easements and other matters of the public record as
of the date of recording being acceptable to mortgage lending institutions
generally and, in the case of FHA Loans, to the FHA, and specifically referred
to in the lender's title insurance policy delivered to the originator of the
Mortgage Loan, (3) other matters to which like properties are commonly subject
which do not materially interfere with the benefits of the security intended to
be provided by the Mortgage or the use, enjoyment, value or marketability of the
related Mortgaged Property and which

                                        6

<PAGE>

may not in any way prevent realization of the benefits of the related Insurance
Agreement, if applicable and (4) with respect to any second lien mortgage loan,
the lien of the related first mortgage loan. Any security agreement, chattel
mortgage or equivalent document related to and delivered in connection with the
Mortgage Loan establishes and creates a valid, existing and enforceable first or
second lien and first or second priority security interest on the property
described therein and the Seller has full right to sell and assign the same to
the Purchaser.

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

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

                  (k) Immediately prior to the transfer and assignment
contemplated herein, the Seller was the sole owner and holder of the Mortgage
Loans and has good and marketable title to each Mortgage Loan, free and clear of
any and all liens, pledges, charges, claims, participation interests, mortgages,
security interests or encumbrances or other interests of any nature and has full
right and authority to sell and assign the same.

                  (l) Each Mortgage Loan is covered by an ALTA mortgagee title
insurance policy acceptable to FNMA or FHLMC, issued by a title insurer
acceptable to (1) FNMA and FHLMC, in the case of a conventional Mortgage Loan
and (2) the FHA, in the case of an FHA Loan, and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring (subject to the
exceptions contained in (h)(1) and (2) above) the Seller, its successors and
assigns as to the first or second priority lien of the Mortgage in the original
principal amount of the Mortgage Loan and against any loss by reason of the
invalidity or unenforceability of the lien resulting from the provisions of the
Mortgage providing for adjustment in the mortgage interest rate and/or monthly
payment including any negative amortization thereunder. Additionally, such
mortgagee title insurance policy affirmatively insures ingress and egress to and
from the Mortgaged Property, and against encroachments by or upon the Mortgaged
Property or any interest therein. The Seller is the sole insured of such
mortgagee title insurance policy, and such lender's title insurance policy is in
full force and effect and will be in full force and effect upon the consummation
of the transactions contemplated by this Agreement. No claims have been made
under such mortgagee title insurance policy, and no prior holder of the related
Mortgage, including the Seller, has done, by act or omission, anything which
would impair the coverage of such mortgagee title insurance policy.

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

                                        7

<PAGE>

with, the lien of the related Mortgage.

                  (n) The collection practices used by the Servicer with respect
to each Mortgage Note and Mortgage have been in all respects legal, proper,
prudent and customary in the mortgage servicing industry.

                  (o) The Mortgage and related Mortgage Note contain customary
and enforceable provisions such as to render the rights and remedies of the
holder thereof adequate for the realization against the Mortgaged Property of
the benefits of the security provided thereby, including, (1) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (2) otherwise by
judicial foreclosure. There is no homestead or other exemption available to the
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage. The Mortgagor has not
notified the Seller and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Soldiers and Sailors Civil Relief Act of
1940, as amended.

                  (p) The Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage on the Mortgaged
Property and the security interest of any applicable security agreement or
chattel mortgage.

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

                  (r) No Mortgage Loan contains provisions pursuant to which
monthly payments are (1) paid or partially paid with funds deposited in any
separate account established by the Seller, the Mortgagor, or anyone on behalf
of the Mortgagor, (2) paid by any source other than the Mortgagor or (3)
contains any other similar provisions which may constitute a "buydown"
provision. The Mortgage Loan is not a graduated payment mortgage loan and the
Mortgage Loan does not have a shared appreciation or other contingent interest
feature.

                  (s) The Mortgage Note, the Mortgage, the Assignment and any
other documents required to be delivered with respect to each Mortgage Loan
pursuant to Section 2.02 hereof have been delivered to the Purchaser or its
designee, all in compliance with the specific requirements of Section 2.02
hereof.

                  (t) If the residential dwelling on the Mortgaged Property is a
condominium unit or a unit in a planned unit development (other than a de
minimis planned unit development) such condominium or planned unit development
project meets FNMA's eligibility requirements.

                  (u) None of the Mortgage Loans are secured by a leasehold
estate or constitute other than real property under applicable state law.

                                        8

<PAGE>

                  (v) The rights with respect to each Mortgage Loan are
assignable by the Seller without the consent of any Person other than consents
which will have been obtained on or before the Closing Date.

                  (w) The Mortgage Loans are not being transferred by the Seller
with any intent to hinder, delay or defraud any creditors of the Seller.

                  (x) All parties which have had any interest in each Mortgage
Loan, whether as mortgagee, assignee, pledgee or otherwise, and including,
without limitation, the Seller, are (or during the period in which they held and
disposed such interest, were) in compliance with any and all applicable
licensing requirements of the laws of the state wherein the property securing
the Mortgage is located to the extent that any noncompliance thereunder would
affect the value or marketability of the Mortgage Loans.

                  (y) To the best of Seller's knowledge, the Mortgaged Property
is free from any and all toxic or hazardous substances and there exists no
violation of any local, state or federal environmental law, rule or regulation.

                  (z) The Mortgaged Property is free from material damage.

                  (aa) Each Mortgage Loan has been serviced by the Servicer in
accordance with the terms thereof and Applicable Regulations.

                  (bb) [Reserved]

                  (cc) [Reserved]

                  (dd) There is no proceeding pending for the total or partial
condemnation and no eminent domain proceedings pending affecting any Mortgaged
Property.

                  (ee) There was no fraud involved in the origination of any
Mortgage Loan by the applicable mortgagee or Mortgagor, and to the best of the
Seller's knowledge, there was no fraud by the appraiser or any other party
involved in the origination of any such Mortgage Loan.

                  (ff) Each mortgage file contains an appraisal of or a broker's
price opinion regarding the related Mortgaged Property indicating an appraised
value equal to the appraised value identified for such Mortgaged Property on the
Mortgage Loan Schedule. Each appraisal has been prepared on FNMA or FHLMC forms.

                  (gg) No improvements on any Mortgaged Property encroach on
adjoining properties (and in the case of a condominium unit, such improvements
are within the project with respect to that unit), and no improvements on
adjoining properties encroach upon such Mortgaged Property unless there exists
in the applicable Mortgage File a title policy with endorsements which insure
against losses sustained by the insured as a result of such encroachments.

                                        9

<PAGE>

                  (hh) Each Insurance Agreement is in full force and effect and
will be in full force and effect upon the consummation of the transactions
contemplated by this Agreement.

                  (ii) With respect to escrow deposits, if any, all such
payments are in the possession of, or under the control of, the Servicer and
there exists no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. No escrow deposits or
escrow advances or other charges or payments due the Servicer have been
capitalized under any Mortgage or the related Note.

                  (jj) No Mortgage Loan, other than a Bankruptcy Plan Mortgage
Loan, is subject to any pending bankruptcy or insolvency proceeding. To the
Seller's best knowledge, no material litigation or lawsuit relating to any
Mortgage Loan is pending.

                  (kk) The Seller used no selection procedures that identified
the Mortgage Loans as being less desirable or valuable than other comparable
mortgage loans acquired by the Seller.

                  (ll) The sale, transfer, assignment and conveyance of Mortgage
Loans by the Seller pursuant to this Agreement will not result in any tax, fee
or governmental charge (other than income taxes and related taxes) payable by
the Seller, the Depositor or the Trustee to any federal, state or local
government other than taxes which have or will be paid by the Seller as due
("TRANSFER TAXES"). In the event that the Depositor or the Trustee receives
actual notice of any Transfer Taxes arising out of the transfer, assignment and
conveyance of the Mortgage Loans, other than any taxes to be paid by the
creditor, on written demand by the Depositor, or the Trustee, or upon the
Seller's otherwise being given notice thereof by the Depositor or the Trustee,
the Seller shall pay, and otherwise indemnify and hold the Depositor and the
Trustee harmless, on an after-tax basis, from and against any and all such
Transfer Taxes (it being understood that the Certificateholders, the Trustee and
the Depositor shall have no obligation to pay such Transfer Taxes).

                  (mm) With respect to each Mortgage Loan that is a "mortgage"
as such term is defined in 15 U.S.C. 1602(aa), no obligor has or will have a
claim or defense under such Mortgage Loan as a result of a violation of the Home
Ownership and Equity Protection Act of 1994.

                  (nn) With respect to the Mortgage Loans, the Mortgaged
Properties securing repayment of the related Mortgage Note, consists of a fee
simple interest in a single parcel or two contiguous parcels of real property
(i) improved by a (A) detached or semi-detached one-family dwelling, (B)
detached or semi-detached two-to four family dwelling, (C) one-family unit in a
FNMA eligible condominium project, (D) detached or semi-detached one-family
dwelling in a planned unit development, (E) multi-family dwelling or townhouse
or (F) mobile home or manufactured dwelling which constitutes real property or
(ii) unimproved by any residential dwelling.

                  (oo) Except for the Mortgage Loans identified on the Mortgage
Loan Schedule as delinquent, there is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note and no event
which, with the passage of time or with notice and the expiration

                                       10

<PAGE>

of any grace or cure period, would constitute a default, breach, violation or
event of acceleration, and the Seller has not waived any default, breach,
violation or event of acceleration except, in the case of an FHA Loan, by
written instruments, and the substance of which waiver has been approved by the
FHA to the extent required by the applicable Insurance Agreement.

                  (pp) The Seller has no actual knowledge that with respect to
any Mortgage Loan (1) the Servicer has sent a notice of default to the related
Mortgagor which the Servicer is currently seeking to enforce, or (2) any
foreclosure proceedings have been commenced or acceleration been declared which
is currently pending. The Seller is not transferring any Mortgage Loan to the
Purchaser with the intention or knowledge that the Purchaser or the Trust will
acquire the related Mortgaged Property.

                  (qq) With respect to any Mortgage Loan that is secured by a
second lien on the related Mortgaged Property, either (i) no consent for the
Mortgage Loan is required by the holder of any related senior lien or (ii) such
consent has been obtained and is contained in the Mortgage File.

                  (rr) In any case in which a Mortgage Loan is secured by a
second lien and a senior lien on the related Mortgaged Property provides for
negative amortization or deferred interest, the balance of such senior lien on
the related Mortgaged Property used to calculate the Combined Loan to Value
Ratio for the Mortgage Loan is based on the maximum amount of negative
amortization possible under such senior loan.

                  (ss) With respect to a Mortgage Loan which is a second lien,
as of the date hereof, the Seller has not received a notice of default of a
senior lien on the related Mortgaged Property which has not been cured.

                  (tt) No Mortgage Loan is delinquent (other than Mortgage Loans
subject to a bankruptcy plan or forbearance plan). The Seller has not waived any
default, breach, violation or event of acceleration, and the Seller has not
taken any action to waive any default, breach, violation or event of
acceleration, with respect to any Mortgage Loan.

                  (uu) Each Mortgage Loan is a "qualified Mortgage" within the
meaning of Section 860 G(a)(3) of the Code.

                  (vv) With respect to any Adjustable-Rate Mortgage Loan, all
rate adjustments have been performed in accordance with the terms of the related
Mortgage Note or subsequent modifications, if any.

                  (ww) At the time of their origination, all FHA Loans conformed
to HUD origination guidelines.

                  (xx) Each Mortgage Loan is directly secured by a Mortgage on a
residential property, and either (1) substantially all of the proceeds of the
Mortgage Loan were used to acquire, improve or protect the portion of the
residential property that consists of an interest in real property

                                       11

<PAGE>

(within the meaning of Treasury Regulations Sections 1.856-3(c) and 1.856-3(d))
and the interest in real property was the only security for the Mortgage Loan as
of the Testing Date (as defined below), or (2) the fair market value of the
interest in real property which secures the Mortgage Loan was at least equal to
80% of the principal amount of the Mortgage Loan (a) as of the Testing Date, or
(b) as of the Closing Date. For purposes of the previous sentence, (1) the fair
market value of the referenced interest in real property shall first be reduced
by (a) the amount of any lien on the interest in real property that is senior to
the Mortgage Loan, unless the Mortgage Loan includes both a first lien loan and
a second lien loan on the same Mortgaged Property, in which case the 80% test
shall be applied in the aggregate, and (b) a proportionate amount of any lien on
the interest in real property that is on a parity with the Mortgage Loan, and
(2) the "TESTING DATE" shall be the date on which the referenced Mortgage Loan
was originated unless (a) the Mortgage Loan was modified after the date of its
origination in a manner that would cause "significant modification" of the
Mortgage Loan within the meaning of Treasury Regulations Section 1.1001-3, and
(b) the "significant modification" did not occur at a time when the Mortgage
Loan was in default or when default with respect to the Mortgage Loan was
reasonably foreseeable.

                  (yy) With respect to each Mortgage Loan that is a mobile or
manufactured housing unit, such unit is a "single family residence" within the
meaning of Section 25(e)(1) of the Code, and has a minimum of 400 square feet of
living space, a minimum width of 102 inches and is of a kind customarily used at
a fixed location.

                  (zz) Any written agreement between the Mortgagor in respect of
a Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved the application of the Seller's underwriting standards
or some assessment of the Mortgagor's ability to repay the Modified Mortgage
Loan.

                  (aaa) No Group I Mortgage Loan is covered by the Home
Ownership and Equity Protection Act of 1994 ("HOEPA") and no Mortgage Loan is in
violation of any state law or ordinance similar to HOEPA.

                  (bbb) No proceeds from any Group I Mortgage Loan were used to
finance single- premium credit insurance policies.

                  (ccc) No Group I Mortgage Loan originated on or after October
1, 2002 will impose a Prepayment Charge for a term in excess of three years. Any
Group I Mortgage Loan originated prior to such date will not impose a Prepayment
Charge in excess of five years.

                  (ddd) The Servicer has fully furnished and will continue to
fully furnish, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories), on a monthly
basis.

                                       12

<PAGE>

                  (eee) There is no Group I Mortgage Loan in the Trust Fund that
was originated on or after October 1, 2002 and before March 7, 2003, which is
secured by property located in the State of Georgia.

                  (fff) There is no Group I Mortgage Loan in the Trust Fund that
was originated on or after March 7, 2003, which is a "high cost home loan" as
defined under the Georgia Fair Lending Act.

                  (ggg) (a) No Mortgage Loan is classified as a high cost
mortgage loan under HOEPA; and (b) no Mortgage Loan in the Trust Fund is a "high
cost home," "covered" (excluding home loans defined as "covered home loans"
pursuant to clause (1) of the definition of that term in the New Jersey Home
Ownership Security Act of 2002), "high risk home" or "predatory" loan under any
other applicable state, federal or local law (or a similarly classified loan
using different terminology under a law imposing heightened regulatory scrutiny
or additional legal liability for residential mortgage loans having high
interest rates, points and/or fees).

                  (hhh) Each Mortgage Loan at the time it was made complied in
all material respects with applicable local, state and federal laws, including,
but not limited to, all applicable predatory and abusive lending laws.

                  (iii) None of the Mortgage Loans are High Cost as defined by
the applicable predatory and abusive lending laws.

                  (jjj) No Mortgage Loans are subject to the Georgia Fair
Lending act ("GFLA") effective from October 1, 2002 to March 6, 2003.

                  (kkk) The Prepayment Charges included in the transaction are
enforceable and were originated in compliance with all federal, state and local
laws.

                  (lll) All mortgage loans are originated in compliance with
state, local, and federal laws.

                  With respect to the representations and warranties set forth
in this Section 3.01 that are made to the best of the Seller's knowledge or as
to which the Seller has no knowledge, if it is discovered by the Depositor, the
Seller, the Servicer or the Trustee, as set forth in Section 2.04 of the Pooling
and Servicing Agreement, that the substance of such representation and warranty
is inaccurate and such inaccuracy materially and adversely affects the value of
the related Mortgage Loan or the interest therein of the Purchaser or the
Purchaser's assignee, transferee or designee for the benefit of the
Certificateholders then, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.

                  Upon discovery by the Depositor, the Seller, the Servicer, the
Purchaser or any

                                       13

<PAGE>

assignee, transferee or designee of the Purchaser of a breach of any of the
representations and warranties contained in this Article III or Section 2.04 of
the Pooling and Servicing Agreement that materially and adversely affects the
value of any Mortgage Loan or the interest therein of the Purchaser or the
Purchaser's assignee, transferee or designee for the benefit of the
Certificateholders, the party discovering the breach shall give prompt written
notice to the others and in no event later than two Business Days from the date
of such discovery. It is understood by the parties hereto that a breach of the
representations and warranties made in this Section 3.01(aaa), (bbb), (ccc),
(ddd), (eee), (fff) and (ggg) will be deemed to materially and adversely affect
the value of the related Mortgage Loan or the interest therein of the Purchaser
or the Purchaser's assignee. Within 90 days of the earlier of its discovery or
its receipt of notice of any such breach of a representation or warranty, the
Seller shall promptly cure such breach in all material respects, or in the event
such defect or breach cannot be cured, the Seller shall repurchase the affected
Mortgage Loan or cause the removal of such Mortgage Loan from the Trust Fund and
substitute for it one or more Eligible Substitute Mortgage Loans, in either
case, in accordance with Section 2.03 of the Pooling and Servicing Agreement.

                  Upon discovery or receipt of written notice by the Seller of
any materially defective document in, or that a document is missing from, a
Mortgage File, the Seller shall have 120 days to cure such defect or 150 days
following the Closing Date, in the case of missing Mortgages or Assignments (or
within 90 days of the earlier of the Seller's discovery or receipt of
notification if such defect would cause the Mortgage Loan not to be a "qualified
mortgage" for REMIC purposes), or in the event such defect cannot be cured, the
Seller shall repurchase the affected Mortgage Loan or cause the removal of such
Mortgage Loan from the Trust Fund and substitute for it one or more Eligible
Substitute Mortgage Loans, in either case, within such time periods and in
accordance with Section 2.03 of the Pooling and Servicing Agreement.

                  It is understood and agreed that the representations and
warranties set forth in this Section 3.01 shall survive delivery of the
respective Mortgage Files to the Trustee or its agent, on behalf of the
Purchaser and shall inure to the benefit of the Certificateholders
notwithstanding any restrictive or qualified endorsement or assignment.

                  It is understood and agreed that the obligations of the Seller
set forth in this Section 3.01 to cure, repurchase or substitute for a defective
Mortgage Loan constitute the sole remedies of the Purchaser, the
Certificateholders or the Trustee on their behalf respecting a missing or
defective document or a breach of the representations or warranties contained in
this Section 3.01.

                  Section 3.02 SELLER REPRESENTATIONS AND WARRANTIES. The Seller
hereby represents and warrants to the Purchaser that as of the Closing Date or
as of such date specifically provided herein:

                  (i) The Seller is duly organized, validly existing and in good
standing as a limited liability company under the laws of the State of Delaware
and has the power and authority to own its assets and to transact the business
in which it is currently engaged. The Seller is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the
business

                                       14

<PAGE>

transacted by it or properties owned or leased by it requires such qualification
and in which the failure to so qualify would have a material adverse effect on
(a) its business, properties, assets or condition (financial or other), (b) the
performance of its obligations under this Agreement, (c) the value or
marketability of the Mortgage Loans, or (d) its ability to foreclose on the
related Mortgaged Properties.

                  (ii) The Seller has the power and authority to make, execute,
deliver and perform this Agreement and to consummate all of the transactions
contemplated hereunder and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the Seller's legal, valid and binding
obligations enforceable in accordance with its terms, except as enforcement of
such terms may be limited by (1) bankruptcy, insolvency, reorganization,
receivership, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by the availability of equitable remedies, (2) general
equity principals (regardless of whether such enforcement is considered in a
proceeding in equity or at law) or (3) public policy considerations underlying
the securities laws, to the extent that such policy considerations limit the
enforceability of the provisions of this Agreement which purport to provide
indemnification from securities laws liabilities.

                  (iii) The Seller holds all necessary licenses, certificates
and permits from all governmental authorities necessary for conducting its
business as it is presently conducted, except for such licenses, certificates
and permits the absence of which, individually or in the aggregate, would not
have a material adverse effect on the ability of the Seller to conduct its
business as it is presently conducted. It is not required to obtain the consent
of any other party or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority, bureau or agency
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents, licenses, approvals
or authorizations, or registrations or declarations as shall have been obtained
or filed, as the case may be, prior to the Closing Date.

                  (iv) The execution, delivery and performance of this Agreement
by the Seller will not conflict with or result in a breach of, or constitute a
default under, any provision of any existing law or regulation or any order or
decree of any court applicable to the Seller or any of its properties or any
provision of its Limited Liability Company Agreement, or constitute a material
breach of, or result in the creation or imposition of any lien, charge or
encumbrance upon any of its properties pursuant to any mortgage, indenture,
contract or other agreement to which it is a party or by which it may be bound.

                  (v) No certificate of an officer, written statement or report
delivered pursuant to the terms hereof by the Seller contains any untrue
statement of a material fact or omits to state any material fact necessary to
make the certificate, statement or report not misleading.

                  (vi) The transactions contemplated by this Agreement are in
the ordinary course of the Seller's business.

                                       15

<PAGE>

                  (vii) The Seller is not insolvent, nor will the Seller be made
insolvent by the transfer of the Mortgage Loans, nor is the Seller aware of any
pending insolvency.

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

                  (ix) There are no actions or proceedings against, or
investigations of, the Seller pending or, to its knowledge, threatened, before
any court, administrative agency or other tribunal (i) that, if determined
adversely, would prohibit the Seller from entering into this Agreement and the
Pooling and Servicing Agreement, (ii) seeking to prevent the consummation of any
of the transactions contemplated by this Agreement or (iii) that, if determined
adversely, would prohibit or materially and adversely affect the Seller's
performance of any of its respective obligations under, or the validity or
enforceability of, this Agreement and the Pooling and Servicing Agreement.

                  (x) The Seller is not transferring the Mortgage Loans to the
Purchaser hereunder with any intent to hinder, delay or defraud any of its
creditors.

                  (xi) The Seller acquired title to the Mortgage Loans in good
faith, without notice of any adverse claims.

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

                  (xiii) The Seller understands that (a) the Private
Certificates have not been and will not be registered or qualified under the
Securities Act of 1933, as amended (the "SECURITIES ACT") or any state
securities law, (b) the Purchaser is not required to so register or qualify the
Private Certificates, (c) the Private Certificates may be resold only if
registered and qualified pursuant to the provisions of the Act or any state
securities law, or if an exemption from such registration and qualification is
available, (d) the Pooling and Servicing Agreement contains restrictions
regarding the transfer of the Private Certificates and (e) the Private
Certificates will bear a legend to the foregoing effect.

                  (xiv) The Seller is acquiring the Private Certificates for its
own account for investment only and not with a view to or for sale in connection
with any distribution thereof in any manner that would violate the Securities
Act or any applicable state securities laws.

                  (xv) The Seller is (a) a substantial, sophisticated
institutional investor having such knowledge and experience in financial and
business matters, and, in particular, in such matters

                                       16

<PAGE>

related to securities similar to the Private Certificates, such that it is
capable of evaluating the merits and risks of investment in the Private
Certificates, (b) able to bear the economic risks of such an investment and (c)
an "accredited investor" within the meaning of Rule 501 (a) promulgated pursuant
to the Securities Act.

                  (xvi) The Seller has been furnished with such information
concerning the Private Certificates and the Purchaser as has been requested by
the Seller from the Purchaser and is relevant to the Seller's decision to
purchase the Private Certificates. The Seller has had any questions arising from
such review answered by the Purchaser to the satisfaction of the Seller.

                  (xvii) The Seller has not and will not nor has it authorized
or will it authorize any person to (a) offer, pledge, sell, dispose of or
otherwise transfer any Private Certificate, any interest in any Private
Certificate or any other similar security to any person in any manner, (b)
solicit any offer to buy or to accept a pledge, disposition of other transfer of
any Private Certificate, any interest in any Private Certificate or any other
similar security from any person in any manner, (c) otherwise approach or
negotiate with respect to any Private Certificate, any interest in any Private
Certificate or any other similar security with any person in any manner, (d)
make any general solicitation by means of general advertising or in any other
manner or (e) take any other action, that (as to any of (a) through (e) above)
would constitute a distribution of any Private Certificate under the Securities
Act, that would render the disposition of any Private Certificate a violation of
Section 5 of the Securities Act or any state securities law, or that would
require registration or qualification pursuant thereto. The Seller will not sell
or otherwise transfer any of the Private Certificates, except in compliance with
the provisions of the Pooling and Servicing Agreement.

                  (xviii) The Seller is not an employee benefit plan or other
retirement arrangement subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or Section 4975 of the Internal Revenue Code of
1986, as amended (the "Code"), (collectively, an "ERISA Plan"), and is not
acting on behalf of, as named fiduciary of, as trustee of, or investing the
assets of an ERISA Plan.

                                   ARTICLE IV

                               SELLER'S COVENANTS

                  Section 4.01 COVENANTS OF THE SELLER.

                  (a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Purchaser, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Purchaser, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; PROVIDED, HOWEVER, that nothing in this Section 4.01 shall prevent
or be

                                       17

<PAGE>

deemed to prohibit the Seller from suffering to exist upon any of the Mortgage
Loans any liens for municipal or other local taxes and other governmental
charges if such taxes or governmental charges shall not at the time be due and
payable or if the Seller shall currently be contesting the validity thereof in
good faith by appropriate proceedings and shall have set aside on its books
adequate reserves with respect thereto.

                  (b) The Seller hereby covenants that neither it nor any
affiliate of the Seller will directly solicit any Mortgagor hereunder to
refinance the related Mortgage Loan. For the purposes of the foregoing, neither
the Seller nor any affiliate of the Seller shall be deemed to directly solicit
any Mortgagor if the Seller responds to a request from a Mortgagor regarding a
refinancing or if the Mortgagor receives marketing materials which are generally
disseminated.

                                    ARTICLE V

                  OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS

                  (a) On or after April 8, 2004, as to any Mortgage Loan which
is Delinquent in payment by 120 days or more or any REO Property, an Affiliate
of the Seller may, at its option, purchase such Mortgage Loan from the Trust
Fund at the Purchase Price for such Mortgage Loan provided that an Affiliate of
the Seller may exercise the purchase right during the period commencing on the
first day of the calendar quarter succeeding the calendar quarter in which the
Initial Delinquency Date occurred and ending on the last Business Day of such
calendar quarter. The "Initial Delinquency Date" of a Mortgage Loan shall mean
the date on which the Mortgage Loan first became 120 days Delinquent.

                  (b) If an Affiliate of the Seller does not exercise the
purchase right with respect to a Mortgage Loan during the period specified in
the preceding paragraph, such Mortgage Loan shall thereafter again become
eligible for purchase pursuant to the preceding paragraph only after the
Mortgage Loan ceases to be 120 days or more Delinquent and thereafter becomes
120 day Delinquent again.

                                   ARTICLE VI

                                   TERMINATION

                  Section 6.01 TERMINATION. The respective obligations and
responsibilities of the Seller and the Purchaser created hereby shall terminate
upon the termination of the Trust as provided in Section 8.01 of the Trust
Agreement.

                                   ARTICLE VII

                            MISCELLANEOUS PROVISIONS

                                       18

<PAGE>

                  Section 7.01 AMENDMENT. This Agreement may be amended from
time to time by --------- the Seller and the Purchaser, by written agreement
signed by the Seller and the Purchaser.

                  Section 7.02 GOVERNING LAW. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.

                  Section 7.03 NOTICES. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, postage prepaid, addressed
as follows:

                  if to the Seller:

                  Credit-Based Asset Servicing and Securitization LLC
                  335 Madison Avenue
                  19th Floor
                  New York, New York  10017
                  Attention:  General Counsel

or such other address as may hereafter be furnished to the Purchaser in writing
by the Seller.

                  if to the Purchaser:

                  Citigroup Mortgage Loan Trust Inc.
                  390 Greenwich Street
                  New York, New York 10013
                  Attention: Mortgage Finance Group

or such other address as may hereafter be furnished to the Seller in writing by
the Purchaser.

                  Section 7.04 SEVERABILITY OF PROVISIONS. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall be held
invalid for any reason whatsoever, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.

                  Section 7.05 COUNTERPARTS. This Agreement may be executed in
one or more counterparts by the different parties hereto on separate
counterparts, each of which, when so executed, shall be deemed to be an original
and such counterparts, together, shall constitute one and the same agreement.

                  Section 7.06 FURTHER AGREEMENTS. The Purchaser and the Seller
each agree to execute and deliver to the other such additional documents,
instruments or agreements as may be necessary or reasonable and appropriate to
effectuate the purposes of this Agreement or in

                                       19

<PAGE>

connection with the issuance of any Series of Certificates representing
interests in the Mortgage Loans.

                  Without limiting the generality of the foregoing, as a further
inducement for the Purchaser to purchase the Mortgage Loans from the Seller, the
Seller will cooperate with the Purchaser in connection with the sale of any of
the securities representing interests in the Mortgage Loans. In that connection,
the Seller will provide to the Purchaser any and all information and appropriate
verification of information, whether through letters of its auditors and counsel
or otherwise, as the Purchaser shall reasonably request and will provide to the
Purchaser such additional representations and warranties, covenants, opinions of
counsel, letters from auditors, and certificates of public officials or officers
of the Seller as are reasonably required in connection with such transactions
and the offering of investment grade securities rated by the Rating Agencies.

                  Section 7.07 INTENTION OF THE PARTIES. It is the intention of
the parties that the Purchaser is purchasing, and the Seller is selling, the
Mortgage Loans rather than the pledging of the Mortgage Loans by the Seller to
secure a loan by the Purchaser to the Seller. Accordingly, the parties hereto
each intend to treat the transaction for Federal income tax purposes and all
other purposes as a sale by the Seller and a purchase by the Purchaser of the
Mortgage Loans. The Purchaser will have the right to review the Mortgage Loans
and the related Mortgage Files to determine the characteristics of the Mortgage
Loans which will affect the Federal income tax consequences of owning the
Mortgage Loans and the Seller will cooperate with all reasonable requests made
by the Purchaser in the course of such review.

                  Section 7.08 SUCCESSORS AND ASSIGNS; ASSIGNMENT OF THIS
AGREEMENT. This Agreement shall bind and inure to the benefit of and be
enforceable by the Seller, the Purchaser and the Trustee. The obligations of the
Seller under this Agreement cannot be assigned or delegated to a third party
without the consent of the Purchaser and which consent shall be at the
Purchaser's sole discretion, except that the Purchaser acknowledges and agrees
that the Seller may assign its obligations hereunder to any Person into which
the Seller is merged or any corporation resulting from any merger, conversion or
consolidation to which the Seller is a party or any Person succeeding to the
business of the Seller. The parties hereto acknowledge that the Purchaser is
acquiring the Mortgage Loans for the purpose of contributing them to a trust
that will issue a series of certificates representing undivided interests in
such Mortgage Loans. As an inducement to the Purchaser to purchase the Mortgage
Loans, the Seller acknowledges and consents to the assignment by the Purchaser
to the Trustee of all of the Purchaser's rights against the Seller pursuant to
this Agreement insofar as such rights relate to Mortgage Loans transferred to
the Trustee and to the enforcement or exercise of any right or remedy against
the Seller pursuant to this Agreement by the Trustee. Such enforcement of a
right or remedy by the Trustee shall have the same force and effect as if the
right or remedy had been enforced or exercised by the Purchaser directly.

                  Section 7.09 SURVIVAL. The representations and warranties set
forth in Sections 3.01 and 3.02 hereof shall survive the purchase of the
Mortgage Loans hereunder.

                                       20

<PAGE>

                  IN WITNESS WHEREOF, the Seller and the Purchaser have caused
their names to be signed to this Mortgage Loan Purchase Agreement by their
respective officers thereunto duly authorized as of the day and year first above
written.

                                         CITIGROUP MORTGAGE LOAN TRUST
                                         INC. ,
                                         as Purchaser

                                         By: __________________________________
                                         Name:
                                         Title:

                                         CREDIT-BASED ASSET SERVICING AND
                                         SECURITIZATION LLC, as Seller

                                         By:___________________________________
                                         Name:
                                         Title:

<PAGE>

                                    EXHIBIT H

                           FORM OF LOST NOTE AFFIDAVIT

                  Personally appeared before me the undersigned authority to
administer oaths, ______________________ who first being duly sworn deposes and
says: Deponent is ______________________ of ______________________________,
successor by merger to _________________________________________ ("Seller") and
who has personal knowledge of the facts set out in this affidavit.

                  On ___________________, _________________________ did execute
and deliver a promissory note in the principal amount of $__________.

                  That said note has been misplaced or lost through causes
unknown and is presently lost and unavailable after diligent search has been
made. Seller's records show that an amount of principal and interest on said
note is still presently outstanding, due, and unpaid, and Seller is still owner
and holder in due course of said lost note.

                  Seller executes this Affidavit for the purpose of inducing
U.S. Bank National Association, as trustee on behalf of C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004- CB3, to accept the transfer of the above
described loan from Seller.

                  Seller agrees to indemnify and hold harmless U.S. Bank
National Association, Citigroup Mortgage Loan Trust Inc., Citigroup Global
Markets Inc. and J.P. Morgan Securities Inc. for any losses incurred by such
parties resulting from the above described promissory note has been lost or
misplaced.

                                                By:
                                                Name:
                                                Title:

                                       H-1

<PAGE>

STATE OF                   )
                           )        SS:
COUNTY OF                  )

                  On this ____ day of _______ 20__, before me, a Notary Public,
in and for said County and State, appeared ________________________, who
acknowledged the extension of the foregoing and who, having been duly sworn,
states that any representations therein contained are true.

                  Witness my hand and Notarial Seal this ____ day of _______
20__.

                  My commission expires              .

                                       H-2

<PAGE>

                                    EXHIBIT I

                          FORM OF ERISA REPRESENTATION

U.S. Bank National Association
60 Livingston Avenue
EP-MN-WS3D
St. Paul, Minnesota 55107-2292

Citigroup Mortgage Loan Trust Inc.
390 Greenwich Street
New York, New York 10013

                  Re:      C-BASS Mortgage Loan Asset-Backed Certificates,
                           Series 2004-CB3

Ladies and Gentlemen:

                  1. [The undersigned is the ______________________ of (the
"Transferee") a [corporation duly organized] and existing under the laws of
__________, on behalf of which he makes this affidavit.] [The undersigned,
___________________, is the transferee (the "Transferee").]

                  2. The Transferee hereby acknowledges that under the terms of
the Pooling and Servicing Agreement (the "Agreement") among Citigroup Mortgage
Loan Trust Inc., as depositor (the "Depositor"), Credit-Based Asset Servicing
and Securitization LLC, as seller, Litton Loan Servicing LP, as servicer and
U.S. Bank National Association, as trustee (the "Trustee"), no transfer of the
ERISA-Restricted Certificates shall be permitted to be made to any person unless
the Depositor and the Certificate Registrar (as defined in the Agreement) have
received a certificate from such transferee in the form hereof.

                  3. The Transferee either (x) (i) is not an employee benefit
plan subject to Section 406 or Section 407 of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code"), the Trustee of any such plan or a
person acting on behalf of any such plan nor a person using the assets of any
such plan or (ii) (except in the case of the Residual, Class X or Class N
Certificates) is an insurance company which is purchasing such Certificates with
funds contained in an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60") and that the purchase and holding of such Certificates are covered under
Sections I and III of PTCE 95-60 or (y) (except in the case of a Mezzanine or
Residual Certificate) shall deliver to the Certificate Registrar and the
Depositor an opinion of counsel (a "Benefit Plan Opinion") satisfactory to the
Certificate Registrar, and upon which the Certificate

                                       I-1

<PAGE>

Registrar and the Depositor shall be entitled to rely, to the effect that the
purchase and holding of such Certificate by the Transferee will not result in
the assets of the Trust Fund being deemed to be plan assets and subject to the
prohibited transaction provisions of ERISA or the Code and will not subject the
Trustee, the Certificate Registrar or the Depositor to any obligation in
addition to those undertaken by such entities in the Pooling and Servicing
Agreement, which opinion of counsel shall not be an expense of the Trustee or
the Depositor.

                                       I-2

<PAGE>

                  Capitalized terms used but not defined herein shall have the
meanings ascribed to such terms in the Agreement.

                  IN WITNESS WHEREOF, the Transferee has executed this
certificate.

                                                             [Transferee]

                                                 By:
                                                 Name:
                                                 Title:

                                       I-3

<PAGE>

                                   EXHIBIT J-1

                    FORM OF INVESTMENT LETTER [NON-RULE 144A]

                                                        [DATE]

Citigroup Mortgage Loan Trust Inc.
390 Greenwich Street
New York, New York 10013

U.S. Bank National Association
60 Livingston Avenue
EP-MN-WS3D
St. Paul, Minnesota 55107-2292

                  Re:      C-BASS Mortgage Loan Asset-Backed Certificates,
                           Series 2004-CB3

Ladies and Gentlemen:

                  In connection with our acquisition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB3 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are acquiring the Certificates for investment
for our own account and not with a view to any distribution of such Certificates
(but without prejudice to our right at all times to sell or otherwise dispose of
the Certificates in accordance with clause (g) below), (e) we agree that the
Certificates must be held indefinitely by us and we acknowledge that we are able
to bear the economic risk of investment in the Certificates, (f) we have not
offered or sold any Certificates to, or solicited offers to buy any Certificates
from, any person, or otherwise approached or negotiated with any person with
respect thereto, or taken any other action which would result in a violation of
Section 5 of the Act, (g) we will not sell, transfer or otherwise dispose of any
Certificates unless (1) such sale, transfer or other disposition is made
pursuant to an effective registration statement under the Act or is exempt from
such registration requirements, and if requested, we will at our expense provide
an opinion of counsel satisfactory to the addressees of this Certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this

                                      J-1-1

<PAGE>

certificate, and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Pooling and Servicing Agreement and (h)
we acknowledge that the Certificates will bear a legend setting forth the
applicable restrictions on transfer.

                                      J-1-2

<PAGE>

                                               Very truly yours,

                                               [NAME OF TRANSFEREE]

                                               By:
                                                         Authorized Officer

                                      J-1-3

<PAGE>

                                   EXHIBIT J-2

                       FORM OF RULE 144A INVESTMENT LETTER

                                                         [DATE]

Citigroup Mortgage Loan Trust Inc.
390 Greenwich Street
New York, New York 10013

U.S. Bank National Association
60 Livingston Avenue
EP-MN-WS3D
St. Paul, Minnesota 55107-2292

         Re:    C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB3
                ---------------------------------------------------------------

Ladies and Gentlemen:

                  In connection with our acquisition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB3 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have had the
opportunity to ask questions of and receive answers from the Depositor
concerning the purchase of the Certificates and all matters relating thereto or
any additional information deemed necessary to our decision to purchase the
Certificates, (c) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Certificates, any
interest in the Certificates or any other similar security to, or solicited any
offer to buy or accept a transfer, pledge or other disposition of the
Certificates, any interest in the Certificates or any other similar security
from, or otherwise approached or negotiated with respect to the Certificates,
any interest in the Certificates or any other similar security with, any person
in any manner, or made any general solicitation by means of general advertising
or in any other manner, or taken any other action, that would constitute a
distribution of the Certificates under the Securities Act or that would render
the disposition of the Certificates a violation of Section 5 of the Securities
Act or require registration pursuant thereto, nor will act, nor has authorized
or will authorize any person to act, in such manner with respect to the
Certificates, (d) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2. We
are aware that the sale to us is being made in reliance on Rule 144A. We are
acquiring the Certificates for our own account or for resale pursuant to Rule
144A and further, understand that such Certificates may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the

                                      J-2-1

<PAGE>

account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Securities Act.

                                      J-2-2

<PAGE>

                                              Very truly yours,

                                              [NAME OF TRANSFEREE]

                                              By:
                                                         Authorized Officer

                                      J-2-3

<PAGE>

                                                            ANNEX 1 TO EXHIBIT J
                                                            --------------------

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
            --------------------------------------------------------

          [For Transferees Other Than Registered Investment Companies]

                  The undersigned (the "Buyer") hereby certifies as follows to
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:

                  i. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.

                  ii. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $ 1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.

                  ___ CORPORATION, ETC. The Buyer is a corporation (other than a
                  bank, savings and loan association or similar institution),
                  Massachusetts or similar business trust, partnership, or
                  charitable organization described in Section 501(c)(3) of the
                  Internal Revenue Code of 1986, as amended.

                  ___ BANK. The Buyer (a) is a national bank or banking
                  institution organized under the laws of any State, territory
                  or the District of Columbia, the business of which is
                  substantially confined to banking and is supervised by the
                  State or territorial banking commission or similar official or
                  is a foreign bank or equivalent institution, and (b) has an
                  audited net worth of at least $25,000,000 as demonstrated in
                  its latest annual financial statements, a copy of which is
                  attached hereto.

                  ___ SAVINGS AND LOAN. The Buyer (a) is a savings and loan
                  association, building and loan association, cooperative bank,
                  homestead association or similar institution, which is
                  supervised and examined by a State or Federal authority having
                  supervision over any such institutions or is a foreign savings
                  and loan association or equivalent institution and (b) has an
                  audited net worth of at least $25,000,000 as demonstrated in
                  its latest annual financial statements, A COPY OF WHICH IS
                  ATTACHED HERETO.

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

1        Buyer must own and/or invest on a discretionary basis at least
         $__________ in securities unless Buyer is a dealer, and, in that case,
         Buyer must own and/or invest on a discretionary basis at least
         $__________ in securities.

                                      J-2-4

<PAGE>

                  ___ BROKER-DEALER. The Buyer is a dealer registered pursuant
                  to Section 15 of the Securities Exchange Act of 1934.

                  ___ INSURANCE COMPANY. The Buyer is an insurance company whose
                  primary and predominant business activity is the writing of
                  insurance or the reinsuring of risks underwritten by insurance
                  companies and which is subject to supervision by the insurance
                  commissioner or a similar official or agency of a State,
                  territory or the District of Columbia.

                  ___ STATE OR LOCAL PLAN. The Buyer is a plan established and
                  maintained by a State, its political subdivisions, or any
                  agency or instrumentality of the State or its political
                  subdivisions, for the benefit of its employees.

                  ___ ERISA Plan. The Buyer is an employee benefit plan within
                  the meaning of Title I of the Employee Retirement Income
                  Security Act of 1974.

                  ___ INVESTMENT ADVISOR. The Buyer is an investment advisor
                  registered under the Investment Advisors Act of 1940.

                  ___ SMALL BUSINESS INVESTMENT COMPANY. Buyer is a small
                  business investment company licensed by the U.S. Small
                  Business Administration under Section 301(c) or (d) of the
                  Small Business Investment Act of 1958.

                  ___ BUSINESS DEVELOPMENT COMPANY. Buyer is a business
                  development company as defined in Section 202(a)(22) of the
                  Investment Advisors Act of 1940.

                  iii. The term "SECURITIES" as used herein DOES NOT INCLUDE (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned but
subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.

                  iv. For purposes of determining the aggregate amount of
securities owned and/or invested on a discretionary basis by the Buyer, the
Buyer used the cost of such securities to the Buyer and did not include any of
the securities referred to in the preceding paragraph, except (i) where the
Buyer reports its securities holdings in its financial statements on the basis
of their market value, and (ii) no current information with respect to the cost
of those securities has been published. If clause (ii) in the preceding sentence
applies, the securities may be valued at market. Further, in determining such
aggregate amount, the Buyer may have included securities owned by subsidiaries
of the Buyer, but only if such subsidiaries are consolidated with the Buyer in
its financial statements prepared in accordance with generally accepted
accounting principles and if the investments of such subsidiaries are managed
under the Buyer's direction. However, such securities were not included if the
Buyer

                                      J-2-5

<PAGE>

is a majority-owned, consolidated subsidiary of another enterprise and the Buyer
is not itself a reporting company under the Securities Exchange Act of 1934, as
amended.

                  v. The Buyer acknowledges that it is familiar with Rule 144A
and understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made herein
because one or more sales to the Buyer may be in reliance on Rule 144A.

                  vi. Until the date of purchase of the Rule 144A Securities,
the Buyer will notify each of the parties to which this certification is made of
any changes in the information and conclusions herein. Until such notice is
given, the Buyer's purchase of the Certificates will constitute a reaffirmation
of this certification as of the date of such purchase. In addition, if the Buyer
is a bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.

                                              Print Name of Buyer

                                              By:
                                              Name:
                                              Title:

                                              Date:

                                      J-2-6

<PAGE>

                                                            ANNEX 2 TO EXHIBIT J
                                                            --------------------

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

           [For Transferees That are Registered Investment Companies]

                  The undersigned (the "Buyer") hereby certifies as follows to
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:

                  1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.

                  2. In connection with purchases by Buyer, the Buyer is a
"qualified institutional buyer" as defined in SEC Rule 144A because (i) the
Buyer is an investment company registered under the Investment Company Act of
1940, as amended and (ii) as marked below, the Buyer alone, or the Buyer's
Family of Investment Companies, owned at least $100,000,000 in securities (other
than the excluded securities referred to below) as of the end of the Buyer's
most recent fiscal year. For purposes of determining the amount of securities
owned by the Buyer or the Buyer's Family of Investment Companies, the cost of
such securities was used, except (i) where the Buyer or the Buyer's Family of
Investment Companies reports its securities holdings in its financial statements
on the basis of their market value, and (ii) no current information with respect
to the cost of those securities has been published. If clause (ii) in the
preceding sentence applies, the securities may be valued at market.

                  ___ The Buyer owned $ in securities (other than the excluded
                  securities referred to below) as of the end of the Buyer's
                  most recent fiscal year (such amount being calculated in
                  accordance with Rule 144A).

                  ___ The Buyer is part of a Family of Investment Companies
                  which owned in the aggregate $ in securities (other than the
                  excluded securities referred to below) as of the end of the
                  Buyer's most recent fiscal year (such amount being calculated
                  in accordance with Rule 144A).

                  3. The term "FAMILY OF INVESTMENT COMPANIES" as used herein
means two or more registered investment companies (or series thereof) that have
the same investment adviser or investment advisers that are affiliated (by
virtue of being majority owned subsidiaries of the same parent or because one
investment adviser is a majority owned subsidiary of the other).

                  4. The term "SECURITIES" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii)

                                      J-2-7

<PAGE>

securities issued or guaranteed by the U.S. or any instrumentality thereof,
(iii) bank deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps.

                  5. The Buyer is familiar with Rule 144A and understands that
the parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.

                  6. Until the date of purchase of the Certificates, the
undersigned will notify the parties listed in the Rule 144A Transferee
Certificate to which this certification relates of any changes in the
information and conclusions herein. Until such notice is given, the Buyer's
purchase of the Certificates will constitute a reaffirmation of this
certification by the undersigned as of the date of such purchase.

                                              Print Name of Buyer or Adviser

                                              By:
                                              Name:
                                              Title:

                                              IF AN ADVISER:

                                              Print Name of Buyer

                                              Date:

                                      J-2-8

<PAGE>

                                    EXHIBIT K

                 FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT

         C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2004-CB3

STATE OF                )
                        ) ss.:
COUNTY OF               )

                  The undersigned, being first duly sworn, deposes and says as
follows:

                  1. The undersigned is [an officer of] ______________, the
proposed Transferee of an Ownership Interest in a [Class R and/or Class R-X
Certificates] (the "Certificates") issued pursuant to the Pooling and Servicing
Agreement, (the "Agreement"), relating to the above- referenced Certificates,
among Citigroup Mortgage Loan Trust Inc., as depositor, Credit-Based Asset
Servicing and Securitization LLC, as seller, Litton Loan Servicing LP, as
servicer and U.S. Bank National Association, as trustee. Capitalized terms used,
but not defined herein shall have the meanings ascribed to such terms in the
Agreement. The Transferee has authorized the undersigned to make this affidavit
on behalf of the Transferee.

                  2. The Transferee is, as of the date hereof, and will be, as
of the date of the Transfer, a Permitted Transferee. The Transferee is acquiring
its Ownership Interest in the Certificates either (i) for its own account or
(ii) as nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit. The
Transferee has no knowledge that any such affidavit is false.

                  3. The Transferee has been advised of, and understands that
(i) a tax will be imposed on Transfers of the Certificates to Persons that are
not Permitted Transferees; (ii) such tax will be imposed on the transferor, or,
if such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.

                  4. The Transferee has been advised of, and understands that a
tax will be imposed on a "pass-through entity" holding the Certificates if at
any time during the taxable year of the pass-through entity a Person that is not
a Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record

                                       K-1

<PAGE>

holder is a Permitted Transferee and the pass-through entity does not have
actual knowledge that such affidavit is false. (For this purpose, a
"pass-through entity" includes a regulated investment company, a real estate
investment trust or common trust fund, a partnership, trust or estate, and
certain cooperatives and, except as may be provided in Treasury Regulations,
persons holding interests in pass-through entities as a nominee for another
Person.)

                  5. The Transferee has reviewed the provisions of Section
5.02(d) of the Agreement and understands the legal consequences of the
acquisition of an Ownership Interest in the Certificates including, without
limitation, the restrictions on subsequent Transfers and the provisions
regarding voiding the Transfer and mandatory sales. The Transferee expressly
agrees to be bound by and to abide by the provisions of Section 5.02(d) of the
Agreement and the restrictions noted on the face of the Certificates. The
Transferee understands and agrees that any breach of any of the representations
included herein shall render the Transfer to the Transferee contemplated hereby
null and void.

                  6. The Transferee agrees to require a Transfer Affidavit from
any Person to whom the Transferee attempts to Transfer its Ownership Interest in
the Certificates, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth in this Exhibit K to the Agreement (a "Transferor Certificate")
to the effect that such Transferee has no actual knowledge that the Person to
which the Transfer is to be made is not a Permitted Transferee.

                  7. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect to
the Certificates.

                  8. The Transferee's taxpayer identification number is _______.

                  9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).

                  10. The Transferee is aware that the Certificates may be a
"noneconomic residual interest" within the meaning of proposed Treasury
regulations promulgated pursuant to the Code and that the transferor of a
noneconomic residual interest will remain liable for any taxes due with respect
to the income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.

                  11. The Transferee is not an employee benefit plan that is
subject to ERISA or a plan that is subject to Section 4975 of the Code, nor are
we acting on behalf of such a plan.

                                       K-2

<PAGE>

                  IN WITNESS WHEREOF, the Transferee has caused this instrument
to be executed on its behalf, pursuant to authority of its Board of Directors,
by its duly authorized officer and its corporate seal to be hereunto affixed,
duly attested, this day of , 20 .

                                                   [NAME OF TRANSFEREE]

                                                   By:
                                                   Name:
                                                   Title:

[Corporate Seal]

ATTEST:

[Assistant] Secretary

                  Personally appeared before me the above-named _______________,
known or proved to me to be the same person who executed the __________________
foregoing instrument and to be the of the Transferee, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.

                  Subscribed and sworn before me this _____ day of _________,
20__.

                                              NOTARY PUBLIC

                                              My Commission expires the ____ day

                                              of  _______________, 20__.

                                       K-3

<PAGE>

                                    EXHIBIT L

                         FORM OF TRANSFEROR CERTIFICATE

                                                         [DATE]

U.S. Bank National Association
60 Livingston Avenue
EP-MN-WS3D
St. Paul, Minnesota 55107-2292

Citigroup Mortgage Loan Trust Inc.
390 Greenwich Street
New York, New York 10013

         Re:   C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB3
               ---------------------------------------------------------------

Ladies and Gentlemen:

                  In connection with our disposition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB3 (the "Certificates"), we certify that
(a) we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act, (c) [in
the case of a Residual Certificate only] to the extent we are disposing of a
Class [R, or R-X] Certificate, we have no knowledge the Transferee is not a
Permitted Transferee and (d) [in the case of a Residual Certificate only] no
purpose of the proposed disposition of a Class [R, or R-X] Certificate is to
impede the assessment or collection of tax.

                                              Very truly yours,

                                              [TRANSFEROR]

                                              By: ______________________________
                                              Name:
                                              Title:

                                       L-1

<PAGE>

                                    EXHIBIT M

                    MONTHLY INFORMATION DELIVERED BY SERVICER

1.       With respect to the Mortgage Pool, the number and Principal Balances of
         all Mortgage Loans which were the subject of Principal Prepayments
         during the related Due Period.

2.       With respect to the Mortgage Pool, the amount of all curtailments which
         were received during the related Due Period.

3.       With respect to the Mortgage Pool, the aggregate amount of principal
         portion of all Monthly Payments received during the related Due Period.

4.       With respect to the Mortgage Pool, the amount of interest received on
         the Mortgage Loans during the related Due Period.

5.       With respect to the Mortgage Pool, the aggregate amount of the Advances
         made and recovered with respect to such Distribution Date.

6.       With respect to the Mortgage Pool, the delinquency and foreclosure
         information and the amount of Mortgage Loan Losses during the related
         Due Period.

7.       With respect to the Mortgage Pool, the weighted average maturity, the
         weighted average Mortgage Interest Rate and the weighted average Net
         Mortgage Interest Rate as of the last day of the Due Period preceding
         of the related Interest Accrual Period.

8.       The Servicing Fees paid and Servicing Fees accrued during the related
         Due Period.

9.       The amount of all payments or reimbursements to the Servicer paid or to
         be paid since the prior Distribution Date (or in the case of the first
         Distribution Date, since the Closing Date).

10.      The Pool Balance.

11.      With respect to the Mortgage Pool, the number of Mortgage Loans
         outstanding at the beginning and at the end of the related Due Period.

12.      The aggregate interest accrued on the Mortgage Loans at their
         respective Mortgage Interest Rates for the related Due Period.

13.      The amount deposited in the Collection Account which may not be
         withdrawn therefrom pursuant to an Order of a United States Bankruptcy
         Court of competent jurisdiction imposing a stay pursuant to Section 362
         of U.S. Bankruptcy Code.

                                       M-1

<PAGE>

14.      The aggregate Realized Losses since the Cut-off Date as of the end of
         the related Due Period.

15.      The LIBOR Carryover Amount for the Offered Certificates and the Class
         B-4 Certificates, if any, with respect to such Distribution Date.

16.      The Overcollateralized Amount, the Targeted Overcollateralization
         Amount and any Overcollateralization Deficiency, in each case after
         giving effect to distributions on such Distribution Date.

                                       M-2

<PAGE>

                                    EXHIBIT N

            FORM OF OFFICER'S CERTIFICATE WITH RESPECT TO PREPAYMENTS

                              Officer's Certificate
         C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB3

                                                      [DATE]

VIA FACSIMILE

U.S. Bank National Association, Trustee
60 Livingston Avenue
EP-MN-WS3D
St. Paul, Minnesota 55107-2292

                  Re:      Prepayments

Dear Sir or Madam:

               __________________ hereby certifies that he/she is an officer of
the Servicer, holding the office set forth beneath his/her name and hereby
further certifies as follows:

               With respect to the Mortgage Loans set forth in the attached
schedule:

               1.   A Principal Prepayment in full was received during the
                    related Collection Period;

               2.   Any prepayment penalty due under the terms of the Mortgage
                    Note with respect to such Principal Prepayment in full was
                    received from the mortgagor and deposited in the Collection
                    Account:   ____ Yes   ____ No

               3.   As to each Mortgage Loan so noted on the attached schedule,
                    all or part of the prepayment penalty required in connection
                    with the Principal Prepayment in full was waived based upon
                    (Circle one):

                    (i) the Servicer's determination that such waiver would
                    maximize recovery of Liquidation Proceeds for such Mortgage
                    Loan, taking into account the value of such prepayment
                    penalty, or

                                       N-1

<PAGE>

                    (ii)(A) the enforceability thereof be limited (1) by
                    bankruptcy insolvency, moratorium, receivership, or other
                    similar law relating to creditors' rights generally or (2)
                    due to acceleration in connection with a foreclosure or
                    other involuntary payment, or (B) the enforceability is
                    otherwise limited or prohibited by applicable law;

               4.   We certify that all amounts due in connection with the
                    waiver of a prepayment penalty inconsistent with number 3
                    above which are required to be deposited by the Servicer
                    pursuant to Section 3.01 of the Pooling and Servicing
                    Agreement, have been or will be so deposited.

               Capitalized terms used herein shall have the meanings ascribed to
such terms in the Pooling and Servicing Agreement, dated March 1, 2004, among
Citigroup Mortgage Loan Trust Inc., as depositor, Credit-Based Asset Servicing
and Securitization LLC, as seller, Litton Loan Servicing LP, as servicer and
U.S. Bank National Association, as trustee.

                                              LITTON LOAN SERVICING LP

                                              By:
                                              Name:
                                              Title:

                                       N-2

<PAGE>

                                   EXHIBIT O-1

       FORM OF CERTIFICATION TO BE PROVIDED BY THE SERVICER WITH FORM 10-K

                                  Certification

                  1. I have reviewed this annual report on Form 10-K, and all
reports on Form 8-K containing distribution or servicing reports filed in
respect of periods included in the year covered by this annual report, of
Citigroup Mortgage Loan Trust, Series 2004-CB3, C-BASS Mortgage Loan
Asset-Backed Certificates;

                  2. Based on my knowledge, the information in these reports,
taken as a whole, does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading as of
the last day of the period covered by this annual report;

                  3. Based on my knowledge, the distribution or servicing
information required to be provided to the trustee by the servicer under the
pooling and servicing, or similar, agreement, for inclusion in these reports is
included in these reports;

                  4. Based on my knowledge and upon the annual compliance
statement included in the report and required to be delivered to the trustee in
accordance with the terms of the pooling and servicing, or similar, agreement,
and except as disclosed in the reports, the servicer has fulfilled its
obligations under the servicing agreement; and

                  5. The reports disclose all significant deficiencies relating
to the servicer's compliance with the minimum servicing standards based upon the
report provided by an independent public accountant, after conducting a review
in compliance with the Uniform Single Attestation Program for Mortgage Bankers
or similar procedure, as set forth in the pooling and servicing, or similar,
agreement, that is included in these reports.

                  In giving the certifications above, I have reasonably relied
on information provided to me by the following unaffiliated parties: U.S. Bank
National Association.

                                            LITTON LOAN SERVICING LP

                                            By:_________________________________
                                            Name:
                                            Title:
                                            Date:

                                      O-1-1

<PAGE>

                                   EXHIBIT O-2

                           FORM OF CERTIFICATION TO BE
                      PROVIDED TO DEPOSITOR BY THE TRUSTEE

                  Re:      C-BASS Mortgage Loan Asset-Backed Certificates,
                           Series 2004-CB3

                  I, [identify the certifying individual], certify to Litton
Loan Servicing LP (the "Servicer"), and its officers, directors and affiliates,
and with the knowledge and intent that they will rely upon this certification,
that:

                  1. I have reviewed the annual report on Form 10 K for the
fiscal year [___], and all reports on Form 8-K containing Monthly Statements
filed in respect of periods included in the year covered by that annual report,
of Citigroup Mortgage Loan Trus, Inc. (the "Depositor") relating to the above
referenced trust;

                  2. Subject to paragraph 4 hereof, based on my knowledge, the
Distribution Information in the Monthly Statements prepared by the Trustee,
taken as a whole, does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading as of
the last day of the period covered by that annual report; and

                  3. Based on my knowledge, the Distribution Information
required to be provided by the Trustee under the Pooling and Servicing Agreement
is included in these reports.

                  4. In compiling the Distribution Information and making the
foregoing certifications, the Trustee has relied upon information furnished to
it by the Servicer under the Pooling and Servicing Agreement. The Trustee shall
have no responsibility or liability for any inaccuracy in such reports resulting
from information so provided to it by the Servicer.

                  Capitalized terms used but not defined herein have the
meanings ascribed to them in the Pooling and Servicing Agreement, dated March 1,
2004 (the "Pooling and Servicing Agreement"), among the Depositor, Credit-Based
Asset Servicing and Securitization LLC, as seller, the Servicer, and U.S. Bank
National Association, as trustee.

                                           U.S. BANK NATIONAL
                                           ASSOCIATION, as Trustee

                                           By:__________________________________
                                           Name:
                                           Title:
                                           Date:

                                      O-2-1

<PAGE>

                                    EXHIBIT P

                            FORM OF POWER OF ATTORNEY

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO
LITTON LOAN SERVICING LP
4828 Loop Central Drive
Houston, Texas 77081
Attn: _________________________________

                            LIMITED POWER OF ATTORNEY

                  KNOW ALL MEN BY THESE PRESENTS, that U.S. Bank National
Association, having its principal place of business at 60 Livingston Avenue, St.
Paul, Minnesota 55107-2292, as Trustee (the "Trustee") pursuant to that Pooling
and Servicing Agreement among (the "Depositor"), Litton Loan Servicing LP (the
"Servicer"), and the Trustee, dated as of March 1, 2004 (the "Pooling and
Servicing Agreement"), hereby constitutes and appoints the Servicer, by and
through the Servicer's officers, the Trustee's true and lawful Attorney-in-Fact,
in the Trustee's name, place and stead and for the Trustee's benefit, in
connection with all mortgage loans serviced by the Servicer pursuant to the
Pooling and Servicing Agreement for the purpose of performing all acts and
executing all documents in the name of the Trustee as may be customarily and
reasonably necessary and appropriate to effectuate the following enumerated
transactions in respect of any of the mortgages or deeds of trust (the
"Mortgages" and the "Deeds of Trust", respectively) and promissory notes secured
thereby (the "Mortgage Notes") for which the undersigned is acting as Trustee
for various certificateholders (whether the undersigned is named therein as
mortgagee or beneficiary or has become mortgagee by virtue of endorsement of the
Mortgage Note secured by any such Mortgage or Deed of Trust) and for which the
Servicer is acting as servicer, all subject to the terms of the Pooling and
Servicing Agreement.

                  This appointment shall apply to the following enumerated
transactions only:

                  1. The modification or re-recording of a Mortgage or Deed of
Trust, where said modification or re-recordings is for the purpose of correcting
the Mortgage or Deed of Trust to conform same to the original intent of the
parties thereto or to correct title errors discovered after such title insurance
was issued and said modification or re-recording, in either instance, does not
adversely affect the lien of the Mortgage or Deed of Trust as insured.

                  2. The subordination of the lien of a Mortgage or Deed of
Trust to an easement in favor of a public utility company of a government agency
or unit with powers of eminent domain;

                                       P-1

<PAGE>

this section shall include, without limitation, the execution of partial
satisfactions/releases, partial reconveyances or the execution or requests to
trustees to accomplish same.

                  3. The conveyance of the properties to the mortgage insurer,
or the closing of the title to the property to be acquired as real estate owned,
or conveyance of title to real estate owned.

                  4. The completion of loan assumption agreements.

                  5. The full satisfaction/release of a Mortgage or Deed of
Trust or full conveyance upon payment and discharge of all sums secured thereby,
including, without limitation, cancellation of the related Mortgage Note.

                  6. The assignment of any Mortgage or Deed of Trust and the
related Mortgage Note, in connection with the repurchase of the mortgage loan
secured and evidenced thereby.

                  7. The full assignment of a Mortgage or Deed of Trust upon
payment and discharge of all sums secured thereby in conjunction with the
refinancing thereof, including, without limitation, the assignment of the
related Mortgage Note.

                  8. With respect to a Mortgage or Deed of Trust, the
foreclosure, the taking of a deed in lieu of foreclosure, or the completion of
judicial or non-judicial foreclosure or termination, cancellation or rescission
of any such foreclosure, including, without limitation, any and all of the
following acts:

                                    a. the substitution of trustee(s) serving
                  under a Deed of Trust, in accordance with state law and the
                  Deed of Trust;

                                    b. the preparation and issuance of
                  statements of breach or non-performance;

                                    c. the preparation and filing of notices of
                  default and/or notices of sale;

                                    d. the cancellation/rescission of notices of
                  default and/or notices of sale;

                                    e. the taking of a deed in lieu of
                  foreclosure; and

                                    f. the preparation and execution of such
                  other documents and performance of such other actions as may
                  be necessary under the terms of the Mortgage, Deed of Trust or
                  state law to expeditiously complete said transactions in
                  paragraphs 8.a. through 8.e., above.

                                       P-2

<PAGE>

                  The undersigned gives said Attorney-in-Fact full power and
authority to execute such instruments and to do and perform all and every act
and thing necessary and proper to carry into effect the power or powers granted
by or under this Limited Power of Attorney as fully as the undersigned might or
could do, and hereby does ratify and confirm to all that said Attorney-in-Fact
shall lawfully do or cause to be done by authority hereof.

                  Third parties without actual notice may rely upon the exercise
of the power granted under this Limited Power of attorney; and may be satisfied
that this Limited Power of Attorney shall continue in full force and effect and
has not been revoked unless an instrument of revocation has been made in writing
by the undersigned.

                                       P-3

<PAGE>

IN WITNESS WHEREOF, U.S. Bank National Association as Trustee pursuant to that
Pooling and Servicing Agreement among the Depositor, the Servicer, and the
Trustee, dated as of March 1, 2004 (Citigroup Mortgage Loan Trust, Series
2004-CB3, C-BASS Mortgage Loan Asset-Backed Certificates), has caused its
corporate seal to be hereto affixed and these presents to be signed and
acknowledged in its name and behalf by _______ its duly elected and authorized
Vice President this _____ day of ______, 200__.

                                   as Trustee for Citigroup Mortgage Loan Trust,
                 Series 2004-CB3, C-BASS Mortgage Loan Asset-Backed Certificates

                                           By __________________________________

STATE OF _____________________

COUNTY OF _____________________

On ___________, 200__, before me, the undersigned, a Notary Public in and for
said state, personally appeared ___________, Vice President of U.S. Bank
National Association as Trustee for Citigroup Mortgage Loan Trust, Series
2004-CB3 C-BASS Mortgage Loan Asset-Backed Certificates, personally known to me
to be the person whose name is subscribed to the within instrument and
acknowledged to me that he/she executed that same in his/her authorized
capacity, and that by his/her signature on the instrument the entity upon behalf
of which the person acted and executed the instrument.

WITESS my hand and official seal.
            (SEAL)
____________________________________
Notary Public
My Commission Expires ________________________

                                       P-4Exhibit 4.1

<PAGE>

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

                   OPTION ONE MORTGAGE ACCEPTANCE CORPORATION,
                                    Depositor

                        OPTION ONE MORTGAGE CORPORATION,
                                 Master Servicer

                                       and

                             WELLS FARGO BANK, N.A.,
                                     Trustee

                         POOLING AND SERVICING AGREEMENT

                            Dated as of April 1, 2004

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

                      Option One Mortgage Loan Trust 2004-2

                    Asset-Backed Certificates, Series 2004-2

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

<PAGE>

<TABLE>
<CAPTION>

                                                 TABLE OF CONTENTS

                                                     ARTICLE I

                                                    DEFINITIONS
<S>               <C>
SECTION 1.01.     Defined Terms...................................................................................4
SECTION 1.02.     Accounting.....................................................................................52
SECTION 1.03.     Allocation of Certain Interest Shortfalls......................................................52
SECTION 1.04.     Rights of the NIMS Insurer.....................................................................53

                                                    ARTICLE II

                                           CONVEYANCE OF MORTGAGE LOANS;
                                         ORIGINAL ISSUANCE OF CERTIFICATES

SECTION 2.01.     Conveyance of Mortgage Loans...................................................................54
SECTION 2.02.     Acceptance by Trustee..........................................................................57
SECTION 2.03.     Repurchase or Substitution of Mortgage Loans by the Originator.................................59
SECTION 2.04.     Intentionally Omitted..........................................................................61
SECTION 2.05.     Representations, Warranties and Covenants of the Master Servicer...............................61
SECTION 2.06.     Representations and Warranties of the Depositor................................................64
SECTION 2.07.     Issuance of Certificates.......................................................................65
SECTION 2.08.     Conveyance of the Subsequent Mortgage Loans....................................................65
SECTION 2.09.     Conveyance of  REMIC Regular Interests and Acceptance of REMIC 2 and
                  REMIC 3 by the Trustee; Issuance of Certificates...............................................69
SECTION 2.10.     Negative Covenants of the Trustee and the Master Servicer......................................70

                                                    ARTICLE III

                                           ADMINISTRATION AND SERVICING
                                               OF THE MORTGAGE LOANS

SECTION 3.01.     Master Servicer to Act as Master Servicer......................................................71
SECTION 3.02.     Sub-Servicing Agreements Between Master Servicer and Sub-Servicers
                   ..............................................................................................73
SECTION 3.03.     Successor Sub-Servicers........................................................................74
SECTION 3.04.     Liability of the Master Servicer...............................................................74
SECTION 3.05.     No Contractual Relationship Between Sub-Servicers and the NIMS Insurer,
                  the Trustee or Certificateholders..............................................................75
SECTION 3.06.     Assumption or Termination of Sub-Servicing Agreements by Trustee...............................75
SECTION 3.07.     Collection of Certain Mortgage Loan Payments...................................................75
SECTION 3.08.     Sub-Servicing Accounts.........................................................................76
SECTION 3.09.     Collection of Taxes, Assessments and Similar Items; Servicing Accounts
                   ..............................................................................................77
SECTION 3.10.     Collection Account and Distribution Account....................................................78
</TABLE>

                                                         i

<PAGE>

<TABLE>
<CAPTION>

<S>               <C>
SECTION 3.11.     Withdrawals from the Collection Account and Distribution Account...............................80
SECTION 3.12.     Investment of Funds in the Collection Account and the Distribution Account
                   ..............................................................................................82
SECTION 3.13.     [Reserved].....................................................................................83
SECTION 3.14.     Maintenance of Hazard Insurance and Errors and Omissions and Fidelity
                  Coverage.......................................................................................83
SECTION 3.15.     Enforcement of Due-On-Sale Clauses; Assumption Agreements......................................85
SECTION 3.16.     Realization Upon Defaulted Mortgage Loans......................................................86
SECTION 3.17.     Trustee to Cooperate; Release of Mortgage Files................................................88
SECTION 3.18.     Servicing Compensation.........................................................................90
SECTION 3.19.     Reports to the Trustee; Collection Account Statements..........................................90
SECTION 3.20.     Statement as to Compliance.....................................................................90
SECTION 3.21.     Independent Public Accountants' Servicing Report...............................................91
SECTION 3.22.     Access to Certain Documentation; Filing of Reports by Trustee..................................91
SECTION 3.23.     Title, Management and Disposition of REO Property..............................................93
SECTION 3.24.     Obligations of the Master Servicer in Respect of Prepayment Interest
                  Shortfalls.....................................................................................96
SECTION 3.25.     [Reserved].....................................................................................97
SECTION 3.26.     Obligations of the Master Servicer in Respect of Mortgage Rates and
                  Monthly Payments...............................................................................97
SECTION 3.27.     Solicitations..................................................................................97
SECTION 3.28.     Net WAC Rate Carryover Reserve Account.........................................................98
SECTION 3.29.     Advancing Facility.............................................................................99
SECTION 3.30.     PMI Policy; Claims Under the PMI Policy.......................................................100

                                                     ARTICLE IV

                                                   FLOW OF FUNDS

SECTION 4.01.     Distributions.................................................................................101
SECTION 4.02.     [Reserved]....................................................................................108
SECTION 4.03.     Statements....................................................................................108
SECTION 4.04.     Remittance Reports; Advances..................................................................112
SECTION 4.05.     Pre-Funding Accounts..........................................................................113
SECTION 4.06.     [Reserved]....................................................................................115
SECTION 4.07.     Distributions on the REMIC Regular Interests..................................................115
SECTION 4.08.     Allocation of Realized Losses.................................................................118

                                                     ARTICLE V

                                                 THE CERTIFICATES

SECTION 5.01.     The Certificates..............................................................................121
SECTION 5.02.     Registration of Transfer and Exchange of Certificates.........................................121
SECTION 5.03.     Mutilated, Destroyed, Lost or Stolen Certificates.............................................126
SECTION 5.04.     Persons Deemed Owners.........................................................................127
</TABLE>

                                                        ii

<PAGE>

<TABLE>
<CAPTION>

<S>               <C>
SECTION 5.05.     Appointment of Paying Agent...................................................................127

                                                    ARTICLE VI

                                       THE MASTER SERVICER AND THE DEPOSITOR

SECTION 6.01.     Liability of the Master Servicer and the Depositor............................................128
SECTION 6.02.     Merger or Consolidation of, or Assumption of the Obligations of, the Master
                  Servicer or the Depositor.....................................................................128
SECTION 6.03.     Limitation on Liability of the Master Servicer and Others.....................................128
SECTION 6.04.     Master Servicer Not to Resign.................................................................129
SECTION 6.05.     Delegation of Duties..........................................................................130
SECTION 6.06.     [Reserved]....................................................................................130
SECTION 6.07.     Inspection....................................................................................130

                                                    ARTICLE VII

                                                      DEFAULT

SECTION 7.01.     Master Servicer Events of Termination.........................................................131
SECTION 7.02.     Trustee to Act; Appointment of Successor......................................................133
SECTION 7.03.     Waiver of Defaults............................................................................134
SECTION 7.04.     Notification to Certificateholders............................................................134
SECTION 7.05.     Survivability of Master Servicer Liabilities..................................................135

                                                   ARTICLE VIII

                                                    THE TRUSTEE

SECTION 8.01.     Duties of Trustee.............................................................................135
SECTION 8.02.     Certain Matters Affecting the Trustee.........................................................136
SECTION 8.03.     Trustee Not Liable for Certificates or Mortgage Loans.........................................137
SECTION 8.04.     Trustee May Own Certificates..................................................................138
SECTION 8.05.     Trustee Fee and Expenses......................................................................138
SECTION 8.06.     Eligibility Requirements for Trustee..........................................................139
SECTION 8.07.     Resignation or Removal of Trustee.............................................................140
SECTION 8.08.     Successor Trustee.............................................................................140
SECTION 8.09.     Merger or Consolidation of Trustee............................................................141
SECTION 8.10.     Appointment of Co-Trustee or Separate Trustee.................................................141
SECTION 8.11.     Limitation of Liability.......................................................................142
SECTION 8.12.     Trustee May Enforce Claims Without Possession of Certificates.................................143
SECTION 8.13.     Suits for Enforcement.........................................................................143
SECTION 8.14.     Waiver of Bond Requirement....................................................................143
SECTION 8.15.     Waiver of Inventory, Accounting and Appraisal Requirement.....................................144
</TABLE>

                                                        iii

<PAGE>

<TABLE>
<CAPTION>

                                                    ARTICLE IX

                                               REMIC ADMINISTRATION
<S>               <C>
SECTION 9.01.     REMIC Administration..........................................................................144
SECTION 9.02.     Prohibited Transactions and Activities........................................................146
SECTION 9.03.     Indemnification with Respect to Certain Taxes and Loss of REMIC Status
                   .............................................................................................146

                                                     ARTICLE X

                                                    TERMINATION

SECTION 10.01.    Termination...................................................................................148
SECTION 10.02.    Additional Termination Requirements...........................................................150

                                           ARTICLE XI

                                    MISCELLANEOUS PROVISIONS

SECTION 11.01.    Amendment.....................................................................................151
SECTION 11.02.    Recordation of Agreement; Counterparts........................................................152
SECTION 11.03.    Limitation on Rights of Certificateholders....................................................152
SECTION 11.04.    Governing Law; Jurisdiction...................................................................153
SECTION 11.05.    Notices.......................................................................................153
SECTION 11.06.    Severability of Provisions....................................................................154
SECTION 11.07.    Article and Section References................................................................154
SECTION 11.08.    Notice to the Rating Agencies and the NIMS Insurer............................................154
SECTION 11.09.    Further Assurances............................................................................155
SECTION 11.10.    Third Party Rights............................................................................155
SECTION 11.11.    Benefits of Agreement.........................................................................155
SECTION 11.12.    Acts of Certificateholders....................................................................156
SECTION 11.13     No Petition...................................................................................156
</TABLE>

                                                        iv

<PAGE>

<TABLE>
<CAPTION>

EXHIBITS:
---------
<S>               <C>
Exhibit A-1       Form of Class A-1A Certificates
Exhibit A-2       Form of Class A-1B Certificates
Exhibit A-3       Form of Class A-2 Certificates
Exhibit A-4       Form of Class A-3 Certificates
Exhibit A-5       Form of Class A-4 Certificates
Exhibit A-6       Form of Class M-1 Certificates
Exhibit A-7       Form of Class M-2 Certificates
Exhibit A-8       Form of Class M-3 Certificates
Exhibit A-9       Form of Class M-4 Certificates
Exhibit A-10      Form of Class M-5 Certificates
Exhibit A-11      Form of Class M-6 Certificates
Exhibit A-12      Form of Class M-7 Certificates
Exhibit A-13      Form of Class C Certificates
Exhibit A-14      Form of Class P Certificates
Exhibit A-15      Form of Class R Certificates
Exhibit B         [Reserved]
Exhibit C         Form of Mortgage Loan Purchase Agreement
Exhibit D         Mortgage Loan Schedule
Exhibit E         Request for Release
Exhibit F-1       Form of Trustee's Initial Certification
Exhibit F-2       Form of Trustee's Final Certification
Exhibit F-3       Form of Receipt of Mortgage Note
Exhibit G         Loss Mitigation Procedures
Exhibit H         Form of Lost Note Affidavit
Exhibit I         [Reserved]
Exhibit J         Form of Investment Letter
Exhibit K         Form of Residual Certificates Transfer Affidavit
Exhibit L         Form of Transferor Certificate
Exhibit M         Form of ERISA Representation Letter
Exhibit N         Form of Cap Contract
Exhibit O         Form of Subsequent Transfer Instrument
Exhibit P         Form of Addition Notice
Exhibit R-1       Form of Certification to Be Provided by the Depositor with Form 10-K
Exhibit R-2       Form of Certification to Be Provided to Depositor by the Trustee
Exhibit S         Annual Statement of Compliance pursuant to Section 3.20

Schedule I        Prepayment Charge Schedule
</TABLE>

                                        v

<PAGE>

                  This Pooling and Servicing Agreement is dated as of April 1,
2004 (the "Agreement"), among OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as
depositor (the "Depositor"), OPTION ONE MORTGAGE CORPORATION, as master servicer
(the "Master Servicer") and WELLS FARGO BANK, N.A., as trustee (the "Trustee").

                             PRELIMINARY STATEMENT:

                  The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund created hereunder. The Certificates will consist of fifteen
classes of certificates, designated as (i) the Class A-1A Certificates, (ii) the
Class A-1B Certificates, (iii) the Class A-2 Certificates, (iv) the Class A-3
Certificates, (v) the Class A-4 Certificates, (vi) the Class M-1 Certificates,
(vii) the Class M-2 Certificates, (viii) the Class M-3 Certificates, (ix) the
Class M-4 Certificates, (x) the Class M-5 Certificates, (xi) the Class M-6
Certificates, (xii) the Class M-7 Certificates, (xiii) the Class P Certificates,
(xiv) the Class C Certificates and (xv) the Class R Certificates.

                                     REMIC 1
                                     -------

         As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the Group I Mortgage Loans, the Group II
Mortgage Loans and certain other related assets subject to this Agreement (but
exclusive of the Pre-Funding Accounts, the Net WAC Rate Carryover Reserve
Account, the Master Servicer Prepayment Charge Payment Amounts and the Cap
Contracts) as a real estate investment conduit (a "REMIC") for federal income
tax purposes, and such segregated pool of assets will be designated as "REMIC
1." The Class R-1 Interest will represent the sole class of "residual interests"
in REMIC 1 for purposes of the REMIC Provisions under federal income tax law.
The following table irrevocably sets forth the designation, the Uncertificated
REMIC 1 Pass-Through Rate, the initial Uncertificated Principal Balance, and
solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC 1
Regular Interests. None of the REMIC 1 Regular Interests will be certificated.

<TABLE>
<CAPTION>

                           Uncertificated REMIC 1       Initial Uncertificated              Assumed Final
      Designation            Pass-Through Rate            Principal Balance                Maturity Date(1)
      -----------            -----------------            -----------------                ----------------
<S>                              <C>                        <C>                                <C>
          LT1                    Variable(2)                $   490,030,048.25                 May 2034
         LT1PF                   Variable(2)                $   160,706,451.30                 May 2034
          LT2                    Variable(2)                $   263,478,343.49                 May 2034
         LT2PF                   Variable(2)                $    85,785,057.22                 May 2034
          LTP                    Variable(2)                $           100.00                 May 2034
</TABLE>
-------------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest possible maturity date has been designated as
     the "latest possible maturity date" for each Uncertificated REMIC 1 Regular
     Interest.
(2)  Calculated in accordance with the definition of "Uncertificated REMIC 1
     Pass-Through Rate" herein.

<PAGE>

                                     REMIC 2
                                     -------

                  As provided herein, the Trustee will make an election to treat
the segregated pool of assets consisting of the REMIC 1 Regular Interests as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 2." The Class R-2 Interest will represent the sole class
of "residual interests" in REMIC 2 for purposes of the REMIC Provisions (as
defined herein) under federal income tax law. The following table irrevocably
sets forth the designation, the Uncertificated REMIC 2 Pass-Through Rate, the
initial Uncertificated Principal Balance, and solely for purposes of satisfying
Treasury regulation Section 1.860G-1(a)(4)(iii), the "latest possible maturity
date" for each of the REMIC 2 Regular Interests. None of the REMIC 2 Regular
Interests will be certificated.

<TABLE>
<CAPTION>

                        Uncertificated REMIC 2        Initial Uncertificated              Assumed Final
    Designation            Pass-Through Rate             Principal Balance               Maturity Date(1)
    -----------            -----------------             -----------------               ----------------
<S>                          <C>                        <C>                                   <C>
       LT2AA                 Variable(2)                $   489,999,951.13                    May 2034
      LT2A1A                 Variable(2)                $     1,683,450.00                    May 2034
      LT2A1B                 Variable(2)                $     1,000,000.00                    May 2034
       LT2A2                 Variable(2)                $       487,650.00                    May 2034
       LT2A3                 Variable(2)                $       798,550.00                    May 2034
       LT2A4                 Variable(2)                $       155,350.00                    May 2034
       LT2M1                 Variable(2)                $       290,000.00                    May 2034
       LT2M2                 Variable(2)                $       237,500.00                    May 2034
       LT2M3                 Variable(2)                $        70,000.00                    May 2034
       LT2M4                 Variable(2)                $        50,000.00                    May 2034
       LT2M5                 Variable(2)                $        62,500.00                    May 2034
       LT2M6                 Variable(2)                $        50,000.00                    May 2034
       LT2M7                 Variable(2)                $        52,500.00                    May 2034
       LT2ZZ                 Variable(2)                $     5,062,499.00                    May 2034
       LT2P                  Variable(2)                $           100.00                    May 2034
      LT2SUB1                Variable(2)                $        11,404.66                    May 2034
      LT2GRP1                Variable(2)                $        65,073.66                    May 2034
      LT2SUB2                Variable(2)                $         6,095.34                    May 2034
      LT2GRP2                Variable(2)                $        34,926.34                    May 2034
       LT2XX                 Variable(2)                $   499,882,450.13                    May 2034
</TABLE>
--------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest maturity date has been designated as the
     "latest possible maturity date" for each REMIC 2 Regular Interest.
(2)  Calculated in accordance with the definition of "Uncertificated REMIC 2
     Pass-Through Rate" herein.

                                        2

<PAGE>

                                     REMIC 3
                                     -------

         As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the REMIC 2 Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC 3." The Class R-3 Interest represents the sole class of
"residual interests" in REMIC 3 for purposes of the REMIC Provisions.

         The following table sets forth (or describes) the Class designation,
Pass-Through Rate and Original Class Certificate Principal Balance for each
Class of Certificates that represents one or more of the "regular interests" in
REMIC 3 created hereunder:

<TABLE>
<CAPTION>

                                                                 Original Class
                                      Pass-Through            Certificate Principal           Assumed Final
      Class Designation                   Rate                       Balance                Maturity Date(1)
      -----------------                   ----                       -------                ----------------
<S>                                   <C>                     <C>                              <C>
Class A-1A...................         Variable(2)             $   336,690,000.00               May 2034
Class A-1B...................         Variable(2)             $   200,000,000.00               May 2034
Class A-2....................         Variable(2)             $    97,530,000.00               May 2034
Class A-3....................         Variable(2)             $   159,710,000.00               May 2034
Class A-4....................         Variable(2)             $    31,070,000.00               May 2034
Class M-1....................         Variable(2)             $    58,000,000.00               May 2034
Class M-2....................         Variable(2)             $    47,500,000.00               May 2034
Class M-3....................         Variable(2)             $    14,000,000.00               May 2034
Class M-4....................         Variable(2)             $    10,000,000.00               May 2034
Class M-5....................         Variable(2)             $    12,500,000.00               May 2034
Class M-6....................         Variable(2)             $    10,000,000.00               May 2034
Class M-7....................         Variable(2)             $    10,500,000.00               May 2034
Class C......................         Variable(2)             $    12,499,900.26               May 2034
Class P......................            N/A(4)               $           100.00               May 2034
</TABLE>
------------------
(1)  Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
     regulations, the Distribution Date following the maturity date for the
     Mortgage Loan with the latest maturity date has been designated as the
     "latest possible maturity date" for each Class of Certificates that
     represents one or more of the "regular interests" in REMIC 3.
(2)  Calculated in accordance with the definition of "Pass-Through Rate" herein.
(3)  The Class C Certificates will accrue interest at their variable
     Pass-Through Rate on the Notional Amount of the Class C Certificates
     outstanding from time to time which shall equal the aggregate of the
     Uncertificated Principal Balances of the REMIC 2 Regular Interests (other
     than REMIC 2 Regular Interest LT2P). The Class C Certificates will not
     accrue interest on their Class Certificate Principal Balance.
(4)  The Class P Certificates will not accrue interest.

                                        3

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

                  SECTION 1.01. Defined Terms.

                  Whenever used in this Agreement or in the Preliminary
Statement, the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article. Unless otherwise
specified, all calculations in respect of interest on the Offered Certificates
shall be made on the basis of the actual number of days elapsed on the basis of
a 360-day year and all other calculations of interest described herein shall be
made on the basis of a 360-day year consisting of twelve 30-day months. The
Class P Certificates and the Class R Certificates are not entitled to
distributions in respect of interest and, accordingly, will not accrue interest.

                  "1933 Act":  The Securities Act of 1933, as amended.

                  "Account": Either of the Collection Account and Distribution
Account.

                  "Accrual Period": With respect to the Class A Certificates and
the Mezzanine Certificates and each Distribution Date, the period commencing on
the preceding Distribution Date (or in the case of the first such Accrual
Period, commencing on the Closing Date) and ending on the day preceding the
current Distribution Date. With respect to the Class C Certificates and each
Distribution Date, the calendar month prior to the month of such Distribution
Date.

                  "Addition Notice": With respect to the transfer of Subsequent
Mortgage Loans to the Trust Fund pursuant to Section 2.08, a notice of the
Depositor's designation of the Subsequent Mortgage Loans to be sold to the Trust
Fund and the aggregate principal balance of such Subsequent Mortgage Loans as of
the Subsequent Cut-off Date. The Addition Notice shall be given not later than
three Business Days prior to the related Subsequent Transfer Date and shall be
substantially in the form attached hereto as Exhibit P.

                  "Adjustable Rate Mortgage Loan": A first lien Mortgage Loan
which provides at any period during the life of such loan for the adjustment of
the Mortgage Rate payable in respect thereto. The Adjustable Rate Mortgage Loans
are identified as such on the Mortgage Loan Schedule.

                  "Adjusted Net Maximum Mortgage Rate": With respect to any
Distribution Date and any Mortgage Loan (or the related REO Property) in the
Trust Fund as of the close of business on the last day of the preceding calendar
month, a per annum rate of interest equal to the applicable Maximum Mortgage
Rate for such Mortgage Loan (or the Mortgage Rate in the case of any Fixed Rate
Mortgage Loan) as of the first day of the month preceding the month in which the
Distribution Date occurs minus the sum of (i) the Trustee Fee Rate, (ii) the
Servicing Fee Rate and (iii) the PMI Premium Rate, if applicable.

                  "Adjusted Net Mortgage Rate": With respect to any Distribution
Date and any Mortgage Loan (or the related REO Property) in the Trust Fund as of
the close of business on the last day of the preceding calendar month, a per
annum rate of interest equal to the applicable Mortgage

                                        4

<PAGE>

Rate for such Mortgage Loan as of the first day of the month preceding the month
in which the related Distribution Date occurs minus the sum of (i) the Trustee
Fee Rate, (ii) the Servicing Fee Rate and (iii) the PMI Premium Rate, if
applicable.

                  "Adjustment Date": With respect to each Adjustable Rate
Mortgage Loan, each adjustment date, on which the Mortgage Rate of such Mortgage
Loan changes pursuant to the related Mortgage Note. The first Adjustment Date
following the Cut-off Date as to each Adjustable Rate Mortgage Loan is set forth
in the Mortgage Loan Schedule.

                  "Advance": As to any Mortgage Loan or REO Property, any
advance made by the Master Servicer in respect of any Distribution Date pursuant
to Section 4.04.

                  "Advancing Facility":  As defined in Section 3.29 hereof.

                  "Advancing Person":  As defined in Section 3.29 hereof.

                  "Adverse REMIC Event": As defined in Section 9.01(f) hereof.

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

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

                  "Allocated Realized Loss Amount": With respect to any
Distribution Date and the Mezzanine Certificates, the sum (reduced by the amount
of any Subsequent Recoveries added to the Certificate Principal Balance of such
Class of Certificates) of (i) any Realized Losses allocated to such Class of
Certificates on such Distribution Date and (ii) the amount of any Allocated
Realized Loss Amount for such Class of Certificates remaining unpaid from the
previous Distribution Date as reduced by an amount equal to the increase in the
related Certificate Principal Balance due to the receipt of Subsequent
Recoveries.

                  "Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form (excepting therefrom, if applicable,
the mortgage recordation information which has not been required pursuant to
Section 2.01 hereof or returned by the applicable recorder's office and if the
assignment has been delivered in blank, the name of the Assignee), which is
sufficient under the laws of the jurisdiction wherein the related Mortgaged
Property is located to reflect or record the sale of the Mortgage.

                  "Assumed Final Maturity Date": As to each Class of
Certificates, the date set forth as such in the Preliminary Statement.

                                        5

<PAGE>

                  "Available Funds": With respect to any Distribution Date, an
amount equal to the excess of (i) the sum of (a) the aggregate of the related
Monthly Payments received on or prior to the related Determination Date,
including any Subsequent Recoveries, (b) Liquidation Proceeds, Insurance
Proceeds, Principal Prepayments and other unscheduled recoveries of principal
and interest in respect of the Mortgage Loans received during the related
Prepayment Period, (c) the aggregate of any amounts received in respect of a
related REO Property withdrawn from any REO Account and deposited in the
Collection Account for such Distribution Date, (d) the aggregate of any amounts
deposited in the Collection Account by the Master Servicer in respect of related
Prepayment Interest Shortfalls for such Distribution Date, (e) the aggregate of
any Advances made by the Master Servicer for such Distribution Date, (f) the
aggregate of any related advances made by the Trustee for such Distribution Date
pursuant to Section 7.02, (g) [reserved], (h) with respect to the Distribution
Date immediately following the end of the Funding Period, any amounts in the
Pre-Funding Accounts (exclusive of investment income) after giving effect to any
purchase of Subsequent Mortgage Loans, (i) [reserved] and (j) the amount of any
Prepayment Charges collected by the Master Servicer in connection with the full
or partial prepayment of any of the Mortgage Loans and any Master Servicer
Prepayment Charge Payment Amount over (ii) the sum of (a) amounts reimbursable
or payable to the Master Servicer pursuant to Section 3.11(a) or the Trustee
pursuant to Section 3.11(b), (b) amounts deposited in the Collection Account or
the Distribution Account pursuant to clauses (a) through (j) above, as the case
may be, in error, (c) the amount of any Prepayment Charges collected by the
Master Servicer in connection with the full or partial prepayment of any of the
Mortgage Loans and any Master Servicer Prepayment Charge Payment Amount, (d) the
Trustee Fee payable from the Distribution Account pursuant to Section 8.05, (e)
the PMI Premium payable from the Distribution Account and (f) any
indemnification payments or expense reimbursements made by the Trust Fund
pursuant to Section 8.05.

                  "Balloon Mortgage Loan": A Mortgage Loan that provides for a
Balloon Payment.

                  Balloon Payment": A payment of the unamortized principal
balance of a Mortgage Loan in a single payment at the maturity of such Mortgage
Loan that is substantially greater than the preceding Monthly Payment.

                  "Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11
of the United States Code), as amended.

                  "Book-Entry Certificates": Any of the Certificates that shall
be registered in the name of the Depository or its nominee, the ownership of
which is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant", or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Offered Certificates shall be Book-Entry Certificates.

                  "Business Day": Any day other than a Saturday, a Sunday or a
day on which banking or savings institutions in the State of Delaware, the State
of New York, the State of Maryland, the State of California, the Commonwealth of
Pennsylvania, the State of Florida, the State of Minnesota or in the city in
which the Corporate Trust Office of the Trustee is located are authorized or
obligated by law or executive order to be closed.

                                        6

<PAGE>

                  "Cap Amount": The Cap Amount for each Class of Mezzanine
Certificates is equal to (i) the aggregate amount received by the Trust from the
related Cap Contract multiplied by (ii) a fraction equal to (a) the Certificate
Principal Balance of such Class immediately prior to the applicable Distribution
Date divided by (b) the aggregate Certificate Principal Balance of the Mezzanine
Certificates immediately prior to the applicable Distribution Date. The Cap
Amount for each Class of Group II Certificates is equal to (i) the aggregate
amount received by the Trust from the related Cap Contract multiplied by (ii) a
fraction equal to (a) the Certificate Principal Balance of such Class
immediately prior to the applicable Distribution Date divided by (b) the
aggregate Certificate Principal Balance of the Group II Certificates immediately
prior to the applicable Distribution Date.

                  "Cap Contract": Any one of the following: the Cap Contract
between the Trustee, on behalf of the Trust and the counterparty thereunder, for
the benefit of the Holders of the Class A- 1A Certificates, a form of which is
attached hereto as Exhibit N; the Cap Contract between the Trustee, on behalf of
the Trust and the counterparty thereunder, for the benefit of the Holders of the
Group II Certificates, a form of which is attached hereto as Exhibit N; and the
Cap Contract between the Trustee, on behalf of the Trust and the counterparty
thereunder, for the benefit of the Holders of the Mezzanine Certificates, a form
of which is attached hereto as Exhibit N.

                  "Certificate": Any Regular Certificate or Residual
Certificate.

                  "Certificateholder": The Person in whose name a Certificate is
registered in the Certificate Register, except that a Disqualified Organization
or non-U.S. Person shall not be a Holder of a Class R Certificate for any
purpose hereof and, solely for the purposes of giving any consent pursuant to
this Agreement, any Certificate registered in the name of the Depositor or the
Master Servicer or any Affiliate thereof shall be deemed not to be outstanding
and the Voting Rights to which it is entitled shall not be taken into account in
determining whether the requisite percentage of Voting Rights necessary to
effect any such consent has been obtained, except as otherwise provided in
Section 11.01. The Trustee and the NIMS Insurer may conclusively rely upon a
certificate of the Depositor or the Master Servicer in determining whether a
Certificate is held by an Affiliate thereof. All references herein to
"Certificateholders" shall reflect the rights of Certificate Owners as they may
indirectly exercise such rights through the Depository and participating members
thereof, except as otherwise specified herein; provided, however, that the
Trustee and the NIMS Insurer shall be required to recognize as a
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.

                  "Certificate Margin": With respect to the Class A-1A
Certificates on each Distribution Date (A) on or prior to the Optional
Termination Date, 0.210% per annum and (B) after the Optional Termination Date,
0.420% per annum. With respect to the Class A-1B Certificates on each
Distribution Date (A) on or prior to the Optional Termination Date, 0.240% per
annum and (B) after the Optional Termination Date, 0.480% per annum. With
respect to the Class A-2 Certificates on each Distribution Date (A) on or prior
to the Optional Termination Date, 0.110% per annum and (B) after the Optional
Termination Date, 0.220% per annum. With respect to the Class A-3 Certificates
on each Distribution Date (A) on or prior to the Optional Termination Date,
0.210% per annum and (B) after the Optional Termination Date, 0.420% per annum.
With respect to the Class A-4 Certificates on each Distribution Date (A) on or
prior to the Optional Termination Date, 0.450%

                                        7

<PAGE>

per annum and (B) after the Optional Termination Date, 0.900% per annum. With
respect to the Class M-1 Certificates on each Distribution Date (A) on or prior
to the Optional Termination Date, 0.530% per annum and (B) after the Optional
Termination Date, 0.795% per annum. With respect to the Class M-2 Certificates
on each Distribution Date (A) on or prior to the Optional Termination Date,
1.050% per annum and (B) after the Optional Termination Date, 1.575% per annum.
With respect to the Class M-3 Certificates on each Distribution Date (A) on or
prior to the Optional Termination Date, 1.250% per annum and (B) after the
Optional Termination Date, 1.875% per annum. With respect to the Class M-4
Certificates on each Distribution Date (A) on or prior to the Optional
Termination Date, 1.800% per annum and (B) after the Optional Termination Date,
2.700% per annum. With respect to the Class M-5 Certificates on each
Distribution Date (A) on or prior to the Optional Termination Date, 2.000% per
annum and (B) after the Optional Termination Date, 3.000% per annum. With
respect to the Class M-6 Certificates on each Distribution Date (A) on or prior
to the Optional Termination Date, 3.330% per annum and (B) after the Optional
Termination Date, 4.950% per annum. With respect to the Class M-7 Certificates
on each Distribution Date (A) on or prior to the Optional Termination Date,
3.500% per annum and (B) after the Optional Termination Date, 5.250% per annum.

                  "Certificate Owner": With respect to each Book-Entry
Certificate, any beneficial owner thereof.

                  "Certificate Principal Balance": With respect to any Class of
Regular Certificates (other than the Class C Certificates) immediately prior to
any Distribution Date, will be equal to the Initial Certificate Principal
Balance thereof (A) increased, in the case of a Mezzanine Certificate, by the
amount of any Subsequent Recoveries added to the Certificate Principal Balance
of such Class pursuant to Section 4.01, (B) reduced by the sum of all amounts
actually distributed in respect of principal of such Class and (C) further
reduced, in the case of a Mezzanine Certificate, by Realized Losses allocated
thereto on all prior Distribution Dates. With respect to the Class C
Certificates as of any date of determination, an amount equal to the excess, if
any, of (A) the then aggregate Uncertificated Principal Balances of the REMIC 2
Regular Interests over (B) the then aggregate Certificate Principal Balances of
the Class A Certificates, the Mezzanine Certificates and the Class P
Certificates then outstanding.

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

                  "Class": Collectively, Certificates which have the same
priority of payment and bear the same class designation and the form of which is
identical except for variation in the Percentage Interest evidenced thereby.

                  "Class A Certificateholder": Any Holder of a Class A
Certificate.

                  "Class A Certificates": Any Class A-1A Certificate, Class A-1B
Certificate, Class A- 2 Certificate, Class A-3 Certificate or Class A-4
Certificate.

                                        8

<PAGE>

                  "Class A Principal Distribution Amount": With respect to any
Distribution Date, the sum of (i) the Group I Principal Distribution Amount and
(ii) the Group II Principal Distribution Amount.

                  "Class A-1A Certificate": Any one of the Class A-1A
Certificates executed by the Trustee, and authenticated and delivered by the
Certificate Registrar, substantially in the form annexed hereto as Exhibit A-1,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class A-1B Certificate": Any one of the Class A-1B
Certificates executed by the Trustee, and authenticated and delivered by the
Certificate Registrar, substantially in the form annexed hereto as Exhibit A-2,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class A-2 Certificate": Any one of the Class A-2 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-3, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class A-3 Certificate": Any one of the Class A-3 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-4, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class A-4 Certificate": Any one of the Class A-4 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-5, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class C Certificate": Any one of the Class C Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-13,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class M-1 Certificate": Any one of the Class M-1 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-6, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class M-1 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date)
and (ii) the Certificate Principal Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 76.60% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to

                                        9

<PAGE>

the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) and (B) the positive difference,
if any, of the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) minus the Overcollateralization Floor.

                  "Class M-2 Certificate": Any one of the Class M-2 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-7, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class M-2 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date) and (iii) the Certificate Principal Balance of the
Class M-2 Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 86.10% and (ii) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (B) the positive
difference, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period) minus the Overcollateralization Floor.

                  "Class M-3 Certificate": Any one of the Class M-3 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-8, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class M-3 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date) and (iv) the
Certificate Principal Balance of the Class M-3 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 88.90% and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the positive difference, if any, of the aggregate Stated
Principal Balance of the

                                       10

<PAGE>

Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus the Overcollateralization Floor.

                  "Class M-4 Certificate": Any one of the Class M-4 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-9, representing
the right to distributions as set forth herein and therein and evidencing a
regular interest in REMIC 3.

                  "Class M-4 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date) and (v) the Certificate Principal Balance of the Class M-4 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 90.90% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (B) the positive difference, if any,
of the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) minus the Overcollateralization Floor.

                  "Class M-5 Certificate": Any one of the Class M-5 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-10,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class M-5 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date) and (vi) the Certificate

                                       11

<PAGE>

Principal Balance of the Class M-5 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 93.40% and (ii)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the positive difference, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) minus
the Overcollateralization Floor.

                  "Class M-6 Certificate": Any one of the Class M-6 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-11,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class M-6 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on such Distribution Date),
(ii) the Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the payment of the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii) the Certificate Principal Balance of the Class
M-2 Certificates (after taking into account the payment of the Class M-2
Principal Distribution Amount on such Distribution Date), (iv) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date) and (vii) the
Certificate Principal Balance of the Class M-6 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 95.40% and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the positive difference, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) minus
the Overcollateralization Floor.

                  "Class M-7 Certificate": Any one of the Class M-7 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-12,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class M-7 Principal Distribution Amount": An amount, not less
than zero, equal to the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
payment of the Class A Principal Distribution Amount on

                                       12

<PAGE>

such Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the payment of the Class M-4 Principal
Distribution Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the payment of
the Class M-5 Principal Distribution Amount on such Distribution Date), (vii)
the Certificate Principal Balance of the Class M-6 Certificates (after taking
into account the payment of the Class M-6 Principal Distribution Amount on such
Distribution Date) and (viii) the Certificate Principal Balance of the Class M-7
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 97.50% and (ii) the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period, to
the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) and (B) the positive difference,
if any, of the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) minus the Overcollateralization Floor.

                  "Class P Certificate": Any one of the Class P Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-14,
representing the right to distributions as set forth herein and therein and
evidencing a regular interest in REMIC 3.

                  "Class R Certificate": The Class R Certificate executed by the
Trustee, and authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-15 and evidencing the
ownership of the Class R-1 Interest, the Class R-2 Interest and the Class R-3
Interest.

                  "Class R-1 Interest": The uncertificated Residual Interest in
REMIC 1.

                  "Class R-2 Interest": The uncertificated Residual Interest in
REMIC 2.

                  "Class R-3 Interest": The uncertificated Residual Interest in
REMIC 3.

                  "Close of Business": As used herein, with respect to any
Business Day, 5:00 p.m. (New York time).

                  "Closing Date": April 13, 2004.

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

                                       13

<PAGE>

                  "Collection Account": The account or accounts created and
maintained by the Master Servicer pursuant to Section 3.10(a), which shall be
entitled "Wells Fargo Bank, N.A., as Trustee, in trust for registered Holders of
Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates, Series
2004-2," which must be an Eligible Account.

                  "Compensating Interest":  As defined in Section 3.24 hereof.

                  "Convertible Mortgage Loan": Any Adjustable-Rate Mortgage Loan
which allows the Mortgagor thereunder to convert the Mortgage Rate thereon to a
fixed Mortgage Rate.

                  "Corporate Trust Office": The principal corporate trust office
of the Trustee at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office at the date
of the execution of this instrument is located at Sixth and Marquette,
Minneapolis, Minnesota 55479-0113, Attention: Option One Series 2004-2, or at
such other address as the Trustee may designate from time to time by notice to
the Certificateholders, the Depositor, the Master Servicer, the Originator and
the Seller.

                  "Corresponding Certificate": With respect to each REMIC 2
Regular Interest set forth below, the corresponding Regular Certificate set
forth in the table below:

        REMIC 2 REGULAR INTEREST                  Regular Certificate
        ------------------------                  -------------------
                 LT2A1A                                Class A-1A
                 LT2A1B                                Class A-1B
                 LT2A2                                 Class A-2
                 LT2A3                                 Class A-3
                 LT2A4                                 Class A-4
                 LT2M1                                 Class M-1
                 LT2M2                                 Class M-2
                 LT2M3                                 Class M-3
                 LT2M4                                 Class M-4
                 LT2M5                                 Class M-5
                 LT2M6                                 Class M-6
                 LT2M7                                 Class M-7
                  LT2P                                  Class P

                  "Credit Enhancement Percentage": For any Distribution Date,
the percentage equivalent of a fraction, the numerator of which is the sum of
the aggregate Certificate Principal Balances of the Mezzanine Certificates and
the Class C Certificates, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans and any amounts remaining in the
Pre-Funding Accounts, calculated prior to taking into account payments of
principal on the Mortgage Loans and distribution of the Group I Principal
Distribution Amount and the Group II Principal Distribution Amount to the
Holders of the Certificates then entitled to distributions of principal on such
Distribution Date.

                                       14

<PAGE>

                  "Custodian": Wells Fargo Bank, N.A., as custodian of the
Mortgage Files, and any successor thereto.

                  "Cut-off Date": With respect to each Initial Mortgage Loan,
the later of (i) the date of origination of such Mortgage Loan or (ii) April 1,
2004.

                  "Cut-off Date Principal Balance": With respect to any Mortgage
Loan, the unpaid principal balance thereof as of the Cut-off Date or Subsequent
Cut-off Date, as applicable (or as of the applicable date of substitution with
respect to a Qualified Substitute Mortgage Loan), after application of scheduled
payments due thereon, whether or not received.

                  "Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.

                  "Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, which valuation results from a proceeding initiated under the Bankruptcy
Code.

                  "Definitive Certificates": As defined in Section 5.02(c)
hereof.

                  "Deleted Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Qualified Substitute Mortgage Loans.

                   "Delinquency Master Servicer Termination Trigger": A
Delinquency Master Servicer Termination Trigger will have occurred with respect
to the Certificates on a Distribution Date if the Three Month Rolling
Delinquency Percentage for the Mortgage Loans exceeds 18.00%.

                  "Delinquency Percentage": For any Distribution Date, the
percentage obtained by dividing (x) the aggregate Stated Principal Balance of
Mortgage Loans Delinquent 60 days or more by (y) the aggregate Stated Principal
Balance of the Mortgage Loans, in each case, as of the last day of the previous
calendar month.

                  "Delinquent": Any Mortgage Loan, the Monthly Payment due on a
Due Date which is not made by the Close of Business on the next scheduled Due
Date for such Mortgage Loan. For example, a Mortgage Loan is 60 or more days
Delinquent if the Monthly Payment due on a Due Date is not made by the Close of
Business on the second scheduled Due Date after such Due Date.

                  "Depositor": Option One Mortgage Acceptance Corporation, a
Delaware corporation, or any successor in interest.

                  "Depository": The initial Depository shall be The Depository
Trust Company and upon request, Clearstream Banking Luxembourg and the Euroclear
System, whose nominee is Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the

                                       15

<PAGE>

Securities Exchange Act of 1934, as amended. The Depository shall initially be
the registered Holder of the Book-Entry Certificates. The Depository shall at
all times be a "clearing corporation" as defined in Section 8-102(3) of the
Uniform Commercial Code of the State of New York.

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

                  "Determination Date": With respect to any Distribution Date,
the 15th day of the calendar month in which such Distribution Date occurs or, if
such 15th day is not a Business Day, the Business Day immediately preceding such
15th day.

                  "Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon or any use
of such REO Property in a trade or business conducted by the REMIC other than
through an Independent Contractor; provided, however, that the Trustee (or the
Master Servicer on behalf of the Trustee) shall not be considered to Directly
Operate an REO Property solely because the Trustee (or the Master Servicer on
behalf of the Trustee) establishes rental terms, chooses tenants, enters into or
renews leases, deals with taxes and insurance, or makes decisions as to repairs
or capital expenditures with respect to such REO Property.

                  "Disqualified Organization": A "disqualified organization"
under Section 860E of the Code, which as of the Closing Date is any of: (i) the
United States, any state or political subdivision thereof, any foreign
government, any international organization, or any agency or instrumentality of
any of the foregoing, (ii) any organization (other than a cooperative described
in Section 521 of the Code) which is exempt from the tax imposed by Chapter 1 of
the Code unless such organization is subject to the tax imposed by Section 511
of the Code, (iii) any organization described in Section 1381(a)(2)(C) of the
Code, (iv) an "electing large partnership" within the meaning of Section 775 of
the Code or (v) any other Person so designated by the Trustee based upon an
Opinion of Counsel provided by nationally recognized counsel to the Trustee that
the holding of an ownership interest in a Residual Certificate by such Person
may cause any REMIC formed hereunder or any Person having an ownership interest
in any Class of Certificates (other than such Person) to incur liability for any
federal tax imposed under the Code that would not otherwise be imposed but for
the transfer of an ownership interest in the Residual Certificate to such
Person. A corporation will not be treated as an instrumentality of the United
States or of any state or political subdivision thereof, if all of its
activities are subject to tax and, a majority of its board of directors is not
selected by a governmental unit. The term "United States", "state" and
"international organizations" shall have the meanings set forth in Section 7701
of the Code.

                  "Distribution Account": The trust account or accounts created
and maintained by the Trustee pursuant to Section 3.10(b) which shall be
entitled "Distribution Account, Wells Fargo Bank, N.A., as Trustee, in trust for
the registered Certificateholders of Option One Mortgage Loan Trust 2004-2,
Asset-Backed Certificates, Series 2004-2" and which must be an Eligible Account.

                                       16

<PAGE>

                  "Distribution Date": The 25th day of any calendar month, or if
such 25th day is not a Business Day, the Business Day immediately following such
25th day, commencing in May 2004.

                  "Due Date": With respect to each Mortgage Loan and any
Distribution Date, the first day of the calendar month in which such
Distribution Date occurs on which the Monthly Payment for such Mortgage Loan was
due (or, in the case of any Mortgage Loan under the terms of which the Monthly
Payment for such Mortgage Loan was due on a day other than the first day of the
calendar month in which such Distribution Date occurs, the day during the
related Due Period on which such Monthly Payment was due), exclusive of any days
of grace.

                  "Due Period": With respect to any Distribution Date, the
period commencing on the second day of the month preceding the month in which
such Distribution Date occurs and ending on the first day of the month in which
such Distribution Date occurs.

                  "Eligible Account": Any of (i) an account or accounts
maintained with a federal or state chartered depository institution or trust
company the short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the short-term unsecured debt obligations of such holding
company) are rated P-1 by Moody's, F-1 by Fitch and A-1+ by S&P (or comparable
ratings if Moody's, Fitch and S&P are not the Rating Agencies) at the time any
amounts are held on deposit therein, (ii) an account or accounts the deposits in
which are fully insured by the FDIC (to the limits established by such
corporation), the uninsured deposits in which account are otherwise secured such
that, as evidenced by an Opinion of Counsel delivered to the NIMS Insurer, the
Trustee and to each Rating Agency, the Certificateholders will have a claim with
respect to the funds in such account or a perfected first priority security
interest against such collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution with which such account is
maintained, (iii) a trust account or accounts maintained with the trust
department of a federal or state chartered depository institution, national
banking association or trust company acting in its fiduciary capacity or (iv) an
account otherwise acceptable to each Rating Agency without reduction or
withdrawal of their then current ratings of the Certificates as evidenced by a
letter from each Rating Agency to the Trustee and the NIMS Insurer. Eligible
Accounts may bear interest.

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

                  "Escrow Payments": The amounts constituting ground rents,
taxes, assessments, water rates, fire and hazard insurance premiums and other
payments required to be escrowed by the Mortgagor with the mortgagee pursuant to
any Mortgage Loan.

                  "Estate in Real Property": A fee simple estate in a parcel of
real property.

                  "Excess Overcollateralized Amount": With respect to the Class
A Certificates and the Mezzanine Certificates and any Distribution Date, the
excess, if any, of (i) the Overcollateralized Amount for such Distribution Date,
assuming that 100% of the Principal Remittance Amount is applied as a principal
payment on such Distribution Date over (ii) the Overcollateralization Target
Amount for such Distribution Date.

                                       17

<PAGE>

                  "Extra Principal Distribution Amount": With respect to any
Distribution Date, the lesser of (x) the Monthly Interest Distributable Amount
payable on the Class C Certificates on such Distribution Date as reduced by
Realized Losses allocated thereto with respect to such Distribution Date
pursuant to Section 4.08 and (y) the Overcollateralization Deficiency Amount for
such Distribution Date.

                  "Fannie Mae": Federal National Mortgage Association or any
successor thereto.

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

                  "Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Originator or the Master Servicer pursuant to or as
contemplated by Section 2.03 or 10.01), a determination made by the Master
Servicer that all Insurance Proceeds, Liquidation Proceeds and other payments or
recoveries which the Master Servicer, in its reasonable good faith judgment,
expects to be finally recoverable in respect thereof have been so recovered. The
Master Servicer shall maintain records, prepared by a Servicing Officer, of each
Final Recovery Determination made thereby.

                  "Fitch": Fitch Ratings, or its successor in interest.

                  "Fixed Rate Mortgage Loan": A first or second lien Mortgage
Loan which provides for a fixed Mortgage Rate payable with respect thereto. The
Fixed Rate Mortgage Loans are identified as such on the Mortgage Loan Schedule.

                  "Formula Rate": For any Distribution Date and any Class of the
Class A Certificates and the Mezzanine Certificates, the lesser of (i) LIBOR
plus the related Certificate Margin and (ii) the applicable Maximum Cap Rate.

                  "Freddie Mac": The Federal Home Loan Mortgage Corporation, or
any successor thereto.

                  "Funding Period": The period beginning on the Closing Date and
ending on the earlier to occur of the date upon which (a) the amount on deposit
in the Pre-Funding Accounts (exclusive of investment income) has been reduced to
zero or (b) April 30, 2004.

                  "Gross Margin": With respect to each Adjustable Rate Mortgage
Loan, the fixed percentage set forth in the related Mortgage Note that is added
to the Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Rate for such Mortgage Loan.

                  "Group I Allocation Percentage": With respect to any
Distribution Date, the percentage equivalent of a fraction, the numerator of
which is (i) the Group I Principal Remittance Amount for such Distribution Date,
and the denominator of which is (ii) the Principal Remittance Amount for such
Distribution Date.

                                       18

<PAGE>

                  "Group I Basic Principal Distribution Amount": With respect to
any Distribution Date, the excess of (i) the Group I Principal Remittance Amount
for such Distribution Date over (ii) the Overcollateralization Release Amount,
if any, for such Distribution Date multiplied by the Group I Allocation
Percentage.

                  "Group I Certificates": The Class A-1A Certificates and Class
A-1B Certificates.

                  "Group I Interest Remittance Amount": With respect to any
Distribution Date, that portion of the Available Funds for such Distribution
Date attributable to interest received or advanced with respect to the Group I
Mortgage Loans.

                  "Group I Mortgage Loan": A Mortgage Loan assigned to Loan
Group I with a principal balance that conforms to Fannie Mae and Freddie Mac
guidelines.

                  "Group I Pre-Funding Account": The account established and
maintained pursuant to Section 4.05, as defined herein.

                  "Group I Principal Distribution Amount": With respect to any
Distribution Date, the sum of (i) the Group I Basic Principal Distribution
Amount for such Distribution Date and (ii) the Extra Principal Distribution
Amount for such Distribution Date multiplied by the Group I Allocation
Percentage.

                  "Group I Principal Remittance Amount": With respect to any
Distribution Date, the sum of (i) each scheduled payment of principal collected
or advanced on the Group I Mortgage Loans by the Master Servicer that were due
during the related Due Period, (ii) the principal portion of all partial and
full principal prepayments of the Group I Mortgage Loans received by the Master
Servicer during the related Prepayment Period, (iii) the principal portion of
all related Net Liquidation Proceeds, Subsequent Recoveries and Insurance
Proceeds received during such Prepayment Period with respect to the Group I
Mortgage Loans, (iv) that portion of the Purchase Price, representing principal
of any repurchased Group I Mortgage Loan, deposited to the Collection Account
during such Prepayment Period, (v) the principal portion of any related
Substitution Adjustments deposited in the Collection Account during such
Prepayment Period with respect to the Group I Mortgage Loans, (vi) on the
Distribution Date on which the Trust Fund is to be terminated pursuant to
Section 10.01, that portion of the Termination Price, in respect of principal on
the Group I Mortgage Loans and (vii) on the Distribution Date immediately
following the end of the Funding Period, any remaining amounts in the Group I
Pre-Funding Account (exclusive of investment income therein) after giving effect
to any purchase of Subsequent Group I Mortgage Loans.

                  "Group I Senior Principal Distribution Amount": An amount, not
less than zero, equal to the excess of (x) the aggregate Certificate Principal
Balance of the Group I Certificates immediately prior to such Distribution Date
over (y) the lesser of (A) the product of (i) 65.00% and (ii) the aggregate
Stated Principal Balance of the Group I Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period) and (B) the positive difference, if any, of the aggregate Stated
Principal Balance of the Group I Mortgage Loans as of the last day of the
related Due Period (after

                                       19

<PAGE>

giving effect to scheduled payments of principal due during the related Due
Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus the
Overcollateralization Floor.

                  "Group II Allocation Percentage": With respect to any
Distribution Date, the percentage equivalent of a fraction, the numerator of
which is (i) the Group II Principal Remittance Amount for such Distribution
Date, and the denominator of which is (ii) the Principal Remittance Amount for
such Distribution Date.

                  "Group II Basic Principal Distribution Amount": With respect
to any Distribution Date, the excess of (i) the Group II Principal Remittance
Amount for such Distribution Date over (ii) the Overcollateralization Release
Amount, if any, for such Distribution Date multiplied by the Group II Allocation
Percentage.

                  "Group II Certificates": The Class A-2 Certificates, the Class
A-3 Certificates and Class A-4 Certificates.

                  "Group II Interest Remittance Amount": With respect to any
Distribution Date, that portion of the Available Funds for such Distribution
Date attributable to interest received or advanced with respect to the Group II
Mortgage Loans.

                  "Group II Mortgage Loan": A Mortgage Loan assigned to Loan
Group II with a principal balance that may or may not conform to Fannie Mae and
Freddie Mac guidelines.

                  "Group II Pre-Funding Account": The account established and
maintained pursuant to Section 4.05, as defined herein.

                  "Group II Principal Distribution Amount": With respect to any
Distribution Date, the sum of (i) the Group II Basic Principal Distribution
Amount for such Distribution Date and (ii) the Extra Principal Distribution
Amount for such Distribution Date multiplied by the Group II Allocation
Percentage.

                  "Group II Principal Remittance Amount": With respect to any
Distribution Date, the sum of (i) each scheduled payment of principal collected
or advanced on the Group II Mortgage Loans by the Master Servicer that were due
during the related Due Period, (ii) the principal portion of all partial and
full principal prepayments of the Group II Mortgage Loans received by the Master
Servicer during the related Prepayment Period, (iii) the principal portion of
all related Net Liquidation Proceeds, Subsequent Recoveries and Insurance
Proceeds received during such Prepayment Period with respect to the Group II
Mortgage Loans, (iv) that portion of the Purchase Price, representing principal
of any repurchased Group II Mortgage Loan, deposited to the Collection Account
during such Prepayment Period, (v) the principal portion of any related
Substitution Adjustments deposited in the Collection Account during such
Prepayment Period with respect to the Group II Mortgage Loans, (vi) on the
Distribution Date on which the Trust Fund is to be terminated pursuant to
Section 10.01, that portion of the Termination Price, in respect of principal on
the Group II Mortgage Loans and (vii) on the Distribution Date immediately
following the end of the Funding

                                       20

<PAGE>

Period, any remaining amounts in the Group II Pre-Funding Account (exclusive of
investment income therein) after giving effect to any purchase of Subsequent
Group II Mortgage Loans.

                  "Group II Senior Principal Distribution Amount": An amount,
not less than zero, equal to the excess of (x) the Certificate Principal Balance
of the Group II Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) the product of (i) 65.00% and (ii) the aggregate Stated
Principal Balance of the Group II Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period) and (B) the positive difference, if any, of the aggregate Stated
Principal Balance of the Group II Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period) minus the Overcollateralization Floor.

                  "Highest Priority": As of any date of determination, the Class
of Mezzanine Certificates then outstanding with a Certificate Principal Balance
greater than zero, with the highest priority for payments pursuant to Section
4.01, in the following order: Class M-1, Class M-2, Class M-3, Class M-4, Class
M-5, Class M-6 and Class M-7 Certificates.

                  "Holder":  See "Certificateholder."

                  "Independent": When used with respect to any specified Person,
any such Person who (a) is in fact independent of the Depositor, the Master
Servicer and their respective Affiliates, (b) does not have any direct financial
interest in or any material indirect financial interest in the Depositor or the
Master Servicer or any Affiliate thereof, and (c) is not connected with the
Depositor or the Master Servicer or any Affiliate thereof as an officer,
employee, promoter, underwriter, trustee, partner, director or Person performing
similar functions; PROVIDED, HOWEVER, that a Person shall not fail to be
Independent of the Depositor or the Master Servicer or any Affiliate thereof
merely because such Person is the beneficial owner of 1% or less of any class of
securities issued by the Depositor or the Master Servicer or any Affiliate
thereof, as the case may be.

                  "Independent Contractor": Either (i) any Person (other than
the Master Servicer) that would be an "independent contractor" with respect to
any of the REMICs created hereunder within the meaning of Section 856(d)(3) of
the Code if such REMIC were a real estate investment trust (except that the
ownership tests set forth in that section shall be considered to be met by any
Person that owns, directly or indirectly, 35% or more of any Class of
Certificates), so long as each such REMIC does not receive or derive any income
from such Person and provided that the relationship between such Person and such
REMIC is at arm's length, all within the meaning of Treasury Regulation Section
1.856-4(b)(5), or (ii) any other Person (including the Master Servicer) if the
Trustee has received an Opinion of Counsel to the effect that the taking of any
action in respect of any REO Property by such Person, subject to any conditions
therein specified, that is otherwise herein contemplated to be taken by an
Independent Contractor will not cause such REO Property to cease to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code
(determined without regard to the exception applicable for purposes of Section
860D(a) of the Code),

                                       21

<PAGE>

or cause any income realized in respect of such REO Property to fail to qualify
as Rents from Real Property.

                  "Indenture": An indenture relating to the issuance of notes
secured by the Class C Certificates, the Class P Certificates and/or the Class R
Certificates (or any portion thereof) which may or may not be guaranteed by the
NIMS Insurer.

                  "Index": With respect to each Adjustable Rate Mortgage Loan
and with respect to each related Adjustment Date, the index as specified in the
related Mortgage Note.

                  "Initial Certificate Principal Balance": With respect to any
Regular Certificate, the amount designated "Initial Certificate Principal
Balance" on the face thereof.

                  "Initial Group I Mortgage Loan": Any of the Group I Mortgage
Loans included in the Trust Fund as of the Closing Date. The aggregate principal
balance of the Initial Group I Mortgage Loans as of the Cut-off Date is equal to
$490,030,148.25.

                  "Initial Group II Mortgage Loan": Any of the Group II Mortgage
Loans included in the Trust Fund as of the Closing Date. The aggregate principal
balance of the Initial Group II Mortgage Loans as of the Cut-off Date is equal
to $263,478,343.48.

                  "Initial Mortgage Loan": Any of the Initial Group I Mortgage
Loans or Initial Group II Mortgage Loans included in the Trust Fund as of the
Closing Date.

                  "Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a Mortgage Loan (including the PMI
Policy), to the extent such proceeds are received by the Master Servicer and are
not to be applied to the restoration of the related Mortgaged Property or
released to the Mortgagor in accordance with the procedures that the Master
Servicer would follow in servicing mortgage loans held for its own account,
subject to the terms and conditions of the related Mortgage Note and Mortgage.

                  "Interest Determination Date": With respect to the Class A
Certificates and the Mezzanine Certificates and each related Accrual Period, the
second LIBOR Business Day preceding the commencement of such Accrual Period.

                  "Late Collections": With respect to any Mortgage Loan, all
amounts received subsequent to the Determination Date immediately following any
related Due Period, whether as late payments of Monthly Payments or as Insurance
Proceeds, Liquidation Proceeds, Subsequent Recoveries or otherwise, which
represent late payments or collections of principal and/or interest due (without
regard to any acceleration of payments under the related Mortgage and Mortgage
Note) but delinquent on a contractual basis for such Due Period and not
previously recovered.

                  "LIBOR": With respect to each Accrual Period, the rate
determined by the Trustee on the related Interest Determination Date on the
basis of the London interbank offered rate for one- month United States dollar
deposits, as such rate appears on the Telerate Page 3750, as of 11:00 a.m.
(London time) on such Interest Determination Date. If such rate does not appear
on Telerate Page

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<PAGE>

3750, the rate for such Interest Determination Date will be determined on the
basis of the offered rates of the Reference Banks for one-month United States
dollar deposits, as of 11:00 a.m. (London time) on such Interest Determination
Date. The Trustee will request the principal London office of each of the
Reference Banks to provide a quotation of its rate. On such Interest
Determination Date, LIBOR for the related Accrual Period will be established by
the Trustee as follows:

                  (i) If on such Interest Determination Date two or more
         Reference Banks provide such offered quotations, LIBOR for the related
         Accrual Period shall be the arithmetic mean of such offered quotations
         (rounded upwards if necessary to the nearest whole multiple of 1/16 of
         1%); and

                  (ii) If on such Interest Determination Date fewer than two
         Reference Banks provide such offered quotations, LIBOR for the related
         Accrual Period shall be the higher of (i) LIBOR as determined on the
         previous Interest Determination Date and (ii) the Reserve Interest
         Rate.

                  "LIBOR Business Day": Any day on which banks in London,
England and The City of New York are open and conducting transactions in foreign
currency and exchange.

                  "Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Master Servicer has determined, in
accordance with the servicing procedures specified herein, as of the end of the
related Prepayment Period, that all Liquidation Proceeds which it expects to
recover with respect to the liquidation of the Mortgage Loan or disposition of
the related REO Property have been recovered.

                  "Liquidation Event": With respect to any Mortgage Loan, any of
the following events: (i) such Mortgage Loan is paid in full, (ii) a Final
Recovery Determination is made as to such Mortgage Loan or (iii) such Mortgage
Loan is removed from the Trust Fund by reason of its being purchased, sold or
replaced pursuant to or as contemplated by Section 2.03 or Section 10.01. With
respect to any REO Property, either of the following events: (i) a Final
Recovery Determination is made as to such REO Property or (ii) such REO Property
is removed from the Trust Fund by reason of its being sold or purchased pursuant
to Section 3.23 or Section 10.01.

                  "Liquidation Proceeds": The amount (other than amounts
received in respect of the rental of any REO Property prior to REO Disposition)
received by the Master Servicer in connection with (i) the taking of all or a
part of a Mortgaged Property by exercise of the power of eminent domain or
condemnation, (ii) the liquidation of a defaulted Mortgage Loan by means of a
trustee's sale, foreclosure sale or otherwise or (iii) the repurchase,
substitution or sale of a Mortgage Loan or an REO Property pursuant to or as
contemplated by Section 2.03, Section 3.23 or Section 10.01.

                  "Loan-to-Value Ratio": As of any date and as to any Mortgage
Loan, the fraction, expressed as a percentage, the numerator of which is the
Principal Balance of the Mortgage Loan (and, with respect to any second lien
Mortgage Loan, the Principal Balance of the related first lien Mortgage Loan
plus the Principal Balance of such second lien Mortgage Loan), and the
denominator of which is the Value of the related Mortgaged Property.

                                       23

<PAGE>

                  "Loan Group": Either Loan Group I or Loan Group II, as the
context requires.

                  "Loan Group I": The group of Mortgage Loans with principal
balances that conform to Fannie Mae and Freddie Mac guidelines identified in the
Mortgage Loan Schedule as having been assigned to Loan Group I.

                  "Loan Group II": The group of Mortgage Loans with principal
balances that may or may not conform to Fannie Mae and Freddie Mac guidelines
identified in the Mortgage Loan Schedule as having been assigned to Loan Group
II.

                  "Losses":  As defined in Section 9.03.

                  "Loss Mitigation Procedures": The policies and procedures set
forth in Exhibit G hereto relating to the realization on delinquent Mortgage
Loans.

                  "Lost Note Affidavit": With respect to any Mortgage Loan as to
which the original Mortgage Note has been permanently lost, misplaced or
destroyed and has not been replaced, an affidavit from the Originator certifying
that the original Mortgage Note has been lost, misplaced or destroyed (together
with a copy of the related Mortgage Note) and indemnifying the Trust against any
loss, cost or liability resulting from the failure to deliver the original
Mortgage Note in the form of Exhibit H hereto.

                  "Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting Rights.

                  "Marker Rate": With respect to the Class C Certificates and
any Distribution Date, a per annum rate equal to two (2) times the weighted
average of the Uncertificated REMIC 2 Pass- Through Rates for REMIC 2 Regular
Interest LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular Interest
LT2A2, REMIC 2 Regular Interest LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2
Regular Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2 Regular Interest
LT2M5, REMIC 2 Regular Interest LT2M6, REMIC 2 Regular Interest LT2M7 and REMIC
2 Regular Interest LT2ZZ, with the rates on such REMIC 2 Regular Interests
subject to a cap equal to lesser of (i) LIBOR plus the related Certificate
Margin and (ii) the related Net WAC Rate for the purpose of this calculation;
and with the rate on REMIC 2 Regular Interest LT2ZZ subject to a cap of zero for
the purpose of this calculation; provided, however, that for this purpose,
calculations of the Uncertificated REMIC 2 Pass-Through Rate and the related
caps with respect to REMIC 2 Regular Interest LT2A1A, REMIC 2 Regular Interest
LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2
Regular Interest LT2A4, REMIC 2 Regular Interest LT2M1, REMIC 2 Regular Interest
LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2
Regular Interest LT2M5, REMIC 2 Regular Interest LT2M6 and REMIC 2 Regular
Interest LT2M7 shall be multiplied by a fraction, the numerator of which is the
actual number of days in the Accrual Period and the denominator of which is 30.

                  "Master Servicer": Option One Mortgage Corporation, a
California corporation, or any successor servicer appointed as herein provided,
in its capacity as Master Servicer hereunder.

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<PAGE>

                  "Master Servicer Affiliate": A Person (i) controlling,
controlled by or under common control with the Master Servicer or which is 50%
or more owned by the Master Servicer and (ii) which is qualified to service
residential mortgage loans.

                  "Master Servicer Event of Termination": One or more of the
events described in Section 7.01.

                  "Master Servicer Optional Purchase Delinquency Trigger": A
Master Servicer Optional Purchase Delinquency Trigger has occurred with respect
to a Distribution Date if the Delinquency Percentage exceeds 35.00% of the
Credit Enhancement Percentage.

                  "Master Servicer Prepayment Charge Payment Amount": The
amounts payable by the Master Servicer in respect of any Prepayment Charges
pursuant to Section 2.05 or Section 3.01.

                  "Master Servicer Remittance Date": With respect to any
Distribution Date, the Business Day prior to such Distribution Date.

                  "Maximum Cap Rate": For any Distribution Date and (x) the
Group I Certificates, a per annum rate equal to the weighted average of the
Adjusted Net Maximum Mortgage Rates of the Group I Mortgage Loans multiplied by
a fraction, the numerator of which is 30 and the denominator of which is the
actual number of days elapsed in the related Accrual Period, (y) the Group II
Certificates, a per annum rate equal to the weighted average of the Adjusted Net
Maximum Mortgage Rates of the Group II Mortgage Loans multiplied by a fraction,
the numerator of which is 30 and the denominator of which is the actual number
of days elapsed in the related Accrual Period and (z) the Mezzanine
Certificates, a per annum rate equal to the weighted average (weighted in
proportion to the results of subtracting from the aggregate principal balance of
each loan group the aggregate Certificate Principal Balance of the related Class
A Certificates) of the weighted average Adjusted Net Maximum Mortgage Rates of
the Group I Mortgage Loans and the weighted average Adjusted Net Maximum
Mortgage Rates of the Group II Mortgage Loans, multiplied by a fraction, the
numerator of which is 30 and the denominator of which is the actual number of
days elapsed in the related Accrual Period.

                  "Maximum LT2ZZ Uncertificated Accrued Interest Deferral
Amount": With respect to any Distribution Date, the excess of (i) accrued
interest at the Uncertificated REMIC 2 Pass- Through Rate applicable to REMIC 2
Regular Interest LT2ZZ for such Distribution Date on a balance equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2ZZ minus the
REMIC 2 Overcollateralization Amount, in each case for such Distribution Date,
over (ii) Uncertificated Interest on REMIC 2 Regular Interest LT2A1A, REMIC 2
Regular Interest LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2 Regular
Interest LT2A3, REMIC 2 Regular Interest LT2A4, REMIC 2 Regular Interest LT2M1,
REMIC 2 Regular Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2 Regular
Interest LT2M4, REMIC 2 Regular Interest LT2M5, REMIC 2 Regular Interest LT2M6
and REMIC 2 Regular Interest LT2M7 for such Distribution Date, with the rate on
each such REMIC 2 Regular Interest subject to a cap equal to the lesser of (i)
LIBOR plus the related Certificate Margin and (ii) the related Net WAC Rate
provided, however, that solely for this purpose, calculations of the
Uncertificated REMIC 2 Pass-Through Rate and the related caps with respect to
REMIC 2 Regular Interest LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC

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<PAGE>

2 Regular Interest LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2 Regular
Interest LT2A4 REMIC 2 Regular Interest LT2M1, REMIC 2 Regular Interest LT2M2,
REMIC 2 Regular Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2 Regular
Interest LT2M5, REMIC 2 Regular Interest LT2M6 and REMIC 2 Regular Interest
LT2M7 shall be multiplied by a fraction, the numerator of which is the actual
number of days in the Interest Accrual Period and the denominator of which is
30.

                  "Maximum Mortgage Rate": With respect to each Adjustable Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
maximum Mortgage Rate thereunder.

                  "Mezzanine Certificate": Any Class M-1 Certificate, Class M-2
Certificate, Class M- 3 Certificate, Class M-4 Certificate, Class M-5
Certificates, Class M-6 Certificates or the Class M-7 Certificates.

                  "Minimum Mortgage Rate": With respect to each Adjustable Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Rate thereunder.

                  "Monthly Interest Distributable Amount": With respect to the
Class A Certificates, the Mezzanine Certificates, the Class C Certificates and
any Distribution Date the amount of interest accrued during the related Accrual
Period at the related Pass-Through Rate on the Certificate Principal Balance (or
Notional Amount in the case of the Class C Certificates) of such Class
immediately prior to such Distribution Date, reduced by any Net Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls as allocated to such
Certificate as provided in Section 1.03 and based on its respective entitlements
to interest irrespective of any Net Prepayment Interest Shortfalls and Relief
Act Interest Shortfalls for such Distribution Date).

                  "Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient Valuation and/or
Debt Service Reduction with respect to such Mortgage Loan and (ii) any reduction
in the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Master Servicer pursuant to Section 3.01; and (c) on the assumption that all
other amounts, if any, due under such Mortgage Loan are paid when due.

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

                  "Mortgage": The mortgage, deed of trust or other instrument
creating a first lien or second lien on, or first or second priority security
interest in, a Mortgaged Property securing a Mortgage Note.

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

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<PAGE>

                  "Mortgage Loan": Each mortgage loan transferred and assigned
to the Trustee pursuant to Section 2.01, Section 2.03(d) or Section 2.08 as from
time to time held as a part of the Trust Fund, the Mortgage Loans so held being
identified in the Mortgage Loan Schedule.

                  "Mortgage Loan Purchase Agreement": The agreements among the
Master Servicer, in its capacity as Originator, the Seller and the Depositor, as
applicable, regarding the transfer of the Mortgage Loans by the Seller to or at
the direction of the Depositor, substantially in the forms attached hereto as
Exhibit C.

                  "Mortgage Loan Schedule": As of any date, the list of Mortgage
Loans included in REMIC 1 on such date, separately identifying the Group I
Mortgage Loans and the Group II Mortgage Loans, attached hereto as Exhibit D, as
supplemented by each schedule of Subsequent Mortgage Loans attached to a
Subsequent Transfer Instrument. The Mortgage Loan Schedule shall be prepared by
the Originator and shall set forth the following information with respect to
each Mortgage Loan, as applicable:

                  (1) the Mortgage Loan identifying number;

                  (2) [reserved];

                  (3) the state and zip code of the Mortgaged Property;

                  (4) a code indicating whether the Mortgaged Property was
         represented by the borrower, at the time of origination, as being
         owner-occupied;

                  (5) the type of Residential Dwelling constituting the
         Mortgaged Property;

                  (6) the original months to maturity;

                  (7) the stated remaining months to maturity from the Cut-off
         Date (or Subsequent Cut-off Date, with respect to a Subsequent Mortgage
         Loan) based on the original amortization schedule;

                  (8) the Loan-to-Value Ratio at origination;

                  (9) the Mortgage Rate in effect immediately following the
         Cut-off Date (or Subsequent Cut-off Date, with respect to a Subsequent
         Mortgage Loan);

                  (10) the date on which the first Monthly Payment was due on
         the Mortgage Loan;

                  (11) the stated maturity date;

                  (12) the amount of the Monthly Payment at origination;

                  (13) the amount of the Monthly Payment due on the first Due
         Date after the Cut- off Date (or Subsequent Cut-off Date, with respect
         to a Subsequent Mortgage Loan);

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<PAGE>

                  (14) the last Due Date on which a Monthly Payment was actually
         applied to the unpaid Stated Principal Balance;

                  (15) the original principal amount of the Mortgage Loan;

                  (16) the Stated Principal Balance of the Mortgage Loan as of
         the Close of Business on the Cut-off Date (or Subsequent Cut-off Date,
         with respect to a Subsequent Mortgage Loan);

                  (17) a code indicating the purpose of the Mortgage Loan (I.E.,
         purchase financing, rate/term refinancing, cash-out refinancing);

                  (18) the Mortgage Rate at origination;

                  (19) a code indicating the documentation program (I.E., full
         documentation, limited documentation, stated income documentation);

                  (20) the risk grade;

                  (21) the Value of the Mortgaged Property;

                  (22) the sale price of the Mortgaged Property, if applicable;

                  (23) the actual unpaid principal balance of the Mortgage Loan
         as of the Cut-off Date (or Subsequent Cut-off Date, with respect to a
         Subsequent Mortgage Loan);

                  (24) the type and term of the related Prepayment Charge;

                  (25) the rounding code;

                  (26) the program code;

                  (27) a code indicating the lien priority for Mortgage Loans;

                  (28) with respect to each Adjustable Rate Mortgage Loan, the
         Minimum Mortgage Rate;

                  (29) with respect to each Adjustable Rate Mortgage Loan, the
         Maximum Mortgage Rate;

                  (30) with respect to each Adjustable Rate Mortgage Loan, the
         Gross Margin;

                  (31) with respect to each Adjustable Rate Mortgage Loan, the
         next Adjustment Date;

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<PAGE>

                  (32) with respect to each Adjustable Rate Mortgage Loan, the
         Periodic Rate Cap;

                  (33) a code indicating whether such Mortgage Loan is covered
         under the PMI Policy;

                  (34) the credit score ("FICO") of such Mortgage Loan; and

                  (35) the total amount of points and fees charged such Mortgage
         Loan.

                  The Mortgage Loan Schedule shall set forth the following
information, with respect to the Mortgage Loans in the aggregate and for each
Loan Group as of the Cut-off Date (or Subsequent Cut-off Date, with respect to a
Subsequent Mortgage Loan): (1) the number of Mortgage Loans (separately
identifying the number of Fixed-Rate Mortgage Loans and the number of
Adjustable-Rate Mortgage Loans); (2) the current Stated Principal Balance of the
Mortgage Loans; (3) the weighted average Mortgage Rate of the Mortgage Loans and
(4) the weighted average maturity of the Mortgage Loans. The Mortgage Loan
Schedule shall be amended from time to time by the Originator in accordance with
the provisions of this Agreement. With respect to any Qualified Substitute
Mortgage Loan, Cut-off Date shall refer to the related Cut-off Date for such
Mortgage Loan, determined in accordance with the definition of Cut-off Date
herein.

                  "Mortgage Note": The original executed note or other evidence
of indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage
Loan.

                  "Mortgage Pool": The pool of Mortgage Loans, identified on
Exhibit D from time to time, and any REO Properties acquired in respect thereof
and as supplemented by any Subsequent Mortgage Loans identified on each schedule
of Subsequent Mortgage Loans attached to a Subsequent Transfer Instrument.

                  "Mortgage Rate": With respect to each Fixed Rate Mortgage
Loan, the rate set forth in the related Mortgage Note. With respect to each
Adjustable Rate Mortgage Loan, the annual rate at which interest accrues on such
Mortgage Loan from time to time in accordance with the provisions of the related
Mortgage Note, which rate (A) as of any date of determination until the first
Adjustment Date following the Cut-off Date (or Subsequent Cut-off Date, with
respect to a Subsequent Mortgage Loan) shall be the rate set forth in the
Mortgage Loan Schedule as the Mortgage Rate in effect immediately following the
Cut-off Date (or Subsequent Cut-off Date, with respect to a Subsequent Mortgage
Loan) and (B) as of any date of determination thereafter shall be the rate as
adjusted on the most recent Adjustment Date, to equal the sum, rounded to the
next highest or nearest 0.125% (as provided in the Mortgage Note), of the Index,
determined as set forth in the related Mortgage Note, plus the related Gross
Margin subject to the limitations set forth in the related Mortgage Note. With
respect to each Mortgage Loan that becomes an REO Property, as of any date of
determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO Property.

                  "Mortgaged Property": The underlying property securing a
Mortgage Loan, including any REO Property, consisting of an Estate in Real
Property improved by a Residential Dwelling.

                                       29

<PAGE>

                  "Mortgagor":  The obligor on a Mortgage Note.

                  "Net Liquidation Proceeds": With respect to any Liquidated
Mortgage Loan or any other disposition of related Mortgaged Property (including
REO Property) the related Liquidation Proceeds and Insurance Proceeds net of
Advances, Servicing Advances, Servicing Fees and any other accrued and unpaid
servicing fees received and retained in connection with the liquidation of such
Mortgage Loan or Mortgaged Property.

                  "Net Monthly Excess Cashflow": With respect to each
Distribution Date, the sum of (a) any Overcollateralization Release Amount for
such Distribution Date and (b) the excess of (x) Available Funds for such
Distribution Date over (y) the sum for such Distribution Date of (A) the Monthly
Interest Distributable Amounts for the Offered Certificates, (B) the Unpaid
Interest Shortfall Amounts for the Class A Certificates and (C) the Principal
Remittance Amount.

                  "Net Mortgage Rate": With respect to any Mortgage Loan (or the
related REO Property), as of any date of determination, a per annum rate of
interest equal to the then applicable Mortgage Rate for such Mortgage Loan minus
the Servicing Fee Rate.

                  "Net Prepayment Interest Shortfall": With respect to any
Distribution Date, the excess, if any, of any Prepayment Interest Shortfalls for
such date over the related Compensating Interest.

                  "Net WAC Rate": With respect to each Distribution Date and the
Group I Certificates, a per annum rate equal to the weighted average of the
Adjusted Net Mortgage Rates of the Group I Mortgage Loans, multiplied by a
fraction, the numerator of which is 30 and the denominator of which is the
actual number of days elapsed in the related Accrual Period. For federal income
tax purposes, the economic equivalent of such rate shall be expressed as the
weighted average of the Uncertificated REMIC 2 Pass-Through Rate on REMIC 2
Regular Interest LT2GRP1, weighted on the basis of the Uncertificated Balance of
such REMIC 2 Regular Interest.

         With respect to each Distribution Date and the Group II Certificates, a
per annum rate equal to the weighted average of the Adjusted Net Mortgage Rates
of the Group II Mortgage Loans, multiplied by a fraction, the numerator of which
is 30 and the denominator of which is the actual number of days elapsed in the
related Accrual Period. For federal income tax purposes, the economic equivalent
of such rate shall be expressed as the weighted average of the Uncertificated
REMIC 2 Pass-Through Rate on REMIC 2 Regular Interest LT2GRP2, weighted on the
basis of the Uncertificated Balance of such REMIC 2 Regular Interest.

         With respect to each Distribution Date and the Mezzanine Certificates,
a per annum rate equal to the weighted average (weighted in proportion to the
results of subtracting from the aggregate principal balance of each Loan Group
the aggregate Certificate Principal Balance of the related Class A Certificates)
of the weighted average Adjusted Net Mortgage Rates of the Group I Mortgage
Loans and the weighted average Adjusted Net Mortgage Rates of the Group II
Mortgage Loans, multiplied by a fraction, the numerator of which is 30 and the
denominator of which is the actual number of days elapsed in the related Accrual
Period. For federal income tax purposes, the economic equivalent of such rate
shall be expressed as the weighted average of the Uncertificated REMIC 2

                                       30

<PAGE>

Pass-Through Rates on (a) REMIC 2 Regular Interest LT2SUB1, subject to a cap and
a floor equal to the Expense Adjusted Net Mortgage Rates of the Group I Mortgage
Loans and (b) REMIC 2 Regular Interest LT2SUB2, subject to a cap and floor equal
to the Expense Adjusted Net Mortgage Rates of the Group II Mortgage Loans,
weighted on the basis of the Uncertificated Balance of each such REMIC 2 Regular
Interest.

                  "Net WAC Rate Carryover Amount": With respect to any Class of
Class A Certificates and Mezzanine Certificates and any Distribution Date, the
sum of (A) the positive excess of (i) the amount of interest accrued on such
Class of Certificates for such Distribution Date calculated at the related
Formula Rate over (ii) the amount of interest accrued on such Class of
Certificates at the Net WAC Rate for such Distribution Date and (B) the related
Net WAC Rate Carryover Amount for the previous Distribution Date not previously
paid, together with interest thereon at a rate equal to the related Formula
Rate, in each case for such Distribution Date and for such related Accrual
Period.

                  "Net WAC Rate Carryover Reserve Account": The reserve account
established and maintained pursuant to Section 3.28.

                  "New Lease": Any lease of REO Property entered into on behalf
of the Trust, including any lease renewed or extended on behalf of the Trust if
the Trust has the right to renegotiate the terms of such lease.

                  "NIMS Insurer": Any insurer that is guaranteeing certain
payments under notes secured by collateral which includes all or a portion of
the Class C Certificates, the Class P Certificates and/or the Residual
Certificates.

                  "Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan or REO
Property that, in the good faith business judgment of the Master Servicer, will
not be ultimately recoverable from Late Collections, Insurance Proceeds,
Liquidation Proceeds or condemnation proceeds on such Mortgage Loan or REO
Property as provided herein.

                  "Notional Amount": Immediately prior to any Distribution Date,
with respect to the Class C Certificates, the aggregate of the Uncertificated
Principal Balances of the REMIC 2 Regular Interests (other than REMIC 2 Regular
Interest LT2P).

                  "Offered Certificates": The Class A Certificates, the Class
M-1 Certificates, the Class M-2 Certificates, the Class M-3 Certificates, the
Class M-4 Certificates, the Class M-5 Certificates, the Class M-6 Certificates
and the Class M-7 Certificates offered to the public pursuant to the Prospectus
Supplement.

                  "Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), and by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries or Servicing Officers of the
Master Servicer, the Originator or the Depositor, as applicable.

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<PAGE>

                  "Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be a salaried counsel for the Depositor or the Master
Servicer, acceptable to the Trustee, except that any opinion of counsel relating
to (a) the qualification of any REMIC as a REMIC or (b) compliance with the
REMIC Provisions must be an opinion of Independent counsel.

                  "Optional Termination Date": The first Distribution Date on
which the Master Servicer or the NIMS Insurer may opt to terminate the Trust
Fund pursuant to Section 10.01.

                  "Original Class Certificate Principal Balance": With respect
to the Class A Certificates, the Mezzanine Certificates, the Class C
Certificates and the Class P Certificates, the corresponding amounts set forth
opposite such Class above in the Preliminary Statement.

                  "Original Notional Amount": With respect to the Class C
Certificates, $1,000,000,000.26.

                  "Original Group I Pre-Funded Amount": The amount deposited by
the Depositor in the Group I Pre-Funding Account on the Closing Date, which
amount is $160,706,451.30.

                  "Original Group II Pre-Funded Amount": The amount deposited by
the Depositor in the Group II Pre-Funding Account on the Closing Date, which
amount is $85,785,057.22.

                  "Original Pre-Funded Amounts": The Original Group I Pre-Funded
Amount and the Original Group II Pre-Funded Amount.

                  "Originator": Option One Mortgage Corporation, a California
corporation, or its successor in interest, in its capacity as originator under
the Mortgage Loan Purchase Agreement.

                  "Overcollateralization Deficiency Amount": With respect to any
Distribution Date, the amount, if any, by which the Overcollateralization Target
Amount exceeds the Overcollateralized Amount on such Distribution Date (after
giving effect to distributions in respect of the Group I Basic Principal
Distribution Amount and the Group II Basic Principal Distribution Amount on such
Distribution Date).

                  "Overcollateralization Floor": With respect to (i) the Group I
Certificates, $3,253,683, (ii) the Group II Certificates, $1,746,317 and (iii)
the Mezzanine Certificates, $5,000,000.

                  "Overcollateralization Release Amount": With respect to any
Distribution Date, the lesser of (x) the Principal Remittance Amount for such
Distribution Date and (y) the Excess Overcollateralized Amount.

                  "Overcollateralization Target Amount": With respect to any
Distribution Date, prior to the Stepdown Date will be be 1.25% of the sum of (i)
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date and (ii) the amounts on deposit in the Pre-Funding Accounts on the Closing
Date. The Overcollateralization Target Amount on or after the Stepdown Date will
be the lesser of the amount set forth in the preceding sentence and 2.50% of the
aggregate Stated Principal Balance of the Mortgage Loans for the related
Distribution Date, subject to a floor

                                       32

<PAGE>

equal to 0.50% of the sum of (i) the aggregate Stated Principal Balance of the
Initial Mortgage Loans as of the Cut-off Date and (ii) the Original Pre-Funded
Amounts; provided however, if a Trigger Event is in effect on the related
Distribution Date, the Overcollateralization Target Amount will be equal to the
Overcollateralization Target Amount for the previous Distribution Date.

                  "Overcollateralized Amount": For any Distribution Date, is the
amount, equal to (i) the sum of the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and any funds on deposit in the
Pre-Funding Accounts on the related Determination Date minus (ii) the sum of the
aggregate Certificate Principal Balance of the Class A Certificates, the
Mezzanine Certificates and the Class P Certificates as of such Distribution Date
(after giving effect to distributions to be made on such Distribution Date).

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

                  "Pass-Through Rate":

                  With respect to the Class A Certificates and the Mezzanine
Certificates and any Distribution Date, the lesser of (x) the related Formula
Rate for such Distribution Date and (y) the Net WAC Rate for such Distribution
Date.

                  With respect to the Class C Certificates and any Distribution
Date, a per annum rate equal to the percentage equivalent of a fraction, the
numerator of which is the sum of the amounts calculated pursuant to clauses (A)
through (O) below, and the denominator of which is the aggregate of the
Uncertificated Principal Balances of REMIC 2 Regular Interest LT2AA, REMIC 2
Regular Interest LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular
Interest LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2 Regular Interest LT2A4,
REMIC 2 Regular Interest LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2 Regular
Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2 Regular Interest LT2M5,
REMIC 2 Regular Interest LT2M6, REMIC 2 Regular Interest LT2M7 and REMIC 2
Regular Interest LT2ZZ. For purposes of calculating the Pass- Through Rate for
the Class C Certificates, the numerator is equal to the sum of the following
components:

                  (A) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2AA minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2AA;

                  (B) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A1A minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2A1A;

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<PAGE>

                  (C) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A1B minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2A1B;

                  (D) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2A2;

                  (E) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2A3;

                  (F) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2A4;

                  (G) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M1;

                  (H) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M2;

                  (I) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M3;

                  (J) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M4;

                  (K) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M5;

                  (L) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M6 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M6;

                  (M) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2M7 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M7;

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<PAGE>

                  (N) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2ZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2ZZ;

                  (O) 100% of the interest distributable on REMIC 2 Regular
Interest LT2P.

                  "Paying Agent": Any paying agent appointed pursuant to Section
5.05.

                  "Percentage Interest": With respect to any Certificate (other
than a Class R Certificate), a fraction, expressed as a percentage, the
numerator of which is the Initial Certificate Principal Balance or Notional
Amount represented by such Certificate and the denominator of which is the
Original Class Certificate Principal Balance or initial Notional Amount of the
related Class. With respect to a Class R Certificate, the portion of the Class
evidenced thereby, expressed as a percentage, as stated on the face of such
Certificate; PROVIDED, HOWEVER, that the sum of all such percentages for each
such Class totals 100%.

                  "Periodic Rate Cap": With respect to each Adjustable Rate
Mortgage Loan and any Adjustment Date therefor, the fixed percentage set forth
in the related Mortgage Note, which is the maximum amount by which the Mortgage
Rate for such Mortgage Loan may increase or decrease (without regard to the
Maximum Mortgage Rate or the Minimum Mortgage Rate) on such Adjustment Date from
the Mortgage Rate in effect immediately prior to such Adjustment Date.

                  "Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued or managed by the Depositor, the Master Servicer,
the NIMS Insurer, the Trustee or any of their respective Affiliates or for which
an Affiliate of the NIMS Insurer or Trustee serves as an advisor:

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

                  (ii) (A) demand and time deposits in, certificates of deposit
         of, bankers' acceptances issued by or federal funds sold by any
         depository institution or trust company (including the Trustee or its
         agent acting in their respective commercial capacities) incorporated
         under the laws of the United States of America or any state thereof and
         subject to supervision and examination by federal and/or state
         authorities, so long as, at the time of such investment or contractual
         commitment providing for such investment, such depository institution
         or trust company (or, if the only Rating Agency is S&P, in the case of
         the principal depository institution in a depository institution
         holding company, debt obligations of the depository institution holding
         company) or its ultimate parent has a short-term uninsured debt rating
         in the highest available rating category of Moody's, Fitch and S&P and
         provided that each such investment has an original maturity of no more
         than 365 days; and provided further that, if the only Rating Agency is
         S&P and if the depository or trust company is a principal subsidiary of
         a bank holding company and the debt obligations of such subsidiary are
         not separately rated, the applicable rating shall be that of the bank
         holding company; and, provided further that, if the original maturity
         of such short-term obligations of a domestic

                                       35

<PAGE>

         branch of a foreign depository institution or trust company shall
         exceed 30 days, the short- term rating of such institution shall be
         A-1+ in the case of S&P if S&P is the Rating Agency; and (B) any other
         demand or time deposit or deposit which is fully insured by the FDIC;

                  (iii) repurchase obligations with a term not to exceed 30 days
         with respect to any security described in clause (i) above and entered
         into with a depository institution or trust company (acting as
         principal) rated A-1+ or higher by S&P, F-1+ or higher by Fitch and A2
         or higher by Moody's, provided, however, that collateral transferred
         pursuant to such repurchase obligation must be of the type described in
         clause (i) above and must (A) be valued daily at current market prices
         plus accrued interest, (B) pursuant to such valuation, be equal, at all
         times, to 105% of the cash transferred by the Trustee in exchange for
         such collateral and (C) be delivered to the Trustee or, if the Trustee
         is supplying the collateral, an agent for the Trustee, in such a manner
         as to accomplish perfection of a security interest in the collateral by
         possession of certificated securities;

                  (iv) securities bearing interest or sold at a discount that
         are issued by any corporation incorporated under the laws of the United
         States of America or any State thereof and that are rated by a Rating
         Agency in its highest long-term unsecured rating category at the time
         of such investment or contractual commitment providing for such
         investment;

                  (v) commercial paper (including both non-interest-bearing
         discount obligations and interest-bearing obligations payable on demand
         or on a specified date not more than 30 days after the date of
         acquisition thereof) that is rated by a Rating Agency in its highest
         short- term unsecured debt rating available at the time of such
         investment;

                  (vi) units of money market funds, including those managed or
         advised by the Trustee or its Affiliates, that have been rated "AAAm"
         by S&P, "AAA" by Fitch (if rated by Fitch) and "Aaa" by Moody's; and

                  (vii) if previously confirmed in writing to the Trustee, any
         other demand, money market or time deposit, or any other obligation,
         security or investment, as may be acceptable to the Rating Agencies in
         writing as a permitted investment of funds backing securities having
         ratings equivalent to its highest initial rating of the Class A
         Certificates;

provided, that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of the
yield to maturity at par of the underlying obligations.

                  "Permitted Transferee": Any transferee of a Residual
Certificate other than a Disqualified Organization or a non-U.S. Person.

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

                                       36

<PAGE>

                  "Plan": Any employee benefit plan or certain other retirement
plans and arrangements, including individual retirement accounts and annuities,
Keogh plans and bank collective investment funds and insurance company general
or separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.

                  "PMI Insurer": PMI Mortgage Insurance Co., an Arizona
corporation, or its successors in interest.

                  "PMI Premium": The amount payable to the PMI Insurer on each
Distribution Date, which amount shall be calculated as the product of (i) the
PMI Premium Rate, multiplied by (ii) the unpaid Principal Balance of each PMI
Mortgage Loan as of the first day of the related Due Period (after giving effect
to scheduled payments of principal due during the Due Period relating to the
previous Distribution Date, to the extent received or advanced), plus any
applicable premium taxes on PMI Mortgage Loans located in West Virginia and
Kentucky.

                  "PMI Premium Rate": An individual premium rate uniquely
assigned to each PMI Mortgage Loan for the term of the PMI Policy.

                  "PMI Mortgage Loans": The list of Mortgage Loans insured by
the PMI Insurer attached hereto on the Mortgage Loan Schedule

                  "PMI Policy": The Master Policy # 22092-0003-0, Bulk Primary
First Lien Master Policy UW 2510.00 (09/00) (#24-10) with respect to the PMI
Mortgage Loans, including all endorsements thereto dated the Closing Date and
any applicable Certificate Schedules, issued by the PMI Insurer and the Letter
Agreement, dated April 13, 2004, among the PMI Insurer, the Master Servicer and
the Trustee.

                  "Pool Balance": As of any date of determination, the aggregate
Stated Principal Balance of the Mortgage Loans in both Loan Groups as of such
date.

                  "Pre-Funding Accounts": The Group I Pre-Funding Account and
the Group II Pre- Funding Account.

                  "Prepayment Assumption": As defined in the Prospectus
Supplement.

                  "Prepayment Charge": With respect to any Mortgage Loan, the
charges, fees, penalties or premiums, if any, due in connection with a full or
partial prepayment of such Mortgage Loan in accordance with the terms thereof
(other than any Master Servicer Prepayment Charge Payment Amount).

                  "Prepayment Charge Schedule": As of any date, the list of
Prepayment Charges on the Mortgage Loans included in the Trust Fund on such
date, attached hereto as Schedule I (including the Prepayment Charge Summary
attached thereto). The Prepayment Charge Schedule shall be prepared by the
Master Servicer (in its capacity as Originator) and set forth the following
information with respect to each Prepayment Charge:

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<PAGE>

                  (i)      the Mortgage Loan identifying number;

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

                  (iii)    the state of origination of the related Mortgage
                           Loan;

                  (iv)     the date on which the first monthly payment was due
                           on the related Mortgage Loan;

                  (v)      the term of the related Prepayment Charge; and

                  (vi)     the principal balance of the related Mortgage Loan as
                           of the Cut-off Date (or Subsequent Cut-off Date, with
                           respect to a Subsequent Mortgage Loan).

                  The Prepayment Charge Schedule shall be amended from time to
time by the Master Servicer in accordance with the provisions of this Agreement
and a copy of such amended Prepayment Charge Schedule shall be furnished by the
Master Servicer to the NIMS Insurer.

                  "Prepayment Interest Excess": With respect to any Distribution
Date, for each Mortgage Loan that was the subject of a Principal Prepayment in
full during the portion of the related Prepayment Period occurring between the
first day and the Determination Date of the calendar month in which such
Distribution Date occurs, an amount equal to interest (to the extent received)
at the applicable Net Mortgage Rate on the amount of such Principal Prepayment
for the number of days commencing on the first day of the calendar month in
which such Distribution Date occurs and ending on the date on which such
prepayment is so applied.

                  "Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan that was the subject of a Principal
Prepayment in full during the portion of the related Prepayment Period occurring
between the first day of the related Prepayment Period and the last day of the
calendar month preceding the month in which such Distribution Date occurs, an
amount equal to one month's interest on the Mortgage Loan less any payments made
by the Mortgagor. The obligations of the Master Servicer in respect of any
Prepayment Interest Shortfall are set forth in Section 3.24.

                  "Prepayment Period": With respect to any Distribution Date,
the period commencing on the day after the Determination Date in the calendar
month preceding the calendar month in which such Distribution Date occurs (or,
in the case of the first Distribution Date, commencing on April 1, 2004) and
ending on the Determination Date of the calendar month in which such
Distribution Date occurs.

                  "Principal Balance": As to any Mortgage Loan other than a
Liquidated Mortgage Loan, and any day, the related Cut-off Date Principal
Balance, MINUS all collections credited against the Principal Balance of any
such Mortgage Loan. For purposes of this definition, a Liquidated Mortgage Loan
shall be deemed to have a Principal Balance equal to the Principal Balance of
the related Mortgage Loan as of the final recovery of related Liquidation
Proceeds and a Principal Balance of zero thereafter. As to any REO Property and
any day, the Principal Balance of the related

                                       38

<PAGE>

Mortgage Loan immediately prior to such Mortgage Loan becoming REO Property
minus any REO Principal Amortization received with respect thereto on or prior
to such day.

                  "Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.

                  "Principal Remittance Amount": With respect to any
Distribution Date, the sum of (i) the Group I Principal Remittance Amount and
(ii) the Group II Principal Remittance Amount.

                  "Prospectus Supplement": That certain Prospectus Supplement
dated April 8, 2004 relating to the public offering of the Offered Certificates.

                  "Purchase Price": With respect to any Mortgage Loan or REO
Property to be purchased pursuant to or as contemplated by Section 2.03, and as
confirmed by an Officers' Certificate from the Master Servicer to the Trustee,
an amount equal to the sum of (i) 100% of the Stated Principal Balance thereof
as of the date of purchase, (ii) in the case of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance at the applicable Mortgage Rate in
effect from time to time from the Due Date as to which interest was last covered
by a payment by the Mortgagor or an advance by the Master Servicer, which
payment or advance had as of the date of purchase been distributed pursuant to
Section 4.01, through the end of the calendar month in which the purchase is to
be effected, and (y) an REO Property, the sum of (1) accrued interest on such
Stated Principal Balance at the applicable Mortgage Rate in effect from time to
time from the Due Date as to which interest was last covered by a payment by the
Mortgagor or an advance by the Master Servicer through the end of the calendar
month immediately preceding the calendar month in which such REO Property was
acquired, plus (2) REO Imputed Interest for such REO Property for each calendar
month commencing with the calendar month in which such REO Property was acquired
and ending with the calendar month in which such purchase is to be effected, net
of the total of all net rental income, Insurance Proceeds, Liquidation Proceeds
and Advances that as of the date of purchase had been distributed as or to cover
REO Imputed Interest pursuant to Section 4.04, (iii) any unreimbursed Servicing
Advances and Advances and any unpaid Servicing Fees allocable to such Mortgage
Loan or REO Property, (iv) any amounts previously withdrawn from the Collection
Account in respect of such Mortgage Loan or REO Property pursuant to Section
3.23 and (v) in the case of a Mortgage Loan required to be purchased pursuant to
Section 2.03, expenses reasonably incurred or to be incurred by the Master
Servicer, the NIMS Insurer or the Trustee in respect of the breach or defect
giving rise to the purchase obligation including any costs and damages incurred
by the Trust in connection with any violation by such loan of any predatory or
abusive lending law.

                  "Qualified Insurer": Any insurance company acceptable to
Fannie Mae.

                  "Qualified Substitute Mortgage Loan": A mortgage loan
substituted for a Deleted Mortgage Loan pursuant to the terms of this Agreement
or the Mortgage Loan Purchase Agreement which must, on the date of such
substitution, (i) have an outstanding principal balance (or in the case of a
substitution of more than one mortgage loan for a Deleted Mortgage Loan, an
aggregate principal balance), after application of all scheduled payments of
principal and interest due during

                                       39

<PAGE>

or prior to the month of substitution, not in excess of, and not more than 5%
less than, the outstanding principal balance of the Deleted Mortgage Loan as of
the Due Date in the calendar month during which the substitution occurs, (ii)
have a Mortgage Rate not less than (and not more than one percentage point in
excess of) the Mortgage Rate of the Deleted Mortgage Loan, (iii) if the
Qualified Substitute Mortgage Loan is an Adjustable Rate Mortgage Loan, have a
Maximum Mortgage Rate not less than the Maximum Mortgage Rate on the Deleted
Mortgage Loan, (iv) if the Qualified Substitute Mortgage Loan is an Adjustable
Rate Mortgage Loan, have a Minimum Mortgage Rate not less than the Minimum
Mortgage Rate of the Deleted Mortgage Loan, (v) if the Qualified Substitute
Mortgage Loan is an Adjustable Rate Mortgage Loan, have a Gross Margin equal to
or greater than the Gross Margin of the Deleted Mortgage Loan, (vi) if the
Qualified Substitute Mortgage Loan is an Adjustable Rate Mortgage Loan, have a
next Adjustment Date not more than two months later than the next Adjustment
Date on the Deleted Mortgage Loan, (vii) have a remaining term to maturity not
greater than (and not more than one year less than) that of the Deleted Mortgage
Loan, (viii) be current as of the date of substitution, (ix) have a
Loan-to-Value Ratio as of the date of substitution equal to or lower than the
Loan-to-Value Ratio of the Deleted Mortgage Loan as of such date, (x) have a
risk grading determined by the Originator at least equal to the risk grading
assigned on the Deleted Mortgage Loan, (xi) have been underwritten or
reunderwritten by the Originator in accordance with the same underwriting
criteria and guidelines as the Deleted Mortgage Loan, (xii) be covered by the
PMI Policy if the Deleted Mortgage Loan was covered by the PMI Policy, (xiii)
have a Prepayment Charge provision at least equal to the Prepayment Charge
provision of the Deleted Mortgage Loan, (xiv) conform to each representation and
warranty set forth in Section 3.01 of the Mortgage Loan Purchase Agreement
applicable to the Deleted Mortgage Loan, (xv) have the same Due Date as the
Deleted Mortgage Loan and (xvi) not be a Convertible Mortgage Loan unless that
Deleted Mortgage Loan was a Convertible Mortgage Loan. In the event that one or
more mortgage loans are substituted for one or more Deleted Mortgage Loans, the
amounts described in clause (i) hereof shall be determined on the basis of
aggregate principal balances, the Mortgage Rates described in clauses (ii)
through (vi) hereof shall be satisfied for each such mortgage loan, the risk
gradings described in clause (x) hereof shall be satisfied as to each such
mortgage loan, the terms described in clause (vii) hereof shall be determined on
the basis of weighted average remaining term to maturity (provided that no such
mortgage loan may have a remaining term to maturity longer than the Deleted
Mortgage Loan), the Loan-to-Value Ratios described in clause (ix) hereof shall
be satisfied as to each such mortgage loan and, except to the extent otherwise
provided in this sentence, the representations and warranties described in
clause (xii) hereof must be satisfied as to each Qualified Substitute Mortgage
Loan or in the aggregate, as the case may be.

                  "Rating Agency or Rating Agencies": Moody's, Fitch and S&P or
their successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating agencies, or other comparable Persons, designated by the Depositor,
notice of which designation shall be given to the Trustee and Master Servicer.

                  "Realized Loss": With respect to any Liquidated Mortgage Loan,
the amount of loss realized equal to the portion of the Stated Principal Balance
remaining unpaid after application of all Net Liquidation Proceeds in respect of
such Mortgage Loan.

                                       40

<PAGE>

                  "Record Date": With respect to (i) the Class P Certificates,
the Class C Certificates and the Class R Certificates, the Close of Business on
the last Business Day of the calendar month preceding the month in which the
related Distribution Date occurs and (ii) with respect to the Class A
Certificates and the Mezzanine Certificates, the Close of Business on the
Business Day immediately preceding the related Distribution Date; PROVIDED,
HOWEVER, that following the date on which Definitive Certificates for a Class A
Certificate or a Mezzanine Certificate are available pursuant to Section 5.02,
the Record Date for such Certificates shall be the last Business Day of the
calendar month preceding the month in which the related Distribution Date
occurs.

                  "Reference Banks": Those banks (i) with an established place
of business in London, England, (ii) not controlling, under the control of or
under common control with the Depositor, the Originator or the Master Servicer
or any affiliate thereof and (iii) which have been designated as such by the
Depositor; PROVIDED, HOWEVER, that if fewer than two of such banks provide a
LIBOR rate, then any leading banks selected by the Depositor which are engaged
in transactions in United States dollar deposits in the international
Eurocurrency market.

                  "Regular Certificate": Any of the Class A Certificates,
Mezzanine Certificates, Class C Certificates or Class P Certificates.

                  "Relief Act":  The Servicemembers Civil Relief Act.

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

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

                  "REMIC 1": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to which a REMIC election is to be made consisting of: (i) such
Mortgage Loans as from time to time are subject to this Agreement, together with
the Mortgage Files relating thereto, and together with all collections thereon
and proceeds thereof, (ii) any REO Property, together with all collections
thereon and proceeds thereof, (iii) the Trustee's rights with respect to the
Mortgage Loans under all insurance policies, including the PMI Policy, required
to be maintained pursuant to this Agreement and any proceeds thereof, (iv) the
Depositor's rights under the Mortgage Loan Purchase Agreement (including any
security interest created thereby) and (v) the Collection Account, the
Distribution Account (subject to the last sentence of this definition) and any
REO Account and such assets that are deposited therein from time to time and any
investments thereof, together with any and all income, proceeds and payments
with respect thereto. Notwithstanding the foregoing, however, a REMIC election
will not be made with respect to the Pre-Funding Accounts, the Net WAC Rate
Carryover Reserve Account, the Master Servicer Prepayment Charge Payment Amounts
or the Cap Contracts.

                                       41

<PAGE>

                  "REMIC 1 Regular Interest LT1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1 shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1PF": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1PF
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT2": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT2 shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT2PF": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT2PF
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LTP": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LTP shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to any Prepayment Charges
collected by the Master Servicer and to a distribution of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.

                  "REMIC 1 Regular Interests": REMIC 1 Regular Interest LT1,
REMIC 1 Regular Interest LT1PF, REMIC 1 Regular Interest LT2, REMIC 1 Regular
Interest LT2PF and REMIC 1 Regular Interest LTP.

                  "REMIC 2": The segregated pool of assets consisting of all of
the REMIC 1 Regular Interests and conveyed in trust to the Trustee, for the
benefit of REMIC 3, as holder of the REMIC 2 Regular Interests, and the Class R
Certificateholders, in respect of the Class R-2 Interest, pursuant to Article II
hereunder, and all amounts deposited therein, with respect to which a separate
REMIC election is to be made.

                                       42

<PAGE>

                  "REMIC 2 Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50.00% of the sum
of the aggregate Stated Principal Balance of the Mortgage Loans and related REO
Properties then outstanding and the amount on deposit in the Pre-Funding
Accounts and (ii) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2AA minus the Marker Rate, divided by (b) 12.

                  "REMIC 2 Marker Allocation Percentage": 50% of any amount
payable from or loss attributable to the Mortgage Loans, which shall be
allocated to REMIC 2 Regular Interest LT2AA, REMIC 2 Regular Interest LT2A1A,
REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2 Regular
Interest LT2A3, REMIC 2 Regular Interest LT2A4, REMIC 2 Regular Interest LT2M1,
REMIC 2 Regular Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2 Regular
Interest LT2M4, REMIC 2 Regular Interest LT2M5, REMIC 2 Regular Interest LT2M6,
REMIC 2 Regular Interest LT2M7 and REMIC 2 Regular Interest LT2ZZ and REMIC 2
Regular Interest LT2P.

                  "REMIC 2 Overcollateralization Target Amount": 0.50% of the
Overcollateralization Target Amount.

                  "REMIC 2 Overcollateralized Amount": With respect to any date
of determination, (i) 0.50% of the aggregate Uncertificated Principal Balances
of the REMIC 2 Regular Interests minus (ii) the aggregate of the Uncertificated
Principal Balances of REMIC 2 Regular Interest LT2A1A, REMIC 2 Regular Interest
LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2
Regular Interest LT2A4, REMIC 2 Regular Interest LT2M1, REMIC 2 Regular Interest
LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2
Regular Interest LT2M5, REMIC 2 Regular Interest LT2M6, REMIC 2 Regular Interest
LT2M7 and REMIC 2 Regular Interest LT2P, in each case as of such date of
determination.

                  "REMIC 2 Principal Loss Allocation Amount": With respect to
any Distribution Date, an amount equal to (a) the product of (i) 50% of the sum
of the aggregate Stated Principal Balance of the Mortgage Loans and related REO
Properties then outstanding and the amount on deposit in the Pre-Funding
Accounts and (ii) 1 minus a fraction, the numerator of which is two times the
aggregate of the Uncertificated Principal Balances of REMIC 2 Regular Interest
LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2
Regular Interest LT2A3, REMIC 2 Regular Interest LT2A4, REMIC 2 Regular Interest
LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2
Regular Interest LT2M4, REMIC 2 Regular Interest LT2M5, REMIC 2 Regular Interest
LT2M6 and REMIC 2 Regular Interest LT2M7 and the denominator of which is the
aggregate of the Uncertificated Principal Balances of REMIC 2 Regular Interest
LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2
Regular Interest LT2A3, REMIC 2 Regular Interest LT2A4, REMIC 2 Regular Interest
LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2
Regular Interest LT2M4, REMIC 2 Regular Interest LT2M5, REMIC 2 Regular Interest
LT2M6, REMIC 2 Regular Interest LT2M7, and REMIC 2 Regular Interest LT2ZZ.

                  "REMIC 2 Regular Interests": Any of REMIC 2 Regular Interest
LT2AA, REMIC 2 Regular Interest LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2
Regular Interest LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2 Regular Interest
LT2A4, REMIC 2 Regular Interest

                                       43

<PAGE>

LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2
Regular Interest LT2M4, REMIC 2 Regular Interest LT2M5, REMIC 2 Regular Interest
LT2M6, REMIC 2 Regular Interest LT2M7, REMIC 2 Regular Interest LT2ZZ, REMIC 2
Regular Interest LT2P, REMIC 2 Regular Interest LT2SUB1, REMIC 2 Regular
Interest LT2GRP1, REMIC 2 Regular Interest LT2SUB2, REMIC 2 Regular Interest
LT2GRP2 and REMIC 2 Regular Interest LT2XX, each of which is a separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a Regular Interest in REMIC 2. Each REMIC 2 Regular Interest shall
accrue interest at the related Uncertificated REMIC 2 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 2 Sub WAC Allocation Percentage": 50% of any amount
payable from or loss attributable to the Mortgage Loans, which shall be
allocated to REMIC 2 Regular Interest LT2SUB1, REMIC II Regular Interest
LT2GRP1, REMIC 2 Regular Interest LT2SUB2, REMIC 2 Regular Interest LT2GRP2 and
REMIC 2 Regular Interest LT2XX.

                  "REMIC 2 Subordinated Balance Ratio": The ratio among the
Uncertificated Balances of each REMIC 2 Regular Interest ending with the
designation "SUB,", equal to the ratio among, with respect to each such REMIC 2
Regular Interest, the excess of (x) the aggregate Stated Principal Balance of
the Mortgage Loans in the related Loan Group over (y) the current Certificate
Principal Balance of Class A Certificates in the related Loan Group.

                  "REMIC 3": The segregated pool of assets consisting of all of
the REMIC 2 Regular Interests conveyed in trust to the Trustee, for the benefit
of the Holders of the Regular Certificates and the Class R Certificate (in
respect of the Class R-3 Interest), pursuant to Article II hereunder, and all
amounts deposited therein, with respect to which a separate REMIC election is to
be made.

                  "REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits which appear at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations and rulings promulgated thereunder, as the foregoing
may be in effect from time to time.

                  "REMIC Regular Interests": The REMIC 1 Regular Interests and
the REMIC 2 Regular Interests.

                  "Remittance Report": A report prepared by the Master Servicer
and delivered to the Trustee and the NIMS Insurer pursuant to Section 4.04.

                  "Rents from Real Property": With respect to any REO Property,
gross income of the character described in Section 856(d) of the Code.

                  "REO Account": The account or accounts maintained by the
Master Servicer in respect of an REO Property pursuant to Section 3.23.

                                       44

<PAGE>

                  "REO Disposition": The sale or other disposition of an REO
Property on behalf of the Trust Fund.

                  "REO Imputed Interest": As to any REO Property, for any
calendar month during which such REO Property was at any time part of the Trust
Fund, one month's interest at the applicable Net Mortgage Rate on the Stated
Principal Balance of such REO Property (or, in the case of the first such
calendar month, of the related Mortgage Loan if appropriate) as of the Close of
Business on the Distribution Date in such calendar month.

                  "REO Principal Amortization": With respect to any REO
Property, for any calendar month, the excess, if any, of (a) the aggregate of
all amounts received in respect of such REO Property during such calendar month,
whether in the form of rental income, sale proceeds (including, without
limitation, that portion of the Termination Price paid in connection with a
purchase of all of the Mortgage Loans and REO Properties pursuant to Section
10.01 that is allocable to such REO Property) or otherwise, net of any portion
of such amounts (i) payable pursuant to Section 3.23 in respect of the proper
operation, management and maintenance of such REO Property or (ii) payable or
reimbursable to the Master Servicer pursuant to Section 3.23 for unpaid
Servicing Fees in respect of the related Mortgage Loan and unreimbursed
Servicing Advances and Advances in respect of such REO Property or the related
Mortgage Loan, over (b) the REO Imputed Interest in respect of such REO Property
for such calendar month.

                  "REO Property": A Mortgaged Property acquired by the Master
Servicer on behalf of the Trust Fund through foreclosure or deed-in-lieu of
foreclosure, as described in Section 3.23.

                  "Request for Release": A release signed by a Servicing
Officer, in the form of Exhibit E attached hereto.

                  "Reserve Interest Rate": With respect to any Interest
Determination Date, the rate per annum that the Trustee determines to be either
(i) the arithmetic mean (rounded upwards if necessary to the nearest whole
multiple of 1/16 of 1%) of the one-month United States dollar lending rates
which banks in The City of New York selected by the Depositor are quoting on the
relevant Interest Determination Date to the principal London offices of leading
banks in the London interbank market or (ii) in the event that the Trustee can
determine no such arithmetic mean, in the case of any Interest Determination
Date after the initial Interest Determination Date, the lowest one-month United
States dollar lending rate which such New York banks selected by the Depositor
are quoting on such Interest Determination Date to leading European banks.

                  "Residential Dwelling": Any one of the following: (i) a
detached one-family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a one-family dwelling unit in a Fannie Mae eligible condominium project,
(iv) a manufactured home, or (v) a detached one-family dwelling in a planned
unit development, none of which is a co-operative or mobile home.

                  "Residual Certificate":  The Class R Certificates.

                  "Residual Interest": The sole class of "residual interests" in
a REMIC within the meaning of Section 860G(a)(2) of the Code.

                                       45

<PAGE>

                  "Responsible Officer": When used with respect to the Trustee,
the Chairman or Vice Chairman of the Board of Directors or Trustees, the
Chairman or Vice Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, any vice president, any assistant vice
president, the Secretary, any assistant secretary, the Treasurer, any assistant
treasurer, the Cashier, any assistant cashier, any trust officer or assistant
trust officer, the Controller and any assistant controller or any other officer
of the Trustee customarily performing functions similar to those performed by
any of the above designated officers and, with respect to a particular matter,
to whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.

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

                  "Seller": Any one or all of: (i) Option One Mortgage
Corporation, a California corporation or (ii) Option One Owner Trust 2001-1A,
Option One Owner Trust 2001-1B, Option One Owner Trust 2001-2, Option One Owner
Trust 2002-3, Option One Owner Trust 2003-4 and/or Option One Owner Trust
2003-5, each a Delaware statutory trust.

                  "Servicing Account": The account or accounts created and
maintained pursuant to Section 3.09.

                  "Servicing Advances": All customary, reasonable and necessary
"out of pocket" costs and expenses (including reasonable attorneys' fees and
expenses) incurred by the Master Servicer in the performance of its servicing
obligations, including, but not limited to, the cost of (i) the preservation,
restoration, inspection and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property and (iv) compliance with the
obligations under Sections 3.01, 3.09, 3.16, and 3.23.

                  "Servicing Fee": With respect to each Mortgage Loan and for
any calendar month, an amount equal to one month's interest (or in the event of
any payment of interest which accompanies a Principal Prepayment in full or in
part made by the Mortgagor during such calendar month, interest for the number
of days covered by such payment of interest) at the Servicing Fee Rate on the
same principal amount on which interest on such Mortgage Loan accrues for such
calendar month. A portion of such Servicing Fee may be retained by any
Sub-Servicer as its servicing compensation.

                  "Servicing Fee Rate": 0.30% per annum for the first 10 Due
Periods, 0.40% per annum for the 11th through 30th Due Periods and 0.65% per
annum for all Due Periods thereafter.

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

                  "Servicing Standard": Shall mean the standards set forth in
Section 3.01.

                                       46

<PAGE>

                  "Servicing Transfer Costs": Shall mean all reasonable costs
and expenses incurred by the Trustee in connection with the transfer of
servicing from a predecessor servicer, including, without limitation, any
reasonable costs or expenses associated with the complete transfer of all
servicing data and the completion, correction or manipulation of such servicing
data as may be required by the Trustee to correct any errors or insufficiencies
in the servicing data or otherwise to enable the Trustee to service the Mortgage
Loans properly and effectively.

                  "Startup Day": As defined in Section 9.01(b) hereof.

                  "Stated Principal Balance": With respect to any Mortgage Loan:
(a) as of any date of determination up to but not including the Distribution
Date on which the proceeds, if any, of a Liquidation Event with respect to such
Mortgage Loan would be distributed, the outstanding principal balance of such
Mortgage Loan as of the Cut-off Date (or Subsequent Cut-off Date, as
applicable), as shown in the Mortgage Loan Schedule, minus the sum of (i) the
principal portion of each Monthly Payment due on a Due Date subsequent to the
Cut-off Date (or Subsequent Cut-off Date, as applicable), to the extent received
from the Mortgagor or advanced by the Master Servicer and distributed pursuant
to Section 4.01 on or before such date of determination, (ii) all Principal
Prepayments received after the Cut-off Date (or Subsequent Cut-off Date, as
applicable), to the extent distributed pursuant to Section 4.01 on or before
such date of determination, (iii) all Liquidation Proceeds and Insurance
Proceeds to the extent distributed pursuant to Section 4.01 on or before such
date of determination, and (iv) any Realized Loss incurred with respect thereto
as a result of a Deficient Valuation made during or prior to the Due Period for
the most recent Distribution Date coinciding with or preceding such date of
determination; and (b) as of any date of determination coinciding with or
subsequent to the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such Mortgage Loan would be distributed, zero.
With respect to any REO Property: (a) as of any date of determination up to but
not including the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such REO Property would be distributed, an
amount (not less than zero) equal to the Stated Principal Balance of the related
Mortgage Loan as of the date on which such REO Property was acquired on behalf
of the Trust Fund, minus the aggregate amount of REO Principal Amortization in
respect of such REO Property for all previously ended calendar months, to the
extent distributed pursuant to Section 4.01 on or before such date of
determination; and (b) as of any date of determination coinciding with or
subsequent to the Distribution Date on which the proceeds, if any, of a
Liquidation Event with respect to such REO Property would be distributed, zero.

                  "Stepdown Date": The earlier to occur of (a) the Distribution
Date on which the aggregate Certificate Principal Balance of the Class A
Certificates has been reduced to zero and (b) the later to occur of (i) the
Distribution Date occurring in May 2007 and (ii) the first Distribution Date on
which the Credit Enhancement Percentage (calculated for this purpose only after
taking into account payments of principal on the Mortgage Loans and distribution
of the Group I Principal Distribution Amount and the Group II Principal
Distribution Amount to the Certificates then entitled to distributions of
principal on such Distribution Date) is equal to or greater than 35.00%.

                  "Subsequent Cut-off Date": With respect to those Subsequent
Mortgage Loans sold to the Trust Fund pursuant to a Subsequent Transfer
Instrument, the later of (i) first day of the month

                                       47

<PAGE>

in which the related Subsequent Transfer Date occurs or (ii) the date of
origination of such Mortgage Loan.

                  "Subsequent Group I Mortgage Loan": A Subsequent Mortgage Loan
to be included in Loan Group I.

                  "Subsequent Group II Mortgage Loan": A Subsequent Mortgage
Loan to be included in Loan Group II.

                  "Subsequent Mortgage Loan": A Mortgage Loan sold by the
Depositor to the Trust Fund pursuant to Section 2.08, such Mortgage Loan being
identified on the Mortgage Loan Schedule attached to a Subsequent Transfer
Instrument.

                  "Subsequent Mortgage Loan Purchase Agreements": The agreements
among the Depositor, the Originator and the Seller, regarding the transfer of
the Subsequent Mortgage Loans by the Seller to the Depositor.

                  "Subsequent Recoveries": As of any Distribution Date,
unexpected amounts received by the Master Servicer (net of any related expenses
permitted to be reimbursed pursuant to Section 3.10) specifically related to a
Mortgage Loan that was the subject of a liquidation or an REO Disposition prior
to the related Prepayment Period that resulted in a Realized Loss.

                  "Subsequent Transfer Date": With respect to each Subsequent
Transfer Instrument, the date on which the related Subsequent Mortgage Loans are
sold to the Trust Fund.

                  "Subsequent Transfer Instrument": Each Subsequent Transfer
Instrument, dated as of a Subsequent Transfer Date, executed by the Trustee and
the Depositor substantially in the form attached hereto as Exhibit O, by which
Subsequent Mortgage Loans are transferred to the Trust Fund.

                  "Sub-Servicer": Any Person with which either Master Servicer
has entered into a Sub- Servicing Agreement and which meets the qualifications
of a Sub-Servicer pursuant to Section 3.02.

                  "Sub-Servicing Account": An account established by a
Sub-Servicer which meets the requirements set forth in Section 3.08 and is
otherwise acceptable to the applicable Master Servicer.

                  "Sub-Servicing Agreement": The written contract between either
Master Servicer and a Sub-Servicer relating to servicing and administration of
certain Mortgage Loans as provided in Section 3.02.

                  "Substitution Adjustment": As defined in Section 2.03(d)
hereof.

                  "Tax Matters Person": The tax matters person appointed
pursuant to Section 9.01(e) hereof.

                                       48

<PAGE>

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

                  "Termination Price":  As defined in Section 10.01(a) hereof.

                  "Terminator": As defined in Section 10.01 hereof.

                  "Three Month Rolling Delinquency Percentage": With respect to
the Mortgage Loans and any Distribution Date, the average for the three most
recent calendar months of the fraction, expressed as a percentage, the numerator
of which is (x) the sum (without duplication) of the aggregate of the Stated
Principal Balances of all Mortgage Loans that are (i) 60 or more days
Delinquent, (ii) in bankruptcy and 60 or more days Delinquent, (iii) in
foreclosure and 60 or more days Delinquent or (iv) REO Properties, and the
denominator of which is (y) the sum of the Stated Principal Balances of the
Mortgage Loans, in the case of both (x) and (y), as of the Close of Business on
the last Business Day of each of the three most recent calendar months.

                  "Trigger Event": A Trigger Event is in effect with respect to
any Distribution Date on or after the Stepdown Date if:

                  (a) the percentage obtained by dividing (x) the principal
amount of Mortgage Loans Delinquent 60 days or more by (y) the aggregate
principal balance of the Mortgage Loans, in each case, as of the last day of the
previous calendar month, exceeds 45.00% of the Credit Enhancement Percentage or

                  (b) the aggregate amount of Realized Losses incurred since the
Cut-off Date through the last day of the related Prepayment Period (after
reduction for all Subsequent Recoveries received from the Cut-off Date through
the Prepayment Period) divided by the aggregate principal balance of the Initial
Mortgage Loans as of the Cut-off Date plus the Original Pre-Funded Amounts
exceeds the applicable percentages set forth below with respect to such
Distribution Date:

<TABLE>
<CAPTION>

           DISTRIBUTION DATE OCCURRING IN                                PERCENTAGE
           ------------------------------                                ----------
<S>                                                        <C>
May 2007 through April 2008                                2.75% for May 2007, plus an additional
                                                           1/12 of 1.25% for each month thereafter

May 2008 through April 2009                                4.00% for May 2008, plus an additional
                                                           1/12 of 0.25% for each month thereafter

May 2009 through April 2010                                4.25% for May 2009, plus an additional
                                                           1/12 of 0.25% for each month thereafter
</TABLE>

                                       49

<PAGE>

<TABLE>
<CAPTION>

<S>                                                        <C>
May 2010 through April 2011                                4.50% for May 2010, plus an additional
                                                           1/12 of 0.10% for each month thereafter

May 2011 and thereafter                                                     4.60%
</TABLE>

                  "Trust": Option One Mortgage Loan Trust 2004-2, the trust
created hereunder.

                  "Trust Fund": All of the assets of the Trust, which the trust
created hereunder consisting of REMIC 1, REMIC 2 and REMIC 3, the Pre-Funding
Accounts, the Net WAC Rate Carryover Reserve Account, the Master Servicer
Prepayment Charge Payment Amounts and payments in respect of the Cap Contracts.

                  "Trustee": Wells Fargo Bank, N.A., a national banking
association, or any successor trustee appointed as herein provided.

                  "Trustee Fee": The amount payable to the Trustee on each
Distribution Date pursuant to Section 8.05 as compensation for all services
rendered by it in the execution of the trust hereby created and in the exercise
and performance of any of the powers and duties of the Trustee hereunder, which
amount shall equal one twelfth of the product of (i) the Trustee Fee Rate,
multiplied by (ii) the aggregate Stated Principal Balance of the Mortgage Loans
and any REO Properties (after giving effect to scheduled payments of principal
due during the Due Period relating to the previous Distribution Date, to the
extent received or advanced) and any amount in the Pre- Funding Accounts as of
the first day of the calendar month prior to the month of such Distribution Date
(or, in the case of the initial Distribution Date, as of the Cut-off Date).

                  "Trustee Fee Rate":  0.003% per annum.

                  "Uncertificated Accrued Interest": With respect to each REMIC
Regular Interest on each Distribution Date, an amount equal to one month's
interest at the related Uncertificated Pass- Through Rate on the Uncertificated
Principal Balance of such REMIC Regular Interest. In each case, Uncertificated
Accrued Interest will be reduced by any Net Prepayment Interest Shortfalls and
Relief Act Interest Shortfalls (allocated to such REMIC Regular Interests based
on their respective entitlements to interest irrespective of any Net Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution
Date).

                  "Uncertificated Pass-Through Rate": The Uncertificated REMIC 1
Pass-Through Rate and Uncertificated REMIC 2 Pass-Through Rate.

                  "Uncertificated Principal Balance": With respect to each REMIC
Regular Interest, the amount of such REMIC Regular Interest outstanding as of
any date of determination. As of the Closing Date, the Uncertificated Principal
Balance of each REMIC Regular Interest shall equal the amount set forth in the
Preliminary Statement hereto as its initial Uncertificated Principal Balance. On
each Distribution Date, the Uncertificated Principal Balance of each REMIC
Regular Interest shall be reduced by all distributions of principal made on such
REMIC Regular Interest on such Distribution Date pursuant to Section 4.08 and,
if and to the extent necessary and appropriate, shall be further reduced on such
Distribution Date by Realized Losses as provided in Section 4.08, and

                                       50

<PAGE>

the Uncertificated Principal Balances of REMIC 2 Regular Interest LT2ZZ shall be
increased by interest deferrals as provided in Section 4.08.

                  "Uncertificated REMIC 1 Pass-Through Rate": With respect to
REMIC 1 Regular Interest LT1 and REMIC 1 Regular Interest LTP, and (i) for the
first Distribution Date, the weighted average of the Expense Adjusted Net
Mortgage Rates of the Initial Group I Mortgage Loans and (ii) thereafter, the
weighted average of the Expense Adjusted Net Mortgage Rates of the Group I
Mortgage Loans. With respect to REMIC 1 Regular Interest LT2, and (i) for the
first Distribution Date, the weighted average of the Expense Adjusted Net
Mortgage Rates of the Initial Group II Mortgage Loans and (ii) thereafter, the
weighted average of the Expense Adjusted Net Mortgage Rates of the Group II
Mortgage Loans. With respect to REMIC 1 Regular Interest LT1PF and (i) the first
Distribution Date, 0.00% and (ii) thereafter, the weighted average of the
Expense Adjusted Net Mortgage Rates of the Group I Mortgage Loans. With respect
to REMIC 1 Regular Interest LT2PF and (i) the first Distribution Date, 0.00% and
(ii) thereafter, the weighted average of the Expense Adjusted Net Mortgage Rates
of the Group II Mortgage Loans.

                  "Uncertificated REMIC 2 Pass-Through Rate": With respect to
REMIC 2 Regular Interest LTAA, REMIC 2 Regular Interest LT2A1A, REMIC 2 Regular
Interest LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2 Regular Interest LT2A3,
REMIC 2 Regular Interest LT2A4, REMIC 2 Regular Interest LT2M1, REMIC 2 Regular
Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2 Regular Interest LT2M4,
REMIC 2 Regular Interest LT2M5, REMIC 2 Regular Interest LT2M6, REMIC 2 Regular
Interest LT2M7, REMIC 2 Regular Interest LT2ZZ, REMIC 2 Regular Interest LT2P,
REMIC 2 Regular Interest LT2SUB1, REMIC 2 Regular Interest LT2SUB2 and REMIC 2
Regular Interest LT2XX, the weighted average of the Uncertificated REMIC 1 Pass-
Through Rates on the REMIC 1 Regular Interests, weighted on the basis of the
Uncertificated Principal Balance of each such REMIC 1 Regular Interest. With
respect to REMIC 2 Regular Interest LT2GRP1, the weighted average of the
Uncertificated REMIC 1 Pass-Through Rates on REMIC 1 Regular Interest LT1, REMIC
1 Regular Interest LT1PF and REMIC 1 Regular Interest LTP, weighted on the basis
of the Uncertificated Principal Balance of each such REMIC 1 Regular Interest
and with respect REMIC 2 Regular Interest LT2GRP2, the weighted average of the
REMIC 1 Remittance on REMIC 1 Regular Interest LT2 and REMIC 1 Regular Interest
LT2PF, weighted on the basis of the Uncertificated Principal Balance of each
such REMIC 1 Regular Interest.

                  "Underwriters": Each of Banc of America Securities LLC,
Greenwich Capital Markets, Inc., UBS Securities LLC, and H&R Block Financial
Advisors Inc.

                  "Uninsured Cause": Any cause of damage to a Mortgaged Property
such that the complete restoration of such property is not fully reimbursable by
the hazard insurance policies required to be maintained pursuant to Section
3.14.

                  "United States Person" or "U.S. Person": A citizen or resident
of the United States, a corporation, partnership (or other entity treated as a
corporation or partnership for United States federal income tax purposes)
created or organized in, or under the laws of, the United States, any state
thereof, or the District of Columbia (except in the case of a partnership, to
the extent provided in Treasury regulations) provided that, for purposes solely
of the restrictions on the transfer of Class R Certificates, no partnership or
other entity treated as a partnership for United States federal income

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tax purposes shall be treated as a United States Person unless all persons that
own an interest in such partnership either directly or through any entity that
is not a corporation for United States federal income tax purposes are required
by the applicable operative agreement to be United States Persons, or an estate
the income of which from sources without the United States is includible in
gross income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States, or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have authority to control all substantial decisions of the trust. The
term "United States" shall have the meaning set forth in Section 7701 of the
Code or successor provisions.

                  "Unpaid Interest Shortfall Amount": With respect to the Class
A Certificates and the Mezzanine Certificates and (i) the first Distribution
Date, zero, and (ii) any Distribution Date after the first Distribution Date,
the amount, if any, by which (a) the sum of (1) the Monthly Interest
Distributable Amount for such Class for the immediately preceding Distribution
Date and (2) the outstanding Unpaid Interest Shortfall Amount, if any, for such
Class for such preceding Distribution Date exceeds (b) the aggregate amount
distributed on such Class in respect of interest pursuant to clause (a) of this
definition on such preceding Distribution Date, plus interest on the amount of
interest due but not paid on the Certificates of such Class on such preceding
Distribution Date, to the extent permitted by law, at the Pass-Through Rate for
such Class for the related Accrual Period.

                  "Value": With respect to any Mortgage Loan, and the related
Mortgaged Property, the lesser of:

         (i)      the lesser of (a) the value thereof as determined by an
                  appraisal made for the originator of the Mortgage Loan at the
                  time of origination of the Mortgage Loan by an appraiser who
                  met the minimum requirements of Fannie Mae and Freddie Mac,
                  and (b) the value thereof as determined by a review appraisal
                  conducted by the Originator in the event any such review
                  appraisal determines an appraised value more than 10% lower
                  than the value thereof, in the case of a Mortgaged Loan with a
                  Loan- to-Value Ratio less than or equal to 80%, or more than
                  5% lower than the value thereof, in the case of a Mortgage
                  Loan with a Loan-to-Value Ratio greater than 80%, as
                  determined by the appraisal referred to in clause (i)(a)
                  above; and

         (ii)     the purchase price paid for the related Mortgaged Property by
                  the Mortgagor with the proceeds of the Mortgage Loan;
                  provided, however, that in the case of a refinanced Mortgage
                  Loan (which is a Mortgage Loan the proceeds of which were not
                  used to purchase the related Mortgaged Property) or a Mortgage
                  Loan originated in connection with a "lease option purchase"
                  if the "lease option purchase price" was set 12 months or more
                  prior to origination, such value of the Mortgaged Property is
                  based solely upon clause (i) above.

                  "Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. At all times the Class A
Certificates, the Mezzanine Certificates and the Class C Certificates shall have
98% of the Voting Rights (allocated among the Holders of the Class A
Certificates, the Mezzanine Certificates and the Class C Certificates in
proportion to the then outstanding Certificate Principal Balances of their
respective Certificates), the Class P Certificates

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<PAGE>

shall have 1% of the Voting Rights and the Class R Certificates shall have 1% of
the Voting Rights. The Voting Rights allocated to any Class of Certificates
(other than the Class P Certificates and the Class R Certificates) shall be
allocated among all Holders of each such Class in proportion to the outstanding
Certificate Principal Balance or Notional Amount of such Certificates and the
Voting Rights allocated to the Class P Certificates and the Class R Certificates
shall be allocated among all Holders of each such Class in proportion to such
Holders' respective Percentage Interest; PROVIDED, HOWEVER that when none of the
Regular Certificates are outstanding, 100% of the Voting Rights shall be
allocated among Holders of the Class R Certificates in accordance with such
Holders' respective Percentage Interests in the Certificates of such Class.

                  SECTION 1.02. Accounting.

                  Unless otherwise specified herein, for the purpose of any
definition or calculation, whenever amounts are required to be netted,
subtracted or added or any distributions are taken into account such definition
or calculation and any related definitions or calculations shall be determined
without duplication of such functions.

                  SECTION 1.03. Allocation of Certain Interest Shortfalls.

                  For purposes of calculating the amount of the Monthly Interest
Distributable Amount for each of the Class A Certificates, the Mezzanine
Certificates and the Class C Certificates for any Distribution Date, (1) the
aggregate amount of any Net Prepayment Interest Shortfalls and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, among the Class C Certificates on a
PRO RATA basis based on, and to the extent of, one month's interest at the then
applicable Pass-Through Rate on the Notional Amount of each such Certificate
and, thereafter, among the Class A Certificates and the Mezzanine Certificates,
on a PRO RATA basis based on, and to the extent of, one month's interest at the
then applicable respective Pass- Through Rate on the respective Certificate
Principal Balance of each such Certificate and (2) the aggregate amount of any
Realized Losses and Net WAC Rate Carryover Amounts incurred for any Distribution
Date shall be allocated among the Class C Certificates on a PRO RATA basis based
on, and to the extent of, one month's interest at the then applicable
Pass-Through Rate on the Notional Amount of each such Certificate after the
allocation thereto in clause (1).

                  For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC 1 Regular Interests for any Distribution Date,
the aggregate amount of any Net Prepayment Interest Shortfalls and Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, (i) with respect to the Group I
Mortgage Loans, to REMIC 1 Regular Interest LT1 and REMIC 1 Regular Interest
LT1PF, in each case to the extent of one month's interest at the then applicable
respective Uncertificated REMIC 1 Pass-Through Rate on the respective
Uncertificated Principal Balance of each such REMIC 1 Regular Interest;
provided, however, with respect to the first Distribution Date, such amounts
relating to the Initial Group I Mortgage Loans shall be allocated to REMIC 1
Regular Interest LT1 and such amounts relating to the Subsequent Group I
Mortgage Loans shall be allocated to REMIC Regular Interest LT1PF and (b) with
respect to the Group II Mortgage Loans, to REMIC 1 Regular Interest LT2 and
REMIC 1 Regular Interest LT2PF, in each case to the extent of one month's
interest at the then applicable respective Uncertificated REMIC 1 Pass-Through
Rate on the respective Uncertificated Principal

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<PAGE>

Balance of each such REMIC 1 Regular Interest; provided, however, with respect
to the first Distribution Date, such amounts relating to the Initial Group I
Mortgage Loans shall be allocated to REMIC 1 Regular Interest LT2 and such
amounts relating to the Subsequent Group II Mortgage Loans shall be allocated to
REMIC 1 Regular Interest LT2PF.

                  For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC 2 Regular Interests for any Distribution Date:

                  (A) The REMIC 2 Marker Allocation Percentage of the aggregate
         amount of any Prepayment Interest Shortfalls and the REMIC 2 Marker
         Allocation Percentage of any Relief Act Interest Shortfalls incurred in
         respect of the Mortgage Loans for any Distribution Date shall be
         allocated first, to Uncertificated Accrued Interest payable to REMIC 2
         Regular Interest LT2AA and REMIC 2 Regular Interest LT2ZZ up to an
         aggregate amount equal to the REMIC 2 Interest Loss Allocation Amount,
         98% and 2%, respectively, and thereafter among REMIC 2 Regular Interest
         LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular Interest
         LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2 Regular Interest LT2A4,
         REMIC 2 Regular Interest LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2
         Regular Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2 Regular
         Interest LT2M5, REMIC 2 Regular Interest LT2M6, REMIC 2 Regular
         Interest LT2M7 and REMIC 2 Regular Interest LT2ZZ, PRO RATA based on,
         and to the extent of, one month's interest at the then applicable
         respective Uncertificated REMIC 2 Pass-Through Rate on the respective
         Uncertificated Principal Balance of each such REMIC 2 Regular Interest;
         and

                  (B) The REMIC 2 Sub WAC Allocation Percentage of the aggregate
         amount of any Prepayment Interest Shortfalls and the REMIC 2 Sub WAC
         Allocation Percentage of any Relief Act Interest Shortfalls incurred in
         respect of the Mortgage Loans for any Distribution Date shall be
         allocated first, to Uncertificated Accrued Interest payable to REMIC 2
         Regular Interest LT2SUB1, REMIC 2 Regular Interest LT2GRP1, REMIC 2
         Regular Interest LT2SUB2, REMIC 2 Regular Interest LT2GRP2 and REMIC 2
         Regular Interest LT2XX, PRO RATA based on, and to the extent of, one
         month's interest at the then applicable respective Uncertificated REMIC
         2 Pass-Through Rate on the respective Uncertificated Principal Balance
         of each such REMIC 2 Regular Interest.

                  SECTION 1.04. Rights of the NIMS Insurer.

                  Each of the rights of the NIMS Insurer set forth in this
Agreement shall exist so long as (i) the NIMS Insurer has undertaken to
guarantee certain payments of notes issued pursuant to an Indenture and (ii) any
series of notes issued pursuant to one or more Indentures remain outstanding or
the NIMS Insurer is owed amounts in respect of its guarantee of payment on such
notes; provided, however, the NIMS Insurer shall not have any rights hereunder
(except pursuant to Section 11.01 in the case of clause (ii) below) so long as
(i) the NIMS Insurer has not undertaken to guarantee certain payments of notes
issued pursuant to the Indenture or (ii) any default has occurred and is
continuing under the insurance policy issued by the NIMS Insurer with respect to
such notes.

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<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

                  SECTION 2.01. Conveyance of Mortgage Loans.

                  The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey in trust to
the Trustee without recourse for the benefit of the Certificateholders all the
right, title and interest of the Depositor, including any security interest
therein for the benefit of the Depositor, in and to (i) each Mortgage Loan
identified on the Mortgage Loan Schedule, including the related Cut-off Date
Principal Balance, all interest accruing thereon on and after the Cut-off Date
and all collections in respect of interest and principal due after the Cut-off
Date; (ii) property which secured each such Mortgage Loan and which has been
acquired by foreclosure or deed in lieu of foreclosure; (iii) its interest in
any insurance policies (including the PMI Policy) in respect of the Mortgage
Loans; (iv) the rights of the Depositor under the Mortgage Loan Purchase
Agreement, (v) all other assets included or to be included in the Trust Fund,
(vi) [reserved] and (vii) all proceeds of any of the foregoing. Such assignment
includes all interest and principal due and collected by the Depositor or the
Master Servicer after the Cut-off Date with respect to the Mortgage Loans.

                  In connection with such transfer and assignment, the
Depositor, does hereby deliver to, and deposit with the Trustee, or its
designated agent (the "Custodian"), the following documents or instruments with
respect to each Initial Mortgage Loan so transferred and assigned and the
Originator, on behalf of the Depositor, shall, in accordance with Section 2.08,
deliver or caused to be delivered to the Trustee with respect to each Subsequent
Mortgage Loan, the following documents or instruments (with respect to each
Mortgage Loan, a "Mortgage File") :

                  (i) the original Mortgage Note, endorsed either (A) in blank,
         in which case the Trustee shall cause the endorsement to be completed
         or (B) in the following form: "Pay to the order of Wells Fargo Bank,
         N.A., as Trustee, without recourse", or with respect to any lost
         Mortgage Note, an original Lost Note Affidavit stating that the
         original mortgage note was lost, misplaced or destroyed, together with
         a copy of the related mortgage note; PROVIDED, HOWEVER, that such
         substitutions of Lost Note Affidavits for original Mortgage Notes may
         occur only with respect to Mortgage Loans, the aggregate Cut-off Date
         Principal Balance or Subsequent Cut-off Date Principal Balance, as
         applicable, of which is less than or equal to 1.00% of the Pool Balance
         as of the Cut-off Date or Subsequent Cut-off Date, as applicable;

                  (ii) the original Mortgage with evidence of recording thereon,
         and the original recorded power of attorney, if the Mortgage was
         executed pursuant to a power of attorney, with evidence of recording
         thereon;

                  (iii) an original Assignment. The Mortgage shall be assigned
         either (A) in blank or (B) to "Wells Fargo Bank, N.A., as Trustee,
         without recourse";

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<PAGE>

                  (iv) an original of any intervening assignment of Mortgage
         showing a complete chain of assignments;

                  (v) the original or a certified copy of lender's title
         insurance policy; and

                  (vi) the original or copies of each assumption, modification,
         written assurance or substitution agreement, if any.

                  The Trustee agrees to execute and deliver (or cause the
Custodian to execute and deliver) to the Depositor and the NIMS Insurer on or
prior to the Closing Date an acknowledgment of receipt of the original Mortgage
Note (with any exceptions noted), substantially in the form attached as Exhibit
F-3 hereto.

                  If any of the documents referred to in Section 2.01(ii), (iii)
or (iv) above has as of the Closing Date (or Subsequent Transfer Date, with
respect to Subsequent Mortgage Loans) been submitted for recording but either
(x) has not been returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original of such
document, the obligations of the Depositor to deliver such documents shall be
deemed to be satisfied upon (1) delivery to the Trustee or the Custodian no
later than the Closing Date (or Subsequent Closing Date, with respect to
Subsequent Mortgage Loans), of a copy of each such document certified by the
Master Servicer, in its capacity as Originator, in the case of (x) above or the
applicable public recording office in the case of (y) above to be a true and
complete copy of the original that was submitted for recording and (2) if such
copy is certified by the Master Servicer, in its capacity as Originator,
delivery to the Trustee or the Custodian, promptly upon receipt thereof of
either the original or a copy of such document certified by the applicable
public recording office to be a true and complete copy of the original. If the
original lender's title insurance policy, or a certified copy thereof, was not
delivered pursuant to Section 2.01(v) above, the Master Servicer, in its
capacity as Originator, shall deliver or cause to be delivered to the Trustee or
the Custodian, the original or a copy of a written commitment or interim binder
or preliminary report of title issued by the title insurance or escrow company
or an original attorney's opinion of title, with the original or a certified
copy thereof to be delivered to the Trustee or the Custodian, promptly upon
receipt thereof. The Master Servicer or the Depositor shall deliver or cause to
be delivered to the Trustee or the Custodian promptly upon receipt thereof any
other documents constituting a part of a Mortgage File received with respect to
any Mortgage Loan, including, but not limited to, any original documents
evidencing an assumption or modification of any Mortgage Loan.

                  Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File, the
Master Servicer, in its capacity as Originator, shall have 120 days to cure such
defect or deliver such missing document to the Trustee or the Custodian. If the
Originator does not cure such defect or deliver such missing document within
such time period, the Master Servicer, in its capacity as Originator, shall
either repurchase or substitute for such Mortgage Loan in accordance with
Section 2.03.

                  The Depositor (at the expense of the Master Servicer, in its
capacity as Originator) shall cause the Assignments which were delivered in
blank to be completed and shall cause all Assignments referred to in Section
2.01(iii) hereof and, to the extent necessary, in Section 2.01(iv)

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<PAGE>

hereof to be recorded. The Depositor shall be required to deliver such
Assignments for recording within 90 days of the Closing Date (or Subsequent
Transfer Date, with respect to a Subsequent Mortgage Loan). Notwithstanding the
foregoing, however, for administrative convenience and facilitation of servicing
and to reduce closing costs, the Assignments of Mortgage shall not be required
to be submitted for recording (except with respect to any Mortgage Loan located
in Maryland) unless the Trustee and the Depositor receives notice that such
failure to record would result in a withdrawal or a downgrading by any Rating
Agency of the rating on any Class of Certificates; PROVIDED, HOWEVER, each
Assignment shall be submitted for recording by the Depositor in the manner
described above, at no expense to the Trust Fund or Trustee, upon the earliest
to occur of: (i) reasonable direction by Holders of Certificates entitled to at
least 25% of the Voting Rights, (ii) the occurrence of a Master Servicer Event
of Termination, (iii) the occurrence of a bankruptcy, insolvency or foreclosure
relating to the Master Servicer, (iv) the occurrence of a servicing transfer as
described in Section 7.02 hereof, (v) if the Originator is not the Master
Servicer and with respect to any one Assignment the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Mortgagor under the related Mortgage,
(vi) any Mortgage Loan that is 90 days or more Delinquent and such recordation
would be necessary to facilitate conversion of the Mortgaged Property in
accordance with Section 3.16 and (vii) reasonable direction by the NIMS Insurer.
Upon (a) receipt of written notice from the Trustee that recording of the
Assignments is required pursuant to one or more of the conditions (excluding (v)
and (vi) above) set forth in the preceding sentence or (b) upon the occurrence
of condition (v) or (vi) in the preceding sentence, the Depositor shall be
required to deliver such Assignments for recording as provided above, promptly
and in any event within 30 days following receipt of such notice.
Notwithstanding the foregoing, if the Originator fails to pay the cost of
recording the Assignments, such expense will be paid by the Trustee and the
Trustee shall be reimbursed for such expenses by the Trust. To the extent not
previously delivered to the Trustee by the Depositor, the Depositor shall
furnish the Trustee, or its designated agent, with a copy of each Assignment
submitted for recording. In the event that any such Assignment is lost or
returned unrecorded because of a defect therein, the Depositor shall promptly
have a substitute Assignment prepared or have such defect cured, as the case may
be, and thereafter cause each such Assignment to be duly recorded.

                  The Depositor herewith delivers to the Trustee an executed
copy of the Mortgage Loan Purchase Agreement and the PMI Policy.

                  The Master Servicer shall forward to the Custodian original
documents evidencing an assumption, modification, consolidation or extension of
any Mortgage Loan entered into in accordance with this Agreement within two
weeks of their execution; provided, however, that the Master Servicer shall
provide the Custodian with a certified true copy of any such document submitted
for recordation within two weeks of its execution, and shall provide the
original of any document submitted for recordation or a copy of such document
certified by the appropriate public recording office to be a true and complete
copy of the original within 365 days of its submission for recordation. In the
event that the Master Servicer cannot provide a copy of such document certified
by the public recording office within such 365 day period, an Officers'
Certificate of the Master Servicer which shall (A) identify the recorded
document, (B) state that the recorded document has not been delivered to the
Custodian due solely to a delay caused by the public recording office, (C) state
the amount of time generally required by the applicable recording office to
record and return a document submitted for recordation, if known and (D) specify
the date the applicable recorded

                                       57

<PAGE>

document is expected to be delivered to the Custodian, and, upon receipt of a
copy of such document certified by the public recording office, the Master
Servicer shall immediately deliver such document to the Custodian. In the event
the appropriate public recording office will not certify as to the accuracy of
such document, the Master Servicer shall deliver a copy of such document
certified by an officer of the Master Servicer to be a true and complete copy of
the original to the Custodian.

                  The parties hereto understand and agree that it is not
intended that any mortgage loan be included in the Trust that is a "High-Cost
Home Loan" as defined by the HOEPA or any other applicable predatory or abusive
lending laws.

                  The Depositor hereby directs the Trustee to execute, deliver
and perform its obligations under the Cap Contracts on the Closing Date and
thereafter on behalf of the Holders of the Certificates. The Seller, the
Depositor, the Master Servicer and the Holders of the Certificates by their
acceptance of such Certificates acknowledge and agree that the Trustee shall
execute, deliver and perform its obligations under the Cap Contracts and shall
do so solely in its capacity as Trustee of the Trust Fund and not in its
individual capacity.

                  SECTION 2.02. Acceptance by Trustee.

                  Subject to the provisions of Section 2.01 and subject to the
review described below and any exceptions noted on the exception report
described in the next paragraph below, the Trustee acknowledges receipt of the
documents referred to in Section 2.01 above and all other assets included in the
definition of "Trust Fund" and declares that it holds and will hold such
documents and the other documents delivered to it constituting a Mortgage File,
and that it holds or will hold all such assets and such other assets included in
the definition of "Trust Fund" in trust for the exclusive use and benefit of all
present and future Certificateholders.

                  The Trustee agrees, for the benefit of the Certificateholders,
to review, or that it has reviewed pursuant to Section 2.01 (or to cause the
Custodian to review or that it has caused the Custodian to have reviewed) each
Mortgage File on or prior to the Closing Date, with respect to each Initial
Mortgage Loan or the Subsequent Transfer Date, with respect to each Subsequent
Mortgage Loan (or, with respect to any document delivered after the Startup Day,
within 45 days of receipt and with respect to any Qualified Substitute Mortgage,
within 45 days after the assignment thereof). The Trustee further agrees, for
the benefit of the Certificateholders, to certify to the Depositor, the Master
Servicer and the NIMS Insurer in substantially the form attached hereto as
Exhibit F-1, within 45 days after the Closing Date, with respect to each Initial
Mortgage Loan and the Subsequent Transfer Date, with respect to each Subsequent
Mortgage Loan (or, with respect to any document delivered after the Startup Day,
within 45 days of receipt and with respect to any Qualified Substitute Mortgage,
within 45 days after the assignment thereof) that, as to each Mortgage Loan
listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or any Mortgage Loan specifically identified in the exception report annexed
thereto as not being covered by such certification), (i) all documents required
to be delivered to it pursuant Section 2.01 of this Agreement are in its
possession, (ii) such documents have been reviewed by it and have not been
mutilated, damaged or torn and relate to such Mortgage Loan and (iii) based on
its examination and only as to the foregoing, the information set forth in the
Mortgage Loan Schedule that corresponds to items (1) and (2) of the Mortgage
Loan Schedule accurately reflects information set forth in the Mortgage File.

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<PAGE>

It is herein acknowledged that, in conducting such review, the Trustee (or the
Custodian, as applicable) is under no duty or obligation to inspect, review or
examine any such documents, instruments, certificates or other papers to
determine that they are genuine, enforceable, or appropriate for the represented
purpose or that they have actually been recorded or that they are other than
what they purport to be on their face.

                  Prior to the first anniversary date of this Agreement the
Trustee shall deliver (or cause the Custodian to deliver) to the Depositor, the
Master Servicer and the NIMS Insurer a final certification in the form annexed
hereto as Exhibit F-2 evidencing the completeness of the Mortgage Files, with
any applicable exceptions noted thereon.

                  If in the process of reviewing the Mortgage Files and making
or preparing, as the case may be, the certifications referred to above, the
Trustee (or the Custodian, as applicable) finds any document or documents
constituting a part of a Mortgage File to be missing or defective in any
material respect, at the conclusion of its review the Trustee shall so notify
the Originator the Depositor, the NIMS Insurer and the Master Servicer. In
addition, upon the discovery by the Originator, the Depositor, the NIMS Insurer
or the Master Servicer (or upon receipt by the Trustee of written notification
of such breach) of a breach of any of the representations and warranties made by
the Originator in the Mortgage Loan Purchase Agreement in respect of any
Mortgage Loan which materially adversely affects such Mortgage Loan or the
interests of the related Certificateholders in such Mortgage Loan, the party
discovering such breach shall give prompt written notice to the other parties to
this Agreement.

                  The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage Loans, the
related Mortgage Notes and the related documents, conveying good title thereto
free and clear of any liens and encumbrances, from the Depositor to the Trustee
in trust for the benefit of the Certificateholders and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee a first
priority perfected security interest in all of the Depositor's right, title and
interest in and to the Mortgage Loans, the related Mortgage Notes and the
related documents, and that this Agreement shall constitute a security agreement
under applicable law.

                  SECTION 2.03. Repurchase or Substitution of Mortgage Loans by
                                the Originator.

                  (a) Upon discovery or receipt of written notice of any
materially defective document in, or that a document is missing from, a Mortgage
File or of the breach by the Originator of any representation, warranty or
covenant under the Mortgage Loan Purchase Agreement in respect of any Mortgage
Loan which materially adversely affects the value of such Mortgage Loan or the
interest therein of the Certificateholders, the Trustee shall promptly notify
the Originator, the NIMS Insurer and the Master Servicer of such defect, missing
document or breach and request that the Originator deliver such missing document
or cure such defect or breach within 120 days from the date the Originator was
notified of such missing document, defect or breach, and if the Originator does
not deliver such missing document or cure such defect or breach in all material
respects during

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<PAGE>

such period, the Trustee shall enforce the Originator's obligation under the
Mortgage Loan Purchase Agreement and cause the Originator to repurchase such
Mortgage Loan from the Trust Fund at the Purchase Price on or prior to the
Determination Date following the expiration of such 120 day period (subject to
Section 2.03(e)). The Purchase Price for the repurchased Mortgage Loan shall be
deposited in the Collection Account, and the Trustee, upon receipt of written
certification from the Master Servicer of such deposit, shall release to the
Originator the related Mortgage File and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
Originator shall furnish to it and as shall be necessary to vest in the
Originator any Mortgage Loan released pursuant hereto and the Trustee shall have
no further responsibility with regard to such Mortgage File (it being understood
that the Trustee shall have no responsibility for determining the sufficiency of
such assignment for its intended purpose). In lieu of repurchasing any such
Mortgage Loan as provided above, the Originator may cause such Mortgage Loan to
be removed from the Trust Fund (in which case it shall become a Deleted Mortgage
Loan) and substitute one or more Qualified Substitute Mortgage Loans in the
manner and subject to the limitations set forth in Section 2.03(d). It is
understood and agreed that the obligation of the Originator to cure or to
repurchase (or to substitute for) any Mortgage Loan as to which a document is
missing, a material defect in a constituent document exists or as to which such
a breach has occurred and is continuing shall constitute the sole remedy against
the Originator respecting such omission, defect or breach available to the
Trustee on behalf of the Certificateholders.

                  (b) Within 90 days of the earlier of discovery by the
Depositor or receipt of notice by the Depositor of the breach of any
representation, warranty or covenant of the Depositor set forth in Section 2.06
which materially and adversely affects the interests of the Certificateholders
in any Mortgage Loan, the Depositor shall cure such breach in all material
respects.

                  (c) Within 90 days of the earlier of discovery by the Master
Servicer or receipt of notice by the Master Servicer of the breach of any
representation, warranty or covenant of the Master Servicer set forth in Section
2.05 which materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the Master Servicer shall cure such
breach in all material respects.

                  (d) Any substitution of Qualified Substitute Mortgage Loans
for Deleted Mortgage Loans made pursuant to Section 2.03(a) must be effected
prior to the last Business Day that is within two years after the Closing Date.
As to any Deleted Mortgage Loan for which the Originator substitutes a Qualified
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Originator delivering to the Trustee, for such Qualified Substitute Mortgage
Loan or Loans, the Mortgage Note, the Mortgage and the Assignment to the
Trustee, and such other documents and agreements, with all necessary
endorsements thereon, as are required by Section 2.01, together with an
Officers' Certificate providing that each such Qualified Substitute Mortgage
Loan satisfies the definition thereof and specifying the Substitution Adjustment
(as described below), if any, in connection with such substitution. The Trustee
shall acknowledge receipt for such Qualified Substitute Mortgage Loan or Loans
and, within ten Business Days thereafter, shall review such documents as
specified in Section 2.02 and deliver to the Master Servicer and the NIMS
Insurer, with respect to such Qualified Substitute Mortgage Loan or Loans, a
certification substantially in the form attached hereto as Exhibit F-1, with any
applicable exceptions noted thereon. Within one year of the date of
substitution, the Trustee shall deliver to the Master Servicer and the NIMS
Insurer a

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certification substantially in the form of Exhibit F-2 hereto with respect to
such Qualified Substitute Mortgage Loan or Loans, with any applicable exceptions
noted thereon. Monthly Payments due with respect to Qualified Substitute
Mortgage Loans in the month of substitution are not part of the Trust Fund and
will be retained by the Originator. For the month of substitution, distributions
to Certificateholders will reflect the collections and recoveries in respect of
such Deleted Mortgage Loan in the Due Period preceding the month of substitution
and the Originator shall thereafter be entitled to retain all amounts
subsequently received in respect of such Deleted Mortgage Loan. The Originator
shall give or cause to be given written notice to the Certificateholders and the
NIMS Insurer that such substitution has taken place, shall amend the Mortgage
Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the
terms of this Agreement and the substitution of the Qualified Substitute
Mortgage Loan or Loans and shall deliver a copy of such amended Mortgage Loan
Schedule to the NIMS Insurer and the Trustee. Upon such substitution by the
Originator, such Qualified Substitute Mortgage Loan or Loans shall constitute
part of the Mortgage Pool and shall be subject in all respects to the terms of
this Agreement and the Mortgage Loan Purchase Agreement, including all
applicable representations and warranties thereof included in the Mortgage Loan
Purchase Agreement as of the date of substitution.

                  For any month in which the Originator substitutes one or more
Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the
Master Servicer will determine the amount (the "Substitution Adjustment"), if
any, by which the aggregate Purchase Price of all such Deleted Mortgage Loans
exceeds the aggregate, as to each such Qualified Substitute Mortgage Loan, of
the principal balance thereof as of the date of substitution, together with one
month's interest on such principal balance at the applicable Net Mortgage Rate.
On the date of such substitution, the Originator will deliver or cause to be
delivered to the Master Servicer for deposit in the Collection Account an amount
equal to the Substitution Adjustment, if any, and the Trustee, upon receipt of
the related Qualified Substitute Mortgage Loan or Loans and certification by the
Master Servicer of such deposit, shall release to the Originator the related
Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as the Originator shall
deliver to it and as shall be necessary to vest therein any Deleted Mortgage
Loan released pursuant hereto.

                  In addition, the Originator shall obtain at its own expense
and deliver to the Trustee and the NIMS Insurer an Opinion of Counsel to the
effect that such substitution will not cause (a) any federal tax to be imposed
on the Trust Fund, including without limitation, any federal tax imposed on
"prohibited transactions" under Section 860F(a)(l) of the Code or on
"contributions after the startup date" under Section 860G(d)(l) of the Code or
(b) any REMIC to fail to qualify as a REMIC at any time that any Certificate is
outstanding. If such Opinion of Counsel can not be delivered, then such
substitution may only be effected at such time as the required Opinion of
Counsel can be given.

                  (e) Upon discovery by the Originator, the Master Servicer, the
NIMS Insurer or the Trustee that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
party discovering such fact shall within two Business Days give written notice
thereof to the other parties. In connection therewith, the Originator or the
Depositor, as the case may be, shall repurchase or, subject to the limitations
set forth in Section 2.03(d), substitute one or more Qualified Substitute
Mortgage Loans for the affected Mortgage Loan

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within 90 days of the earlier of discovery or receipt of such notice with
respect to such affected Mortgage Loan. Such repurchase or substitution shall be
made (i) by the Originator if the affected Mortgage Loan's status as a
non-qualified mortgage is or results from a breach of any representation,
warranty or covenant made by the Originator under the Mortgage Loan Purchase
Agreement or (ii) the Depositor, if the affected Mortgage Loan's status as a
non-qualified mortgage is a breach of any representation or warranty of the
Depositor set forth in Section 2.06, or if its status as a non-qualified
mortgage is a breach of no representation or warranty. Any such repurchase or
substitution shall be made in the same manner as set forth in Section 2.03(a),
if made by the Originator, or Section 2.03(b), if made by the Depositor. The
Trustee shall reconvey to the Depositor or the Originator, as the case may be,
the Mortgage Loan to be released pursuant hereto in the same manner, and on the
same terms and conditions, as it would a Mortgage Loan repurchased for breach of
a representation or warranty.

                      SECTION 2.04. Intentionally Omitted.

                  SECTION 2.05. Representations, Warranties and Covenants of the
                                Master Servicer.

                  The Master Servicer hereby represents, warrants and covenants
to the Trustee, for the benefit of each of the Trustee and the
Certificateholders and to the Depositor that as of the Closing Date or as of
such date specifically provided herein:

                  (i) The Master Servicer is duly organized, validly existing,
         and in good standing under the laws of the jurisdiction of its
         formation and has all licenses necessary to carry on its business as
         now being conducted and is licensed, qualified and in good standing in
         the states where the Mortgaged Property is located if the laws of such
         state require licensing or qualification in order to conduct business
         of the type conducted by the Master Servicer or to ensure the
         enforceability or validity of each Mortgage Loan; the Master Servicer
         has the power and authority to execute and deliver this Agreement and
         to perform in accordance herewith; the execution, delivery and
         performance of this Agreement (including all instruments of transfer to
         be delivered pursuant to this Agreement) by the Master Servicer and the
         consummation of the transactions contemplated hereby have been duly and
         validly authorized; this Agreement evidences the valid, binding and
         enforceable obligation of the Master Servicer, subject to applicable
         bankruptcy, insolvency, reorganization, moratorium or other similar
         laws affecting the enforcement of creditors' rights generally; and all
         requisite corporate action has been taken by the Master Servicer to
         make this Agreement valid and binding upon the Master Servicer in
         accordance with its terms;

                  (ii) The consummation of the transactions contemplated by this
         Agreement are in the ordinary course of business of the Master Servicer
         and will not result in the breach of any term or provision of the
         charter or by-laws of the Master Servicer or result in the breach of
         any term or provision of, or conflict with or constitute a default
         under or result in the acceleration of any obligation under, any
         agreement, indenture or loan or credit agreement or other instrument to
         which the Master Servicer or its property is subject, or result in the
         violation of any law, rule, regulation, order, judgment or decree to
         which the Master Servicer or its property is subject;

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                  (iii) The execution and delivery of this Agreement by the
         Master Servicer and the performance and compliance with its obligations
         and covenants hereunder do not require the consent or approval of any
         governmental authority or, if such consent or approval is required, it
         has been obtained;

                  (iv) This Agreement, and all documents and instruments
         contemplated hereby which are executed and delivered by the Master
         Servicer, constitute and will constitute valid, legal and binding
         obligations of the Master Servicer, enforceable in accordance with
         their respective terms, except as the enforcement thereof may be
         limited by applicable bankruptcy laws and general principles of equity;

                  (v) [Reserved];

                  (vi) The Master Servicer does not believe, nor does it have
         any reason or cause to believe, that it cannot perform each and every
         covenant contained in this Agreement;

                  (vii) There is no action, suit, proceeding or investigation
         pending or, to its knowledge, threatened against the Master Servicer
         that, either individually or in the aggregate, (A) may result in any
         change in the business, operations, financial condition, properties or
         assets of the Master Servicer that might prohibit or materially and
         adversely affect the performance by such Master Servicer of its
         obligations under, or validity or enforceability of, this Agreement, or
         (B) may result in any material impairment of the right or ability of
         the Master Servicer to carry on its business substantially as now
         conducted, or (C) may result in any material liability on the part of
         the Master Servicer, or (D) would draw into question the validity or
         enforceability of this Agreement or of any action taken or to be taken
         in connection with the obligations of the Master Servicer contemplated
         herein, or (E) would otherwise be likely to impair materially the
         ability of the Master Servicer to perform under the terms of this
         Agreement;

                  (viii) Neither this Agreement nor any information, certificate
         of an officer, statement furnished in writing or report delivered to
         the Trustee by the Master Servicer in connection with the transactions
         contemplated hereby contains any untrue statement of a material fact;

                  (ix) The Master Servicer covenants that its computer and other
         systems used in servicing the Mortgage Loans operate in a manner such
         that the Master Servicer can service the Mortgage Loans in accordance
         with the terms of this Agreement;

                  (x) The information set forth in the Prepayment Charge
         Schedule (including the Prepayment Charge Summary attached thereto) is
         complete, true and correct in all material respects on the date or
         dates when such information is furnished and each Prepayment Charge is
         permissible and enforceable in accordance with its terms (except to the
         extent that the enforceability thereof may be limited by bankruptcy,
         insolvency, moratorium, receivership and other similar laws affecting
         creditor's rights generally or the collectibility thereof may be
         limited due to acceleration in connection with a foreclosure) under
         applicable federal, state and local law;

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                  (xi) The Master Servicer will not waive any Prepayment Charge
         unless it is waived in accordance with the standard set forth in
         Section 3.01; and

                  (xii) The Master Servicer has accurately and fully reported,
         and will continue to accurately and fully report, its borrower credit
         files to each of the credit repositories in a timely manner.

                  It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.05 shall survive delivery
of the Mortgage Files to the Trustee and shall inure to the benefit of the
Trustee, the Depositor and the Certificateholders. Upon discovery by any of the
Depositor, the NIMS Insurer, the Master Servicer, the Originator or the Trustee
of a breach of any of the foregoing representations, warranties and covenants
which materially and adversely affects the value of any Mortgage Loan,
Prepayment Charge or the interests therein of the Certificateholders, the party
discovering such breach shall give prompt written notice (but in no event later
than two Business Days following such discovery) to the Master Servicer, the
Originator, the NIMS Insurer and the Trustee. Notwithstanding the foregoing,
within 90 days of the earlier of discovery by the Master Servicer or receipt of
notice by the Master Servicer of the breach of the representation or covenant of
the Master Servicer (in its capacity as Originator) set forth in Sections
2.05(x) or 2.05(xi) above which materially and adversely affects the interests
of the Holders of the Class P Certificates in any Prepayment Charge, the Master
Servicer shall remedy such breach as follows: (a) if the representation made by
the Master Servicer (in its capacity as Originator) in Section 2.05(x) above is
breached and a Principal Prepayment has occurred in the applicable Prepayment
Period or if a change of law subsequent to the Closing Date limits the
enforceability of a Prepayment Charge (other than in the circumstances provided
in Section 2.05(x) above), the Master Servicer (in its capacity as Originator)
must pay the amount of the scheduled Prepayment Charge, for the benefit of the
Holders of the Class P Certificates, by depositing such amount into the
Collection Account, net of any amount previously collected by the Master
Servicer and paid by the Master Servicer, for the benefit of the Holders of the
Class P Certificates, in respect of such Prepayment Charge; and (b) if any of
the covenants made by the Master Servicer in Section 2.05(xi) above is breached,
the Master Servicer must pay the amount of such waived Prepayment Charge, for
the benefit of the Holders of the Class P Certificates, by depositing such
amount into the Collection Account. The foregoing shall not, however, limit any
remedies available to the Certificateholders, the Depositor or the Trustee on
behalf of the Certificateholders, pursuant to the Mortgage Loan Purchase
Agreement signed by the Master Servicer in its capacity as Originator,
respecting a breach of the representations, warranties and covenants of the
Master Servicer in its capacity as Originator contained in the Mortgage Loan
Purchase Agreement.

                  SECTION 2.06. Representations and Warranties of the Depositor.

                  The Depositor represents and warrants to the Trust and the
Trustee on behalf of the Certificateholders as follows:

                  (i) This Agreement constitutes a legal, valid and binding
         obligation of the Depositor, enforceable against the Depositor in
         accordance with its terms, except as enforceability may be limited by
         applicable bankruptcy, insolvency, reorganization, moratorium or other
         similar laws now or hereafter in effect affecting the enforcement of

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         creditors' rights in general and except as such enforceability may be
         limited by general principles of equity (whether considered in a
         proceeding at law or in equity);

                  (ii) Immediately prior to the sale and assignment by the
         Depositor to the Trustee on behalf of the Trust of each Mortgage Loan,
         the Depositor had good and marketable title to each Mortgage Loan
         (insofar as such title was conveyed to it by the Seller) subject to no
         prior lien, claim, participation interest, mortgage, security interest,
         pledge, charge or other encumbrance or other interest of any nature;

                  (iii) As of the Closing Date, the Depositor has transferred
         all right, title and interest in the Mortgage Loans to the Trustee on
         behalf of the Trust;

                  (iv) The Depositor has not transferred the Mortgage Loans to
         the Trustee on behalf of the Trust with any intent to hinder, delay or
         defraud any of its creditors;

                  (v) The Depositor has been duly incorporated and is validly
         existing as a corporation in good standing under the laws of Delaware,
         with full corporate power and authority to own its assets and conduct
         its business as presently being conducted;

                  (vi) The Depositor is not in violation of its articles of
         incorporation or by-laws or in default in the performance or observance
         of any material obligation, agreement, covenant or condition contained
         in any contract, indenture, mortgage, loan agreement, note, lease or
         other instrument to which the Depositor is a party or by which it or
         its properties may be bound, which default might result in any material
         adverse changes in the financial condition, earnings, affairs or
         business of the Depositor or which might materially and adversely
         affect the properties or assets, taken as a whole, of the Depositor;

                  (vii) The execution, delivery and performance of this
         Agreement by the Depositor, and the consummation of the transactions
         contemplated thereby, do not and will not result in a material breach
         or violation of any of the terms or provisions of, or, to the knowledge
         of the Depositor, constitute a default under, any indenture, mortgage,
         deed of trust, loan agreement or other agreement or instrument to which
         the Depositor is a party or by which the Depositor is bound or to which
         any of the property or assets of the Depositor is subject, nor will
         such actions result in any violation of the provisions of the articles
         of incorporation or by-laws of the Depositor or, to the best of the
         Depositor's knowledge without independent investigation, any statute or
         any order, rule or regulation of any court or governmental agency or
         body having jurisdiction over the Depositor or any of its properties or
         assets (except for such conflicts, breaches, violations and defaults as
         would not have a material adverse effect on the ability of the
         Depositor to perform its obligations under this Agreement);

                  (viii) To the best of the Depositor's knowledge without any
         independent investigation, no consent, approval, authorization, order,
         registration or qualification of or with any court or governmental
         agency or body of the United States or any other jurisdiction is
         required for the issuance of the Certificates, or the consummation by
         the Depositor of the other transactions contemplated by this Agreement,
         except such consents, approvals, authorizations, registrations or
         qualifications as (a) may be required under State securities

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<PAGE>

         or Blue Sky laws, (b) have been previously obtained or (c) the failure
         of which to obtain would not have a material adverse effect on the
         performance by the Depositor of its obligations under, or the validity
         or enforceability of, this Agreement; and

                  (ix) There are no actions, proceedings or investigations
         pending before or, to the Depositor's knowledge, threatened by any
         court, administrative agency or other tribunal to which the Depositor
         is a party or of which any of its properties is the subject: (a) which
         if determined adversely to the Depositor would have a material adverse
         effect on the business, results of operations or financial condition of
         the Depositor; (b) asserting the invalidity of this Agreement or the
         Certificates; (c) seeking to prevent the issuance of the Certificates
         or the consummation by the Depositor of any of the transactions
         contemplated by this Agreement, as the case may be; or (d) which might
         materially and adversely affect the performance by the Depositor of its
         obligations under, or the validity or enforceability of, this
         Agreement.

                  SECTION 2.07. Issuance of Certificates.

                  The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery to it of the Mortgage Files, subject to the provisions of
Sections 2.01 and 2.02, together with the assignment to it of all other assets
included in the Trust Fund, receipt of which is hereby acknowledged.
Concurrently with such assignment and delivery and in exchange therefor, the
Trustee, pursuant to the written request of the Depositor executed by an officer
of the Depositor, has executed, authenticated and delivered to or upon the order
of the Depositor, the Certificates in authorized denominations. The interests
evidenced by the Certificates, constitute the entire beneficial ownership
interest in the Trust Fund.

                  SECTION 2.08. Conveyance of the Subsequent Mortgage Loans.

                  (a) Subject to the conditions set forth in paragraph (b) below
in consideration of the Trustee's delivery on the Subsequent Transfer Dates to
or upon the order of the Depositor of all or a portion of the balance of funds
in the Pre-Funding Accounts, the Depositor shall on any Subsequent Transfer Date
sell, transfer, assign, set over and convey without recourse to the Trust Fund
but subject to the other terms and provisions of this Agreement all of the
right, title and interest of the Depositor in and to (i) the Subsequent Mortgage
Loans identified on the Mortgage Loan Schedule attached to the related
Subsequent Transfer Instrument delivered by the Depositor on such Subsequent
Transfer Date, (ii) all interest accruing thereon on and after the Subsequent
Cut-off Date and all collections in respect of interest and principal due after
the Subsequent Cut-off Date and (iii) all items with respect to such Subsequent
Mortgage Loans to be delivered pursuant to Section 2.01 and the other items in
the related Mortgage Files; PROVIDED, HOWEVER, that the Depositor reserves and
retains all right, title and interest in and to principal received and interest
accruing on the Subsequent Mortgage Loans prior to the related Subsequent
Cut-off Date. The transfer to the Trustee for deposit in the Mortgage Pool by
the Depositor of the Subsequent Mortgage Loans identified on the Mortgage Loan
Schedule shall be absolute and is intended by the Depositor, the Master
Servicer, the Trustee and the Certificateholders to constitute and to be treated
as a sale of the Subsequent Mortgage Loans by the Depositor to the Trust Fund.
The related Mortgage File for each Subsequent Mortgage Loan

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<PAGE>

shall be delivered to the Trustee at least three Business Days prior to the
related Subsequent Transfer Date.

                  The purchase price paid by the Trustee from amounts released
from the Group I Pre- Funding Account or the Group II Pre-Funding Account, as
applicable, shall be one-hundred percent (100%) of the aggregate Stated
Principal Balance of the related Subsequent Mortgage Loans so transferred (as
identified on the Mortgage Loan Schedule provided by the Depositor). This
Agreement shall constitute a fixed-price purchase contract in accordance with
Section 860G(a)(3)(A)(ii) of the Code.

                  (b) The Depositor shall transfer to the Trustee for deposit in
         the Mortgage Pool the Subsequent Mortgage Loans and the other property
         and rights related thereto as described in paragraph (a) above, and the
         Trustee shall release funds from the Group I Pre-Funding Account or the
         Group II Pre-Funding Account, as applicable, only upon the satisfaction
         of each of the following conditions on or prior to the related
         Subsequent Transfer Date:

                  (i) the Depositor shall have provided the Trustee, the NIMS
         Insurer and the Rating Agencies with a timely Addition Notice and shall
         have provided any information reasonably requested by the Trustee with
         respect to the Subsequent Mortgage Loans;

                  (ii) the Depositor shall have delivered to the Trustee and the
         NIMS Insurer a duly executed Subsequent Transfer Instrument, which
         shall include a Mortgage Loan Schedule listing the Subsequent Mortgage
         Loans, and the Master Servicer, in its capacity as Originator, shall
         have delivered a computer file containing such Mortgage Loan Schedule
         to the Trustee at least three Business Days prior to the related
         Subsequent Transfer Date;

                  (iii) as of each Subsequent Transfer Date, as evidenced by
         delivery of the Subsequent Transfer Instrument, substantially in the
         form of Exhibit O, the Depositor shall not be insolvent nor shall it
         have been rendered insolvent by such transfer nor shall it be aware of
         any pending insolvency;

                  (iv) such sale and transfer shall not result in a material
         adverse tax consequence to the Trust Fund or the Certificateholders;

                  (v) the Funding Period shall not have terminated;

                  (vi) the Depositor shall not have selected the Subsequent
         Mortgage Loans in a manner that it believed to be adverse to the
         interests of the Certificateholders;

                  (vii) the Depositor shall have delivered to the Trustee and
         the NIMS Insurer a Subsequent Transfer Instrument confirming the
         satisfaction of the conditions precedent specified in this Section 2.08
         and, pursuant to the Subsequent Transfer Instrument, assigned to the
         Trustee without recourse for the benefit of the Certificateholders all
         the right, title and interest of the Depositor, in, to and under the
         Subsequent Mortgage Loan Purchase Agreement, to the extent of the
         Subsequent Mortgage Loans;

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                  (viii) with respect to the last Subsequent Transfer Date, the
         Depositor shall have delivered to the Trustee and the NIMS Insurer a
         letter from an Independent accountant (with copies provided to each
         Rating Agency) stating that the characteristics of the Subsequent
         Mortgage Loans conform to the characteristics set forth in clauses (i)
         through (ix) of paragraph (c) below and to the characteristics set
         forth in paragraph (d) below;

                  (ix) the Depositor shall have delivered to the Trustee, the
         Underwriters and the NIMS Insurer an Opinion of Counsel addressed to
         the Trustee and the Rating Agencies with respect to the transfer of the
         Subsequent Mortgage Loans substantially in the form of the Opinion of
         Counsel delivered to the Trustee on the Closing Date regarding the true
         sale of the Subsequent Mortgage Loans; and

                  (x) the Depositor shall have received the consent of the NIMS
         Insurer to the transfer of such Subsequent Mortgage Loans.

                  (c) The obligation of the Trust Fund to purchase a Subsequent
Mortgage Loan on any Subsequent Transfer Date is subject to the satisfaction of
the conditions set forth in the immediately following paragraph and the accuracy
of the following representations and warranties with respect to each such
Subsequent Mortgage Loan determined as of the applicable Subsequent Cut-off
Date: (i) such Subsequent Mortgage Loan may not be 30 or more days delinquent as
of the last day of the month preceding the Subsequent Cut-off Date; (ii) the
original term to stated maturity of such Subsequent Mortgage Loan will not be
less than 120 months and will not exceed 360 months; (iii) such Subsequent
Mortgage Loan will not have a Loan-to-Value Ratio greater than 100.00%; (iv)
such Subsequent Mortgage Loans will have, as of the Subsequent Cut-off Date, a
weighted average term since origination not in excess of 360 months; (v) such
Subsequent Mortgage Loan, if a Fixed Rate Mortgage Loan, shall have a Mortgage
Rate that is not less than 4.500% per annum or greater than 14.000% per annum;
(vi) each of the Subsequent Mortgage Loans will have a first payment date
occurring on or before May 1, 2004; (vii) if the Subsequent Mortgage Loan is an
Adjustable Rate Mortgage Loan, the Subsequent Mortgage Loan will have a Gross
Margin not less than 2.000% per annum; (viii) if the Subsequent Mortgage Loan is
an Adjustable Rate Mortgage Loan, the Subsequent Mortgage Loan will have a
Maximum Mortgage Rate not less than 10.500% per annum; (ix) if the Subsequent
Mortgage Loan is an Adjustable Rate Mortgage Loan, the Subsequent Mortgage Loan
will have a Minimum Mortgage Rate not less than 3.650% per annum, (x) the
Subsequent Mortgage Loan may not provide for negative amortization; (xi) such
Subsequent Mortgage Loan shall have been serviced by the Master Servicer since
origination, the date of purchase or the date of acquisition of the servicing
and (xii) such Subsequent Mortgage Loan shall have been underwritten in
accordance with the criteria set forth under "Option One Mortgage
Corporation--Underwriting Standards" in the Prospectus Supplement.

                  (d) Following the purchase of any Subsequent Group I Mortgage
Loan by the Trust, the Group I Mortgage Loans (including such Subsequent Group I
Mortgage Loans) will: (i) have a weighted average original term to stated
maturity of not more than 360 months; (ii) have a weighted average Mortgage Rate
of not less than 6.750% per annum and not more than 6.900% per annum; (iii) have
a weighted average Loan-to-Value Ratio of not more than 80.00%; (iv) have no
Mortgage Loan with an original principal balance which does not conform to
Fannie Mae and Freddie Mac guidelines; (v) will consist of Mortgage Loans
covered by the PMI Policy representing

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no less than 23.00% by aggregate Stated Principal Balance of the Group I
Mortgage Loans, (vi) will consist of Mortgage Loans with Prepayment Charges
representing no less than 70.00% by aggregate Stated Principal Balance of the
Group I Mortgage Loans; and (vii) have no more than 25.50% of Fixed Rate
Mortgage Loans by aggregate Stated Principal Balance of the Group I Mortgage
Loans. In addition, the Adjustable Rate Group I Mortgage Loans will have a
weighted average Gross Margin not less than 4.800% per annum. For purposes of
the calculations described in this paragraph, percentages of the Group I
Mortgage Loans will be based on the Stated Principal Balance of the Initial
Group I Mortgage Loans as of the Cut-off Date and the Stated Principal Balance
of the Subsequent Group I Mortgage Loans as of the related Subsequent Cut-off
Date.

                  Following the purchase of any Subsequent Group II Mortgage
Loan by the Trust, the Group II Mortgage Loans (including such Subsequent Group
II Mortgage Loans) will: (i) have a weighted average original term to stated
maturity of not more than 360 months; (ii) have a weighted average Mortgage Rate
of not less than 6.750% per annum and not more than 6.900% per annum; (iii) have
a weighted average Loan-to-Value Ratio of not more than 80.00%; (iv) have no
Mortgage Loan with a principal balance in excess of $1,250,000; (v) will consist
of Mortgage Loans covered by the PMI Policy representing no less than 21.00% by
aggregate Stated Principal Balance of the Group II Mortgage Loans; (vi) will
consist of Mortgage Loans with Prepayment Charges representing no less than
70.00% by aggregate Stated Principal Balance of the Group II Mortgage Loans; and
(vi) have no more than 25.50% of Fixed Rate Mortgage Loans by aggregate Stated
Principal Balance of the Group II Mortgage Loans. In addition, the Adjustable
Rate Group II Mortgage Loans will have a weighted average Gross Margin not less
than 4.800% per annum. For purposes of the calculations described in this
paragraph, percentages of the Group II Mortgage Loans will be based on the
Stated Principal Balance of the Initial Group II Mortgage Loans as of the
Cut-off Date and the Stated Principal Balance of the Subsequent Group II
Mortgage Loans as of the related Subsequent Cut-off Date.

                  (e) Notwithstanding the foregoing, any Subsequent Mortgage
Loan may be rejected by (i) the NIMS Insurer or (ii) any Rating Agency if the
inclusion of any such Subsequent Mortgage Loan would adversely affect the
ratings of any Class of Certificates. At least one Business Day prior to the
Subsequent Transfer Date, each Rating Agency shall notify the Trustee as to
which Subsequent Mortgage Loans, if any, shall not be included in the transfer
on the Subsequent Transfer Date; provided, however, that the Master Servicer, in
its capacity as Originator, shall have delivered to each Rating Agency at least
three Business Days prior to such Subsequent Transfer Date a computer file
acceptable to each Rating Agency describing the characteristics specified in
paragraphs (c) and (d) above.

                  SECTION 2.09. Conveyance of REMIC Regular Interests and
                                Acceptance of REMIC 2 and REMIC 3 by the
                                Trustee; Issuance of Certificates.

                  (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the assets described in the definition of REMIC 1for the
benefit of the holders of the REMIC 1 Regular Interests (which are
uncertificated) and the Class R Certificates (in respect of the Class R-1
Interest). The Trustee acknowledges receipt of the assets

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described in the definition of REMIC 1 and declares that it holds and will hold
the same in trust for the exclusive use and benefit of the holders of the REMIC
1 Regular Interests and the Class R Certificates (in respect of the Class R-1
Interest). The interests evidenced by the Class R-1 Interest, together with the
REMIC 1 Regular Interests, constitute the entire beneficial ownership interest
in REMIC 1.

                  (b) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the REMIC 1 Regular Interests for the benefit of the holders
of the REMIC 2 Regular Interests (which are uncertificated) and the Class R
Certificates (in respect of the Class R-2 Interest). The Trustee acknowledges
receipt of the REMIC 1 Regular Interests and declares that it holds and will
hold the same in trust for the exclusive use and benefit of the holders of the
REMIC 2 Regular Interests and the Class R Certificates (in respect of the Class
R-2 Interest). The interests evidenced by the Class R-2 Interest, together with
the REMIC 2 Regular Interests, constitute the entire beneficial ownership
interest in REMIC 2.

                  (c) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the REMIC 2 Regular Interests (which are uncertificated) for
the benefit of the Holders of the Regular Certificates and the Class R
Certificates (in respect of the Class R-3 Interest). The Trustee acknowledges
receipt of the REMIC 2 Regular Interests and declares that it holds and will
hold the same in trust for the exclusive use and benefit of the Holders of the
Regular Certificates and the Class R Certificates (in respect of the Class R-3
Interest). The interests evidenced by the Class R-3 Interest, together with the
Regular Certificates, constitute the entire beneficial ownership interest in
REMIC 3.

                  (d) [Reserved]

                  (e) [Reserved]

                  (f) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 1 and the acceptance by the Trustee thereof, pursuant to
Section 2.01 and Section 2.02, (ii) the assignment and delivery to the Trustee
of REMIC 2 (including the Residual Interest therein represented by the Class R-2
Interest) and the acceptance by the Trustee thereof, pursuant to Section 2.07
and (iii) the assignment and delivery to the Trustee of REMIC 3 (including the
Residual Interest therein represented by the Class R-3 Interest), and the
acceptance by the Trustee thereof, pursuant to Section 2.07(c), the Trustee,
pursuant to the written request of the Depositor executed by an officer of the
Depositor, has executed, authenticated and delivered to or upon the order of the
Depositor, the Class R Certificates in authorized denominations evidencing the
Class R-1 Interest, the Class R-2 Interest and the Class R-3 Interest.

                  SECTION 2.10. Negative Covenants of the Trustee and the Master
                                Servicer.

                  Except as otherwise expressly permitted by this Agreement, the
Trustee and the Master Servicer shall not cause the Trust Fund to:

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                  (i) sell, transfer, exchange or otherwise dispose of any of
         the assets of the Trust Fund;

                  (ii) dissolve or liquidate the Trust Fund in whole or in part;

                  (iii) engage, directly or indirectly, in any business other
         than that arising out of the issue of the Certificates, and the actions
         contemplated or required to be performed under this Agreement;

                  (iv) incur, create or assume any indebtedness for borrowed
         money;

                  (v) voluntarily file a petition for bankruptcy,
         reorganization, assignment for the benefit of creditors or similar
         proceeding; or

                  (vi) merge, convert or consolidate with any other Person.

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                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                              OF THE MORTGAGE LOANS

                  SECTION 3.01. Master Servicer to Act as Master Servicer.

                  The Master Servicer shall service and administer the Mortgage
Loans on behalf of the Trust and in the best interests of and for the benefit of
the Certificateholders (as determined by the Master Servicer in its reasonable
judgment) in accordance with the terms of this Agreement and the Mortgage Loans
and, to the extent consistent with such terms, in the same manner in which it
services and administers similar mortgage loans for its own portfolio, giving
due consideration to customary and usual standards of practice of mortgage
lenders and loan servicers administering similar mortgage loans but without
regard to:

                  (A) any relationship that the Master Servicer, any
         Sub-Servicer or any Affiliate of the Master Servicer or any
         Sub-Servicer may have with the related Mortgagor;

                  (B) the ownership or non-ownership of any Certificate by the
         Master Servicer or any Affiliate of the Master Servicer;

                  (C) the Master Servicer's obligation to make Advances or
         Servicing Advances; or

                  (D) the Master Servicer's or any Sub-Servicer's right to
         receive compensation for its services hereunder or with respect to any
         particular transaction.

                  To the extent consistent with the foregoing, the Master
Servicer (a) shall seek the timely and complete recovery of principal and
interest on the Mortgage Notes and (b) shall waive (or permit a Sub-Servicer to
waive) a Prepayment Charge only under the following circumstances: (i) such
waiver is standard and customary in servicing similar Mortgage Loans and (ii)
either (A) such waiver relates to a default or a reasonably foreseeable default
and would, in the reasonable judgement of the Master Servicer, maximize recovery
of total proceeds taking into account the value of such Prepayment Charge and
the related Mortgage Loan or (B) such waiver is made in connection with a
refinancing of the related Mortgage Loan unrelated to a default or a reasonably
foreseeable default where (x) the related Mortgagor has stated to the Master
Servicer or an applicable Sub- Servicer an intention to refinance the related
Mortgage Loan and (y) the Master Servicer has concluded in its reasonable
judgement that the waiver of such Prepayment Charge would induce such mortgagor
to refinance with the Master Servicer; provided, however, that the Master
Servicer shall waive no more than 5.00% of the Prepayment Charges (by number of
Prepayment Charges) set forth on the Prepayment Charge Schedule in accordance
with clause (ii)(B) above. If a Prepayment Charge is waived as permitted by
meeting the standards described in clauses (i) and (ii)(B) above, then the
Master Servicer is required to pay the amount of such waived Prepayment Charge,
for the benefit of the Holders of the Class P Certificates, by depositing such
amount into the Collection Account together with and at the time that the amount
prepaid on the related Mortgage Loan is

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required to be deposited into the Collection Account. Notwithstanding any other
provisions of this Agreement, any payments made by the Master Servicer in
respect of any waived Prepayment Charges pursuant to clauses (i) and (ii)(B)
above shall be deemed to be paid outside of the Trust Fund. Subject only to the
above-described servicing standards and the terms of this Agreement and of the
Mortgage Loans, the Master Servicer shall have full power and authority, acting
alone or through Sub-Servicers as provided in Section 3.02, to do or cause to be
done any and all things in connection with such servicing and administration
which it may deem necessary or desirable. Without limiting the generality of the
foregoing, the Master Servicer in its own name or in the name of a Sub-Servicer
is hereby authorized and empowered by the Trustee when the Master Servicer
believes it appropriate in its best judgment in accordance with the servicing
standards set forth above, to execute and deliver, on behalf of the
Certificateholders and the Trustee, and upon notice to the Trustee, any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and all other comparable instruments, with respect to the Mortgage
Loans and the Mortgaged Properties and to institute foreclosure proceedings or
obtain a deed-in-lieu of foreclosure so as to convert the ownership of such
properties, and to hold or cause to be held title to such properties, on behalf
of the Trustee and Certificateholders. The Master Servicer shall service and
administer the Mortgage Loans in accordance with applicable state and federal
law and shall provide to the Mortgagors any reports required to be provided to
them thereby. The Master Servicer shall also comply in the performance of this
Agreement with all reasonable rules and requirements of each insurer under any
standard hazard insurance policy. Subject to Section 3.17, within 15 days of the
Closing Date, the Trustee shall execute, at the written request of the Master
Servicer, and furnish to the Master Servicer and any Sub-Servicer any special or
limited powers of attorney for each county in which a Mortgaged Property is
located and other documents necessary or appropriate to enable the Master
Servicer or any Sub-Servicer to carry out their servicing and administrative
duties hereunder; PROVIDED, such limited powers of attorney or other documents
shall be prepared by the Master Servicer and submitted to the Trustee for
execution. The Trustee shall not be liable for the actions of the Master
Servicer or any Sub-Servicers under such powers of attorney.

                  Subject to Section 3.09 hereof, in accordance with the
standards of the preceding paragraph, the Master Servicer shall advance or cause
to be advanced funds as necessary for the purpose of effecting the payment of
taxes and assessments on the Mortgaged Properties, which advances shall be
Servicing Advances reimbursable in the first instance from related collections
from the Mortgagors pursuant to Section 3.09, and further as provided in Section
3.11. Any cost incurred by the Master Servicer or by Sub-Servicers in effecting
the payment of taxes and assessments on a Mortgaged Property shall not, for the
purpose of calculating distributions to Certificateholders, be added to the
unpaid principal balance of the related Mortgage Loan, notwithstanding that the
terms of such Mortgage Loan so permit.

                  Notwithstanding anything in this Agreement to the contrary,
the Master Servicer may not make any future advances with respect to a Mortgage
Loan (except as provided in Section 4.04) and the Master Servicer shall not (i)
permit any modification with respect to any Mortgage Loan that would change the
Mortgage Rate, reduce or increase the Principal Balance (except for reductions
resulting from actual payments of principal) or change the final maturity date
on such Mortgage Loan (unless, as provided in Section 3.07, the Mortgagor is in
default with respect to the Mortgage Loan or such default is, in the judgment of
the Master Servicer, reasonably foreseeable) or (ii) permit any modification,
waiver or amendment of any term of any Mortgage Loan that would both (A) effect

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an exchange or reissuance of such Mortgage Loan under Section 1001 of the Code
(or Treasury regulations promulgated thereunder) and (B) cause any REMIC created
hereunder to fail to qualify as a REMIC under the Code or the imposition of any
tax on "prohibited transactions" or "contributions after the startup date" under
the REMIC Provisions.

                  SECTION 3.02. Sub-Servicing Agreements Between Master Servicer
                                and Sub- Servicers.

                  (a) The Master Servicer may enter into Sub-Servicing
Agreements with Sub- Servicers for the servicing and administration of the
Mortgage Loans; PROVIDED, HOWEVER, that (i) such agreements would not result in
a withdrawal or a downgrading by any Rating Agency of the rating on any Class of
Certificates and (ii) the NIMS Insurer shall have consented to such Sub-
Servicing Agreement. The Trustee is hereby authorized to acknowledge, at the
request of the Master Servicer, any Sub-Servicing Agreement that meets the
requirements applicable to Sub-Servicing Agreements set forth in this Agreement
and that is otherwise permitted under this Agreement.

                  Each Sub-Servicer shall be (i) authorized to transact business
in the state or states where the related Mortgaged Properties it is to service
are situated, if and to the extent required by applicable law to enable the
Sub-Servicer to perform its obligations hereunder and under the Sub- Servicing
Agreement and (ii) a Freddie Mac or Fannie Mae approved mortgage servicer. Each
Sub- Servicing Agreement must impose on the Sub-Servicer requirements conforming
to the provisions set forth in Section 3.08 and provide for servicing of the
Mortgage Loans consistent with the terms of this Agreement. The Master Servicer
will examine each Sub-Servicing Agreement and will be familiar with the terms
thereof. The terms of any Sub-Servicing Agreement will not be inconsistent with
any of the provisions of this Agreement. The Master Servicer and the
Sub-Servicers may enter into and make amendments to the Sub-Servicing Agreements
or enter into different forms of Sub- Servicing Agreements; PROVIDED, HOWEVER,
that any such amendments or different forms shall be consistent with and not
violate the provisions of this Agreement, and that no such amendment or
different form shall be made or entered into which could be reasonably expected
to be materially adverse to the interests of the Certificateholders without the
consent of the Holders of Certificates entitled to at least 66% of the Voting
Rights; PROVIDED, FURTHER, that the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights shall not be required (i) to cure
any ambiguity or defect in a Sub-Servicing Agreement, (ii) to correct, modify or
supplement any provisions of a Sub-Servicing Agreement, or (iii) to make any
other provisions with respect to matters or questions arising under a
Sub-Servicing Agreement, which, in each case, shall not be inconsistent with the
provisions of this Agreement. Any variation without the consent of the Holders
of Certificates entitled to at least 66% of the Voting Rights from the
provisions set forth in Section 3.08 relating to insurance or priority
requirements of Sub-Servicing Accounts, or credits and charges to the
Sub-Servicing Accounts or the timing and amount of remittances by the
Sub-Servicers to the Master Servicer, are conclusively deemed to be inconsistent
with this Agreement and therefore prohibited. The Master Servicer shall deliver
to the NIMS Insurer and the Trustee copies of all Sub- Servicing Agreements, and
any amendments or modifications thereof, promptly upon the Master Servicer's
execution and delivery of such instruments.

                  (b) As part of its servicing activities hereunder, the Master
Servicer, for the benefit of the Trustee and the Certificateholders, shall
enforce the obligations of each Sub-Servicer

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<PAGE>

under the related Sub-Servicing Agreement and of the Originator under the
Mortgage Loan Purchase Agreement, including, without limitation, any obligation
to make advances in respect of delinquent payments as required by a
Sub-Servicing Agreement, or to purchase a Mortgage Loan on account of missing or
defective documentation or on account of a breach of a representation, warranty
or covenant, as described in Section 2.03(a). Such enforcement, including,
without limitation, the legal prosecution of claims, termination of
Sub-Servicing Agreements, and the pursuit of other appropriate remedies, shall
be in such form and carried out to such an extent and at such time as the Master
Servicer, in its good faith business judgment, would require were it the owner
of the related Mortgage Loans. The Master Servicer shall pay the costs of such
enforcement at its own expense, and shall be reimbursed therefor only (i) from a
general recovery resulting from such enforcement, to the extent, if any, that
such recovery exceeds all amounts due in respect of the related Mortgage Loans,
or (ii) from a specific recovery of costs, expenses or attorneys' fees against
the party against whom such enforcement is directed. Enforcement of the Mortgage
Loan Purchase Agreement against the Originator shall be effected by the Master
Servicer to the extent it is not the Originator, and otherwise by the Trustee in
accordance with the foregoing provisions of this paragraph.

                  SECTION 3.03. Successor Sub-Servicers.

                  The Master Servicer, with the consent of the NIMS Insurer,
shall be entitled to terminate any Sub-Servicing Agreement and the rights and
obligations of any Sub-Servicer pursuant to any Sub-Servicing Agreement in
accordance with the terms and conditions of such Sub-Servicing Agreement. In the
event of termination of any Sub-Servicer, all servicing obligations of such Sub-
Servicer shall be assumed simultaneously by the Master Servicer without any act
or deed on the part of such Sub-Servicer or the Master Servicer, and the Master
Servicer either shall service directly the related Mortgage Loans or shall enter
into a Sub-Servicing Agreement with a successor Sub-Servicer which qualifies
under Section 3.02.

                  Any Sub-Servicing Agreement shall include the provision that
such agreement may be immediately terminated by the Master Servicer or the
Trustee (if the Trustee is acting as Master Servicer) without fee, in accordance
with the terms of this Agreement, in the event that the Master Servicer (or the
Trustee, if such party is then acting as Master Servicer) shall, for any reason,
no longer be the Master Servicer (including termination due to a Master Servicer
Event of Termination).

                  SECTION 3.04. Liability of the Master Servicer.

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

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                  SECTION 3.05. No Contractual Relationship Between
                                Sub-Servicers and the NIMS Insurer, the Trustee
                                or Certificateholders.

                  Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Sub-Servicer
in its capacity as such shall be deemed to be between the Sub-Servicer and the
Master Servicer alone, and the NIMS Insurer, the Trustee or Certificateholders
shall not be deemed parties thereto and shall have no claims, rights,
obligations, duties or liabilities with respect to the Sub-Servicer except as
set forth in Section 3.06. The Master Servicer shall be solely liable for all
fees owed by it to any Sub-Servicer, irrespective of whether the Master
Servicer's compensation pursuant to this Agreement is sufficient to pay such
fees.

                  SECTION 3.06. Assumption or Termination of Sub-Servicing
                                Agreements by Trustee.

                  In the event the Master Servicer shall for any reason no
longer be the servicer (including by reason of the occurrence of a Master
Servicer Event of Termination), the Trustee shall thereupon assume all of the
rights and obligations of the Master Servicer under each Sub-Servicing Agreement
that the Master Servicer may have entered into, unless the Trustee elects to
terminate any Sub-Servicing Agreement in accordance with its terms as provided
in Section 3.03. Upon such assumption, the Trustee (or the successor servicer
appointed pursuant to Section 7.02) shall be deemed, subject to Section 3.03, to
have assumed all of the departing Master Servicer's interest therein and to have
replaced the departing Master Servicer as a party to each Sub-Servicing
Agreement to the same extent as if each Sub-Servicing Agreement had been
assigned to the assuming party, except that (i) the departing Master Servicer
shall not thereby be relieved of any liability or obligations under any
Sub-Servicing Agreement that arose before it ceased to be the Master Servicer
and (ii) neither the Trustee nor any successor Master Servicer shall be deemed
to have assumed any liability or obligation of the Master Servicer that arose
before it ceased to be the Master Servicer.

                  The Master Servicer at its expense shall, upon request of
Trustee, deliver to the assuming party all documents and records relating to
each Sub-Servicing Agreement and the Mortgage Loans then being serviced and an
accounting of amounts collected and held by or on behalf of it, and otherwise
use its best efforts to effect the orderly and efficient transfer of the Sub-
Servicing Agreements to the assuming party. All Servicing Transfer Costs shall
be paid by the predecessor Master Servicer upon presentation of reasonable
documentation of such costs, and if such predecessor Master Servicer defaults in
its obligation to pay such costs, such costs shall be paid by the successor
Master Servicer or the Trustee (in which case the successor Master Servicer or
the Trustee, as applicable, shall be entitled to reimbursement therefor from the
assets of the Trust).

                  SECTION 3.07. Collection of Certain Mortgage Loan Payments.

                  The Master Servicer shall make reasonable efforts to collect
all payments called for under the terms and provisions of the Mortgage Loans,
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any applicable insurance policies, follow such
collection procedures as it would follow with respect to mortgage loans
comparable to

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<PAGE>

the Mortgage Loans and held for its own account. Consistent with the foregoing,
the Master Servicer may in its discretion (i) waive any late payment charge or,
if applicable, any penalty interest, or (ii) extend the due dates for the
Monthly Payments due on a Mortgage Note for a period of not greater than 180
days; PROVIDED, HOWEVER, that any extension pursuant to clause (ii) above shall
not affect the amortization schedule of any Mortgage Loan for purposes of any
computation hereunder, except as provided below; provided further that the NIMS
Insurer's prior written consent shall be required for any modification, waiver
or amendment if the aggregate number of outstanding Mortgage Loans which have
been modified, waived or amended exceeds 5% of the number of Mortgage Loans as
of the Cut-off Date and any Subsequent Cut-off Date. In the event of any such
arrangement pursuant to clause (ii) above, the Master Servicer shall make timely
Advances on such Mortgage Loan during such extension pursuant to Section 4.04
and in accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangement.

                  Notwithstanding the foregoing, in the event that any Mortgage
Loan is in default or, in the judgment of the Master Servicer, such default is
reasonably foreseeable, the Master Servicer, consistent with the standards set
forth in Section 3.01, may also waive, modify or vary any term of such Mortgage
Loan (including modifications that would change the Mortgage Rate, forgive the
payment of principal or interest, capitalize the interest portion of past due
Monthly Payments and outstanding Servicing Advances, or extend the final
maturity date of such Mortgage Loan), accept payment from the related Mortgagor
of an amount less than the Stated Principal Balance in final satisfaction of
such Mortgage Loan, or consent to the postponement of strict compliance with any
such term or otherwise grant indulgence to any Mortgagor (any and all such
waivers, modifications, variances, forgiveness of principal or interest,
postponements, or indulgences collectively referred to herein as "forbearance"),
PROVIDED, HOWEVER, that in no event shall the Master Servicer grant any such
forbearance (other than as permitted by the second sentence of this Section)
with respect to any one Mortgage Loan more than once in any 12 month period or
more than three times over the life of such Mortgage Loan, and PROVIDED,
FURTHER, that in determining which course of action permitted by this sentence
it shall pursue, the Master Servicer shall adhere to the Loss Mitigation
Procedures. The Master Servicer's analysis supporting any forbearance and the
conclusion that any forbearance meets the standards of Section 3.01 and the Loss
Mitigation Procedures shall be reflected in writing in the Mortgage File.

                  SECTION 3.08. Sub-Servicing Accounts.

                  In those cases where a Sub-Servicer is servicing a Mortgage
Loan pursuant to a Sub- Servicing Agreement, the Sub-Servicer will be required
to establish and maintain one or more accounts (collectively, the "Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible Account and shall
comply with all requirements of this Agreement relating to the Collection
Account. The Sub-Servicer shall deposit in the clearing account in which it
customarily deposits payments and collections on mortgage loans in connection
with its mortgage loan servicing activities on a daily basis, and in no event
more than one Business Day after the Sub-Servicer's receipt thereof, all
proceeds of Mortgage Loans received by the Sub-Servicer less its servicing
compensation to the extent permitted by the Sub-Servicing Agreement, and shall
thereafter deposit such amounts in the Sub-Servicing Account, in no event more
than two Business Days after the receipt of such amounts. The Sub-Servicer shall
thereafter deposit such proceeds in the Collection Account or remit such
proceeds to the Master Servicer for deposit in the Collection Account not later
than two Business

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<PAGE>

Days after the deposit of such amounts in the Sub-Servicing Account. For
purposes of this Agreement, the Master Servicer shall be deemed to have received
payments on the Mortgage Loans when the Sub-Servicer receives such payments.

                  SECTION 3.09. Collection of Taxes, Assessments and Similar
                                Items; Servicing Accounts.

                  The Master Servicer shall establish and maintain, or cause to
be established and maintained, one or more accounts (the "Servicing Accounts"),
into which all Escrow Payments shall be deposited and retained. Servicing
Accounts shall be Eligible Accounts. The Master Servicer shall deposit in the
clearing account in which it customarily deposits payments and collections on
mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after the Master
Servicer's receipt thereof, all Escrow Payments collected on account of the
Mortgage Loans and shall thereafter deposit such Escrow Payments in the
Servicing Accounts, in no event more than two Business Days after the receipt of
such Escrow Payments, all Escrow Payments collected on account of the Mortgage
Loans for the purpose of effecting the timely payment of any such items as
required under the terms of this Agreement. Withdrawals of amounts from a
Servicing Account may be made only to (i) effect payment of taxes, assessments,
hazard insurance premiums, and comparable items in a manner and at a time that
assures that the lien priority of the Mortgage is not jeopardized (or, with
respect to the payment of taxes, in a manner and at a time that avoids the loss
of the Mortgaged Property due to a tax sale or the foreclosure as a result of a
tax lien); (ii) reimburse the Master Servicer (or a Sub-Servicer to the extent
provided in the related Sub-Servicing Agreement) out of related collections for
any Servicing Advances made pursuant to Section 3.01 (with respect to taxes and
assessments) and Section 3.14 (with respect to hazard insurance); (iii) refund
to Mortgagors any sums as may be determined to be overages; (iv) pay interest to
the Master Servicer or, if required and as described below, to Mortgagors on
balances in the Servicing Account; or (v) clear and terminate the Servicing
Account at the termination of the Master Servicer's obligations and
responsibilities in respect of the Mortgage Loans under this Agreement in
accordance with Article X. In the event the Master Servicer shall deposit in a
Servicing Account any amount not required to be deposited therein, it may at any
time withdraw such amount from such Servicing Account, any provision herein to
the contrary notwithstanding. The Master Servicer will be responsible for the
administration of the Servicing Accounts and will be obligated to make Servicing
Advances to such accounts when and as necessary to avoid the lapse of insurance
coverage on the Mortgaged Property, or which the Master Servicer knows, or in
the exercise of the required standard of care of the Master Servicer hereunder
should know, is necessary to avoid the loss of the Mortgaged Property due to a
tax sale or the foreclosure as a result of a tax lien. If any such payment has
not been made and the Master Servicer receives notice of a tax lien with respect
to the Mortgage being imposed, the Master Servicer will, within 10 business days
of such notice, advance or cause to be advanced funds necessary to discharge
such lien on the Mortgaged Property. As part of its servicing duties, the Master
Servicer or Sub-Servicers shall pay to the Mortgagors interest on funds in the
Servicing Accounts, to the extent required by law and, to the extent that
interest earned on funds in the Servicing Accounts is insufficient, to pay such
interest from its or their own funds, without any reimbursement therefor. The
Master Servicer may pay to itself any excess interest on funds in the Servicing
Accounts, to the extent such action is in conformity with the Servicing
Standard, is permitted by law and such amounts are not required to be paid to
Mortgagors or used for any of the other purposes set forth above.

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                  SECTION 3.10. Collection Account and Distribution Account.

                  (a) On behalf of the Trust Fund, the Master Servicer shall
establish and maintain, or cause to be established and maintained, one or more
accounts (such account or accounts, the "Collection Account"), held in trust for
the benefit of the Trustee and the Certificateholders. On behalf of the Trust
Fund, the Master Servicer shall deposit or cause to be deposited in the clearing
account in which it customarily deposits payments and collections on mortgage
loans in connection with its mortgage loan servicing activities on a daily
basis, and in no event more than one Business Day after the Master Servicer's
receipt thereof, and shall thereafter deposit in the Collection Account, in no
event more than two Business Days after the Master Servicer's receipt thereof,
as and when received or as otherwise required hereunder, the following payments
and collections received or made by it subsequent to the Cut-off Date or
Subsequent Cut-off Date, as applicable, (other than in respect of principal or
interest on the Mortgage Loans due on or before the Cut-off Date or Subsequent
Cut-off Date, as applicable) or payments (other than Principal Prepayments)
received by it on or prior to the Cut-off Date or Subsequent Cut-off Date, as
applicable, but allocable to a Due Period subsequent thereto:

                  (i) all payments on account of principal, including Principal
         Prepayments (but not Prepayment Charges), on the Mortgage Loans;

                  (ii) all payments on account of interest (net of the related
         Servicing Fee) on each Mortgage Loan;

                  (iii) all Insurance Proceeds, Liquidation Proceeds, Subsequent
         Recoveries and condemnation proceeds (other than proceeds collected in
         respect of any particular REO Property and amounts paid in connection
         with a purchase of Mortgage Loans and REO Properties pursuant to
         Section 10.01);

                  (iv) any amounts required to be deposited pursuant to Section
         3.12 in connection with any losses realized on Permitted Investments
         with respect to funds held in the Collection Account;

                  (v) any amounts required to be deposited by the Master
         Servicer pursuant to the second paragraph of Section 3.14(a) in respect
         of any blanket policy deductibles;

                  (vi) all proceeds of any Mortgage Loan repurchased or
         purchased in accordance with Section 2.03 or Section 10.01;

                  (vii) all amounts required to be deposited in connection with
         Substitution Adjustments pursuant to Section 2.03;

                  (viii) all Prepayment Charges collected by the Master Servicer
         and any Master Servicer Prepayment Charge Payment Amounts in connection
         with the Principal Prepayment of any of the Mortgage Loans; and

                  (ix) without duplication, all payments of claims under the PMI
         Policy.

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                  The foregoing requirements for deposit in the Collection
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of Servicing
Fees, late payment charges, assumption fees, insufficient funds charges and
ancillary income (other than Prepayment Charges) need not be deposited by the
Master Servicer in the Collection Account and may be retained by the Master
Servicer as additional compensation. In the event the Master Servicer shall
deposit in the Collection Account any amount not required to be deposited
therein, it may at any time withdraw such amount from the Collection Account,
any provision herein to the contrary notwithstanding.

                  (b) On behalf of the Trust Fund, the Trustee shall establish
and maintain one or more accounts (such account or accounts, the "Distribution
Account"), held in trust for the benefit of the Trustee and the
Certificateholders. On behalf of the Trust Fund, the Master Servicer shall
deliver to the Trustee in immediately available funds for deposit in the
Distribution Account on or before 1:00 p.m. New York time (i) on the Master
Servicer Remittance Date, that portion of the Available Funds (calculated
without regard to the references in the definition thereof to amounts that may
be withdrawn from the Distribution Account) for the related Distribution Date
then on deposit in the Collection Account, the amount of all Prepayment Charges
collected during the applicable Prepayment Period by the Master Servicer and
Master Servicer Prepayment Charge Payment Amounts in connection with the
Principal Prepayment of any of the Mortgage Loans then on deposit in the
Collection Account and the amount of any funds reimbursable to an Advancing
Person pursuant to Section 3.29, and (ii) on each Business Day as of the
commencement of which the balance on deposit in the Collection Account exceeds
$75,000 following any withdrawals pursuant to the next succeeding sentence, the
amount of such excess, but only if the Collection Account constitutes an
Eligible Account solely pursuant to clause (ii) of the definition of "Eligible
Account." If the balance on deposit in the Collection Account exceeds $75,000 as
of the commencement of business on any Business Day and the Collection Account
constitutes an Eligible Account solely pursuant to clause (ii) of the definition
of "Eligible Account," the Master Servicer shall, on or before 1:00 p.m. New
York time on such Business Day, withdraw from the Collection Account any and all
amounts payable or reimbursable to the Master Servicer, the Trustee, the
Originator or any Sub- Servicer pursuant to Section 3.11 and shall pay such
amounts to the Persons entitled thereto.

                  (c) Funds in the Collection Account and the Distribution
Account may be invested in Permitted Investments in accordance with the
provisions set forth in Section 3.12. The Master Servicer shall give notice to
the NIMS Insurer and the Trustee of the location of the Collection Account
maintained by it when established and prior to any change thereof. The Trustee
shall give notice to the NIMS Insurer, the Master Servicer and the Depositor of
the location of the Distribution Account when established and prior to any
change thereof.

                  (d) Funds held in the Collection Account at any time may be
delivered by the Master Servicer to the Trustee for deposit in an account (which
may be the Distribution Account and must satisfy the standards for the
Distribution Account as set forth in the definition thereof) and for all
purposes of this Agreement shall be deemed to be a part of the Collection
Account; PROVIDED, HOWEVER, that the Trustee shall have the sole authority to
withdraw any funds held pursuant to this subsection (d). In the event the Master
Servicer shall deliver to the Trustee for deposit in the Distribution Account
any amount not required to be deposited therein, it may at any time request that
the Trustee withdraw such amount from the Distribution Account and remit to it
any such amount,

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any provision herein to the contrary notwithstanding. In addition, the Master
Servicer, with respect to items (i) through (iv) below, shall deliver to the
Trustee from time to time for deposit, and the Trustee, with respect to items
(i) through (iv) below, shall so deposit, in the Distribution Account:

                  (i) any Advances, as required pursuant to Section 4.04;

                  (ii) any amounts required to be deposited pursuant to Section
                  3.23(d) or (f) in connection with any REO Property;

                  (iii) any amounts to be paid in connection with a purchase of
                  Mortgage Loans and REO Properties pursuant to Section 10.01;

                  (iv) any Compensating Interest to be deposited pursuant to
                  Section 3.24 in connection with any Prepayment Interest
                  Shortfall; and

                  (v) any amounts required to be paid to the Trustee pursuant to
                  the Agreement, including, but not limited to Section 3.06 and
                  Section 7.02.

                  (e) [Reserved].

                  (f) The Master Servicer shall deposit in the Collection
                  Account any amounts required to be deposited pursuant to
                  Section 3.12(b) in connection with losses realized on
                  Permitted Investments with respect to funds held in the
                  Collection Account.

                  SECTION 3.11. Withdrawals from the Collection Account and
                                Distribution Account.

                  (a) The Master Servicer shall, from time to time, make
withdrawals from the Collection Account for any of the following purposes or as
described in Section 4.04:

                  (i) to remit to the Trustee for deposit in the Distribution
         Account the amounts required to be so remitted pursuant to Section
         3.10(b) or permitted to be so remitted pursuant to the first sentence
         of Section 3.10(d);

                  (ii) subject to Section 3.16(d), to reimburse the Master
         Servicer for (a) any unreimbursed Advances to the extent of amounts
         received which represent Late Collections (net of the related Servicing
         Fees) of Monthly Payments or Liquidation Proceeds and Insurance
         Proceeds on Mortgage Loans with respect to which such Advances were
         made in accordance with the provisions of Section 4.04; (b) any
         unreimbursed Advances with respect to the final liquidation of a
         Mortgage Loan that are Nonrecoverable Advances, but only to the extent
         that Late Collections, including, Liquidation Proceeds and Insurance
         Proceeds received with respect to such Mortgage Loan are insufficient
         to reimburse the Master Servicer for such unreimbursed Advances; or (c)
         subject to Section 4.04(b), any unreimbursed Advances to the extent of
         funds held in the Collection Account for future distribution that were
         not included in Available Funds for the preceding Distribution Date;

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                  (iii) subject to Section 3.16(d), to pay the Master Servicer
         or any Sub-Servicer (a) any unpaid Servicing Fees, (b) any unreimbursed
         Servicing Advances with respect to each Mortgage Loan, but only to the
         extent of any Late Collections, including, Liquidation Proceeds,
         Insurance Proceeds and condemnation proceeds received with respect to
         such Mortgage Loan, and (c) any Servicing Advances with respect to the
         final liquidation of a Mortgage Loan that are Nonrecoverable Advances,
         but only to the extent that Late Collections, including, Liquidation
         Proceeds and Insurance Proceeds received with respect to such Mortgage
         Loan are insufficient to reimburse the Master Servicer or any
         Sub-Servicer for Servicing Advances;

                  (iv) to pay to the Master Servicer as servicing compensation
         (in addition to the Servicing Fee) on the Master Servicer Remittance
         Date any interest or investment income earned on funds deposited in the
         Collection Account;

                  (v) to pay to the Originator, with respect to each Mortgage
         Loan that has previously been purchased or replaced pursuant to Section
         2.03 or Section 3.16(c) all amounts received thereon subsequent to the
         date of purchase or substitution, as the case may be;

                  (vi) to reimburse the Master Servicer for any Advance or
         Servicing Advance previously made which the Master Servicer has
         determined to be a Nonrecoverable Advance in accordance with the
         provisions of Section 4.04;

                  (vii) to pay, or to reimburse the Master Servicer for
         Servicing Advances in respect of, expenses incurred in connection with
         any Mortgage Loan pursuant to Section 3.16(b);

                  (viii) to reimburse the Master Servicer for expenses incurred
         by or reimbursable to the Master Servicer pursuant to Section 6.03;

                  (ix) to reimburse the NIMS Insurer, the Master Servicer (if
         the Master Servicer is not an Affiliate of the Originator) or the
         Trustee, as the case may be, for enforcement expenses reasonably
         incurred in respect of the breach or defect giving rise to the purchase
         obligation under Section 2.03 of this Agreement that were included in
         the Purchase Price of the Mortgage Loan, including any expenses arising
         out of the enforcement of the purchase obligation;

                  (x) to pay itself any Prepayment Interest Excess; and

                  (xi) to clear and terminate the Collection Account pursuant to
         Section 10.01.

                  The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Master Servicer shall deposit in
the Collection Account any amount not required to be deposited therein, it may
at any time withdraw such amount from the Collection Account, any provision
herein to the contrary notwithstanding.

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                  The Master Servicer shall keep and maintain separate
accounting, on a Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any withdrawal from the Collection Account, to the extent held by or
on behalf of it, pursuant to subclauses (ii), (iii), (v), (vi), (ix) and (x)
above. The Master Servicer shall provide written notification to the NIMS
Insurer and the Trustee, on or prior to the next succeeding Master Servicer
Remittance Date, upon making any withdrawals from the Collection Account
pursuant to subclause (vi) above; PROVIDED that an Officers' Certificate in the
form described under Section 4.04(d) shall suffice for such written notification
to the Trustee in respect hereof.

                  (b) The Trustee shall, from time to time, make withdrawals
from the Distribution Account, for any of the following purposes, without
priority:

                  (i) to make distributions in accordance with Section 4.01;

                  (ii) to pay itself the Trustee Fee and any other amounts owed
         to it pursuant to Section 8.05;

                  (iii) to pay any amounts in respect of taxes pursuant to
         Section 9.01(g);

                  (iv) to clear and terminate the Distribution Account pursuant
         to Section 10.01;

                  (v) to pay any amounts required to be paid to the Trustee
         pursuant to this Agreement, including but not limited to funds required
         to be paid pursuant to Section 3.06 and Section 7.02;

                  (vi) to pay to the Trustee, any interest or investment income
         earned on funds deposited in the Distribution Account;

                  (vii) to pay to an Advancing Person reimbursements for
         Advances and/or Servicing Advances pursuant to Section 3.29; and

                  (viii) to pay the PMI Insurer the PMI Premium.

                  SECTION 3.12. Investment of Funds in the Collection Account
                                and the Distribution Account.

                  (a) The Master Servicer may direct any depository institution
maintaining the Collection Account to invest the funds on deposit in such
accounts, and the Trustee may invest the funds on deposit in the Distribution
Account (each such account, for the purposes of this Section 3.12 an "Investment
Account"). All investments pursuant to this Section 3.12 shall be in one or more
Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if a Person other than the Trustee is the
obligor thereon or if such investment is managed or advised by a Person other
than the Trustee or an Affiliate of the Trustee, and (ii) no later than the date
on which such funds are required to be withdrawn from such account pursuant to
this Agreement, if the Trustee is the obligor thereon

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or if such investment is managed or advised by the Trustee or any Affiliate. All
such Permitted Investments shall be held to maturity, unless payable on demand.
Any investment of funds in an Investment Account shall be made in the name of
the Trustee (in its capacity as such), or in the name of a nominee of the
Trustee. The Trustee shall be entitled to sole possession (except with respect
to investment direction of funds held in the Collection Account and any income
and gain realized thereon) over each such investment, and any certificate or
other instrument evidencing any such investment shall be delivered directly to
the Trustee or its agent, together with any document of transfer necessary to
transfer title to such investment to the Trustee or its nominee. In the event
amounts on deposit in an Investment Account are at any time invested in a
Permitted Investment payable on demand, the Trustee shall:

                  (x)      consistent with any notice required to be given
                           thereunder, demand that payment thereon be made on
                           the last day such Permitted Investment may otherwise
                           mature hereunder in an amount equal to the lesser of
                           (1) all amounts then payable thereunder and (2) the
                           amount required to be withdrawn on such date; and

                  (y)      demand payment of all amounts due thereunder promptly
                           upon determination by a Responsible Officer of the
                           Trustee that such Permitted Investment would not
                           constitute a Permitted Investment in respect of funds
                           thereafter on deposit in the Investment Account.

                  (b) All income and gain realized from the investment of funds
deposited in the Collection Account and any REO Account held by or on behalf of
the Master Servicer shall be for the benefit of the Master Servicer and shall be
subject to its withdrawal in accordance with Section 3.11 or Section 3.23, as
applicable. The Master Servicer shall deposit in the Collection Account or any
REO Account, as applicable, the amount of any loss of principal incurred in
respect of any such Permitted Investment made with funds in such account
immediately upon realization of such loss.

                  (c) All income and gain realized from the investment of funds
deposited in the Distribution Account shall be for the benefit of the Trustee.
The Trustee shall deposit in the Distribution Account the amount of any loss of
principal incurred in respect of any such Permitted Investment made with funds
in such accounts immediately upon realization of such loss.

                  (d) Except as otherwise expressly provided in this Agreement,
if any default occurs in the making of a payment due under any Permitted
Investment, or if a default occurs in any other performance required under any
Permitted Investment, the Trustee may and, subject to Section 8.01 and Section
8.02(a)(v), upon the request of the NIMS Insurer or the Holders of Certificates
representing more than 50% of the Voting Rights allocated to any Class of
Certificates, shall take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
proceedings.

                  SECTION 3.13. [Reserved].

                  SECTION 3.14. Maintenance of Hazard Insurance and Errors and
                                Omissions and Fidelity Coverage.

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                  (a) The Master Servicer shall cause to be maintained for each
Mortgage Loan hazard insurance with extended coverage on the Mortgaged Property
in an amount which is at least equal to the lesser of (i) the current Principal
Balance of such Mortgage Loan and (ii) the amount necessary to fully compensate
for any damage or loss to the improvements that are a part of such property on a
replacement cost basis, in each case in an amount not less than such amount as
is necessary to avoid the application of any coinsurance clause contained in the
related hazard insurance policy. The Master Servicer shall also cause to be
maintained hazard insurance with extended coverage on each REO Property in an
amount which is at least equal to the lesser of (i) the maximum insurable value
of the improvements which are a part of such property and (ii) the outstanding
Principal Balance of the related Mortgage Loan at the time it became an REO
Property. The Master Servicer will comply in the performance of this Agreement
with all reasonable rules and requirements of each insurer under any such hazard
policies. Any amounts to be collected by the Master Servicer under any such
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or amounts to be released to the
Mortgagor in accordance with the procedures that the Master Servicer would
follow in servicing loans held for its own account, subject to the terms and
conditions of the related Mortgage and Mortgage Note) shall be deposited in the
Collection Account, subject to withdrawal pursuant to Section 3.11, if received
in respect of a Mortgage Loan, or in the REO Account, subject to withdrawal
pursuant to Section 3.23, if received in respect of an REO Property. Any cost
incurred by the Master Servicer in maintaining any such insurance shall not, for
the purpose of calculating distributions to Certificateholders, be added to the
unpaid Principal Balance of the related Mortgage Loan, notwithstanding that the
terms of such Mortgage Loan so permit. It is understood and agreed that no
earthquake or other additional insurance is to be required of any Mortgagor
other than pursuant to such applicable laws and regulations as shall at any time
be in force and as shall require such additional insurance. If the Mortgaged
Property or REO Property is at any time in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards and flood insurance has been made available, the Master Servicer will
cause to be maintained a flood insurance policy in respect thereof. Such flood
insurance shall be in an amount equal to the lesser of (i) the unpaid Principal
Balance of the related Mortgage Loan and (ii) the maximum amount of such
insurance available for the related Mortgaged Property under the national flood
insurance program (assuming that the area in which such Mortgaged Property is
located is participating in such program).

                  In the event that the Master Servicer shall obtain and
maintain a blanket policy with an insurer having a General Policy Rating of
B:III or better in Best's Key Rating Guide (or such other rating that is
comparable to such rating) insuring against hazard losses on all of the Mortgage
Loans, it shall conclusively be deemed to have satisfied its obligations as set
forth in the first two sentences of this Section 3.14, it being understood and
agreed that such policy may contain a deductible clause, in which case the
Master Servicer shall, in the event that there shall not have been maintained on
the related Mortgaged Property or REO Property a policy complying with the first
two sentences of this Section 3.14, and there shall have been one or more losses
which would have been covered by such policy, deposit to the Collection Account
from its own funds the amount not otherwise payable under the blanket policy
because of such deductible clause. In connection with its activities as
administrator and servicer of the Mortgage Loans, the Master Servicer agrees to
prepare and present, on behalf of itself, the Trustee and Certificateholders,
claims under any such blanket policy in a timely fashion in accordance with the
terms of such policy.

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                  (b) The Master Servicer shall keep in force during the term of
this Agreement a policy or policies of insurance covering errors and omissions
for failure in the performance of the Master Servicer's obligations under this
Agreement, which policy or policies shall be in such form and amount that would
meet the requirements of Fannie Mae or Freddie Mac if it were the purchaser of
the Mortgage Loans, unless the Master Servicer has obtained a waiver of such
requirements from Fannie Mae or Freddie Mac. The Master Servicer shall provide
the Trustee and the NIMS Insurer, upon request, with copies of such insurance
policies and fidelity bond. The Master Servicer shall also maintain a fidelity
bond in the form and amount that would meet the requirements of Fannie Mae or
Freddie Mac, unless the Master Servicer has obtained a waiver of such
requirements from Fannie Mae or Freddie Mac. The Master Servicer shall be deemed
to have complied with this provision if an Affiliate of the Master Servicer has
such errors and omissions and fidelity bond coverage and, by the terms of such
insurance policy or fidelity bond, the coverage afforded thereunder extends to
the Master Servicer. Any such errors and omissions policy and fidelity bond
shall by its terms not be cancelable without thirty days' prior written notice
to the Trustee and the NIMS Insurer. The Master Servicer shall also cause each
Sub-Servicer to maintain a policy of insurance covering errors and omissions and
a fidelity bond which would meet such requirements.

                  SECTION 3.15. Enforcement of Due-On-Sale Clauses; Assumption
                                Agreements.

                  The Master Servicer will, to the extent it has knowledge of
any conveyance or prospective conveyance of any Mortgaged Property by any
Mortgagor (whether by absolute conveyance or by contract of sale, and whether or
not the Mortgagor remains or is to remain liable under the Mortgage Note and/or
the Mortgage), exercise its rights to accelerate the maturity of such Mortgage
Loan under the "due-on-sale" clause, if any, applicable thereto; PROVIDED,
HOWEVER, that the Master Servicer shall not be required to take such action if
in its sole business judgment the Master Servicer believes it is not in the best
interests of the Trust Fund and shall not exercise any such rights if prohibited
by law from doing so. If the Master Servicer reasonably believes it is unable
under applicable law to enforce such "due-on-sale" clause, or if any of the
other conditions set forth in the proviso to the preceding sentence apply, the
Master Servicer will enter into an assumption and modification agreement from or
with the person to whom such property has been conveyed or is proposed to be
conveyed, pursuant to which such person becomes liable under the Mortgage Note
and, to the extent permitted by applicable state law, the Mortgagor remains
liable thereon. The Master Servicer is also authorized to enter into a
substitution of liability agreement with such person, pursuant to which the
original Mortgagor is released from liability and such person is substituted as
the Mortgagor and becomes liable under the Mortgage Note, provided that no such
substitution shall be effective unless such person satisfies the underwriting
criteria of the Master Servicer and has a credit risk rating at least equal to
that of the original Mortgagor. In connection with any assumption or
substitution, the Master Servicer shall apply such underwriting standards and
follow such practices and procedures as shall be normal and usual in its general
mortgage servicing activities and as it applies to other mortgage loans owned
solely by it. The Master Servicer shall not take or enter into any assumption
and modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation, in writing, of the continued
effectiveness of any applicable hazard insurance policy. Any fee collected by
the Master Servicer in respect of an assumption, modification or substitution of
liability agreement shall be retained by the Master Servicer as additional
servicing compensation. In connection with any such assumption, no material

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term of the Mortgage Note (including but not limited to the related Mortgage
Rate and the amount of the Monthly Payment) may be amended or modified, except
as otherwise required pursuant to the terms thereof. The Master Servicer shall
notify the Trustee that any such substitution, modification or assumption
agreement has been completed by forwarding to the Trustee the executed original
of such substitution, modification or assumption agreement, which document shall
be added to the related Mortgage File and shall, for all purposes, be considered
a part of such Mortgage File to the same extent as all other documents and
instruments constituting a part thereof.

                  Notwithstanding the foregoing paragraph or any other provision
of this Agreement, the Master Servicer shall not be deemed to be in default,
breach or any other violation of its obligations hereunder by reason of any
assumption of a Mortgage Loan by operation of law or by the terms of the
Mortgage Note or any assumption which the Master Servicer may be restricted by
law from preventing, for any reason whatever. For purposes of this Section 3.15,
the term "assumption" is deemed to also include a sale (of the Mortgaged
Property) subject to the Mortgage that is not accompanied by an assumption or
substitution of liability agreement.

                  SECTION 3.16. Realization Upon Defaulted Mortgage Loans.

                  (a) The Master Servicer shall use its best efforts, in as
practical a time frame as possible and consistent with Servicing Standard, to
foreclose upon or otherwise comparably convert the ownership of properties
securing such of the Mortgage Loans as come into and continue in default and as
to which no satisfactory arrangements can be made for collection of delinquent
payments pursuant to Section 3.07. The Master Servicer shall be responsible for
all costs and expenses incurred by it in any such proceedings; PROVIDED,
HOWEVER, that such costs and expenses will be recoverable as Servicing Advances
by the Master Servicer as contemplated in Section 3.11 and Section 3.23. The
foregoing is subject to the provision that, in any case in which a Mortgaged
Property shall have suffered damage from an Uninsured Cause, the Master Servicer
shall not be required to expend its own funds toward the restoration of such
property unless it shall determine in its discretion that such restoration will
increase the proceeds of liquidation of the related Mortgage Loan after
reimbursement to itself for such expenses.

                  (b) Notwithstanding the foregoing provisions of this Section
3.16 or any other provision of this Agreement, with respect to any Mortgage Loan
as to which the Master Servicer has received actual notice of, or has actual
knowledge of, the presence of any toxic or hazardous substance on the related
Mortgaged Property, the Master Servicer shall not, on behalf of the Trustee,
either (i) obtain title to such Mortgaged Property as a result of or in lieu of
foreclosure or otherwise, or (ii) otherwise acquire possession of, or take any
other action with respect to, such Mortgaged Property, if, as a result of any
such action, the Trustee, the Trust Fund or the Certificateholders would be
considered to hold title to, to be a "mortgagee-in-possession" of, or to be an
"owner" or "operator" of such Mortgaged Property within the meaning of the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended from time to time, or any comparable law, unless the Master Servicer has
also previously determined, based on its reasonable judgment and a report
prepared by a Person who regularly conducts environmental audits using customary
industry standards, that:

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                  (1) such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic interest of
the Trust Fund to take such actions as are necessary to bring the Mortgaged
Property into compliance therewith; and

                  (2) there are no circumstances present at such Mortgaged
Property relating to the use, management or disposal of any hazardous
substances, hazardous materials, hazardous wastes, or petroleum-based materials
for which investigation, testing, monitoring, containment, clean-up or
remediation could be required under any federal, state or local law or
regulation, or that if any such materials are present for which such action
could be required, that it would be in the best economic interest of the Trust
Fund to take such actions with respect to the affected Mortgaged Property.

                  Notwithstanding the foregoing, if such environmental audit
reveals, or if the Master Servicer has actual knowledge or notice, that such
Mortgaged Property contains such wastes or substances, the Master Servicer shall
not foreclose or accept a deed in lieu of foreclosure without the prior written
consent of the NIMS Insurer.

                  The cost of the environmental audit report contemplated by
this Section 3.16 shall be advanced by the Master Servicer, subject to the
Master Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.11(a)(vii), such right of reimbursement being prior to the
rights of Certificateholders to receive any amount in the Collection Account
received in respect of the affected Mortgage Loan or other Mortgage Loans.

                  If the Master Servicer determines, as described above, that it
is in the best economic interest of the Trust Fund to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes or petroleum-based materials affecting any such Mortgaged Property, then
the Master Servicer shall take such action as it deems to be in the best
economic interest of the Trust Fund; PROVIDED that any amounts disbursed by the
Master Servicer pursuant to this Section 3.16(b) shall constitute Servicing
Advances, subject to Section 4.04(d). The cost of any such compliance,
containment, cleanup or remediation shall be advanced by the Master Servicer,
subject to the Master Servicer's right to be reimbursed therefor from the
Collection Account as provided in Section 3.11(a)(iii) and (a)(vii), such right
of reimbursement being prior to the rights of Certificateholders to receive any
amount in the Collection Account received in respect of the affected Mortgage
Loan or other Mortgage Loans.

                  (c) (i) The NIMS Insurer may, at its option, purchase a
Mortgage Loan which has become 90 or more days delinquent or for which the
Master Servicer has accepted a deed in lieu of foreclosure. Prior to purchase
pursuant to this Section 3.16(c)(i), the Master Servicer shall be required to
continue to make Advances pursuant to Section 4.04. The NIMS Insurer shall not
use any procedure in selecting Mortgage Loans to be repurchased which is
materially adverse to the interests of the Certificateholders. The NIMS Insurer
shall purchase such delinquent Mortgage Loan at a price equal to the Purchase
Price of such Mortgage Loan. Any such purchase of a Mortgage Loan pursuant to
this Section 3.16(c)(i) shall be accomplished by remittance to the Master
Servicer for deposit in the Collection Account of the amount of the Purchase
Price. The Trustee shall

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immediately effectuate the conveyance of such delinquent Mortgage Loan to the
NIMS Insurer to the extent necessary, including the prompt delivery of all
documentation to the NIMS Insurer.

                           (ii) If the Master Servicer Optional Purchase
Delinquency Trigger has been met, the Master Servicer may, at its option,
purchase a Mortgage Loan which has become 90 or more days delinquent or for
which the Master Servicer has accepted a deed in lieu of foreclosure. Prior to
purchase pursuant to this Section 3.16(c)(ii), the Master Servicer shall be
required to continue to make Advances pursuant to Section 4.04. The Master
Servicer shall purchase such delinquent Mortgage Loan at a price equal to the
Purchase Price of such Mortgage Loan. Any such purchase of a Mortgage Loan
pursuant to this Section 3.16(c)(ii) shall be accomplished by deposit in the
Collection Account of the amount of the Purchase Price. The Trustee shall
immediately effectuate the conveyance of such delinquent Mortgage Loan to the
Master Servicer to the extent necessary, including the prompt delivery of all
documentation to the Master Servicer.

                  Notwithstanding the foregoing: (A) the Master Servicer shall
have the option to purchase pursuant to this Section 3.16(c)(ii) only such
delinquent Mortgage Loans having an aggregate Stated Principal Balance such
that, if such delinquent Mortgage Loans were not in the Trust, the Master
Servicer Optional Purchase Delinquency Trigger would not be met; (B) if the
Master Servicer purchases any delinquent Mortgage Loans pursuant to this Section
3.16(c)(ii), it must purchase Mortgage Loans that are delinquent the greatest
number of days before it may purchase any that are delinquent any fewer number
of days; (C) if the Master Servicer purchases some but not all Mortgage Loans
that are delinquent any given number of days, it must purchase Mortgage Loans
having the same delinquency status in the order of lowest Stated Principal
Balance to highest Stated Principal Balance; (D) the Master Servicer may at any
time relinquish its rights to purchase delinquent Mortgage Loans pursuant to
this Section 3.16(C)(ii) in writing delivered to the Trustee, and from and after
the taking of such action by the Master Servicer, the provisions of this Section
3.16(c)(ii) shall no longer be of any force or effect.

                  (d) Proceeds received in connection with any Final Recovery
Determination, as well as any recovery resulting from a partial collection of
Insurance Proceeds, Liquidation Proceeds or condemnation proceeds, in respect of
any Mortgage Loan, will be applied in the following order of priority: FIRST, to
unpaid Servicing Fees; SECOND, to reimburse the Master Servicer or any Sub-
Servicer for any related unreimbursed Servicing Advances pursuant to Section
3.11(a)(iii) and Advances pursuant to Section 3.11(a)(ii); THIRD, to accrued and
unpaid interest on the Mortgage Loan, to the date of the Final Recovery
Determination, or to the Due Date prior to the Distribution Date on which such
amounts are to be distributed if not in connection with a Final Recovery
Determination; and FOURTH, as a recovery of principal of the Mortgage Loan. The
portion of the recovery so allocated to unpaid Servicing Fees shall be
reimbursed to the Master Servicer or any Sub-Servicer pursuant to Section
3.11(a)(iii).

                  SECTION 3.17. Trustee to Cooperate; Release of Mortgage Files.

                  (a) Upon the payment in full of any Mortgage Loan, or the
receipt by the Master Servicer of a notification that payment in full shall be
escrowed in a manner customary for such purposes, the Master Servicer shall
deliver to the Trustee, in written (with two executed copies) or electronic
format, a Request for Release in the form of Exhibit E (which certification
shall include

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a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.10 have been or will be so deposited)
signed by a Servicing Officer (or in a mutually agreeable electronic format that
will, in lieu of a signature on its face, originate from a Servicing Officer)
and shall request delivery to it of the Mortgage File. Upon receipt of such
certification and request, the Trustee shall, within three Business Days,
release and send by overnight mail, at the expense of the Master Servicer, the
related Mortgage File to the Master Servicer. The Trustee agrees to indemnify
the Master Servicer, out of its own funds, for any loss, liability or expense
(other than special, indirect, punitive or consequential damages which will not
be paid by the Trustee) incurred by the Master Servicer as a proximate result of
the Trustee's breach of its obligations pursuant to this Section 3.17. No
expenses incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Collection Account or the Distribution
Account.

                  (b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any insurance policy relating to the Mortgage Loans, the Trustee shall, upon any
request made by or on behalf of the Master Servicer and delivery to the Trustee,
in written (with two executed copies) or electronic format, of a Request for
Release in the form of Exhibit E signed by a Servicing Officer (or in a mutually
agreeable electronic format that will, in lieu of a signature on its face,
originate from a Servicing Officer), release the related Mortgage File to the
Master Servicer within three Business Days, and the Trustee shall, at the
direction of the Master Servicer, execute such documents as shall be necessary
to the prosecution of any such proceedings. Such Request for Release shall
obligate the Master Servicer to return each and every document previously
requested from the Mortgage File to the Trustee when the need therefor by the
Master Servicer no longer exists, unless the Mortgage Loan has been liquidated
and the Liquidation Proceeds relating to the Mortgage Loan have been deposited
in the Collection Account or the Mortgage File or such document has been
delivered to an attorney, or to a public trustee or other public official as
required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non- judicially, and the Master Servicer has delivered, or caused to be
delivered, to the Trustee an additional Request for Release certifying as to
such liquidation or action or proceedings. Upon the request of the Trustee, the
Master Servicer shall provide notice to the Trustee of the name and address of
the Person to which such Mortgage File or such document was delivered and the
purpose or purposes of such delivery. Upon receipt of a Request for Release, in
written (with two executed copies) or electronic format, from a Servicing
Officer stating that such Mortgage Loan was liquidated and that all amounts
received or to be received in connection with such liquidation that are required
to be deposited into the Collection Account have been so deposited, or that such
Mortgage Loan has become an REO Property, such Mortgage Loan shall be released
by the Trustee to the Master Servicer or its designee.

                  (c) Upon written certification of a Servicing Officer, the
Trustee shall execute and deliver to the Master Servicer or the Sub-Servicer, as
the case may be, copies of, any court pleadings, requests for trustee's sale or
other documents necessary to the foreclosure or trustee's sale in respect of a
Mortgaged Property or to any legal action brought to obtain judgment against any
Mortgagor on the Mortgage Note or Mortgage or to obtain a deficiency judgment,
or to enforce any other remedies or rights provided by the Mortgage Note or
Mortgage or otherwise available at law or in equity. Each such certification
shall include a request that such pleadings or documents be executed

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by the Trustee and a statement as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.

                  SECTION 3.18. Servicing Compensation.

                  As compensation for the activities of the Master Servicer
hereunder, the Master Servicer shall be entitled to the Servicing Fee with
respect to each Mortgage Loan payable solely from payments of interest in
respect of such Mortgage Loan, subject to Section 3.24. In addition, the Master
Servicer shall be entitled to recover unpaid Servicing Fees out of Insurance
Proceeds, Liquidation Proceeds or condemnation proceeds to the extent permitted
by Section 3.11(a)(iii) and out of amounts derived from the operation and sale
of an REO Property to the extent permitted by Section 3.23. Except as provided
in Section 3.29, the right to receive the Servicing Fee may not be transferred
in whole or in part except in connection with the transfer of all of the Master
Servicer's responsibilities and obligations under this Agreement; PROVIDED,
HOWEVER, that the Master Servicer may pay from the Servicing Fee any amounts due
to a Sub-Servicer pursuant to a Sub-Servicing Agreement entered into under
Section 3.02.

                  Additional servicing compensation in the form of assumption
fees, late payment charges, insufficient funds charges, ancillary income or
otherwise (other than Prepayment Charges) shall be retained by the Master
Servicer only to the extent such fees or charges are received by the Master
Servicer. The Master Servicer shall also be entitled pursuant to Section
3.11(a)(iv) to withdraw from the Collection Account and pursuant to Section
3.23(b) to withdraw from any REO Account, as additional servicing compensation,
interest or other income earned on deposits therein, subject to Section 3.12 and
Section 3.24. The Master Servicer shall be required to pay all expenses incurred
by it in connection with its servicing activities hereunder (including premiums
for the insurance required by Section 3.14, to the extent such premiums are not
paid by the related Mortgagors or by a Sub-Servicer and servicing compensation
of each Sub-Servicer) and shall not be entitled to reimbursement therefor except
as specifically provided herein.

                  The Master Servicer shall be entitled to any Prepayment
Interest Excess, which it may withdraw from the Collection Account pursuant to
Section 3.11(a)(ix).

                  SECTION 3.19. Reports to the Trustee; Collection Account
                                Statements.

                  Not later than twenty days after each Distribution Date, the
Master Servicer shall forward to the NIMS Insurer and, upon request, to the
Trustee and the Depositor the most current available bank statement for the
Collection Account. Copies of such statement shall be provided by the Trustee to
any Certificateholder and to any Person identified to the Trustee as a
prospective transferee of a Certificate, upon request at the expense of the
requesting party, provided such statement is delivered by the Master Servicer to
the Trustee.

                  SECTION 3.20. Statement as to Compliance.

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                  The Master Servicer will deliver to the Trustee, the NIMS
Insurer and the Depositor not later than March 10th , commencing in 2005, an
Officers' Certificate substantially in the form of Exhibit S attached hereto
stating, as to each signatory thereof, that (i) a review of the activities of
the Master Servicer during the preceding calendar year and of performance under
this Agreement has been made under such officers' supervision and (ii) to the
best of such officers' knowledge, based on such review, the Master Servicer has
fulfilled all of its obligations under this Agreement throughout such year, or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof. Copies of any such statement shall be provided by the Trustee to any
Certificateholder and to any Person identified to the Trustee as a prospective
transferee of a Certificate, upon request at the expense of the requesting
party, provided such statement is delivered by the Master Servicer to the
Trustee.

                  SECTION 3.21. Independent Public Accountants' Servicing
                                Report.

                  Not later than March 10th , commencing in 2005, the Master
Servicer, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to the Master Servicer a
report stating that (i) it has obtained a letter of representation regarding
certain matters from the management of the Master Servicer which includes an
assertion that the Master Servicer has complied with certain minimum residential
mortgage loan servicing standards, identified in the Uniform Single Attestation
Program for Mortgage Bankers established by the Mortgage Bankers Association of
America, with respect to the servicing of residential mortgage loans during the
most recently completed calendar year and (ii) on the basis of an examination
conducted by such firm in accordance with standards established by the American
Institute of Certified Public Accountants, such representation is fairly stated
in all material respects, subject to such exceptions and other qualifications
that may be appropriate. In rendering its report such firm may rely, as to
matters relating to the direct servicing of residential mortgage loans by
Sub-Servicers, upon comparable reports of firms of independent certified public
accountants rendered on the basis of examinations conducted in accordance with
the same standards (rendered within one year of such report) with respect to
those Sub-Servicers. Immediately upon receipt of such report, the Master
Servicer shall furnish a copy of such report to the Trustee, the NIMS Insurer
and each Rating Agency. Copies of such statement shall be provided by the
Trustee to any Certificateholder upon request at the Master Servicer's expense,
provided that such statement is delivered by the Master Servicer to the Trustee.

                  SECTION 3.22. Access to Certain Documentation; Filing of
                                Reports by Trustee.

                  (a) The Master Servicer shall provide to the Office of Thrift
Supervision, the FDIC, and any other federal or state banking or insurance
regulatory authority that may exercise authority over any Certificateholder or
Certificate Owner, access to the documentation regarding the Mortgage Loans
required by applicable laws and regulations. Such access shall be afforded
without charge, but only upon reasonable request and during normal business
hours at the offices of the Master Servicer designated by it. In addition,
access to the documentation regarding the Mortgage Loans will be provided to any
Certificateholder or Certificate Owner, the Trustee, the NIMS Insurer and to any
Person identified to the Master Servicer as a prospective transferee of a
Certificate, upon

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reasonable request during normal business hours at the offices of the Master
Servicer designated by it at the expense of the Person requesting such access.

                  (b) The Trustee shall reasonably cooperate with the Depositor
in connection with satisfying the reporting requirements under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). The Trustee shall prepare
on behalf of the Trust any Forms 8-K and 10-K customary for similar securities
as required by the Exchange Act and the Rules and Regulations of the Securities
and Exchange Commission thereunder, and the Depositor shall sign and the Trustee
shall file (via the Securities and Exchange Commission's Electronic Data
Gathering and Retrieval System) such forms on behalf of the Depositor. The
Depositor hereby grants to the Trustee a limited power of attorney to execute
any Form 8-K and file each such document on behalf of the Depositor. Such power
of attorney shall continue until the earlier of (i) receipt by the Trustee from
the Depositor of written termination of such power of attorney and (ii) the
termination of the Trust. Notwithstanding anything herein to the contrary, the
Depositor, and not the Trustee, shall be responsible for executing each Form
10-K filed on behalf of the Trust.

                  (c) Each Form 8-K shall be filed by the Trustee within 15 days
after each Distribution Date, with a copy of the statement to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
March 30th of each year, commencing in 2005 (or such earlier date as may be
required by the Exchange Act and the Rules and Regulations of the Securities and
Exchange Commission), the Trustee shall file a Form 10-K, in substance as
required by applicable law or applicable Securities and Exchange Commission
staff's interpretations. Such Form 10-K shall include as exhibits the Master
Servicer's annual statement of compliance described under Section 3.20 and the
accountant's report described under Section 3.21, in each case to the extent
they have been timely delivered to the Trustee. If they are not so timely
delivered, the Trustee shall file an amended Form 10-K including such documents
as exhibits reasonably promptly after they are delivered to the Trustee. The
Trustee shall have no liability with respect to any failure to properly prepare
or file such periodic reports resulting from or relating to the Trustee's
inability or failure to obtain any information not resulting from its own
negligence or willful misconduct. The Form 10-K shall also include a
certification in the form attached hereto as Exhibit R-1 (the "Certification"),
which shall be signed by the senior officer of the Depositor in charge of
securitization.

                  The Trustee shall subject to the provisions of Sections 8.01
and 8.02 hereof, indemnify and hold harmless the Depositor and its officers,
directors and Affiliates from and against any losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments
and other costs and expenses arising out of or based upon third party claims
relating to information included in any Form 10-K provided by the Trustee other
than any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs arising out of third party claims
relating to information contained in the Certification, the Master Servicer's
annual statement of compliance described under Section 3.20 and the accountant's
report described under Section 3.21 which are included in such Form 10-K.

                  (d) In addition, the Trustee shall sign a certification (in
the form attached hereto as Exhibit R-2) for the benefit of the Depositor and
its officers, directors and Affiliates regarding certain aspects of items 1
through 3 of the Certification (provided, however, that the Trustee shall not
undertake an analysis of the accountant's report attached as an exhibit to the
Form 10-K). The

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Trustee's certification shall be delivered to the Depositor by no later than
March 18th of each year (or if such day is not a Business Day, the immediately
preceding Business Day) and the Depositor shall deliver the Certification to the
Trustee for filing no later than March 20th of each year (or if such day is not
a Business Day, the immediately preceding Business Day).

                  In addition, the Trustee shall indemnify and hold harmless the
Depositor and its officers, directors and Affiliates from and against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of or
based upon a breach of the Trustee's obligations under this Section 3.22(b) or
the Trustee's negligence, bad faith or willful misconduct in connection
therewith. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Depositor, then the Trustee, in connection
with a breach of the Trustee's obligations under this Section 3.22(b) or the
Trustee's negligence, bad faith or willful misconduct in connection therewith,
agrees that it shall contribute to the amount paid or payable by the Depositor
as a result of the losses, claims, damages or liabilities of the Depositor in
such proportion as is appropriate to reflect the relative fault of the Depositor
on the one hand and the Trustee on the other.

                  (e) Upon any filing with the Securities and Exchange
Commission, the Trustee shall promptly deliver to the Depositor a copy of any
executed report, statement or information.

                  (f) Prior to January 30 of the first year in which the Trustee
is able to do so under applicable law, the Trustee shall file a Form 15
Suspension Notification with respect to the Trust.

                  (g) To the extent that, following the Closing Date, the
Depositor certifies that reports and certifications differing from those
required under this Section 3.22(b) comply with the reporting requirements under
the Exchange Act, the Trustee hereby agrees that it will reasonably cooperate to
amend the provisions of this Section 3.22(b) in order to comply with such
amended reporting requirements and such amendment of this Section 3.22(b). Any
such amendment may result in the reduction of the reports filed by the Depositor
under the Exchange Act. Notwithstanding the foregoing, the Trustee shall not be
obligated to enter into any amendment pursuant to this Section that adversely
affects its obligations and immunities under this Agreement.

                  SECTION 3.23. Title, Management and Disposition of REO
                                Property.

                  (a) The deed or certificate of sale of any REO Property shall
be taken in the name of the Trustee, or its nominee, in trust for the benefit of
the Certificateholders. The Master Servicer, on behalf of REMIC 1, shall sell
any REO Property as soon as practical and in any event no later than the end of
the third full taxable year after the taxable year in which such REMIC acquires
ownership of such REO Property for purposes of Section 860G(a)(8) of the Code or
request from the Internal Revenue Service, no later than 60 days before the day
on which the three-year grace period would otherwise expire, an extension of
such three-year period, unless the Master Servicer shall have delivered to the
Trustee and the NIMS Insurer an Opinion of Counsel acceptable to the NIMS
Insurer and addressed to the Trustee, the NIMS Insurer and the Depositor, to the
effect that the holding by the REMIC of such REO Property subsequent to three
years after its acquisition will not result in the imposition on the REMIC of
taxes on "prohibited transactions" thereof, as defined in Section 860F of the
Code, or cause any of the REMICs created hereunder to fail to qualify as a

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REMIC under Federal law at any time that any Certificates are outstanding. The
Master Servicer shall manage, conserve, protect and operate each REO Property
for the Certificateholders solely for the purpose of its prompt disposition and
sale in a manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code or
result in the receipt by any of the REMICs created hereunder of any "income from
non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the Code,
or any "net income from foreclosure property" which is subject to taxation under
the REMIC Provisions.

                  (b) The Master Servicer shall separately account for all funds
collected and received in connection with the operation of any REO Property and
shall establish and maintain, or cause to be established and maintained, with
respect to REO Properties an account held in trust for the Trustee for the
benefit of the Certificateholders (the "REO Account"), which shall be an
Eligible Account. The Master Servicer shall be permitted to allow the Collection
Account to serve as the REO Account, subject to separate ledgers for each REO
Property. The Master Servicer shall be entitled to retain or withdraw any
interest income paid on funds deposited in the REO Account.

                  (c) The Master Servicer shall have full power and authority,
subject only to the specific requirements and prohibitions of this Agreement, to
do any and all things in connection with any REO Property as are consistent with
the manner in which the Master Servicer manages and operates similar property
owned by the Master Servicer or any of its Affiliates, all on such terms and for
such period (subject to the requirement of prompt disposition set forth in
Section 3.23(a)) as the Master Servicer deems to be in the best interests of
Certificateholders. In connection therewith, the Master Servicer shall deposit,
or cause to be deposited in the clearing account in which it customarily
deposits payments and collections on mortgage loans in connection with its
mortgage loan servicing activities on a daily basis, and in no event more than
one Business Day after the Master Servicer's receipt thereof, and shall
thereafter deposit in the REO Account, in no event more than two Business Days
after the Master Servicer's receipt thereof, all revenues received by it with
respect to an REO Property and shall withdraw therefrom funds necessary for the
proper operation, management and maintenance of such REO Property including,
without limitation:

                  (i) all insurance premiums due and payable in respect of such
         REO Property;

                  (ii) all real estate taxes and assessments in respect of such
         REO Property that may result in the imposition of a lien thereon; and

                  (iii) all costs and expenses necessary to maintain such REO
         Property.

                  To the extent that amounts on deposit in the REO Account with
respect to an REO Property are insufficient for the purposes set forth in
clauses (i) through (iii) above with respect to such REO Property, the Master
Servicer shall advance from its own funds such amount as is necessary for such
purposes if, but only if, the Master Servicer would make such advances if the
Master Servicer owned the REO Property and if in the Master Servicer's judgment,
the payment of such amounts will be recoverable from the rental or sale of the
REO Property.

                  Notwithstanding the foregoing, neither the Master Servicer nor
the Trustee shall:

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                  (A) authorize the Trust Fund to enter into, renew or extend
         any New Lease with respect to any REO Property, if the New Lease by its
         terms will give rise to any income that does not constitute Rents from
         Real Property;

                  (B) authorize any amount to be received or accrued under any
         New Lease other than amounts that will constitute Rents from Real
         Property;

                  (C) authorize any construction on any REO Property, other than
         the completion of a building or other improvement thereon, and then
         only if more than ten percent of the construction of such building or
         other improvement was completed before default on the related Mortgage
         Loan became imminent, all within the meaning of Section 856(e)(4)(B) of
         the Code; or

                  (D) authorize any Person to Directly Operate any REO Property
         on any date more than 90 days after its date of acquisition by the
         Trust Fund;

unless, in any such case, the Master Servicer has obtained an Opinion of
Counsel, provided to the Trustee and the NIMS Insurer, to the effect that such
action will not cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code at any time that
it is held by the REMIC, in which case the Master Servicer may take such actions
as are specified in such Opinion of Counsel.

                  The Master Servicer may contract with any Independent
Contractor for the operation and management of any REO Property, provided that:

                  (1) the terms and conditions of any such contract shall not be
         inconsistent herewith;

                  (2) any such contract shall require, or shall be administered
         to require, that the Independent Contractor pay all costs and expenses
         incurred in connection with the operation and management of such REO
         Property, including those listed above and remit all related revenues
         (net of such costs and expenses) to the Master Servicer as soon as
         practicable, but in no event later than thirty days following the
         receipt thereof by such Independent Contractor;

                  (3) none of the provisions of this Section 3.23(c) relating to
         any such contract or to actions taken through any such Independent
         Contractor shall be deemed to relieve the Master Servicer of any of its
         duties and obligations to the Trustee on behalf of the
         Certificateholders with respect to the operation and management of any
         such REO Property; and

                  (4) the Master Servicer shall be obligated with respect
         thereto to the same extent as if it alone were performing all duties
         and obligations in connection with the operation and management of such
         REO Property.

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                  The Master Servicer shall be entitled to enter into any
agreement with any Independent Contractor performing services for it related to
its duties and obligations hereunder for indemnification of the Master Servicer
by such Independent Contractor, and nothing in this Agreement shall be deemed to
limit or modify such indemnification. The Master Servicer shall be solely liable
for all fees owed by it to any such Independent Contractor, irrespective of
whether the Master Servicer's compensation pursuant to Section 3.18 is
sufficient to pay such fees; PROVIDED, HOWEVER, that to the extent that any
payments made by such Independent Contractor would constitute Servicing Advances
if made by the Master Servicer, such amounts shall be reimbursable as Servicing
Advances made by the Master Servicer.

                  (d) In addition to the withdrawals permitted under Section
3.23(c), the Master Servicer may from time to time make withdrawals from the REO
Account for any REO Property: (i) to pay itself or any Sub-Servicer unpaid
Servicing Fees in respect of the related Mortgage Loan; and (ii) to reimburse
itself or any Sub-Servicer for unreimbursed Servicing Advances and Advances made
in respect of such REO Property or the related Mortgage Loan. On the Master
Servicer Remittance Date, the Master Servicer shall withdraw from each REO
Account maintained by it and deposit into the Distribution Account in accordance
with Section 3.10(d)(ii), for distribution on the related Distribution Date in
accordance with Section 4.01, the income from the related REO Property received
during the related Prepayment Period, net of any withdrawals made pursuant to
Section 3.23(c) or this Section 3.23(d).

                  (e) Subject to the time constraints set forth in Section
3.23(a), each REO Disposition shall be carried out by the Master Servicer in a
manner, at such price and upon such terms and conditions as shall be in
conformity with the requirements of the Loss Mitigation Procedures and as shall
be normal and usual in its Servicing Standard.

                  (f) The proceeds from the REO Disposition, net of any amount
required by law to be remitted to the Mortgagor under the related Mortgage Loan
and net of any payment or reimbursement to the Master Servicer or any
Sub-Servicer as provided above, shall be deposited in the Distribution Account
in accordance with Section 3.10(d)(ii) on the Master Servicer Remittance Date in
the month following the receipt thereof for distribution on the related
Distribution Date in accordance with Section 4.01. Any REO Disposition shall be
for cash only (unless changes in the REMIC Provisions made subsequent to the
Startup Day allow a sale for other consideration).

                  (g) The Master Servicer shall file information returns with
respect to the receipt of mortgage interest received in a trade or business,
reports of foreclosures and abandonments of any Mortgaged Property and
cancellation of indebtedness income with respect to any Mortgaged Property as
required by Sections 6050H, 6050J and 6050P of the Code, respectively. Such
reports shall be in form and substance sufficient to meet the reporting
requirements imposed by such Sections 6050H, 6050J and 6050P of the Code.

                  SECTION 3.24. Obligations of the Master Servicer in Respect of
                                Prepayment Interest Shortfalls.

                  Not later than 1:00 p.m. New York time on each Master Servicer
Remittance Date, the Master Servicer shall remit to the Distribution Account an
amount ("Compensating Interest")

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equal to the lesser of (A) the aggregate of the Prepayment Interest Shortfalls
for the related Distribution Date and (B) its aggregate Servicing Fee for the
related Due Period and any Prepayment Interest Excess earned during the related
Prepayment Period. The Master Servicer shall not have the right to reimbursement
for any amounts remitted to the Trustee in respect of Compensating Interest.
Such amounts so remitted shall be included in the Available Funds and
distributed therewith on the next Distribution Date. The Master Servicer shall
not be obligated to pay Compensating Interest with respect to Relief Act
Interest Shortfalls.

                  SECTION 3.25. [Reserved]

                  SECTION 3.26. Obligations of the Master Servicer in Respect of
                                Mortgage Rates and Monthly Payments.

                  In the event that a shortfall in any collection on or
liability with respect to the Mortgage Loans in the aggregate results from or is
attributable to adjustments to Mortgage Rates, Monthly Payments or Stated
Principal Balances that were made by the Master Servicer in a manner not
consistent with the terms of the related Mortgage Note and this Agreement, the
Master Servicer, upon discovery or receipt of notice thereof, immediately shall
deposit in the Collection Account from its own funds the amount of any such
shortfall and shall indemnify and hold harmless the Trust Fund, the Trustee, the
Depositor and any successor servicer in respect of any such liability. Such
indemnities shall survive the termination or discharge of this Agreement.
Notwithstanding the foregoing, this Section 3.26 shall not limit the ability of
the Master Servicer to seek recovery of any such amounts from the related
Mortgagor under the terms of the related Mortgage Note, as permitted by law.

                  SECTION 3.27. Solicitations.

                  From and after the Closing Date, the Master Servicer agrees
that it will not take any action or permit or cause any action to be taken by
any of its agents and Affiliates, or by any independent contractors or
independent mortgage brokerage companies on the Master Servicer's behalf, to
personally, by telephone, mail or electronic mail, solicit the Mortgagor under
any Mortgage Loan for the purpose of refinancing such Mortgage Loan; PROVIDED,
that the Master Servicer may solicit any Mortgagor for whom the Master Servicer
has received a request for verification of mortgage, a request for demand for
payoff, a mortgagor initiated written or verbal communication indicating a
desire to prepay the related Mortgage Loan, another mortgage company has pulled
a credit report on the mortgagor or the mortgagor initiates a title search;
provided further, it is understood and agreed that promotions undertaken by the
Master Servicer or any of its Affiliates which (i) concern optional insurance
products or other additional products or (ii) are directed to the general public
at large, including, without limitation, mass mailings based on commercially
acquired mailing lists, newspaper, radio and television advertisements shall not
constitute solicitation under this Section, nor is the Master Servicer
prohibited from responding to unsolicited requests or inquiries made by a
Mortgagor or an agent of a Mortgagor. Furthermore, the Master Servicer shall be
permitted to include in its monthly statements to borrowers or otherwise,
statements regarding the availability of the Master Servicer's counseling
services with respect to refinancing mortgage loans.

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                  SECTION 3.28. Net WAC Rate Carryover Reserve Account.

                  No later than the Closing Date, the Trustee shall establish
and maintain with itself a separate, segregated trust account titled, "Net WAC
Rate Carryover Reserve Account, Wells Fargo Bank, N.A., as Trustee, in trust for
registered Holders of Option One Mortgage Loan Trust 2004-2, Asset-Backed
Certificates, Series 2004-2." On the Closing Date, the Depositor will deposit,
or cause to be deposited, into the Net WAC Rate Carryover Reserve Account
$1,000. In addition, the amount deposited in the Net WAC Rate Carryover Reserve
Account will include any payments received by the Trustee under the Cap
Contracts and deposited into the Net WAC Rate Carryover Reserve Account.

                  On each Distribution Date as to which there is a Net WAC Rate
Carryover Amount payable to the Class A Certificates and/or the Mezzanine
Certificates, the Trustee has been directed by the Class C Certificateholders
to, and therefore will, deposit into the Net WAC Rate Carryover Reserve Account
the amounts described in Section 4.01(d)(xix), rather than distributing such
amounts to the Class C Certificateholders. On each such Distribution Date, the
Trustee shall hold all such amounts for the benefit of the Holders of the Class
A Certificates and the Mezzanine Certificates, and will distribute such amounts
to the Holders of the Class A Certificates and/or the Mezzanine Certificates in
the amounts and priorities set forth in Section 4.01(d). If no Net WAC Rate
Carryover Amounts are payable on a Distribution Date, the Trustee shall deposit
into the Net WAC Rate Carryover Reserve Account on behalf of the Class C
Certificateholders, from amounts otherwise distributable to the Class C
Certificateholders, an amount such that when added to other amounts already on
deposit in the Net WAC Rate Carryover Reserve Account, the aggregate amount on
deposit therein is equal to $1,000.

                  For federal and state income tax purposes, the Class C
Certificateholders will be deemed to be the owners of the Net WAC Rate Carryover
Reserve Account and all amounts deposited into the Net WAC Rate Carryover
Reserve Account shall be treated as amounts distributed by REMIC 3 to the Holder
of the Class C Certificates. Upon the termination of the Trust, or the payment
in full of the Class A Certificates and the Mezzanine Certificates, all amounts
remaining on deposit in the Net WAC Rate Carryover Reserve Account will be
released by the Trust and distributed to the Class C Certificateholders or their
designees. The Net WAC Rate Carryover Reserve Account will be part of the Trust
but not part of any REMIC and any payments to the Holders of the Class A
Certificates or the Mezzanine Certificates of Net WAC Rate Carryover Amounts
will not be payments with respect to a "regular interest" in a REMIC within the
meaning of Code Section 860(G)(a)(1).

                  By accepting a Class C Certificate, each Class C
Certificateholder hereby agrees to direct the Trustee, and the Trustee hereby is
directed, to deposit into the Net WAC Rate Carryover Reserve Account the amounts
described above on each Distribution Date as to which there is any Net WAC Rate
Carryover Amount rather than distributing such amounts to the Class C
Certificateholders. By accepting a Class C Certificate, each Class C
Certificateholder further agrees that such direction is given for good and
valuable consideration, the receipt and sufficiency of which is acknowledged by
such acceptance.

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                  At the direction of the Holders of a majority in Percentage
Interest in the Class C Certificates, the Trustee shall direct any depository
institution maintaining the Net WAC Rate Carryover Reserve Account to invest the
funds in such account in one or more Permitted Investments bearing interest or
sold at a discount, and maturing, unless payable on demand, (i) no later than
the Business Day immediately preceding the date on which such funds are required
to be withdrawn from such account pursuant to this Agreement, if a Person other
than the Trustee or an Affiliate manages or advises such investment, and (ii) no
later than the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if the Trustee or an Affiliate manages or
advises such investment. If no investment direction of the Holders of a majority
in Percentage Interest in the Class C Certificates with respect to the Net WAC
Rate Carryover Reserve Account is received by the Trustee, the Trustee shall
invest the funds in such account in Permitted Investments managed by the Trustee
or an Affiliate of the kind described in clause (vi) of the definition of
Permitted Investments.

                  For federal tax return and information reporting, the value of
the right of the Holders of the Class A Certificates and the Mezzanine
Certificates to receive payments from the Net WAC Rate Carryover Reserve Account
in respect of any Net Wac Rate Carryover Amount may be obtained by any
Certificateholder or Certificate Owner from the Trustee upon request. Such
information will be provided to the Trustee by an Underwriter, on behalf of the
Depositor, on or prior to the Closing Date.

                  SECTION 3.29. Advancing Facility.

                  (a) The Master Servicer and/or the Trustee on behalf of the
Trust Fund, in either case, with the consent of the NIMS Insurer and the Master
Servicer in the case of the Trustee, is hereby authorized to enter into a
facility (the "Advancing Facility") with any Person which provides that such
Person (an "Advancing Person") may fund Advances and/or Servicing Advances to
the Trust Fund under this Agreement, although no such facility shall reduce or
otherwise affect the Master Servicer's obligation to fund such Advances and/or
Servicing Advances. If the Master Servicer enters into such an Advancing
Facility pursuant to this Section 3.29, upon reasonable request of the Advancing
Person, the Trustee shall execute a letter of acknowledgment, confirming its
receipt of notice of the existence of such Advancing Facility. To the extent
that an Advancing Person funds any Advance or any Servicing Advance and provides
the Trustee with notice acknowledged by the Servicer that such Advancing Person
is entitled to reimbursement, such Advancing Person shall be entitled to receive
reimbursement pursuant to this Agreement for such amount to the extent provided
in Section 3.29(b). Such notice from the Advancing Person must specify the
amount of the reimbursement, the Section of this Agreement that permits the
applicable Advance or Servicing Advance to be reimbursed and the section(s) of
the Advancing Facility that entitle the Advancing Person to request
reimbursement from the Trustee, rather than the Master Servicer, and include the
Master Servicer's acknowledgment thereto or proof of an Event of Default under
the Advancing Facility. The Trustee shall have no duty or liability with respect
to any calculation of any reimbursement to be paid to an Advancing Person and
shall be entitled to rely without independent investigation on the Advancing
Person's notice provided pursuant to this Section 3.29. An Advancing Person
whose obligations hereunder are limited to the funding of Advances and/or
Servicing Advances shall not be required to meet the qualifications of a Master
Servicer or a Sub-Servicer pursuant to Section 6.06 hereof and will not be
deemed to be a Sub-

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Servicer under this Agreement. If the terms of a facility proposed to be entered
into with an Advancing Person by the Trust Fund would not materially and
adversely affect the interests of any Certificateholder, then the NIMS Insurer
shall not withhold its consent to the Trust Fund's entering such facility.

                  (b) If an Advancing Facility is entered into, then the Master
Servicer shall not be permitted to reimburse itself therefor under Section
3.11(a)(ii), Section 3.11(a)(iii), Section 3.11(a)(vi), Section 3.11(a)(vii)
Section 3.11(a)(viii) and Section 4.04(b) prior to the remittance to the Trust
Fund, but instead the Master Servicer shall include such amounts in the
applicable remittance to the Trustee made pursuant to Section 3.10(a). The
Trustee is hereby authorized to pay to the Advancing Person, reimbursements for
Advances and Servicing Advances from the Distribution Account to the same extent
the Master Servicer would have been permitted to reimburse itself for such
Advances and/or Servicing Advances in accordance with Section 3.11(a)(ii),
Section 3.11(a)(iii), Section 3.11(a)(vi), Section 3.11(a)(vii), Section
3.11(a)(viii) or Section 4.04(b), as the case may be, had the Master Servicer
itself funded such Advance or Servicing Advance. The Trustee is hereby
authorized to pay directly to the Advancing Person such portion of the Servicing
Fee as the parties to any advancing facility agree.

                  (c) All Advances and Servicing Advances made pursuant to the
terms of this Agreement shall be deemed made and shall be reimbursed on a "first
in-first out" (FIFO) basis.

                  (d) Any amendment to this Section 3.29 or to any other
provision of this Agreement that may be necessary or appropriate to effect the
terms of an Advancing Facility as described generally in this Section 3.29,
including amendments to add provisions relating to a successor master servicer,
may be entered into by the Trustee and the Master Servicer without the consent
of any Certificateholder but with the consent of the NIMS Insurer,
notwithstanding anything to the contrary in this Agreement.

                  SECTION 3.30. PMI Policy; Claims Under the PMI Policy.

                  Notwithstanding anything to the contrary elsewhere in this
Article III, the Master Servicer shall not agree to any modification or
assumption of a PMI Mortgage Loan or take any other action with respect to a PMI
Mortgage Loan that could result in denial of coverage under the PMI Policy. The
Master Servicer shall notify the PMI Insurer that the Trustee, on behalf of the
Trust, is the Insured, as that term is defined in the PMI Policy, of each PMI
Mortgage Loan. The Master Servicer shall, on behalf of the Trust, prepare and
file on a timely basis with the PMI Insurer, all claims which may be made under
the PMI Policy with respect to the PMI Mortgage Loans. Consistent with all
rights and obligations hereunder, the Master Servicer shall take all actions
required of the Insured under the PMI Policy (except for the calculation and the
payment of the PMI Premium with respect to funds available in the Distribution
Account). Any amount received from the PMI Insurer with respect to any such PMI
Mortgage Loan shall be deposited by the Master Servicer, no later than two
Business Days following receipt thereof, into the Collection Account.

         The Trustee is hereby directed to execute and deliver the Letter
Agreement, on behalf of the Trust, among the Trustee, the PMI Insurer and the
Master Servicer for the benefit of the Trust Fund.

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                                   ARTICLE IV

                                  FLOW OF FUNDS

                  SECTION 4.01. Distributions.

                  (a)(I) On each Distribution Date, the Trustee shall withdraw
from the Distribution Account that portion of Available Funds for such
Distribution Date consisting of the Group I Interest Remittance Amount for such
Distribution Date, and make the following disbursements and transfers in the
order of priority described below, in each case to the extent of the Group I
Interest Remittance Amount remaining for such Distribution Date:

                  (i) concurrently, to the Holders of each Class of Group I
         Certificates on a PRO RATA basis based on the entitlement of each such
         Class, the Monthly Interest Distributable Amount and the Unpaid
         Interest Shortfall Amount, if any, allocable to such Certificates for
         such Distribution Date; and

                  (ii) concurrently, to the Holders of each Class of Group II
         Certificates, on a PRO RATA basis based on the entitlement of each such
         Class, an amount equal to the excess, if any, of (x) the amount
         required to be distributed pursuant to Section 4.01(a)(II)(i) below for
         such Distribution Date over (y) the amount actually distributed
         pursuant to such section from the Group II Interest Remittance Amount.

                  (II) On each Distribution Date the Trustee shall withdraw from
the Distribution Account that portion of Available Funds for such Distribution
Date consisting of the Group II Interest Remittance Amount for such Distribution
Date, and make the following disbursements and transfers in the order of
priority described below, in each case to the extent of the Group II Interest
Remittance Amount remaining for such Distribution Date:

                  (i) concurrently, to the Holders of each Class of Group II
         Certificates, on a PRO RATA basis based on the entitlement of each such
         Class, the Monthly Interest Distributable Amount and the Unpaid
         Interest Shortfall Amount, if any, allocable to such Certificates for
         such Distribution Date; and

                  (ii) concurrently, to the Holders of each Class of Group I
         Certificates, on a PRO RATA basis based on the entitlement of each such
         Class, an amount equal to the excess, if any, of (x) the amount
         required to be distributed pursuant to Section 4.01(a)(I)(i) above for
         such Distribution Date over (y) the amount actually distributed
         pursuant to such section from the Group I Interest Remittance Amount.

                  (III) On each Distribution Date, following the distributions
made pursuant to Section 4.01(a)(I) and (II) above, the Trustee shall make the
following disbursements and transfers in the order of priority described below,
in each case to the extent of the sum of the Group I Interest Remittance Amount
and the Group II Interest Remittance Amount remaining undistributed for such
Distribution Date:

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                  (i) to the Holders of the Class M-1 Certificates, the Monthly
         Interest Distributable Amount allocable to such Certificates;

                  (ii) to the Holders of the Class M-2 Certificates, the Monthly
         Interest Distributable Amount allocable to such Certificates;

                  (iii) to the Holders of the Class M-3 Certificates, the
         Monthly Interest Distributable Amount allocable to such Certificates;

                  (iv) to the Holders of the Class M-4 Certificates, the Monthly
         Interest Distributable Amount allocable to such Certificates;

                  (v) to the Holders of the Class M-5 Certificates, the Monthly
         Interest Distributable Amount allocable to such Certificates;

                  (vi) to the Holders of the Class M-6 Certificates, the Monthly
         Interest Distributable Amount allocable to such Certificates; and

                  (vii) to the Holders of the Class M-7 Certificates, the
         Monthly Interest Distributable Amount allocable to such Certificates.

                  (b)(I) On each Distribution Date (a) prior to the Stepdown
Date or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the Group I Principal Distribution Amount shall be
made in the following amounts and order of priority:

                  (i) first, concurrently, to the Holders of each Class of Group
         I Certificates, on a PRO RATA basis based on the Certificate Principal
         Balance of each such Class immediately preceding such Distribution
         Date, until the Certificate Principal Balances thereof have been
         reduced to zero;

                  (ii) second, after taking into account the amount distributed
         to the Holders of the Group II Certificates pursuant to Section
         4.01(b)(II)(i) below on such Distribution Date, to the Holders of the
         Group II Certificates (allocated as described below), until the
         Certificate Principal Balances thereof have been reduced to zero.

                  (II) On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the Group II Principal Distribution Amount shall be
made in the following amounts and order of priority:

                  (i) first, to the Holders of the Group II Certificates
         (allocated as described below), until the Certificate Principal
         Balances thereof have been reduced to zero;

                  (ii) second, after taking into account the amount distributed
         to the Holders of the Group I Certificates pursuant to Section
         4.01(b)(I)(i) above on such Distribution Date, concurrently, to the
         Holders of each class of Group I Certificates, on a PRO RATA basis
         based

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         on the Certificate Principal Balance of each such Class immediately
         preceding such Distribution Date, until the Certificate Principal
         Balances thereof have been reduced to zero.

                  (III) On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the sum of the Group I Principal Distribution Amount
and the Group II Principal Distribution Amount remaining undistributed for such
Distribution Date shall be made in the following amounts and order of priority:

                  (i) first, to the Holders of the Class M-1 Certificates, until
         the Certificate Principal Balance thereof has been reduced to zero;

                  (ii) second, to the Holders of the Class M-2 Certificates,
         until the Certificate Principal Balance thereof has been reduced to
         zero;

                  (iii) third, to the Holders of the Class M-3 Certificates,
         until the Certificate Principal Balance thereof has been reduced to
         zero;

                  (iv) fourth, to the Holders of the Class M-4 Certificates,
         until the Certificate Principal Balance thereof has been reduced to
         zero;

                  (v) fifth, to the Holders of the Class M-5 Certificates, until
         the Certificate Principal Balance thereof has been reduced to zero;

                  (vi) sixth, to the Holders of the Class M-6 Certificates,
         until the Certificate Principal Balance thereof has been reduced to
         zero; and

                  (vii) sixth, to the Holders of the Class M-7 Certificates,
         until the Certificate Principal Balance thereof has been reduced to
         zero.

                  (c)(I) On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the Group I Principal Distribution Amount shall be
made in the following amounts and order of priority:

                  (i) first, concurrently, to the Holders of each Class of Group
         I Certificates, on a PRO RATA basis based on the Certificate Principal
         Balance of each such Class immediately preceding such Distribution
         Date, the Group I Senior Principal Distribution Amount until the
         Certificate Principal Balances thereof have been reduced to zero;

                  (ii) second, to the Holders of the Group II Certificates
         (allocated as described below), an amount equal to the excess, if any,
         of (x) the amount required to be distributed pursuant to Section
         4.01(c)(II)(i) below for such Distribution Date over (y) the amount
         actually distributed pursuant to Section 4.01(c)(II)(i) below from the
         Group II Principal Distribution Amount on such Distribution Date.

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<PAGE>

                  (II) On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the Group II Principal Distribution Amount shall
be made in the following amounts and order of priority:

                  (i) first, to the Holders of the Group II Certificates
         (allocated as described below), the Group II Senior Principal
         Distribution Amount until the Certificate Principal Balances thereof
         have been reduced to zero;

                  (ii) second, concurrently, to the Holders of each Class of
         Group I Certificates, on a pro rata basis based on the Certificate
         Principal Balance of each such Class immediately preceding such
         Distribution Date, an amount equal to the excess, if any, of (x) the
         amount required to be distributed pursuant to Section 4.01(c)(I)(i)
         above for such Distribution Date over (y) the amount actually
         distributed pursuant to Section 4.01(c)(I)(i) above from the Group I
         Principal Distribution Amount on such Distribution Date.

                  (III) On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the sum of the Group I Principal Distribution
Amount and the Group II Principal Distribution Amount remaining undistributed
for such Distribution Date shall be made in the following amounts and order of
priority:

                  (i) first, to the Holders of the Class M-1 Certificates, the
         Class M-1 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero;

                  (ii) second, to the Holders of the Class M-2 Certificates, the
         Class M-2 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero;

                  (iii) third, to the Holders of the Class M-3 Certificates, the
         Class M-3 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero;

                  (iv) fourth, to the Holders of the Class M-4 Certificates, the
         Class M-4 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero;

                  (v) fifth, to the Holders of the Class M-5 Certificates, the
         Class M-5 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero;

                  (vi) sixth, to the Holders of the Class M-6 Certificates, the
         Class M-6 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero; and

                  (vii) seventh, to the Holders of the Class M-7 Certificates,
         the Class M-7 Principal Distribution Amount until the Certificate
         Principal Balance thereof has been reduced to zero.

                  With respect to the Group II Certificates, all principal
distributions will be distributed sequentially, first, to the Holders of the
Class A-2 Certificates, until the Certificate Principal Balance of the Class A-2
Certificates has been reduced to zero, second, to the Holders of the Class A-3

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Certificates, until the Certificate Principal Balance of the Class A-3
Certificates has been reduced to zero and third, to the Holders of the Class A-4
Certificates, until the Certificate Principal Balance of the Class A-4
Certificates has been reduced to zero; provided, however, on any Distribution
Date on which the aggregate Certificate Principal Balance of the Mezzanine
Certificates and the Class C Certificates has been reduced to zero,
notwithstanding anything contained herein to the contrary, all distributions of
principal to the Group II Certificates will be distributed concurrently, on a
PRO RATA basis based on the Certificate Principal Balance of each such Class.

                  (d) On each Distribution Date, the Net Monthly Excess Cashflow
shall be distributed as follows:

                  (i) to the Holders of the Class or Classes of Certificates
         then entitled to receive distributions in respect of principal, in an
         amount equal to any Extra Principal Distribution Amount, distributable
         to such Holders as part of the Group I Principal Distribution Amount
         and/or the Group II Principal Distribution Amount as described under
         Section 4.01(b) and Section 4.01(c) above;

                  (ii) to the Holders of the Class M-1 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (iii) to the Holders of the Class M-1 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (iv) to the Holders of the Class M-2 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (v) to the Holders of the Class M-2 Certificates, in an amount
         equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (vi) to the Holders of the Class M-3 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (vii) to the Holders of the Class M-3 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (viii) to the Holders of the Class M-4 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (ix) to the Holders of the Class M-4 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (x) to the Holders of the Class M-5 Certificates, in an amount
         equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (xi) to the Holders of the Class M-5 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

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<PAGE>

                  (xii) to the Holders of the Class M-6 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (xiii) to the Holders of the Class M-6 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (xiv) to the Holders of the Class M-7 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (xv) to the Holders of the Class M-7 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (xvi) to the Net WAC Rate Carryover Reserve Account, the
         amount by which any Net WAC Rate Carryover Amounts for such
         Distribution Date exceed the amounts received by the Trustee under the
         Cap Contracts;

                  (xvii) to the Holders of the Class C Certificates, the Monthly
         Interest Distributable Amount for such Class and any remaining
         Overcollateralization Release Amount for such Distribution Date;

                  (xviii) if such Distribution Date follows the Prepayment
         Period during which occurs the latest date on which a Prepayment Charge
         may be required to be paid in respect of any Mortgage Loans, to the
         Holders of the Class P Certificates, in reduction of the Certificate
         Principal Balance thereof, until the Certificate Principal Balance
         thereof is reduced to zero; and

                  (xix) any remaining amounts to the Holders of the Residual
         Certificates (in respect of the appropriate Class R Interest).

                  On each Distribution Date, after making the distributions of
the Available Funds as set forth above, the Trustee will FIRST, withdraw from
the Net WAC Rate Carryover Reserve Account all income from the investment of
funds in the Net WAC Rate Carryover Reserve Account and distribute such amount
to the Holders of the Class C Certificates, and SECOND, withdraw from the Net
WAC Rate Carryover Reserve Account, to the extent of amounts remaining on
deposit therein, the amount of any Net WAC Rate Carryover Amount for such
Distribution Date and distribute such amount in the following order of priority:

         I. first, to the Class A Certificates and the Mezzanine Certificates
any related unpaid Net WAC Rate Carryover Amount (in each case only up to a
maximum amount equal to the amount received under the related Cap Contract;

         (i) to the Class A-1A Certificates, any related unpaid Net WAC Rate
Carryover Amount;

         (ii) to each class of Group II Certificates, the related Cap Amount, up
to the Net WAC Rate Carryover Amount for each such class; and

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         (ii) concurrently, to each class of Mezzanine Certificates, the related
Cap Amount up to the related Net WAC Rate Carryover Amount.
         II. Second, to the Class A Certificates and Mezzanine Certificates, any
related Net WAC Rate Carryover Amount (after taking into account distributions
pursuant to (I) above), distributed in the following order of priority;

         (i) concurrently, to each Class of Class A Certificates, on a PRO RATA
basis based on the related unpaid Net WAC Rate Carryover Amount for each such
class;

         (ii) to the Class M-1 Certificates;

         (iii) to the Class M-2 Certificates;

         (iv) to the Class M-3 Certificates;

         (v) to the Class M-4 Certificates;

         (vi) to the Class M-5 Certificates;

         (vii) to the Class M-6 Certificates; and

         (viiii) to the Class M-7 Certificates

                  On each Distribution Date, all amounts representing Prepayment
Charges in respect of the Mortgage Loans received during the related Prepayment
Period and any Master Servicer Prepayment Charge Amounts paid by the Master
Servicer during the related Prepayment Period will be withdrawn from the
Distribution Account and distributed by the Trustee to the Holders of the Class
P Certificates and shall not be available for distribution to the Holders of any
other Class of Certificates. The payment of the foregoing amounts to the Holders
of the Class P Certificates shall not reduce the Certificate Principal Balances
thereof.

                  (e) METHOD OF DISTRIBUTION. The Trustee shall make
distributions in respect of a Distribution Date to each Certificateholder of
record on the related Record Date (other than as provided in Section 10.01
respecting the final distribution), in the case of Certificateholders of the
Regular Certificates, by check or money order mailed to such Certificateholder
at the address appearing in the Certificate Register, or by wire transfer.
Distributions among Certificateholders shall be made in proportion to the
Percentage Interests evidenced by the Certificates held by such
Certificateholders.

                  (f) DISTRIBUTIONS ON BOOK-ENTRY CERTIFICATES. Each
distribution with respect to a Book-Entry Certificate shall be paid to the
Depository, which shall credit the amount of such distribution to the accounts
of its Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible

                                      108
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for disbursing funds to the Certificate Owners that it represents. All such
credits and disbursements with respect to a Book-Entry Certificate are to be
made by the Depository and the Depository Participants in accordance with the
provisions of the Certificates. None of the Trustee, the Depositor, the Master
Servicer or the Originator shall have any responsibility therefor except as
otherwise provided by applicable law.

                  (g) SUBSEQUENT RECOVERIES. On each Distribution Date,
following all distributions on the Certificates pursuant to Section 4.01, an
amount equal to the amount of Subsequent Recoveries deposited into the
Collection Account pursuant to Section 3.10 and included in the Available Funds
for such Distribution Date will be applied to increase the Certificate Principal
Balance of the Class of Certificates with the Highest Priority up to the extent
of such Realized Losses previously allocated to that Class of Certificates
pursuant to Section 4.08. An amount equal to the amount of any remaining
Subsequent Recoveries will be applied to increase the Certificate Principal
Balance of the Class of Certificates with the next Highest Priority, up to the
amount of such Realized Losses previously allocated to that Class of
Certificates pursuant to Section 4.08, and so on. Holders of such Certificates
will not be entitled to any distribution in respect of interest on the amount of
such increases for any Interest Accrual Period preceding the Distribution Date
on which such increase occurs. Any such increases shall be applied to the
Certificate Principal Balance of each Certificate of such Class in accordance
with its respective Percentage Interest.

                  SECTION 4.02. [Reserved].

                  SECTION 4.03. Statements.

                  (a) On each Distribution Date, based, as applicable, on
information provided to it by the Master Servicer, the Trustee shall prepare and
make available to each Holder of the Regular Certificates, the NIMS Insurer, the
Master Servicer and the Rating Agencies, a statement as to the distributions
made on such Distribution Date:

                  (i) the amount of the distribution made on such Distribution
         Date to the Holders of each Class of Regular Certificates allocable to
         principal and the amount of the distribution made to the Holders of the
         Class P Certificates allocable to Prepayment Charges and Master
         Servicer Prepayment Charge Payment Amounts;

                  (ii) the amount of the distribution made on such Distribution
         Date to the Holders of each Class of Regular Certificates (other than
         the Class P Certificates) allocable to interest, separately identified;

                  (iii) the Overcollateralized Amount, the Overcollateralization
         Release Amount, the Overcollateralization Deficiency Amount and the
         Overcollateralization Target Amount as of such Distribution Date and
         the Excess Overcollateralized Amount for the Mortgage Pool for such
         Distribution Date;

                  (iv) the aggregate amount of servicing compensation received
         by the Master Servicer with respect to the related Due Period and such
         other customary information as the

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         Trustee deems necessary or desirable, or which a Certificateholder
         reasonably requests, to enable Certificateholders to prepare their tax
         returns;

                  (v) the aggregate amount of Advances for the related Due
         Period;

                  (vi) the aggregate amount of interest and scheduled principal
         received or advanced by the Master Servicer with respect to the related
         Due Period;

                  (vii) with respect to each Loan Group, the related group
         balance at the Close of Business at the end of the related Due Period;

                  (viii) the number, aggregate principal balance, weighted
         average remaining term to maturity and weighted average Mortgage Rate
         of the Mortgage Loans as of the related Determination Date and the
         number and aggregate principal balance of all Subsequent Mortgage Loans
         added during the preceding Prepayment Period;

                  (ix) the number and aggregate unpaid principal balance of
         Mortgage Loans that were (A) Delinquent (exclusive of Mortgage Loans in
         bankruptcy or foreclosure and REO Properties) (1) 30 to 59 days, (2) 60
         to 89 days and (3) 90 or more days, (B) as to which foreclosure
         proceedings have been commenced and Delinquent (1) 30 to 59 days, (2)
         60 to 89 days and (3) 90 or more days, (C) in bankruptcy and Delinquent
         (1) 30 to 59 days, (2) 60 to 89 days and (3) 90 or more days, in each
         case as of the Close of Business on the last day of the calendar month
         preceding such Distribution Date and (D) REO Properties;

                  (x) the total number and cumulative principal balance of all
         Liquidated Mortgage Loans as of the Close of Business of the last day
         of the preceding Prepayment Period, prior to the reduction of each
         principal balance to zero;

                  (xi) the total number and cumulative principal balance of all
         REO Properties as of the Close of Business of the last day of the
         preceding Prepayment Period;

                  (xii) the aggregate amount of Principal Prepayments in full,
         the aggregate amount of Principal Prepayments in part and Net
         Liquidation Proceeds made during the related Prepayment Period;

                  (xiii) the aggregate amount of Realized Losses incurred during
         the related Prepayment Period and the cumulative amount of Realized
         Losses;

                  (xiv) the aggregate amount of extraordinary Trust Fund
         expenses withdrawn from the Collection Account for such Distribution
         Date;

                  (xv) the Certificate Principal Balance of each Class of Class
         A Certificates, each class of Mezzanine Certificates and the Class C
         Certificates, after giving effect to the distributions made on such
         Distribution Date;

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                  (xvi) the Monthly Interest Distributable Amount in respect of
         each class of Class A Certificates, each class of Mezzanine
         Certificates and the Class C Certificates for such Distribution Date
         and the Unpaid Interest Shortfall Amount, if any, with respect to the
         Class A Certificates, the Mezzanine Certificates and the Class C
         Certificates for such Distribution Date;

                  (xvii) the aggregate amount of any Prepayment Interest
         Shortfalls for such Distribution Date, to the extent not covered by
         payments by the Master Servicer pursuant to Section 3.26;

                  (xviii) the Credit Enhancement Percentage for such
         Distribution Date;

                  (xix) the Net WAC Rate Carryover Amount for each class of
         Class A Certificates and each class of Mezzanine Certificates, if any,
         for such Distribution Date and the amount remaining unpaid after
         reimbursements therefor on such Distribution Date;

                  (xx) any Overcollateralization Target Amount,
         Overcollateralized Amount and Overcollateralization Deficiency Amount
         after giving effect to the distribution of principal on such
         Distribution Date;

                  (xxi) when the Stepdown Date or a Trigger Event is in effect;

                  (xxii) the Available Funds;

                  (xxiii) the respective Pass-Through Rates applicable to each
         Class of Class A Certificates, each Class of Mezzanine Certificates and
         the Class C Certificates for such Distribution Date and the
         Pass-Through Rate applicable to each Class of Class A Certificates and
         each class of Mezzanine Certificates for the immediately succeeding
         Distribution Date;

                  (xxiv) (A) the amount of payments received related to claims
         under the PMI Policy during the related Prepayment Period (and the
         number of Mortgage Loans to which such payments related) and (B) the
         cumulative amount of payments received related to claims under the PMI
         Policy since the Closing Date (and the number of Mortgage Loans to
         which such payments related);

                  (xxv) (A) the dollar amount of claims made under the PMI
         Policy that were denied during the Prepayment Period (and the number of
         Mortgage Loans to which such denials related) and (B) the dollar amount
         of the cumulative claims made under the PMI Policy that were denied
         since the Closing Date (and the number of Mortgage Loans to which such
         denials related);

                  (xxvi) the amount on deposit in the Pre-Funding Accounts and
         the Net WAC Rate Carryover Reserve Account; and

                  (xxvii) for the distribution occurring on the Distribution
         Date immediately following the end of the Funding Period, the balance
         on deposit in the Group I Pre-Funding Account

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         and/or the Group II Pre-Funding Account that has not been used to
         purchase Subsequent Group I Mortgage Loans and/or Subsequent Group II
         Mortgage Loans, as applicable, and that is being distributed to the
         related Class A Certificates as a mandatory distribution of principal,
         if any, on such Distribution Date.

                  The Trustee will make such statement (and, at its option, any
additional files containing the same information in an alternative format)
available each month to Certificateholders, the NIMS Insurer and the Rating
Agencies via the Trustee's internet website. The Trustee's internet website
shall initially be located at "www.ctslink.com". Assistance in using the website
can be obtained by calling the Trustee's customer service desk at (301)
815-6600. Parties that are unable to use the above distribution option are
entitled to have a paper copy mailed to them via first class mail by calling the
customer service desk and indicating such. The Trustee shall have the right to
change the way such statements are distributed in order to make such
distribution more convenient and/or more accessible to the above parties and the
Trustee shall provide timely and adequate notification to all above parties
regarding any such changes. As a condition to access the Trustee's internet
website, the Trustee may require registration and the acceptance of a
disclaimer. The Trustee will not be liable for the dissemination of information
in accordance with this Agreement. The Trustee shall also be entitled to rely on
but shall not be responsible for the content or accuracy of any information
provided by third parties for purposes of preparing the distribution date
statement and may affix thereto any disclaimer it deems appropriate in its
reasonable discretion (without suggesting liability on the part of any other
party thereto).

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

                  (b) Within a reasonable period of time after the end of each
calendar year, the Trustee shall, upon written request, furnish to the NIMS
Insurer and each Person who at any time during the calendar year was a
Certificateholder of a Regular Certificate, if requested in writing by such
Person, such information as is reasonably necessary to provide to such Person a
statement containing the information set forth in subclauses (i) through (iii)
above, aggregated for such calendar year or applicable portion thereof during
which such Person was a Certificateholder. Such obligation of the Trustee shall
be deemed to have been satisfied to the extent that substantially comparable
information shall be prepared and furnished by the Trustee to Certificateholders
pursuant to any requirements of the Code as are in force from time to time.

                  (c) On each Distribution Date, the Trustee shall forward to
the NIMS Insurer and the Class R Certificateholders a copy of the reports
forwarded to the Regular Certificateholders in respect of such Distribution Date
with such other information as the Trustee deems necessary or appropriate.

                  (d) Within a reasonable period of time after the end of each
calendar year, the Trustee shall deliver to the NIMS Insurer and each Person who
at any time during the calendar year was a Class R Certificateholder, if
requested in writing by such Person, such information as is reasonably necessary
to provide to such Person a statement containing the information provided
pursuant to the previous paragraph aggregated for such calendar year or
applicable portion thereof

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during which such Person was a Class R Certificateholder. Such obligation of the
Trustee shall be deemed to have been satisfied to the extent that substantially
comparable information shall be prepared and furnished to Certificateholders by
the Trustee pursuant to any requirements of the Code as from time to time in
force.

                  SECTION 4.04. Remittance Reports; Advances.

                  (a) On the second Business Day following each Determination
Date but in no event later than the earlier of (i) such date which would allow
the indenture trustee to submit a claim to the NIMS Insurer under the Indenture
so as to allow a timely payment by the NIMS Insurer under the insurance policy
related to the notes insured by the NIMS Insurer and (ii) the 20th day of each
month (or if such 20th day is not a Business Day, the preceding Business Day),
the Master Servicer shall deliver to the Trustee and the NIMS Insurer by
telecopy or electronic mail (or by such other means as the Master Servicer and
the Trustee may agree from time to time) a Remittance Report with respect to the
related Distribution Date. Not later than the 20th day of each month (or if such
20th day is not a Business Day, the preceding Business Day), the Master Servicer
shall deliver or cause to be delivered to the Trustee in addition to the
information provided on the Remittance Report, such other information reasonably
available to it with respect to the Mortgage Loans as the Trustee may reasonably
require to perform the calculations necessary to make the distributions
contemplated by Section 4.01 and to prepare the statements to Certificateholders
contemplated by Section 4.03. The Trustee shall not be responsible to recompute,
recalculate or verify any information provided to it by the Master Servicer.

                  (b) The amount of Advances to be made by the Master Servicer
for any Distribution Date shall equal, subject to Section 4.04(d), the sum of
(i) the aggregate amount of Monthly Payments (net of the related Servicing Fee),
due during the related Due Period in respect of the Mortgage Loans, which
Monthly Payments were delinquent on a contractual basis as of the Close of
Business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related Due
Period and as to which REO Property an REO Disposition did not occur during the
related Due Period, an amount equal to the excess, if any, of the REO Imputed
Interest on such REO Property for the most recently ended calendar month, over
the net income from such REO Property transferred to the Distribution Account
pursuant to Section 3.23 for distribution on such Distribution Date. For
purposes of the preceding sentence, the Monthly Payment on each Balloon Mortgage
Loan with a delinquent Balloon Payment is equal to the assumed monthly payment
that would have been due on the related Due Date based on the original principal
amortization schedule for the such Balloon Mortgage Loan.

                  On or before 1:00 p.m. New York time on the Master Servicer
Remittance Date, the Master Servicer shall remit in immediately available funds
to the Trustee for deposit in the Distribution Account an amount equal to the
aggregate amount of Advances, if any, to be made in respect of the Mortgage
Loans and REO Properties for the related Distribution Date either (i) from its
own funds or (ii) from the Collection Account, to the extent of funds held
therein for future distribution (in which case it will cause to be made an
appropriate entry in the records of Collection Account that amounts held for
future distribution have been, as permitted by this Section 4.04, used by the
Master Servicer in discharge of any such Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of Advances to be made
by the Master Servicer with respect

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to the Mortgage Loans and REO Properties. Any amounts held for future
distribution used by the Master Servicer to make an Advance as permitted in the
preceding sentence or withdrawn by the Master Servicer as permitted in Section
3.11(a)(ii) in reimbursement of Advances previously made shall be appropriately
reflected in the Master Servicer's records and replaced by the Master Servicer
by deposit in the Collection Account on or before any future Master Servicer
Remittance Date to the extent that the Available Funds for the related
Distribution Date (determined without regard to Advances to be made on the
Master Servicer Remittance Date) shall be less than the total amount that would
be distributed to the Classes of Certificateholders pursuant to Section 4.01 on
such Distribution Date if such amounts held for future distributions had not
been so used to make Advances or reimburse for previously made Advances. The
Trustee will provide notice to the NIMS Insurer and the Master Servicer by
telecopy by the Close of Business on any Master Servicer Remittance Date in the
event that the amount remitted by the Master Servicer to the Trustee on such
date is less than the Advances required to be made by the Master Servicer for
the related Distribution Date, as set forth in the related Remittance Report.

                  (c) The obligation of the Master Servicer to make such
Advances is mandatory, notwithstanding any other provision of this Agreement but
subject to (d) below, and, with respect to any Mortgage Loan, shall continue
until the Mortgage Loan is paid in full or until the recovery of all Liquidation
Proceeds thereon.

                  (d) Notwithstanding anything herein to the contrary, no
Advance or Servicing Advance shall be required to be made hereunder by the
Master Servicer if such Advance or Servicing Advance would, if made, constitute
a Nonrecoverable Advance. The determination by the Master Servicer that it has
made a Nonrecoverable Advance or that any proposed Advance or Servicing Advance,
if made, would constitute a Nonrecoverable Advance, shall be evidenced by an
Officers' Certificate of the Master Servicer delivered to the NIMS Insurer, the
Depositor and the Trustee.

                  SECTION 4.05. Pre-Funding Accounts.

                  (a) No later than the Closing Date, the Trustee shall
establish and maintain two segregated trust accounts that are each Eligible
Accounts, which shall be titled "Group I Pre-Funding Account, Wells Fargo Bank,
N.A., as trustee for the registered holders of Option One Mortgage Loan Trust
2004-2, Asset-Backed Certificates, Series 2004-2" (the "Group I Pre-Funding
Account") and "Group II Pre-Funding Account, Wells Fargo Bank, N.A., as trustee
for the registered holders of Option One Mortgage Loan Trust 2004-2,
Asset-Backed Certificates, Series 2004-2" (the "Group II Pre-Funding Account").
The Trustee shall, promptly upon receipt, deposit in the applicable Pre- Funding
Account and retain therein the Original Group I Pre-Funded Amount and the
Original Group II Pre-Funded Amount, as applicable, remitted on the Closing Date
to the Trustee by the Depositor. Funds deposited in the Pre-Funding Accounts
shall be held in trust by the Trustee for the Certificateholders for the uses
and purposes set forth herein.

                  (b) The Trustee will invest funds deposited in the Pre-Funding
Accounts as directed by the Master Servicer in Permitted Investments with a
maturity date (i) no later than the Business Day immediately preceding the date
on which such funds are required to be withdrawn from such account pursuant to
this Agreement, if a Person other than the Trustee or an Affiliate manages or
advises such investment, (ii) no later than the date on which such funds are
required to

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be withdrawn from such account pursuant to this Agreement, if the Trustee or an
Affiliate manages or advises such investment or (iii) within one Business Day of
the Trustee's receipt thereof. For federal income tax purposes, the Master
Servicer shall be the owner of the Pre-Funding Accounts and shall report all
items of income, deduction, gain or loss arising therefrom. All income and gain
realized from investment of funds deposited in the Group I Pre-Funding Account
and the Group II Pre-Funding Account shall be transferred to the Depositor or
its designee, as applicable, at the following times: (i) on the Business Day
immediately preceding each Distribution Date, if a Person other than the Trustee
or an Affiliate of the Trustee manages or advises such investment, or on each
Distribution Date, if the Trustee or an Affiliate of the Trustee manages or
advises such investment, (ii) on the Business Day immediately preceding each
Subsequent Transfer Date, if a Person other than the Trustee or an Affiliate of
the Trustee manages or advises such investment, or on each Subsequent Transfer
Date, if the Trustee or an Affiliate of the Trustee manages or advises such
investment or (iii) within one Business Day of the Trustee's receipt thereof.
The Master Servicer shall deposit in the Pre-Funding Accounts the amount of any
net loss incurred in respect of any such Permitted Investment immediately upon
realization of such loss without any right of reimbursement therefor. At no time
will the Pre-Funding Accounts be assets of any REMIC created hereunder.

                  (c) Amounts on deposit in the Pre-Funding Accounts shall be
withdrawn by the Trustee as follows:

                  (i) On any Subsequent Transfer Date, the Trustee shall
         withdraw from the Group I Pre-Funding Account or the Group II
         Pre-Funding Account, as applicable, an amount equal to 100% of the
         Stated Principal Balances of the Subsequent Group I Mortgage Loans or
         the Subsequent Group II Mortgage Loans, as applicable, transferred and
         assigned to the Trustee for deposit in the Mortgage Pool on such
         Subsequent Transfer Date and pay such amount to or upon the order of
         the Depositor upon satisfaction of the conditions set forth in Section
         2.08 with respect to such transfer and assignment;

                  (ii) If the amount on deposit in the Pre-Funding Accounts
         (exclusive of investment income) has not been reduced to zero during
         the Funding Period, on the day immediately following the termination of
         the Funding Period, the Trustee shall deposit into the Distribution
         Account any amounts remaining in the Pre-Funding Accounts (exclusive of
         investment income) for distribution in accordance with the terms
         hereof;

                  (iii) To withdraw any amount not required to be deposited in
         the Pre-Funding Accounts or deposited therein in error; and

                  (iv) To clear and terminate the Pre-Funding Accounts upon the
         earlier to occur of (A) the Distribution Date immediately following the
         end of the Funding Period and (B) the termination of this Agreement,
         with any amounts remaining on deposit therein being paid to the Holders
         of the Certificates then entitled to distributions in respect of
         principal.

                  Withdrawals pursuant to clauses (i), (ii) and (iii) shall be
treated as contributions of cash to REMIC 1 on the date of withdrawal.

                  SECTION 4.06. [Reserved].

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                  SECTION 4.07. Distributions on the REMIC Regular Interests.

                  With respect to the Group I Mortgage Loans:

                  (A)(1)(i) to the Holders of REMIC 1 Regular Interest LT1,
         REMIC 1 Regular Interest LT1PF and REMIC 1 Regular Interest LTP in an
         amount equal to (A) the Uncertificated Accrued Interest for each REMIC
         1 Regular Interest for such Distribution Date, plus (B) any amounts in
         respect thereof remaining unpaid from previous Distribution Dates; and

                  (ii) to the Holders of REMIC 1 Regular Interest LTP, on the
         Distribution Date immediately following the expiration of the latest
         Prepayment Charge as identified on the Prepayment Charge Schedule or
         any Distribution Date thereafter until $100 has been distributed
         pursuant to this clause;

                  (2) to the Holders of REMIC 1 Regular Interest LT1 and REMIC 1
         Regular Interest LTPF, in an amount equal to the remainder of the
         Available Funds for such Distribution Date after the distributions made
         pursuant to clause (1) above, allocated as follows:

                           (a) to the Holders of REMIC 1 Regular Interest LT1,
                  until the Uncertificated Principal Balance of REMIC 1 Regular
                  Interest LT1 is reduced to zero;

                           (b) to the Holders of REMIC 1 Regular Interest LT1PF,
                  until the Uncertificated Principal Balance of REMIC 1 Regular
                  Interest LT1PF is reduced to zero; and

                           (c) any remaining amount to the Holders of the Class
                  R Certificates (in respect of the Class R-1 Interest).

                  With respect to the Group II Mortgage Loans:

                  (3) to the Holders of REMIC 1 Regular Interest LT2 and REMIC 1
         Regular Interest LT2PF in an amount equal to (A) the Uncertificated
         Accrued Interest for each REMIC 1 Regular Interest for such
         Distribution Date, plus (B) any amounts in respect thereof remaining
         unpaid from previous Distribution Dates;

                  (4) to the Holders of REMIC 1 Regular Interest LT2 and REMIC 1
         Regular Interest LT2PF, in an amount equal to the remainder of the
         Available Funds for such Distribution Date after the distributions made
         pursuant to clause (1) above, allocated as follows:

                           (a) to the Holders of REMIC 1 Regular Interest LT2,
                  until the Uncertificated Principal Balance of REMIC 1 Regular
                  Interest LT2 is reduced to zero;

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                           (b) to the Holders of REMIC 1 Regular Interest LT2PF,
                  until the Uncertificated Principal Balance of REMIC 1 Regular
                  Interest LT2PF is reduced to zero; and

                           (c) any remaining amount to the Holders of the Class
                  R Certificates (in respect of the Class R-1 Interest).

                  On each Distribution Date, all amounts representing Prepayment
Charges in respect of the Mortgage Loans received during the related Prepayment
Period will be distributed by REMIC 1 to the Holders of REMIC 1 Regular Interest
LTP. The payment of the foregoing amounts to the Holders of REMIC 1 Regular
Interest LTP shall not reduce the Uncertificated Principal Balance thereof.

                  (b) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 3 on account of the REMIC 2 Regular Interests or withdrawn from the
Distribution Account and distributed to the Holders of the Class R Certificates
(in respect of the Class R-2 Interest), as the case may be:

                  (i) first, to Holders of REMIC 2 Regular Interest LT2AA, REMIC
         2 Regular Interest LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2
         Regular Interest LT2A2, REMIC 2 Regular Interest LT2A3, REMIC 2 Regular
         Interest LT2A4, REMIC 2 Regular Interest LT2M1, REMIC 2 Regular
         Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC 2 Regular
         Interest LT2M4, REMIC 2 Regular Interest LT2M5, REMIC 2 Regular
         Interest LT2M6, REMIC 2 Regular Interest LT2M7, REMIC 2 Regular
         Interest LT2ZZ and REMIC 2 Regular Interest LT2P, PRO RATA, in an
         amount equal to (A) the Uncertificated Accrued Interest for such
         Distribution Date, plus (B) any amounts in respect thereof remaining
         unpaid from previous Distribution Dates. Amounts payable as
         Uncertificated Accrued Interest in respect of REMIC 2 Regular Interest
         LT2ZZ shall be reduced and deferred when the REMIC 2 Overcollateralized
         Amount is less than the REMIC 2 Overcollateralization Target Amount, by
         the lesser of (x) the amount of such difference and (y) the Maximum
         LT2ZZ Uncertificated Interest Deferral Amount and such amount shall be
         payable to the Holders of REMIC 2 Regular Interest LT2A1A, REMIC 2
         Regular Interest LT2A1B, REMIC 2 Regular Interest LT2A2, REMIC 2
         Regular Interest LT2A3, REMIC 2 Regular Interest LT2A4, REMIC 2 Regular
         Interest LT2M1, REMIC 2 Regular Interest LT2M2, REMIC 2 Regular
         Interest LT2M3, REMIC 2 Regular Interest LT2M4, REMIC 2 Regular
         Interest LT2M5, REMIC 2 Regular Interest LT2M6 and REMIC 2 Regular
         Interest LT2M7 in the same proportion as the Overcollateralization
         Increase Amount is allocated to the Corresponding Certificates and the
         Uncertificated Principal Balance of REMIC 2 Regular Interest LT2ZZ
         shall be increased by such amount;

                  (ii) to Holders of REMIC 2 Regular Interest LT2SUB1, REMIC 2
         Regular Interest LT2GRP1, REMIC 2 Regular Interest LT2SUB2, REMIC 2
         Regular Interest LT2GRP2 and REMIC 2 Regular Interest LT2XX, PRO RATA,
         in an amount equal to (A) the Uncertificated Accrued Interest for such
         Distribution Date, plus (B) any amounts in respect thereof remaining
         unpaid from previous Distribution Dates;

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                  (iii) to the Holders of REMIC 2 Regular Interests, in an
         amount equal to the remainder of the REMIC 2 Marker Allocation
         Percentage of Available Funds for such Distribution Date after the
         distributions made pursuant to clause (i) above, allocated as follows:

                           (a) to the Holders of REMIC 2 Regular Interest LT2AA
                  and REMIC 2 Regular Interest LT2P, 98.00% of such remainder
                  (other than amounts payable under clause (iv) below), until
                  the Uncertificated Principal Balance of such REMIC 2 Regular
                  Interest is reduced to zero, provided, however, that REMIC 2
                  Regular Interest LT2P shall not be reduced until the
                  Distribution Date immediately following the expiration of the
                  latest Prepayment Charge as identified on the Prepayment
                  Charge Schedule or any Distribution Date thereafter, at which
                  point such amount shall be distributed to REMIC 2 Regular
                  Interest LT2P, until $100 has been distributed pursuant to
                  this clause;

                           (b) to the Holders of REMIC 2 Regular Interest
                  LT2A1A, REMIC 2 Regular Interest LT2A1B, REMIC 2 Regular
                  Interest LT2A2 REMIC 2 Regular Interest LT2A3, REMIC 2 Regular
                  Interest LT2A4, REMIC 2 Regular Interest LT2M1, REMIC 2
                  Regular Interest LT2M2, REMIC 2 Regular Interest LT2M3, REMIC
                  2 Regular Interest LT2M4, REMIC 2 Regular Interest LT2M5,
                  REMIC 2 Regular Interest LT2M6 and REMIC 2 Regular Interest
                  LT2M7, 1.00% of such remainder (other than amounts payable
                  under clause (iv) below), in the same proportion as principal
                  payments are allocated to the Corresponding Certificates,
                  until the Uncertificated Principal Balances of such REMIC 2
                  Regular Interests are reduced to zero;

                           (c) to the Holders of REMIC 2 Regular Interest LT2ZZ,
                  1.00% of such remainder (other than amounts payable under
                  clause (iv) below), until the Uncertificated Balance of such
                  REMIC 2 Regular Interest is reduced to zero; and

                           (d) any remaining amount to the Holders of the Class
                  R Certificates (in respect of the Class R-2 Interest);

         provided, however, that (i) 98.00% and (ii) 2.00% of any principal
         payments that are attributable to an Overcollateralization Reduction
         Amount shall be allocated to Holders of (i) REMIC 2 Regular Interest
         LT2AA and REMIC 2 Regular Interest LT2P, in that order and (ii) REMIC 2
         Regular Interest LT2ZZ, respectively; provided that REMIC 2 Regular
         Interest LT2P shall not be reduced until the Distribution Date
         immediately following the expiration of the latest Prepayment Charge as
         identified on the Prepayment Charge Schedule or any Distribution Date
         thereafter, at which point such amount shall be distributed to REMIC 2
         Regular Interest LT2P, until $100 has been distributed pursuant to this
         clause;

                  (iv) to the Holders of REMIC 2 Regular Interests, in an amount
         equal to the remainder of the REMIC 2 Sub WAC Allocation Percentage of
         Available Funds for such Distribution Date after the distributions made
         pursuant to clause (i) above, such that distributions of principal
         shall be deemed to be made to the REMIC 2 Regular Interests first,

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         so as to keep the Uncertificated Balance of each REMIC 2 Regular
         Interest ending with the designation "GRP" equal to 0.01% of the
         aggregate Stated Principal Balance of the Mortgage Loans in the related
         Loan Group; second, to each REMIC 2 Regular Interest ending with the
         designation "SUB," so that the Uncertificated Balance of each such
         REMIC 2 Regular Interest is equal to 0.01% of the excess of (x) the
         aggregate Stated Principal Balance of the Mortgage Loans in the related
         Loan Group over (y) the current Certificate Principal Balance of the
         Class A Certificate in the related Loan Group (except that if any such
         excess is a larger number than in the preceding distribution period,
         the least amount of principal shall be distributed to such REMIC 2
         Regular Interests such that the REMIC 2 Subordinated Balance Ratio is
         maintained); and third, any remaining principal to REMIC 2 Regular
         Interest LT2XX; and

                  (v) Notwithstanding the distributions described in this
         Section 4.07, distribution of funds shall be made only in accordance
         with Section 4.01.

                  On each Distribution Date, all amounts representing Prepayment
Charges in respect of the Mortgage Loans received during the related Prepayment
Period will be distributed by REMIC 2 to the Holders of REMIC 2 Regular Interest
LT2P. The payment of the foregoing amounts to the Holders of REMIC 2 Regular
Interest LT2P shall not reduce the Uncertificated Principal Balance thereof.

                  SECTION 4.08. Allocation of Realized Losses.

                  (a) All Realized Losses on the Mortgage Loans allocated to any
Regular Certificate shall be allocated by the Trustee on each Distribution Date
as follows: first, as provided in Section 1.03, to the interest accrued on the
Class C Certificates after the allocation thereto of certain interest shortfalls
as provided in Section 1.03; second, to the Class C Certificates (determined for
purposes of this section 4.08 as the amount by which (A) the aggregate
Uncertificated Balances of the REMIC I Regular Interests immediately preceding
such Distribution Date exceed (B) the aggregate Certificate Principal Balances
of the Class A Certificates, the Mezzanine Certificates and the Class P
Certificates immediately preceding such Distribution Date), until the
Certificate Principal Balance thereof has been reduced to zero; third, to the
Class M-7 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero; fourth, to the Class M-6 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; fifth, to the Class M-5
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; sixth, to the Class M-4 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; seventh, to the Class M-3
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero, eighth, to the Class M-2 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero and ninth, to the Class M-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero. All Realized Losses to be allocated to the Certificate Principal
Balances of all Classes on any Distribution Date shall be so allocated after the
actual distributions to be made on such date as provided above. All references
above to the Certificate Principal Balance of any Class of Certificates shall be
to the Certificate Principal Balance of such Class immediately prior to the
relevant Distribution Date, before reduction thereof by any Realized Losses, in
each case to be allocated to such Class of Certificates, on such Distribution
Date.

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<PAGE>

                  Any allocation of Realized Losses to a Class A Certificate or
Mezzanine Certificate on any Distribution Date shall be made by reducing the
Certificate Principal Balance thereof by the amount so allocated; any allocation
of Realized Losses to a Class C Certificate shall be made by reducing the amount
otherwise payable in respect thereof pursuant to Section 4.01(d)(xx). No
allocations of any Realized Losses shall be made to the Certificate Principal
Balances of the Class A Certificates or the Class P Certificates.

                  (b) All Realized Losses on the Group I Mortgage Loans shall be
allocated by the Trustee on each Distribution Date to the REMIC 1 Regular
Interest LT1 and REMIC 1 Regular Interest LT1PF until the Uncertificated
Principal Balance of each such REMIC 1 Regular Interest has been reduced to
zero; provided however, with respect to the first Distribution Date, all
Realized Losses on the Initial Group I Mortgage Loans shall be allocated to
REMIC 1 Regular Interest LT1 until the Uncertificated Principal Balance of each
such REMIC 1 Regular Interest has been reduced to zero, and all Realized Losses
on the Subsequent Group I Mortgage Loans shall be allocated to REMIC 1 Regular
Interest LT1PF until the Uncertificated Principal Balance thereof has been
reduced to zero. All Realized Losses on the Group II Mortgage Loans shall be
allocated by the Trustee on each Distribution Date to the REMIC 1 Regular
Interest LT2 and REMIC 1 Regular Interest LT2PF until the Uncertificated
Principal Balance of each such REMIC 1 Regular Interest has been reduced to
zero; provided however, with respect to the first Distribution Date, all
Realized Losses on the Initial Group II Mortgage Loans shall be allocated to
REMIC 1 Regular Interest LT2 until the Uncertificated Principal Balance of each
such REMIC 1 Regular Interest has been reduced to zero, and all Realized Losses
on the Subsequent Group II Mortgage Loans shall be allocated to REMIC 1 Regular
Interest LT2PF until the Uncertificated Principal Balance thereof has been
reduced to zero.

         (c)(i) The REMIC 2 Marker Percentage of all Realized Losses on the
Mortgage Loans shall be allocated by the Trustee on each Distribution Date to
the following REMIC 2 Regular Interests in the specified percentages, as
follows: first, to Uncertificated Accrued Interest payable to the REMIC 2
Regular Interest LT2AA and REMIC 2 Regular Interest LT2ZZ up to an aggregate
amount equal to the REMIC 2 Interest Loss Allocation Amount, 98% and 2%,
respectively; second, to the Uncertificated Principal Balances of the REMIC 2
Regular Interest LT2AA and REMIC 2 Regular Interest LT2ZZ up to an aggregate
amount equal to the REMIC 2 Principal Loss Allocation Amount, 98% and 2%,
respectively; third, to the Uncertificated Principal Balances of REMIC 2 Regular
Interest LT2AA, REMIC 2 Regular Interest LT2M7 and REMIC 2 Regular Interest
LT2ZZ, 98%, 0.50%, 0.50% and 1.00%, respectively, until the Uncertificated
Principal Balance of REMIC 2 Regular Interest LT2M7 has been reduced to zero;
fourth, to the Uncertificated Principal Balances of REMIC 2 Regular Interest
LT2AA, REMIC 2 Regular Interest LT2M6 and REMIC 2 Regular Interest LT2ZZ, 98%,
1.00%, and 1%, respectively, until the Uncertificated Principal Balance of REMIC
2 Regular Interest LT2M6 has been reduced to zero; fifth, to the Uncertificated
Principal Balances of REMIC 2 Regular Interest LT2AA, REMIC 2 Regular Interest
LT2M5 and REMIC 2 Regular Interest LT2ZZ, 98%, 1.00%, and 1%, respectively,
until the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M5 has
been reduced to zero; sixth, to the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2AA, REMIC 2 Regular Interest LT2M4 and REMIC 2 Regular
Interest LT2ZZ, 98%, 1.00%, and 1%, respectively, until the Uncertificated
Principal Balance of REMIC 2 Regular Interest LT2M4 has been reduced to zero;
seventh, to the Uncertificated Principal Balances of REMIC 2 Regular Interest
LT2AA, REMIC 2 Regular Interest

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LT2M3 and REMIC 2 Regular Interest LT2ZZ, 98%, 1% and 1%, respectively, until
the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2M3 has been
reduced to zero; eighth, to the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2AA, REMIC 2 Regular Interest LT2M2 and REMIC 2 Regular
Interest LT2ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC 2 Regular Interest LT2M2 has been reduced to zero; and ninth,
to the Uncertificated Principal Balances of REMIC 2 Regular Interest LT2AA,
REMIC 2 Regular Interest LT2M1 and REMIC 2 Regular Interest LT2ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 2 Regular
Interest LT2M1 has been reduced to zero.

                  (ii) The REMIC 2 Sub WAC Allocation Percentage of all Realized
Losses shall be applied after all distributions have been made on each
Distribution Date first, so as to keep the Uncertificated Principal Balance of
each REMIC 2 Regular Interest ending with the designation "GRP" equal to 0.01%
of the aggregate Stated Principal Balance of the Mortgage Loans in the related
Loan Group; second, to each REMIC 2 Regular Interest ending with the designation
"SUB," so that the Uncertificated Principal Balance of each such REMIC 2 Regular
Interest is equal to 0.01% of the excess of (x) the aggregate Stated Principal
Balance of the Mortgage Loans in the related Loan Group over (y) the current
Certificate Principal Balance of the Class A Certificate in the related Loan
Group (except that if any such excess is a larger number than in the preceding
distribution period, the least amount of Realized Losses shall be applied to
such REMIC 2 Regular Interests such that the REMIC 2 Subordinated Balance Ratio
is maintained); and third, any remaining Realized Losses shall be allocated to
REMIC 2 Regular Interest LT2XX.

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                                    ARTICLE V

                                THE CERTIFICATES

                  SECTION 5.01. The Certificates.

                  Each of the Class A Certificates, the Mezzanine Certificates,
the Class P Certificates, the Class C Certificates and the Class R Certificates
shall be substantially in the forms annexed hereto as exhibits, and shall, on
original issue, be executed, authenticated and delivered by the Trustee to or
upon the order of the Depositor concurrently with the sale and assignment to the
Trustee of the Trust Fund. The Offered Certificates shall be initially evidenced
by one or more Certificates representing a Percentage Interest with a minimum
dollar denomination of $25,000 and integral dollar multiples of $1.00 in excess
thereof, except that one Certificate of each such Class of Certificates may be
in a different denomination so that the sum of the denominations of all
outstanding Certificates of such Class shall equal the Certificate Principal
Balance or Notional Amount of such Class on the Closing Date. The Class P
Certificates, the Class C Certificates and the Class R Certificates are issuable
in any Percentage Interests; PROVIDED, HOWEVER, that the sum of all such
percentages for each such Class totals 100% and no more than ten Certificates of
each Class may be issued and outstanding at any one time.

                  The Certificates shall be executed on behalf of the Trust by
manual or facsimile signature on behalf of the Trustee by a Responsible Officer.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures were affixed, authorized to sign on behalf of
the Trustee shall bind the Trust, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the authentication and delivery
of such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless such Certificate shall have been
manually authenticated by the Trustee substantially in the form provided for
herein, and such authentication upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. Subject to Section 5.02(c), the Offered Certificates
shall be Book- Entry Certificates. The other Classes of Certificates shall not
be Book-Entry Certificates.

                  SECTION 5.02. Registration of Transfer and Exchange of
                                Certificates.

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

                  Upon surrender for registration of transfer of any Certificate
at any office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of a Class R Certificate,
upon satisfaction of the conditions set forth below, the Trustee on behalf of
the Trust shall execute, authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of the same aggregate
Percentage Interest.

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                  At the option of the Certificateholders, Certificates may be
exchanged for other Certificates in authorized denominations and the same
aggregate Percentage Interests, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute on behalf of the Trust and
authenticate and deliver the Certificates which the Certificateholder making the
exchange is entitled to receive. Every Certificate presented or surrendered for
registration of transfer or exchange shall (if so required by the Trustee or the
Certificate Registrar) be duly endorsed by, or be accompanied by a written
instrument of transfer satisfactory to the Trustee and the Certificate Registrar
duly executed by, the Holder thereof or his attorney duly authorized in writing.
In addition, with respect to each Class R Certificate, the holder thereof may
exchange, in the manner described above, such Class R Certificate for three
separate certificates, each representing such holder's respective Percentage
Interest in the Class R-1 Interest, the Class R-2 Interest and the Class R-3
Interest, respectively, in each case that was evidenced by the Class R
Certificate being exchanged.

                  (b) Except as provided in paragraph (c) below, the Book-Entry
Certificates shall at all times remain registered in the name of the Depository
or its nominee and at all times: (i) registration of such Certificates may not
be transferred by the Trustee except to another Depository; (ii) the Depository
shall maintain book-entry records with respect to the Certificate Owners and
with respect to ownership and transfers of such Certificates; (iii) ownership
and transfers of registration of such Certificates on the books of the
Depository shall be governed by applicable rules established by the Depository;
(iv) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (v) the Trustee shall for all
purposes deal with the Depository as representative of the Certificate Owners of
the Certificates for purposes of exercising the rights of Holders under this
Agreement, and requests and directions for and votes of such representative
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; (vi) the Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with respect
to its Depository Participants and furnished by the Depository Participants with
respect to indirect participating firms and Persons shown on the books of such
indirect participating firms as direct or indirect Certificate Owners; and (vii)
the direct participants of the Depository shall have no rights under this
Agreement under or with respect to any of the Certificates held on their behalf
by the Depository, and the Depository may be treated by the Trustee and its
agents, employees, officers and directors as the absolute owner of the
Certificates for all purposes whatsoever.

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

                  (c) If (i)(x) the Depository or the Depositor advises the
Trustee in writing that the Depository is no longer willing or able to discharge
properly its responsibilities as Depository and

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<PAGE>

(y) the Trustee or the Depositor is unable to locate a qualified successor, (ii)
the Depositor notifies DTC of its intent to terminate the book-entry system and,
upon receipt of notice of such intent from DTC, the participants holding
beneficial interests in the certificates agree to initiate such termination or
(iii) after the occurrence of a Master Servicer Event of Termination, the
Certificate Owners of the Book-Entry Certificates representing Percentage
Interests of such Classes aggregating not less than 51% advise the Trustee and
Depository through the Financial Intermediaries and the Depository Participants
in writing that the continuation of a book-entry system through the Depository
to the exclusion of definitive, fully registered certificates (the "Definitive
Certificates") to Certificate Owners is no longer in the best interests of the
Certificate Owners. Upon surrender to the Certificate Registrar of the
Book-Entry Certificates by the Depository, accompanied by registration
instructions from the Depository for registration, the Trustee shall, at the
Depositor's expense, in the case of (ii) above, or the Master Servicer's
expense, in the case of (i) and (iii) above, execute on behalf of the Trust and
authenticate the Definitive Certificates. Neither the Depositor nor the Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates, the Trustee, the Certificate
Registrar, the Master Servicer, any Paying Agent and the Depositor shall
recognize the Holders of the Definitive Certificates as Certificateholders
hereunder.

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

                  No transfer of a Class C Certificate, Class P Certificate or
Class R Certificate or any interest therein shall be made to any Plan subject to
ERISA or Section 4975 of the Code, any Person acting, directly or indirectly, on
behalf of any such Plan or any Person acquiring such Certificates with "Plan
Assets" of a Plan within the meaning of the Department of Labor regulation
promulgated at 29 C.F.R. ss. 2510.3-101 ("Plan Assets"), as certified by such
transferee in the form of Exhibit M, unless the Trustee is provided with an
Opinion of Counsel for the benefit of the Depositor, the

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Trustee and the Master Servicer and upon which they may rely, which establishes
to the satisfaction of the Trustee that the purchase of such Certificates is
permissible under applicable law, will not constitute or result in any
prohibited transaction under ERISA or Section 4975 of the Code and will not
subject the Depositor, the Master Servicer, the Trustee or the Trust Fund to any
obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in this Agreement,
which Opinion of Counsel shall not be an expense of the Depositor, the Master
Servicer, the Trustee or the Trust Fund. Neither a certification nor an Opinion
of Counsel will be required in connection with the initial transfer of any such
Certificate by the Depositor to an affiliate of the Depositor (in which case,
the Depositor or any affiliate thereof shall have deemed to have represented
that such affiliate is not a Plan or a Person investing Plan Assets) and the
Trustee shall be entitled to conclusively rely upon a representation (which,
upon the request of the Trustee, shall be a written representation) from the
Depositor of the status of such transferee as an affiliate of the Depositor.

                  Each Transferee of a Mezzanine Certificate will be deemed to
have represented by virtue of its purchase or holding of such Certificate (or
interest therein) that either (a) such Transferee is not a Plan or purchasing
such Certificate with Plan Assets, (b) it has acquired and is holding such
Certificate in reliance on Prohibited Transaction Exemption ("PTE") 90-59, 55
Fed. Reg. 36724, as amended by PTE 2002-41, 67 Fed. Reg. 54487 (August 22, 2002)
(the "Exemption"), and that it understands that there are certain conditions to
the availability of the Exemption including that such Certificate must be rated,
at the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60, and (iii) the conditions set forth in Sections I and III of PTCE
95-60 have been satisfied.

                  If any Mezzanine Certificate, Class C Certificate, Class P
Certificate or Residual Certificate or any interest therein is acquired or held
in violation of the provisions of the two preceding paragraphs, the next
preceding permitted beneficial owner will be treated as the beneficial owner of
that Certificate retroactive to the date of transfer to the purported beneficial
owner. Any purported beneficial owner whose acquisition or holding of any such
Certificate or interest therein was effected in violation of the provisions of
the preceding two paragraphs shall indemnify and hold harmless the Depositor,
the Master Servicer, the NIMS Insurer, the Trustee and the Trust from and
against any and all liabilities, claims, costs or expenses incurred by those
parties as a result of that acquisition or holding.

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

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<PAGE>

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

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

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

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

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

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

                  (v) If any Person other than a Permitted Transferee acquires
         any Ownership Interest in a Residual Certificate in violation of the
         restrictions in this Section, then the Trustee shall have the right but
         not the obligation, without notice to the Holder of such Residual
         Certificate or any other Person having an Ownership Interest therein,
         to notify the Depositor to arrange for the sale of such Residual
         Certificate. The proceeds of such sale, net of commissions (which may
         include commissions payable to the Depositor or its affiliates in
         connection with such sale), expenses and taxes due, if any, will be
         remitted by the Trustee

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<PAGE>

         to the previous Holder of such Residual Certificate that is a Permitted
         Transferee, except that in the event that the Trustee determines that
         the Holder of such Residual Certificate may be liable for any amount
         due under this Section or any other provisions of this Agreement, the
         Trustee may withhold a corresponding amount from such remittance as
         security for such claim. The terms and conditions of any sale under
         this clause (v) shall be determined in the sole discretion of the
         Trustee and it shall not be liable to any Person having an Ownership
         Interest in a Residual Certificate as a result of its exercise of such
         discretion.

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

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

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

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

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

                  If (i) any mutilated Certificate is surrendered to the
Certificate Registrar or the Certificate Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate and (ii) there
is delivered to the Trustee, the Depositor, the NIMS Insurer and the Certificate
Registrar such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Trustee or the Certificate
Registrar that such Certificate has been acquired by a bona fide purchaser, the
Trustee shall execute on behalf of the Trust, authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and Percentage Interest. Upon the
issuance of any new Certificate under this Section, the Trustee or the
Certificate Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee and the
Certificate Registrar) in connection therewith. Any duplicate Certificate issued
pursuant to this Section, shall

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<PAGE>

constitute complete and indefeasible evidence of ownership in the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.

                  SECTION 5.04. Persons Deemed Owners.

                  The Master Servicer, the Depositor, the Trustee, the NIMS
Insurer, the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMS Insurer, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.01
and for all other purposes whatsoever, and none of the Master Servicer, the
Trust, the Trustee nor any agent of any of them shall be affected by notice to
the contrary.

                  SECTION 5.05. Appointment of Paying Agent.

                  (a) The Paying Agent shall make distributions to
Certificateholders from the Distribution Account pursuant to Section 4.01 and
shall report the amounts of such distributions to the Trustee. The duties of the
Paying Agent may include the obligation (i) to withdraw funds from the
Collection Account pursuant to Section 3.11(a) and for the purpose of making the
distributions referred to above and (ii) to distribute statements and provide
information to Certificateholders as required hereunder. The Paying Agent
hereunder shall at all times be an entity duly incorporated and validly existing
under the laws of the United States of America or any state thereof, authorized
under such laws to exercise corporate trust powers and subject to supervision or
examination by federal or state authorities. The Paying Agent shall initially be
the Trustee. The Trustee may appoint a successor to act as Paying Agent, which
appointment shall be reasonably satisfactory to the Depositor and the NIMS
Insurer.

                  (b) The Trustee shall cause the Paying Agent (if other than
the Trustee) to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee that such Paying Agent shall hold all
sums, if any, held by it for payment to the Certificateholders in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be paid
to such Certificateholders and shall agree that it shall comply with all
requirements of the Code regarding the withholding of payments in respect of
Federal income taxes due from Certificate Owners and otherwise comply with the
provisions of this Agreement applicable to it.

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                                   ARTICLE VI

                      THE MASTER SERVICER AND THE DEPOSITOR

                  SECTION 6.01. Liability of the Master Servicer and the
                                Depositor.

                  The Master Servicer shall be liable in accordance herewith
only to the extent of the obligations specifically imposed upon and undertaken
by Master Servicer herein. The Depositor shall be liable in accordance herewith
only to the extent of the obligations specifically imposed upon and undertaken
by the Depositor.

                  SECTION 6.02. Merger or Consolidation of, or Assumption of the
                                Obligations of, the Master Servicer or the
                                Depositor.

                  Any entity into which the Master Servicer or Depositor may be
merged or consolidated, or any entity resulting from any merger, conversion or
consolidation to which the Master Servicer or the Depositor shall be a party, or
any corporation succeeding to the business of the Master Servicer or the
Depositor, shall be the successor of the Master Servicer or the Depositor, as
the case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding; PROVIDED, HOWEVER, that the successor Master Servicer
shall satisfy all the requirements of Section 7.02 with respect to the
qualifications of a successor Master Servicer.

                  SECTION 6.03. Limitation on Liability of the Master Servicer
                                and Others.

                  Neither the Master Servicer or the Depositor nor any of the
directors or officers or employees or agents of the Master Servicer or the
Depositor shall be under any liability to the Trust or the Certificateholders
for any action taken or for refraining from the taking of any action by the
Master Servicer or the Depositor in good faith pursuant to this Agreement, or
for errors in judgment; PROVIDED, HOWEVER, that this provision shall not protect
the Master Servicer, the Depositor or any such Person against any liability
which would otherwise be imposed by reason of its willful misfeasance, bad faith
or negligence in the performance of duties of the Master Servicer or the
Depositor, as the case may be, or by reason of its reckless disregard of its
obligations and duties of the Master Servicer or the Depositor, as the case may
be, hereunder; PROVIDED, FURTHER, that this provision shall not be construed to
entitle the Master Servicer to indemnity in the event that amounts advanced by
the Master Servicer to retire any senior lien exceed Liquidation Proceeds (in
excess of related liquidation expenses) realized with respect to the related
Mortgage Loan. The preceding sentence shall not limit the obligations of the
Master Servicer pursuant to Section 8.05. The Master Servicer and any director
or officer or employee or agent of the Master Servicer may rely in good faith on
any document of any kind PRIMA FACIE properly executed and submitted by any
Person respecting any matters arising hereunder. The Master Servicer and the
Depositor, and any director or officer or employee or agent of the Master
Servicer or the Depositor, shall be indemnified by the Trust and held harmless
against any loss, liability or expense incurred in connection with any legal
action relating to this Agreement or the Certificates, other than any loss,
liability or expense related to any specific Mortgage Loan or Mortgage Loans
(except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement) and any loss, liability or expense incurred

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by reason of its willful misfeasance, bad faith or negligence in the performance
of duties hereunder or by reason of its reckless disregard of obligations and
duties hereunder. The Master Servicer or the Depositor may undertake any such
action which it may deem necessary or desirable in respect of this Agreement,
and the rights and duties of the parties hereto and the interests of the
Certificateholders hereunder. In such event, unless the Depositor or the Master
Servicer acts without the consent of Holders of Certificates entitled to at
least 51% of the Voting Rights, the reasonable legal expenses and costs of such
action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust and the Master Servicer shall be entitled to be
reimbursed therefor from the Collection Account as and to the extent provided in
Section 3.11, any such right of reimbursement being prior to the rights of the
Certificateholders to receive any amount in the Collection Account. The Master
Servicer's right to indemnity or reimbursement pursuant to this Section shall
survive any resignation or termination of the Master Servicer pursuant to
Section 6.04 or 7.01 with respect to any losses, expenses, costs or liabilities
arising prior to such resignation or termination (or arising from events that
occurred prior to such resignation or termination). This paragraph shall apply
to the Master Servicer solely in its capacity as Master Servicer hereunder and
in no other capacities. Without limiting the foregoing, the Master Servicer
shall undertake to defend any claims against the Trust Fund, the Trustee and/or
itself initiated by a Borrower or otherwise related to the servicing of any
Mortgage Loan.

                  The Master Servicer (except the Trustee if it is required to
succeed the Master Servicer hereunder) indemnifies and holds the Trustee, the
Depositor, the NIMS Insurer and each Certificateholder harmless against any and
all claims, losses, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments, and any other costs, fees and expenses that the
Trustee, the Depositor, the NIMS Insurer and any Certificateholder may sustain
in any way related to the failure of the Master Servicer to perform its duties
and service the Mortgage Loans in compliance with the terms of this Agreement.
The Master Servicer shall immediately notify the Trustee, the Depositor, the
NIMS Insurer and each Certificateholder if a claim is made that may result in
such claims, losses, penalties, fines, forfeitures, legal fees or related costs,
judgments, or any other costs, fees and expenses, and the Master Servicer shall
assume (with the consent of the Trustee) the defense of any such claim and pay
all expenses in connection therewith, including reasonable counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be entered
against the Master Servicer, the Trustee, the Depositor, the NIMS Insurer and/or
Certificateholder in respect of such claim. The provisions of this paragraph
shall survive the termination of this Agreement and the payment of the
outstanding Certificates.

                  SECTION 6.04. Master Servicer Not to Resign.

                  Subject to the provisions of Section 7.01 and Section 6.02,
the Master Servicer shall not resign from the obligations and duties hereby
imposed on it except (i) upon determination that the performance of its
obligations or duties hereunder are no longer permissible under applicable law
or are in material conflict by reason of applicable law with any other
activities carried on by it or its subsidiaries or Affiliates, the other
activities of the Master Servicer so causing such a conflict being of a type and
nature carried on by the Master Servicer or its subsidiaries or Affiliates at
the date of this Agreement or (ii) upon satisfaction of the following
conditions: (a) the Master Servicer has proposed a successor servicer to the
Trustee and the NIMS Insurer in writing and such proposed successor servicer is
reasonably acceptable to the Trustee and the NIMS Insurer and (b) each Rating

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Agency shall have delivered a letter to the Trustee and the NIMS Insurer prior
to the appointment of the successor servicer stating that the proposed
appointment of such successor servicer as Master Servicer hereunder will not
result in the reduction or withdrawal of the then current rating of the
Certificates; PROVIDED, HOWEVER, that no such resignation by the Master Servicer
shall become effective until such successor servicer or, in the case of (i)
above, the Trustee shall have assumed the Master Servicer's responsibilities and
obligations hereunder or the Trustee shall have designated, with the consent of
the NIMS Insurer, a successor servicer in accordance with Section 7.02. Any such
resignation shall not relieve the Master Servicer of responsibility for any of
the obligations specified in Sections 7.01 and 7.02 as obligations that survive
the resignation or termination of the Master Servicer. Any such determination
permitting the resignation of the Master Servicer pursuant to clause (i) above
shall be evidenced by an Opinion of Counsel to such effect delivered to the
Trustee and the NIMS Insurer. Any such determination permitting the resignation
of the Master Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee and the NIMS Insurer.

                  SECTION 6.05. Delegation of Duties.

                  In the ordinary course of business, the Master Servicer at any
time may delegate any of its duties hereunder to any Person, including any of
its Affiliates, who agrees to conduct such duties in accordance with standards
comparable to those set forth in Section 3.01. Such delegation shall not relieve
the Master Servicer of its liabilities and responsibilities with respect to such
duties and shall not constitute a resignation within the meaning of Section
6.04. Except as provided in Section 3.02, no such delegation is permitted that
results in the delegee subservicing any Mortgage Loans. The Master Servicer
shall provide the Trustee and the NIMS Insurer with 60 days prior written notice
prior to the delegation of any of its duties to any Person other than any of the
Master Servicer's Affiliates or their respective successors and assigns.

                  SECTION 6.06. [Reserved].

                  SECTION 6.07. Inspection.

                  The Master Servicer, in its capacity as Originator and Master
Servicer, shall afford the Trustee and the NIMS Insurer, upon reasonable advance
notice, during normal business hours, access to all records maintained by the
Master Servicer in respect of its rights and obligations hereunder and access to
officers of the Master Servicer responsible for such obligations. Upon request,
the Master Servicer shall furnish to the Trustee and the NIMS Insurer its most
recent publicly available financial statements and such other information
relating to its capacity to perform its obligations under this Agreement.

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                                   ARTICLE VII

                                     DEFAULT

                  SECTION 7.01. Master Servicer Events of Termination.

                  (a) If any one of the following events ("Master Servicer
Events of Termination") shall occur and be continuing:

                  (i) (A) The failure by the Master Servicer to make any
         Advance; or (B) any other failure by the Master Servicer to deposit in
         the Collection Account or Distribution Account any deposit required to
         be made under the terms of this Agreement which continues unremedied
         for a period of one Business Day after the date upon which written
         notice of such failure shall have been given to the Master Servicer by
         the Trustee or to the Trustee by the NIMS Insurer or any Holders of a
         Regular Certificate evidencing at least 25% of the Voting Rights; or

                  (ii) The failure by the Master Servicer to make any required
         Servicing Advance which failure continues unremedied for a period of 30
         days, or the failure by the Master Servicer duly to observe or perform,
         in any material respect, any other covenants, obligations or agreements
         of the Master Servicer as set forth in this Agreement, which failure
         continues unremedied for a period of 30 days, after the date (A) on
         which written notice of such failure, requiring the same to be
         remedied, shall have been given to the Master Servicer by the Trustee
         or to the Trustee by the NIMS Insurer or any Holders of a Regular
         Certificate evidencing at least 25% of the Voting Rights or (B) of
         actual knowledge of such failure by a Servicing Officer of the Master
         Servicer; or

                  (iii) The entry against the Master Servicer of a decree or
         order by a court or agency or supervisory authority having jurisdiction
         in the premises for the appointment of a trustee, conservator, receiver
         or liquidator in any insolvency, conservatorship, receivership,
         readjustment of debt, marshalling of assets and liabilities or similar
         proceedings, or for the winding up or liquidation of its affairs, and
         the continuance of any such decree or order unstayed and in effect for
         a period of 60 days; or

                  (iv) The Master Servicer shall voluntarily go into
         liquidation, consent to the appointment of a conservator or receiver or
         liquidator or similar person in any insolvency, readjustment of debt,
         marshalling of assets and liabilities or similar proceedings of or
         relating to the Master Servicer or of or relating to all or
         substantially all of its property; or a decree or order of a court or
         agency or supervisory authority having jurisdiction in the premises for
         the appointment of a conservator, receiver, liquidator or similar
         person in any insolvency, readjustment of debt, marshalling of assets
         and liabilities or similar proceedings, or for the winding-up or
         liquidation of its affairs, shall have been entered against the Master
         Servicer and such decree or order shall have remained in force
         undischarged, unbonded or unstayed for a period of 60 days; or the
         Master Servicer shall admit in writing its inability to pay its debts
         generally as they become due, file a petition to take advantage of any
         applicable

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         insolvency or reorganization statute, make an assignment for the
         benefit of its creditors or voluntarily suspend payment of its
         obligations; or

                  (v) A Delinquency Master Servicer Termination Trigger has
         occurred and is continuing;

                  (b) then, and in each and every such case, so long as a Master
Servicer Event of Termination shall not have been remedied within the applicable
grace period, (x) with respect solely to clause (i)(A) above, if such Advance is
not made by 5:00 P.M., New York time, on the Business Day immediately following
the Master Servicer Remittance Date (provided the Trustee shall give the Master
Servicer notice of such failure to advance by 5:00 P.M. New York time on the
Master Servicer Remittance Date), the Trustee shall, at the direction of the
NIMS Insurer, terminate all of the rights and obligations of the Master Servicer
under this Agreement and the Trustee, or a successor servicer appointed in
accordance with Section 7.02, shall immediately make such Advance and assume,
pursuant to Section 7.02, the duties of a successor Master Servicer, (y) in the
case of (i)(B), (ii), (iii) and (iv) above, the Trustee shall, at the written
direction of the NIMS Insurer or the Holders of each Class of Regular
Certificates evidencing Percentage Interests aggregating not less than 51%, by
notice then given in writing to the Master Servicer and to the Trustee and (z)
in the case of (v) above, the Trustee shall, at the direction of the NIMS
Insurer, by notice then given in writing to the Master Servicer and to the
Trustee, terminate all of the rights and obligations of the Master Servicer as
servicer under this Agreement. Any such notice to the Master Servicer shall also
be given to each Rating Agency, the Depositor and the Originator. On or after
the receipt by the Master Servicer (and by the Trustee if such notice is given
by the Holders) of such written notice, all authority and power of the Master
Servicer under this Agreement, whether with respect to the Certificates or the
Mortgage Loans or otherwise, shall pass to and be vested in the Trustee pursuant
to and under this Section; and, without limitation, and the Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the Master
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement of each Mortgage Loan and related
documents or otherwise. The Master Servicer agrees to cooperate with the Trustee
(or the applicable successor Master Servicer) in effecting the termination of
the responsibilities and rights of the Master Servicer hereunder, including,
without limitation, the delivery to the Trustee of all documents and records
requested by it to enable it to assume the Master Servicer's functions under
this Agreement within ten Business Days subsequent to such notice, the transfer
within one Business Day subsequent to such notice to the Trustee (or the
applicable successor Master Servicer) for the administration by it of all cash
amounts that shall at the time be held by the Master Servicer and to be
deposited by it in the Collection Account, the Distribution Account, any REO
Account or any Servicing Account or that have been deposited by the Master
Servicer in such accounts or thereafter received by the Master Servicer with
respect to the Mortgage Loans or any REO Property received by the Master
Servicer. All reasonable costs and expenses (including attorneys' fees) incurred
in connection with transferring the Mortgage Files to the successor Master
Servicer and amending this Agreement to reflect such succession as Master
Servicer pursuant to this Section shall be paid by the predecessor Master
Servicer (or if the predecessor Master Servicer is the Trustee, the initial
Master Servicer) upon presentation of reasonable documentation of such costs and
expenses and to the extent not paid by the Master Servicer, by the Trust.

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                  (c) In connection with any failure by the Master Servicer to
make any remittance required to be made by the Master Servicer to the
Distribution Account pursuant to this Section 7.01 on the day and by the time
such remittance is required to be made under the terms of this Section 7.01
(without giving effect to any grace or cure period), the Master Servicer shall
pay to the Trustee for the account of the Trustee interest at the Prime Rate on
any amount not timely remitted from and including the day such remittance was
required to be made to, but not including, the day on which such remittance was
actually made.

                  SECTION 7.02. Trustee to Act; Appointment of Successor.

                  (a) From the time the Master Servicer (and the Trustee, if
notice is sent by the Holders) receives a notice of termination pursuant to
Section 7.01 or 6.04, the Trustee (or such other successor Master Servicer as is
approved in accordance with this Agreement) shall be the successor in all
respects to the Master Servicer in its capacity as servicer under this Agreement
and the transactions set forth or provided for herein and shall be subject to
all the responsibilities, duties and liabilities relating thereto placed on the
Master Servicer by the terms and provisions hereof arising on and after its
succession. Notwithstanding the foregoing, the parties hereto agree that the
Trustee, in its capacity as successor Master Servicer, immediately will assume
all of the obligations of the Master Servicer to make advances. Notwithstanding
the foregoing, the Trustee, in its capacity as successor Master Servicer, shall
not be responsible for the lack of information and/or documents that it cannot
obtain through reasonable efforts. It is understood and acknowledged by the
parties hereto that there will be a period of transition (not to exceed 90 days)
before the transition of servicing obligations is fully effective. As
compensation therefor, the Trustee (or such other successor Master Servicer)
shall be entitled to such compensation as the Master Servicer would have been
entitled to hereunder if no such notice of termination had been given.
Notwithstanding the above, (i) if the Trustee is unwilling to act as successor
Master Servicer or (ii) if the Trustee is legally unable so to act, the Trustee
shall appoint or petition a court of competent jurisdiction to appoint, any
established housing and home finance institution, bank or other mortgage loan or
home equity loan servicer having a net worth of not less than $50,000,000 as the
successor to the Master Servicer hereunder in the assumption of all or any part
of the responsibilities, duties or liabilities of the Master Servicer hereunder;
PROVIDED, that the appointment of any such successor Master Servicer shall be
approved by the NIMS Insurer (such approval not to be unreasonably withheld), as
evidenced by the prior written consent of the NIMS Insurer, and will not result
in the qualification, reduction or withdrawal of the ratings assigned to the
Certificates by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies. Pending appointment of a successor to the Master Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Master Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The appointment of a successor Master
Servicer shall not affect any liability of the predecessor Master Servicer which
may have arisen under this Agreement prior to its termination as Master Servicer
to pay any deductible under an insurance policy pursuant to Section 3.14 or to
indemnify the Trustee or the NIMS Insurer pursuant to Section 6.03), nor shall
any successor Master Servicer be liable for any acts or omissions of the
predecessor Master Servicer or for any breach by such Master Servicer of any of
its representations or warranties contained herein

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or in any related document or agreement. The Trustee and such successor shall
take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession. All Servicing Transfer Costs shall be paid by
the predecessor Master Servicer upon presentation of reasonable documentation of
such costs, and if such predecessor Master Servicer defaults in its obligation
to pay such costs, such costs shall be paid by the successor Master Servicer or
the Trustee (in which case the successor Master Servicer or the Trustee, as
applicable, shall be entitled to reimbursement therefor from the assets of the
Trust).

                  (b) Any successor to the Master Servicer, including the
Trustee, shall during the term of its service as servicer continue to service
and administer the Mortgage Loans for the benefit of Certificateholders, and
maintain in force a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Master Servicer hereunder and
a Fidelity Bond in respect of its officers, employees and agents to the same
extent as the Master Servicer is so required pursuant to Section 3.14.

                  SECTION 7.03. Waiver of Defaults.

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

                  SECTION 7.04. Notification to Certificateholders.

                  (a) Upon any termination or appointment of a successor to the
Master Servicer pursuant to this Article VII or Section 6.04, the Trustee shall
give prompt written notice thereof to the Certificateholders at their respective
addresses appearing in the Certificate Register, the NIMS Insurer and each
Rating Agency.

                  (b) No later than 60 days after the occurrence of any event
which constitutes or which, with notice or a lapse of time or both, would
constitute a Master Servicer Event of Termination for five Business Days after a
Responsible Officer of the Trustee becomes aware of the occurrence of such an
event, the Trustee shall transmit by mail to all Certificateholders and to the
NIMS Insurer notice of such occurrence unless such default or Master Servicer
Event of Termination shall have been waived or cured.

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                  SECTION 7.05. Survivability of Master Servicer Liabilities.

                  Notwithstanding anything herein to the contrary, upon
termination of the Master Servicer hereunder, any liabilities of the Master
Servicer which accrued prior to such termination shall survive such termination.

                                  ARTICLE VIII

                                   THE TRUSTEE

                  SECTION 8.01. Duties of Trustee.

                  The Trustee, prior to the occurrence of a Master Servicer
Event of Termination and after the curing of all Master Servicer Events of
Termination which may have occurred, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. If a Master
Servicer Event of Termination has occurred (which has not been cured) of which a
Responsible Officer has knowledge, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.

                  The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement; provided, however, that the
Trustee will not be responsible for the accuracy or content of any such
resolutions, certificates, statements, opinions, reports, documents or other
instruments. If any such instrument is found not to conform to the requirements
of this Agreement in a material manner the Trustee shall take such action as it
deems appropriate to have the instrument corrected, and if the instrument is not
corrected to the Trustee's satisfaction, the Trustee will provide notice thereof
to the Certificateholders and the NIMS Insurer.

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

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

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<PAGE>

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

                  (iii) the Trustee shall not be personally liable with respect
         to any action taken, suffered or omitted to be taken by it in good
         faith in accordance with the direction of the NIMS Insurer or the
         Majority Certificateholders relating to the time, method and place of
         conducting any proceeding for any remedy available to the Trustee, or
         exercising or omitting to exercise any trust or power conferred upon
         the Trustee, under this Agreement; and

                  (iv) the Trustee shall not be charged with knowledge of any
         failure by the Master Servicer to comply with the obligations of the
         Master Servicer referred to in clauses (i) and (ii) of Section 7.01(a)
         unless a Responsible Officer of the Trustee at the Corporate Trust
         Office obtains actual knowledge of such failure or the Trustee receives
         written notice of such failure from the Master Servicer, the NIMS
         Insurer or the Majority Certificateholders.

                  The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee to perform, or be responsible for the manner of performance of, any
of the obligations of the Master Servicer under this Agreement, except during
such time, if any, as the Trustee shall be the successor to, and be vested with
the rights, duties, powers and privileges of, the Master Servicer in accordance
with the terms of this Agreement.

                  The Depositor hereby directs the Trustee to execute, deliver
and perform its obligations under the related Cap Contract on the Closing Date
and thereafter on behalf of the Holders of the Class A-1A Certificates, the
Group II Certificates and the Mezzanine Certificates. The Seller, the Depositor,
the Master Servicer and the Holders of the Class A-1A Certificates, the Group II
Certificates and the Mezzanine Certificates by their acceptance of such
Certificates acknowledge and agree that the Trustee shall execute, deliver and
perform its obligations under the related Cap Contract and shall do so solely in
its capacity as Trustee of the Trust Fund and not in its individual capacity.

                  SECTION 8.02. Certain Matters Affecting the Trustee.

                  Except as otherwise provided in Section 8.01:

                  (i) the Trustee may request and rely upon, and shall be
         protected in acting or refraining from acting upon, any resolution,
         Officers' Certificate, certificate of auditors or any other
         certificate, statement, instrument, opinion, report, notice, request,
         consent, order, appraisal, bond or other paper or document reasonably
         believed by it to be genuine and to have been signed or presented by
         the proper party or parties, and the manner of obtaining consents and
         of evidencing the authorization of the execution thereof by
         Certificateholders shall be subject to such reasonable regulations as
         the Trustee may prescribe;

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

                  (iii) the Trustee shall be under no obligation to exercise any
         of the rights or powers vested in it by this Agreement, or to
         institute, conduct or defend any litigation hereunder or in relation
         hereto, at the request, order or direction of any of the
         Certificateholders or the NIMS Insurer, pursuant to the provisions of
         this Agreement, unless such Certificateholders or the NIMS Insurer, as
         applicable, shall have offered to the Trustee reasonable security or
         indemnity against the costs, expenses and liabilities which may be
         incurred therein or thereby; the right of the Trustee to perform any
         discretionary act enumerated in this Agreement shall not be construed
         as a duty, and the Trustee shall not be answerable for other than its
         negligence or willful misconduct in the performance of any such act;

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

                  (v) prior to the occurrence of a Master Servicer Event of
         Termination and after the curing of all Master Servicer Events of
         Termination which may have occurred, the Trustee shall not be bound to
         make any investigation into the facts or matters stated in any
         resolution, certificate, statement, instrument, opinion, report,
         notice, request, consent, order, approval, bond or other paper or
         documents, unless requested in writing to do so by the NIMS Insurer or
         the Majority Certificateholder; PROVIDED, HOWEVER, that if the payment
         within a reasonable time to the Trustee of the costs, expenses or
         liabilities likely to be incurred by it in the making of such
         investigation is, in the opinion of the Trustee, not reasonably assured
         to the Trustee by the security afforded to it by the terms of this
         Agreement, the Trustee may require reasonable indemnity against such
         cost, expense or liability as a condition to such proceeding. The
         reasonable expense of every such examination shall be paid by the
         Master Servicer or the NIMS Insurer (if requested by the NIMS Insurer)
         or, if paid by the Trustee, shall be reimbursed by the Master Servicer
         or the NIMS Insurer (if requested by the NIMS Insurer) upon demand and,
         if not reimbursed by the Master Servicer or the NIMS Insurer (if
         requested by the NIMS Insurer), shall be reimbursed by the Trust.
         Nothing in this clause (v) shall derogate from the obligation of the
         Master Servicer to observe any applicable law prohibiting disclosure of
         information regarding the Mortgagors;

                  (vi) the Trustee shall not be accountable, shall have no
         liability and makes no representation as to any acts or omissions
         hereunder of the Master Servicer until such time as the Trustee may be
         required to act as Master Servicer pursuant to Section 7.02 and
         thereupon only for the acts or omissions of the Trustee as successor
         Master Servicer;

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

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

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

                  The recitals contained herein and in the Certificates (other
than the authentication of the Trustee on the Certificates) shall be taken as
the statements of the Depositor, and the Trustee assumes no responsibility for
the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Agreement or of the Certificates (other than the
signature and authentication of the Trustee on the Certificates) or of any
Mortgage Loan or related document. The Trustee shall not be accountable for the
use or application by the Master Servicer, or for the use or application of any
funds paid to the Master Servicer in respect of the Mortgage Loans or deposited
in or withdrawn from the Collection Account by the Master Servicer. The Trustee
shall at no time have any responsibility or liability for or with respect to the
legality, validity and enforceability of any Mortgage or any Mortgage Loan, or
the perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
or its ability to generate the payments to be distributed to Certificateholders
under this Agreement, including, without limitation: the existence, condition
and ownership of any Mortgaged Property; the existence and enforceability of any
hazard insurance thereon (other than if the Trustee shall assume the duties of
the Master Servicer pursuant to Section 7.02); the validity of the assignment of
any Mortgage Loan to the Trustee or of any intervening assignment; the
completeness of any Mortgage Loan; the performance or enforcement of any
Mortgage Loan (other than if the Trustee shall assume the duties of the Master
Servicer pursuant to Section 7.02); the compliance by the Depositor, the
Originator, the Seller or the Master Servicer with any warranty or
representation made under this Agreement or in any related document or the
accuracy of any such warranty or representation prior to the Trustee's receipt
of notice or other discovery of any non-compliance therewith or any breach
thereof; any investment of monies by or at the direction of the Master Servicer
or any loss resulting therefrom, it being understood that the Trustee shall
remain responsible for any Trust property that it may hold in its individual
capacity; the acts or omissions of any of the Master Servicer (other than if the
Trustee shall assume the duties of the Master Servicer pursuant to Section
7.02), any Sub-Servicer or any Mortgagor; any action of the Master Servicer
(other than if the Trustee shall assume the duties of the Master Servicer
pursuant to Section 7.02), or any Sub- Servicer taken in the name of the
Trustee; the failure of the Master Servicer or any Sub-Servicer to act or
perform any duties required of it as agent of the Trustee hereunder; or any
action by the Trustee taken at the instruction of the Master Servicer (other
than if the Trustee shall assume the duties of the Master Servicer pursuant to
Section 7.02); PROVIDED, HOWEVER, that the foregoing shall not relieve the
Trustee of its obligation to perform its duties under this Agreement, including,
without limitation, the Trustee's duty to review the Mortgage Files pursuant to
Section 2.01. The Trustee shall have no responsibility for filing any financing
or continuation statement in any public office at any time or to otherwise
perfect or maintain the perfection of any security interest or lien granted to
it hereunder (unless the Trustee shall have become the successor Master
Servicer).

                  SECTION 8.04. Trustee May Own Certificates.

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                  The Trustee in its individual or any other capacity may become
the owner or pledgee of Certificates with the same rights as it would have if it
were not Trustee and may transact any banking and trust business with the
Originator, the Master Servicer, the Depositor or their Affiliates.

                  SECTION 8.05. Trustee Fee and Expenses.

                  (a) The Trustee shall withdraw from the Distribution Account
on each Distribution Date and pay to itself the Trustee Fee. The Trustee shall
be reimbursed from the Trust Fund for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any of the
provisions of this Agreement (not including expenses, disbursements and advances
incurred or made by the Trustee including the compensation and the expenses and
disbursements of its agents and counsel, in the ordinary course of the Trustee's
performance in accordance with the provisions of this Agreement) up to a limit
of $25,000 per calendar year except any such expense, disbursement or advance as
may arise from its negligence or bad faith or which is the responsibility of
Certificateholders or the Trustee hereunder. In addition, the Trustee and its
officers, directors, employees and agents shall be entitled to be indemnified
for, and held harmless by the Trust Fund against, any and all losses,
liabilities, damages, claims or expenses incurred in connection with any legal
action relating to this Agreement or the Certificates up to a limit of $600,000
per calendar year, other than (i) any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or negligence of the Trustee in the
performance of its duties hereunder or by reason of the Trustee's reckless
disregard of obligations and duties hereunder or (ii) resulting from a breach of
the Master Servicer's obligations and duties under this Agreement and the
Mortgage Loans (for which the Master Servicer shall indemnify pursuant to
Section 8.05(b)). Notwithstanding anything herein to the contrary, the Trustee
shall be reimbursed from the Trust Fund for all Servicing Transfer Costs without
regard to any annual limitations. This section shall survive termination of this
Agreement or the resignation or removal of any Trustee hereunder.

                  (b) The Master Servicer agrees to indemnify the Trustee from,
and hold it harmless against, any loss, liability or expense resulting from a
breach of the Master Servicer's obligations and duties under this Agreement.
Such indemnity shall survive the termination or discharge of this Agreement and
the resignation or removal of the Trustee. Any payment hereunder made by the
Master Servicer to the Trustee shall be from the Master Servicer's own funds,
without reimbursement from the Trust Fund therefor.

                  (c) Any amounts payable to the Trustee, or any director,
officer, employee or agent of the Trustee in respect of the indemnification
provided by this Section 8.05, or pursuant to any other right of reimbursement
from the Trust Fund that the Trustee, or any director, officer, employee or
agent of the Trustee, may have hereunder in its capacity as such, may be
withdrawn by the Trustee from the Distribution Account at any time.

                  (d) The limitations on the indemnification provided to the
Trustee set forth in Section 8.05(a) above shall remain in effect for so long as
any series of notes issued pursuant to one or more Indentures, as set forth in
Section 1.04 remain outstanding.

                  SECTION 8.06. Eligibility Requirements for Trustee.

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                  The Trustee hereunder shall at all times be an entity duly
organized and validly existing under the laws of the United States of America or
any state thereof, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least $50,000,000 and a
minimum long-term debt rating of "Baa3" by Moody's, a long-term debt rating of
at least "A-" and a short-term debt rating of at least "A-1" by S&P, if rated by
S&P, and subject to supervision or examination by federal or state authority. If
such entity publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section 8.06, the combined capital and surplus of such
entity shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. The principal office of the
Trustee (other than the initial Trustee) shall be in a state with respect to
which an Opinion of Counsel has been delivered to such Trustee and the NIMS
Insurer at the time such Trustee is appointed Trustee to the effect that the
Trust will not be a taxable entity under the laws of such state. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions of
this Section 8.06, the Trustee shall resign immediately in the manner and with
the effect specified in Section 8.07.

                  SECTION 8.07. Resignation or Removal of Trustee.

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

                  If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Depositor or the NIMS Insurer or if at any time
the Trustee shall be legally unable to act, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor, the Master Servicer or the NIMS Insurer may
remove the Trustee. If the Depositor, the Master Servicer or the NIMS Insurer
removes the Trustee under the authority of the immediately preceding sentence,
the Depositor, with the consent of the NIMS Insurer, shall promptly appoint a
successor Trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee.

                  The Majority Certificateholders (or the NIMS Insurer upon the
failure of the Trustee to perform its obligations hereunder) may at any time
remove the Trustee by written instrument or instruments delivered to the Master
Servicer, the Depositor and the Trustee; the Depositor shall thereupon use its
best efforts to appoint a successor trustee acceptable to the NIMS Insurer in
accordance with this Section.

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                  Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor Trustee as
provided in Section 8.08.

                  SECTION 8.08. Successor Trustee.

                  Any successor Trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the NIMS Insurer, the Depositor, the
Master Servicer and to its predecessor Trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor Trustee shall become effective, and such successor Trustee, without
any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as Trustee. The Depositor, the Master Servicer and
the predecessor Trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for fully and certainly vesting and
confirming in the successor Trustee all such rights, powers, duties and
obligations.

                  No successor Trustee shall accept appointment as provided in
this Section 8.08 unless at the time of such acceptance such successor Trustee
shall be eligible under the provisions of Section 8.06 and the appointment of
such successor Trustee shall not result in a downgrading of the Regular
Certificates by either Rating Agency, as evidenced by a letter from each Rating
Agency.

                  Upon acceptance of appointment by a successor Trustee as
provided in this Section 8.08, the successor Trustee shall mail notice of the
appointment of a successor Trustee hereunder to all Holders of Certificates at
their addresses as shown in the Certificate Register and to each Rating Agency.

                  SECTION 8.09. Merger or Consolidation of Trustee.

                  Any entity into which the Trustee may be merged or converted
or with which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such entity shall be eligible under the provisions of
Section 8.06 and 8.08, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.

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

                  Notwithstanding any other provisions of this Agreement, at any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust or any Mortgaged Property may at the time be
located, the Depositor and the Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee and the NIMS Insurer to act as co-trustee or
co-trustees, jointly with the Trustee, or separate trustee or separate trustees,
of all or any part of the Trust, and to vest in such Person or Persons, in such
capacity and for the benefit of the Certificateholders, such title to the Trust,
or any part thereof, and, subject to the other provisions of this Section 8.10,
such powers, duties, obligations, rights and trusts as the Master Servicer and
the Trustee may consider necessary

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or desirable. Any such co-trustee or separate trustee shall be subject to the
written approval of the Master Servicer and the NIMS Insurer. If the Master
Servicer and the NIMS Insurer shall not have joined in such appointment within
15 days after the receipt by it of a request so to do, or in the case a Master
Servicer Event of Termination shall have occurred and be continuing, the Trustee
alone shall have the power to make such appointment. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as a
successor trustee under Section 8.06, and no notice to Certificateholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 8.08. The Master Servicer shall be responsible for the fees of any
co-trustee or separate trustee appointed hereunder.

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

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

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

                  (iii) the Master Servicer and the Trustee, acting jointly and
         with the consent of the NIMS Insurer, may at any time accept the
         resignation of or remove any separate trustee or co-trustee except that
         following the occurrence of a Master Servicer Event of Termination, the
         Trustee acting alone may accept the resignation or remove any separate
         trustee or co- trustee.

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

                  Any separate trustee or co-trustee may, at any time,
constitute the Trustee, its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any

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lawful act under or in respect of this Agreement on its behalf and in its name.
If any separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, all of its estates, properties, rights, remedies and
trusts shall vest in and be exercised by the Trustee, to the extent permitted by
law, without the appointment of a new or successor Trustee.

                  SECTION 8.11. Limitation of Liability.

                  The Certificates are executed by the Trustee, not in its
individual capacity but solely as Trustee of the Trust, in the exercise of the
powers and authority conferred and vested in it by this Agreement. Each of the
undertakings and agreements made on the part of the Trustee in the Certificates
is made and intended not as a personal undertaking or agreement by the Trustee
but is made and intended for the purpose of binding only the Trust.

                  SECTION 8.12. Trustee May Enforce Claims Without Possession of
                                Certificates.

                  (a) All rights of action and claims under this Agreement or
the Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee for the benefit of all
Holders of such Certificates, subject to the provisions of this Agreement. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursement and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.

                  (b) The Trustee shall afford the Seller, the Originator, the
Depositor, the Master Servicer, the NIMS Insurer and each Certificate Owner upon
reasonable notice during normal business hours, access to all records maintained
by the Trustee in respect of its duties hereunder and access to officers of the
Trustee responsible for performing such duties. Upon request, the Trustee shall
furnish the Depositor, the Master Servicer, the NIMS Insurer and any requesting
Certificate Owner with its most recent financial statements. The Trustee shall
cooperate fully with the Seller, the Originator the Master Servicer, the
Depositor and such Certificate Owner and shall make available to the Seller, the
Originator, the Master Servicer, the Depositor, the NIMS Insurer and such
Certificate Owner for review and copying such books, documents or records as may
be requested with respect to the Trustee's duties hereunder. The Seller, the
Originator, the Depositor, the Master Servicer and the Certificate Owners shall
not have any responsibility or liability for any action or failure to act by the
Trustee and are not obligated to supervise the performance of the Trustee under
this Agreement or otherwise.

                  SECTION 8.13. Suits for Enforcement.

                  In case a Master Servicer Event of Termination or other
default by the Master Servicer or the Depositor hereunder shall occur and be
continuing, the Trustee, shall, at the direction of the Majority
Certificateholders or the NIMS Insurer, or may, proceed to protect and enforce
its rights and the rights of the Certificateholders or the NIMS Insurer under
this Agreement by a suit, action or proceeding in equity or at law or otherwise,
whether for the specific performance of any

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covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy, as the Trustee, being advised by counsel, and subject
to the foregoing, shall deem most effectual to protect and enforce any of the
rights of the Trustee, the NIMS Insurer and the Certificateholders.

                  SECTION 8.14. Waiver of Bond Requirement.

                  The Trustee shall be relieved of, and each Certificateholder
hereby waives, any requirement of any jurisdiction in which the Trust, or any
part thereof, may be located that the Trustee post a bond or other surety with
any court, agency or body whatsoever.

                  SECTION 8.15. Waiver of Inventory, Accounting and Appraisal
                                Requirement.

                  The Trustee shall be relieved of, and each Certificateholder
hereby waives, any requirement of any jurisdiction in which the Trust, or any
part thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.

                                   ARTICLE IX

                              REMIC ADMINISTRATION

                  SECTION 9.01. REMIC Administration.

                  (a) REMIC elections as set forth in the Preliminary Statement
shall be made by the Trustee on Form 1066 or other appropriate federal tax or
information return for the taxable year ending on the last day of the calendar
year in which the Certificates are issued. The regular interests and residual
interest in each REMIC shall be as designated in the Preliminary Statement.

                  (b) The Closing Date is hereby designated as the "Startup Day"
of each REMIC within the meaning of section 860G(a)(9) of the Code.

                  (c) The Master Servicer shall pay any and all tax related
expenses (not including taxes) of each REMIC, including but not limited to any
professional fees or expenses related to audits or any administrative or
judicial proceedings with respect to each REMIC that involve the Internal
Revenue Service or state tax authorities, but only to the extent that (i) such
expenses are ordinary or routine expenses, including expenses of a routine audit
but not expenses of litigation (except as described in (ii)); or (ii) such
expenses or liabilities (including taxes and penalties) are attributable to the
negligence or willful misconduct of the Master Servicer in fulfilling its duties
hereunder. The Master Servicer shall be entitled to reimbursement of expenses to
the extent provided in clause (i) above from the Collection Account.

                  (d) The Trustee shall prepare, sign and file, all of the
REMICs' federal and state tax and information returns as the direct
representative each REMIC created hereunder. The expenses of preparing and
filing such returns shall be borne by the Trustee.

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                  (e) The Holder of the Class R Certificate at any time holding
the largest Percentage Interest thereof shall be the "tax matters person" as
defined in the REMIC Provisions (the "Tax Matters Person") with respect to each
REMIC and shall act as Tax Matters Person for each REMIC. The Trustee, as agent
for the Tax Matters Person, shall perform on behalf of each REMIC all reporting
and other tax compliance duties that are the responsibility of such REMIC under
the Code, the REMIC Provisions, or other compliance guidance issued by the
Internal Revenue Service or any state or local taxing authority. Among its other
duties, if required by the Code, the REMIC Provisions, or other such guidance,
the Trustee, as agent for the Tax Matters Person, shall provide (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate to
any disqualified person or organization and (ii) to the Certificateholders such
information or reports as are required by the Code or REMIC Provisions. The
Trustee, as agent for the Tax Matters Person, shall represent each REMIC in any
administrative or judicial proceedings relating to an examination or audit by
any governmental taxing authority, request an administrative adjustment as to
any taxable year of any REMIC, enter into settlement agreements with any
government taxing agency, extend any statute of limitations relating to any item
of any REMIC and otherwise act on behalf of any REMIC in relation to any tax
matter involving the Trust.

                  (f) The Trustee, the Master Servicer and the Holders of
Certificates shall take any action or cause the REMIC to take any action
necessary to create or maintain the status of each REMIC as a REMIC under the
REMIC Provisions and shall assist each other as necessary to create or maintain
such status. Neither the Trustee, the Master Servicer nor the Holder of any
Residual Certificate shall take any action, cause any REMIC created hereunder to
take any action or fail to take (or fail to cause to be taken) any action that,
under the REMIC Provisions, if taken or not taken, as the case may be, could (i)
endanger the status of such REMIC as a REMIC or (ii) result in the imposition of
a tax upon such REMIC (including but not limited to the tax on prohibited
transactions as defined in Code Section 860F(a)(2) and the tax on prohibited
contributions set forth on Section 860G(d) of the Code) (either such event, an
"Adverse REMIC Event") unless the Trustee, the NIMS Insurer and the Master
Servicer have received an Opinion of Counsel (at the expense of the party
seeking to take such action) to the effect that the contemplated action will not
endanger such status or result in the imposition of such a tax. In addition,
prior to taking any action with respect to any REMIC created hereunder or the
assets therein, or causing such REMIC to take any action, which is not expressly
permitted under the terms of this Agreement, any Holder of a Residual
Certificate will consult with the Trustee, the NIMS Insurer and the Master
Servicer, or their respective designees, in writing, with respect to whether
such action could cause an Adverse REMIC Event to occur with respect to any
REMIC, and no such Person shall take any such action or cause any REMIC to take
any such action as to which the Trustee, the NIMS Insurer or the Master Servicer
has advised it in writing that an Adverse REMIC Event could occur.

                  (g) Each Holder of a Residual Certificate shall pay when due
any and all taxes imposed on each REMIC created hereunder by federal or state
governmental authorities. To the extent that such Trust taxes are not paid by a
Residual Certificateholder, the Trustee shall pay any remaining REMIC taxes out
of current or future amounts otherwise distributable to the Holder of the
Residual Certificate in the REMICs or, if no such amounts are available, out of
other amounts held in the Distribution Account, and shall reduce amounts
otherwise payable to Holders of regular interests in the related REMIC. Subject
to the foregoing, in the event that a REMIC incurs a state

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or local tax, including franchise taxes, as a result of a determination that
such REMIC is domiciled in the State of California or any other state for state
tax purposes by virtue of the location of the Master Servicer or any
subservicer, the Master Servicer agrees to pay on behalf of such REMIC when due,
any and all state and local taxes imposed as a result of such a determination,
in the event that the Holder of the related Class R Certificate fails to pay
such taxes, if any, when imposed.

                  (h) The Trustee, as agent for the Tax Matters Person, shall,
for federal income tax purposes, maintain books and records with respect to each
REMIC created hereunder on a calendar year and on an accrual basis.

                  (i) No additional contributions of assets shall be made to any
REMIC created hereunder, except as expressly provided in this Agreement with
respect to eligible substitute mortgage loans.

                  (j) Neither the Trustee nor the Master Servicer shall enter
into any arrangement by which any REMIC created hereunder will receive a fee or
other compensation for services.

                  (k) On or before April 15 of each calendar year beginning in
2005, the Master Servicer shall deliver to the NIMS Insurer, the Trustee and
each Rating Agency an Officers' Certificate stating the Master Servicer's
compliance with the provisions of this Section 9.01.

                  (j) The Trustee will apply for an Employee Identification
Number from the Internal Revenue Service via a Form SS-4 or other acceptable
method for all tax entities and shall complete the Form 8811.

                  SECTION 9.02. Prohibited Transactions and Activities.

                  Neither the Depositor, the Master Servicer nor the Trustee
shall sell, dispose of, or substitute for any of the Mortgage Loans, except in a
disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii) the
bankruptcy of the Trust Fund, (iii) the termination of any REMIC created
hereunder pursuant to Article X of this Agreement, (iv) a substitution pursuant
to Article II of this Agreement or (v) a repurchase of Mortgage Loans pursuant
to Article II of this Agreement, nor acquire any assets for any REMIC, nor sell
or dispose of any investments in the Distribution Account for gain, nor accept
any contributions to either REMIC after the Closing Date, unless it and the NIMS
Insurer have received an Opinion of Counsel (at the expense of the party causing
such sale, disposition, or substitution) that such disposition, acquisition,
substitution, or acceptance will not (a) affect adversely the status of any
REMIC created hereunder as a REMIC or of the interests therein other than the
Residual Certificates as the regular interests therein, (b) affect the
distribution of interest or principal on the Certificates, (c) result in the
encumbrance of the assets transferred or assigned to the Trust Fund (except
pursuant to the provisions of this Agreement) or (d) cause any REMIC created
hereunder to be subject to a tax on prohibited transactions or prohibited
contributions pursuant to the REMIC Provisions.

                  SECTION 9.03. Indemnification with Respect to Certain Taxes
                                and Loss of REMIC Status.

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                  (a) In the event that any REMIC fails to qualify as a REMIC,
loses its status as a REMIC, or incurs federal, state or local taxes as a result
of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Master Servicer of its duties
and obligations set forth herein, the Master Servicer shall indemnify the NIMS
Insurer, the Trustee and the Trust Fund against any and all losses, claims,
damages, liabilities or expenses ("Losses") resulting from such negligence;
PROVIDED, HOWEVER, that the Master Servicer shall not be liable for any such
Losses attributable to the action or inaction of the Trustee, the Depositor or
the Holder of such Class R Certificate, as applicable, nor for any such Losses
resulting from misinformation provided by the Holder of such Class R Certificate
on which the Master Servicer has relied. The foregoing shall not be deemed to
limit or restrict the rights and remedies of the Holder of such Class R
Certificate now or hereafter existing at law or in equity. Notwithstanding the
foregoing, however, in no event shall the Master Servicer have any liability (1)
for any action or omission that is taken in accordance with and in compliance
with the express terms of, or which is expressly permitted by the terms of, this
Agreement, (2) for any Losses other than arising out of a negligent performance
by the Master Servicer of its duties and obligations set forth herein, and (3)
for any special or consequential damages to Certificateholders (in addition to
payment of principal and interest on the Certificates).

                  (b) In the event that any REMIC fails to qualify as a REMIC,
loses its status as a REMIC, or incurs federal, state or local taxes as a result
of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Trustee of its duties and
obligations set forth herein, the Trustee shall indemnify the NIMS Insurer and
the Trust Fund against any and all Losses resulting from such negligence;
PROVIDED, HOWEVER, that the Trustee shall not be liable for any such Losses
attributable to the action or inaction of the Master Servicer, the Depositor or
the Holder of such Class R Certificate, as applicable, nor for any such Losses
resulting from misinformation provided by the Holder of such Class R Certificate
on which the Trustee has relied. The foregoing shall not be deemed to limit or
restrict the rights and remedies of the Holder of such Class R Certificate now
or hereafter existing at law or in equity. Notwithstanding the foregoing,
however, in no event shall the Trustee have any liability (1) for any action or
omission that is taken in accordance with and in compliance with the express
terms of, or which is expressly permitted by the terms of, this Agreement, (2)
for any Losses other than arising out of a negligent performance by the Trustee
of its duties and obligations set forth herein, and (3) for any special or
consequential damages to Certificateholders (in addition to payment of principal
and interest on the Certificates).

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                                    ARTICLE X

                                   TERMINATION

                  SECTION 10.01. Termination.

                  (a) The respective obligations and responsibilities of the
Master Servicer, the Depositor and the Trustee created hereby (other than the
obligation of the Trustee to make certain payments to Certificateholders after
the final Distribution Date and the obligation of the Master Servicer to send
certain notices as hereinafter set forth) shall terminate upon notice to the
Trustee upon the earliest of (i) the Distribution Date on which the Certificate
Principal Balances of the Regular Certificates have been reduced to zero, (ii)
the final payment or other liquidation of the last Mortgage Loan in the Trust
and (iii) the optional purchase by the Master Servicer or the NIMS Insurer of
the Mortgage Loans as described below. Notwithstanding the foregoing, in no
event shall the trust created hereby continue beyond the expiration of 21 years
from the death of the last survivor of the descendants of Joseph P. Kennedy, the
late ambassador of the United States to the Court of St. James's, living on the
date hereof.

                  The Master Servicer (or if the Master Servicer fails to
exercise such option, the NIMS Insurer) may, at its option (the party exercising
such right the "Terminator"), terminate this Agreement on any date on which the
aggregate of the Stated Principal Balances of the Mortgage Loans (after giving
effect to scheduled payments of principal due during the related Due Period, to
the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) on such date is equal to or less
than 10% of the sum of the aggregate Stated Principal Balances of the Initial
Mortgage Loans on the Cut-off Date and the Original Pre-Funded Amounts, by
purchasing, on the next succeeding Distribution Date, all of the outstanding
Mortgage Loans and REO Properties at a price equal to the fair market value of
the Mortgage Loans and REO Properties (as determined by the Master Servicer, if
it is the Terminator, the NIMS Insurer, if it is the Terminator and, to the
extent that the Class A Certificates or a Class of Mezzanine Certificates will
not receive all amounts owed to it as a result of the termination, the Trustee,
as of the close of business on the third Business Day next preceding the date
upon which notice of any such termination is furnished to the related
Certificateholders pursuant to Section 10.01(c)), plus accrued and unpaid
interest thereon at the weighted average of the Mortgage Rates through the end
of the Due Period preceding the final Distribution Date plus unreimbursed
Servicing Advances, Advances, any unpaid Servicing Fees allocable to such
Mortgage Loans and REO Properties, any accrued and unpaid Net WAC Rate Carryover
Amount, any previously unpaid Allocated Realized Loss Amounts (the "Termination
Price"); provided, however, such option may only be exercised if (i) the
Termination Price is sufficient to pay all interest accrued on, as well as
amounts necessary to retire the principal balance of, each class of notes
secured by the Class C Certificates and the Class P Certificates and issued
pursuant to the Indenture and any amounts owed to the NIMS Insurer at the time
the option is exercised, and (ii) the fair market value of the Mortgage Loans
and REO Properties determined as provided above is at least equal to the Stated
Principal Balance of the Mortgage Loans (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and the appraised value of the REO Properties.
Notwithstanding the foregoing, if the condition set forth in clause (i) above is
satisfied but the condition set forth in clause (ii) above

                                      149
<PAGE>

is not satisfied, then if the Terminator is the Master Servicer or the NIMS
Insurer, such Terminator may nevertheless exercise such option by paying a
higher Termination Price equal to the Stated Principal Balance of the Mortgage
Loans (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) and the
appraised value of the REO Properties plus accrued and unpaid interest thereon
at the weighted average of the Mortgage Rates through the end of the Due Period
preceding the final Distribution Date plus unreimbursed Servicing Advances,
Advances, any unpaid Servicing Fees allocable to such Mortgage Loans and REO
Properties, any accrued and unpaid Net WAC Rate Carryover Amount, any previously
unpaid Allocated Realized Loss Amounts, provided that the payment of such higher
Termination Price is not prohibited by any regulatory institution under whose
supervision such Terminator may be conducting its business at such time.

                  In connection with any such purchase pursuant to the preceding
paragraph, the Master Servicer or the NIMS Insurer, as applicable, shall deposit
in the Distribution Account all amounts then on deposit in the Collection
Account, which deposit shall be deemed to have occurred immediately preceding
such purchase.

                  Any such purchase shall be accomplished by deposit into the
Distribution Account on the Determination Date before such Distribution Date of
the Termination Price.

                  (b) Notice of any termination, specifying the Distribution
Date (which shall be a date that would otherwise be a Distribution Date) upon
which the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee upon the Trustee receiving notice of such date from the Master
Servicer or the NIMS Insurer, by letter to the Certificateholders and the NIMS
Insurer mailed not earlier than the 15th day and not later than the 25th day of
the month next preceding the month of such final distribution specifying (1) the
Distribution Date upon which final distribution of the Certificates will be made
upon presentation and surrender of such Certificates at the office or agency of
the Trustee therein designated, (2) the amount of any such final distribution
and (3) that the Record Date otherwise applicable to such Distribution Date is
not applicable, distributions being made only upon presentation and surrender of
the Certificates at the office or agency of the Trustee therein specified.

                  (c) Upon presentation and surrender of the Certificates, the
Trustee shall cause to be distributed to the Holders of the Certificates on the
Distribution Date for such final distribution, in proportion to the Percentage
Interests of their respective Class and to the extent that funds are available
for such purpose, an amount equal to the amount required to be distributed to
such Holders in accordance with the provisions of Section 4.01 for such
Distribution Date. By acceptance of the Class R Certificates, the Holders of the
Class R Certificates agree, in connection with any termination hereunder, to
assign and transfer any amounts in excess of the par value of the Mortgage
Loans, and to the extent received in respect of such termination, to pay any
such amounts to the Holders of the Class C Certificates.

                  (d) In the event that all Certificateholders shall not
surrender their Certificates for final payment and cancellation on or before
such final Distribution Date, the Trustee shall promptly following such date
cause all funds in the Distribution Account not distributed in final
distribution

                                      150
<PAGE>

to Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate Servicing Account for
the benefit of such Certificateholders, and the Master Servicer (if the Master
Servicer has exercised its right to purchase the Mortgage Loans), the NIMS
Insurer (if the NIMS Insurer has exercised its right to purchase the Mortgage
Loans) or the Trustee (in any other case) shall give a second written notice to
the remaining Certificateholders, to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
nine months after the second notice all the Certificates shall not have been
surrendered for cancellation, the Class R Certificateholder shall be entitled to
all unclaimed funds and other assets which remain subject hereto, and the
Trustee upon transfer of such funds shall be discharged of any responsibility
for such funds, and the Certificateholders shall look to the Class R
Certificateholder for payment.

                  SECTION 10.02. Additional Termination Requirements.

                  (a) In the event that the Master Servicer or the NIMS Insurer
exercises its purchase option as provided in Section 10.01, each REMIC shall be
terminated in accordance with the following additional requirements, unless the
Trustee shall have been furnished with an Opinion of Counsel to the effect that
the failure of the Trust to comply with the requirements of this Section will
not (i) result in the imposition of taxes on "prohibited transactions" of the
Trust as defined in Section 860F of the Code or (ii) cause any REMIC
constituting part of the Trust Fund to fail to qualify as a REMIC at any time
that any Certificates are outstanding:

                  (i) Within 90 days prior to the final Distribution Date, the
         Master Servicer or the NIMS Insurer shall adopt and the Trustee shall
         sign a plan of complete liquidation of each REMIC created hereunder
         meeting the requirements of a "Qualified Liquidation" under Section
         860F of the Code and any regulations thereunder; and

                  (ii) At or after the time of adoption of such a plan of
         complete liquidation and at or prior to the final Distribution Date,
         the Trustee shall sell all of the assets of the Trust Fund to the
         Master Servicer or the NIMS Insurer, as applicable, for cash pursuant
         to the terms of the plan of complete liquidation.

                  (b) By their acceptance of Certificates, the Holders thereof
hereby agree to appoint the Trustee as their attorney in fact to: (i) adopt such
a plan of complete liquidation (and the Certificateholders hereby appoint the
Trustee as their attorney in fact to sign such plan) as appropriate and (ii) to
take such other action in connection therewith as may be reasonably required to
carry out such plan of complete liquidation all in accordance with the terms
hereof.

                                      151
<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

                  SECTION 11.01. Amendment.

                  This Agreement may be amended from time to time by the
Depositor, the Master Servicer and the Trustee with the consent of the NIMS
Insurer and without the consent of the Certificateholders (i) to cure any
ambiguity, (ii) to correct or supplement any provisions herein which may be
defective or inconsistent with any other provisions herein, (iii) to amend the
provisions of Section 3.22(b) or (iv) to make any other provisions with respect
to matters or questions arising under this Agreement which shall not be
inconsistent with the provisions of this Agreement; provided that such action
shall not, as evidenced by either (a) an Opinion of Counsel delivered to the
Trustee or (b) written notice to the Depositor, the Master Servicer and the
Trustee from the Rating Agencies that such action will not result in the
reduction or withdrawal of the rating of any outstanding Class of Certificates
with respect to which it is a Rating Agency, adversely affect in any material
respect the interests of any Certificateholder. Neither an Opinion of Counsel
nor confirmation from the Rating Agencies will be required in connection with an
amendment to the provisions of Section 3.22(b). No amendment shall be deemed to
adversely affect in any material respect the interests of any Certificateholder
who shall have consented thereto, and no Opinion of Counsel or written notice
from the Rating Agencies shall be required to address the effect of any such
amendment on any such consenting Certificateholder.

                  This Agreement may also be amended from time to time by the
Depositor, the Master Servicer and the Trustee with the consent of the NIMS
Insurer and the Holders of Certificates entitled to at least 66% of the Voting
Rights for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Holders of Certificates; provided, however, that no
such amendment shall (i) reduce in any manner the amount of, or delay the timing
of, payments received on Mortgage Loans which are required to be distributed on
any Certificate without the consent of the Holder of such Certificate, (ii)
adversely affect in any material respect the interests of the Holders of any
Class of Certificates (as evidenced by either (a) an Opinion of Counsel
delivered to the Trustee or (b) written notice to the Depositor, the Master
Servicer and the Trustee from the Rating Agencies that such action will not
result in the reduction or withdrawal of the rating of any outstanding Class of
Certificates with respect to which it is a Rating Agency) in a manner, other
than as described in (i), or (iii) modify the consents required by the
immediately preceding clauses (i) and (ii) without the consent of the Holders of
all Certificates then outstanding. Notwithstanding any other provision of this
Agreement, for purposes of the giving or withholding of consents pursuant to
this Section 11.01, Certificates registered in the name of the Depositor or the
Master Servicer or any Affiliate thereof shall be entitled to Voting Rights with
respect to matters affecting such Certificates.

                  Notwithstanding any provision of this Agreement to the
contrary, the Trustee shall not consent to any amendment to this Agreement
unless it shall have first received an Opinion of Counsel, delivered by (and at
the expense of) the Person seeking such Amendment and satisfactory to the NIMS
Insurer, to the effect that such amendment will not result in the imposition of
a tax on any REMIC created hereunder constituting part of the Trust Fund
pursuant to the REMIC Provisions

                                      152
<PAGE>

or cause any REMIC created hereunder constituting part of the Trust to fail to
qualify as a REMIC at any time that any Certificates are outstanding and that
the amendment is being made in accordance with the terms hereof.

                  Promptly after the execution of any such amendment the Trustee
shall furnish, at the expense of the Person that requested the amendment if such
Person is the Master Servicer (but in no event at the expense of the Trustee),
otherwise at the expense of the Trust, a copy of such amendment and the Opinion
of Counsel referred to in the immediately preceding paragraph to the Master
Servicer, the NIMS Insurer and each Rating Agency.

                  It shall not be necessary for the consent of
Certificateholders under this Section 11.01 to approve the particular form of
any proposed amendment; instead it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable regulations as the Trustee may prescribe.

                  The Trustee may, but shall not be obligated to, enter into any
amendment pursuant to this Section 11.01 that affects its rights, duties and
immunities under this Agreement or otherwise.

                  SECTION 11.02. Recordation of Agreement; Counterparts.

                  To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer at the expense of the Trust, but only upon
direction of Certificateholders accompanied by an Opinion of Counsel to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders.

                  For the purpose of facilitating the recordation of this
Agreement as herein provided and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
together constitute but one and the same instrument.

                  SECTION 11.03. Limitation on Rights of Certificateholders.

                  The death or incapacity of any Certificateholder shall not (i)
operate to terminate this Agreement or the Trust, (ii) entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust, or (iii) otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.

                  Except as expressly provided for herein, no Certificateholder
shall have any right to vote or in any manner otherwise control the operation
and management of the Trust, or the obligations of the parties hereto, nor shall
anything herein set forth or contained in the terms of the Certificates be
construed so as to constitute the Certificateholders from time to time as
partners or

                                      153
<PAGE>

members of an association; nor shall any Certificateholder be under any
liability to any third person by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.

                  No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless also the
Holders of Certificates entitled to at least 25% of the Voting Rights shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee for 15 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and expressly covenanted by each Certificateholder with
every other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, which priority or
preference is not otherwise provided for herein, or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 11.03 each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.

                  SECTION 11.04. Governing Law; Jurisdiction.

                  This Agreement shall be construed in accordance with the laws
of the State of New York, without regard to the conflicts of law provisions
thereof, and the obligations, rights and remedies of the parties hereunder shall
be determined in accordance with such laws. With respect to any claim arising
out of this Agreement, each party irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in The City of New York, and
each party irrevocably waives any objection which it may have at any time to the
laying of venue of any suit, action or proceeding arising out of or relating
hereto brought in any such courts, irrevocably waives any claim that any such
suit, action or proceeding brought in any such court has been brought in any
inconvenient forum and further irrevocably waives the right to object, with
respect to such claim, suit, action or proceeding brought in any such court,
that such court does not have jurisdiction over such party, provided that
service of process has been made by any lawful means.

                  SECTION 11.05. Notices.

                  All directions, demands and notices hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by first class mail, postage prepaid, by facsimile or by express
delivery service, to (a) in the case of the Originator and/or Master Servicer,
Option One Mortgage Corporation, 3 Ada, Irvine, California 92618, Attention:
William O'Neill, or such other address or telecopy number as may hereafter be
furnished to the Depositor, the NIMS Insurer and the Trustee in writing by the
Master Servicer, (b) in the case of the Trustee, Wells Fargo Bank, N.A., P.O.
Box 98, Columbia, Maryland 21046, Attention: Client Manager--Option One

                                      154
<PAGE>

2004-2, with a copy to Wells Fargo Bank, N.A., 9062 Old Annapolis Road,
Columbia, Maryland 21045-1951, Attention: Option One Mortgage Loan Trust Series
2004-2, or such other address or telecopy number as may hereafter be furnished
to the Depositor, the NIMS Insurer and the Master Servicer in writing by the
Trustee, (c) in the case of the Depositor, Option One Mortgage Acceptance
Corporation, 3 Ada, Irvine, California 92618, Attention: William O'Neill, or
such other address or telecopy number as may be furnished to the Master
Servicer, the NIMS Insurer and the Trustee in writing by the Depositor and (d)
in the case of the NIMS Insurer, such address furnished to the Depositor, the
Master Servicer, the Trustee and the Guarantor in writing by the NIMS Insurer,
or such other address or telecopy number as may hereafter be furnished to the
Depositor, the Master Servicer and the Trustee in writing by the NIMS Insurer.
Any notice required or permitted to be mailed to a Certificateholder shall be
given by first class mail, postage prepaid, at the address of such Holder as
shown in the Certificate Register. Notice of any Master Servicer Default shall
be given by telecopy and by certified mail. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have duly been
given when mailed, whether or not the Certificateholder receives such notice. A
copy of any notice required to be telecopied hereunder shall also be mailed to
the appropriate party in the manner set forth above.

                  SECTION 11.06. Severability of Provisions.

                  If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall for any reason whatsoever be held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.

                  SECTION 11.07. Article and Section References.

                  All article and section references used in this Agreement,
unless otherwise provided, are to articles and sections in this Agreement.

                  SECTION 11.08. Notice to the Rating Agencies and the NIMS
                                 Insurer.

                  (a) Each of the Trustee and the Master Servicer shall be
obligated to use its best reasonable efforts promptly to provide notice to the
Rating Agencies and the NIMS Insurer with respect to each of the following of
which a Responsible Officer of the Trustee or Master Servicer, as the case may
be, has actual knowledge:

                  (i) any material change or amendment to this Agreement;

                  (ii) the occurrence of any Master Servicer Event of
         Termination that has not been cured or waived;

                  (iii) the resignation or termination of the Master Servicer or
         the Trustee;

                  (iv) the final payment to Holders of the Certificates of any
         Class;

                                      155
<PAGE>

                  (v) any change in the location of any Account; and

                  (vi) if the Trustee is acting as successor Master Servicer
         pursuant to Section 7.02 hereof, any event that would result in the
         inability of the Trustee to make Advances.

                  (b) In addition, the Trustee shall promptly make available to
each Rating Agency copies of each Statement to Certificateholders described in
Section 4.03 hereof and the Master Servicer shall promptly furnish to each
Rating Agency copies of the following:

                  (i) each annual statement as to compliance described in
         Section 3.20 hereof;

                  (ii) each annual independent public accountants' servicing
         report described in Section 3.21 hereof; and

                  (iii) each notice delivered pursuant to Section 7.01(a) hereof
         which relates to the fact that the Master Servicer has not made an
         Advance.

                  Any such notice pursuant to this Section 11.08 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
Moody's Investors Service, Inc., 99 Church Street, New York, NY 10007,
Attention: MBS Monitoring/Option One Mortgage Loan Trust 2004-2, Fitch Ratings,
One State Street Plaza, New York, New York 10007 and Standard & Poor's Ratings
Services, Inc., 55 Water Street, New York, New York 10004.

                  SECTION 11.09. Further Assurances.

                  Notwithstanding any other provision of this Agreement, neither
the Regular Certificateholders nor the Trustee shall have any obligation to
consent to any amendment or modification of this Agreement unless they have been
provided reasonable security or indemnity against their out-of-pocket expenses
(including reasonable attorneys' fees) to be incurred in connection therewith.

                  SECTION 11.10. Third Party Rights.

                  The NIMS Insurer shall be deemed a third-party beneficiary of
this Agreement to the same extent as if it were a party hereto, and shall have
the right to enforce the provisions of this Agreement.

                  SECTION 11.11. Benefits of Agreement.

                  Nothing in this Agreement or in the Certificates, expressed or
implied, shall give to any Person, other than the Certificateholders, the NIMS
Insurer and the parties hereto and their successors hereunder, any benefit or
any legal or equitable right, remedy or claim under this Agreement.

                                      156
<PAGE>

                  SECTION 11.12. Acts of Certificateholders.

                  (a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by the Certificateholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Certificateholders in
person or by agent duly appointed in writing, and such action shall become
effective when such instrument or instruments are delivered to the Trustee and
the Master Servicer. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "act" of
the Certificateholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee and the Trust, if made in the manner provided in this Section 11.11.

                  (b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Whenever
such execution is by a signer acting in a capacity other than his or her
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.

                  (c) Any request, demand, authorization, direction, notice,
consent, waiver or other action by any Certificateholder shall bind every future
Holder of such Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee or the
Trust in reliance thereon, whether or not notation of such action is made upon
such Certificate.

                  SECTION 11.13 No Petition.

                  The Depositor, Master Servicer and the Trustee, by entering
into this Agreement and each Certificateholder, by accepting a Certificate,
hereby covenant and agree that they will not at any time institute against the
Trust Fund, or join in any institution against the Trust Fund of, any bankruptcy
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations with respect to the Certificates or this
Agreement.

                                      157
<PAGE>

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

                               OPTION ONE MORTGAGE ACCEPTANCE
                               CORPORATION,
                                 as Depositor

                               By:     /s/ David S. Wells
                                  --------------------------------------------
                               Name:   David S. Wells
                               Title:  Assistant Secretary

                               OPTION ONE MORTGAGE CORPORATION,
                                 as Master Servicer

                               By:     /s/ David S. Wells
                                  --------------------------------------------
                               Name:   David S. Wells
                               Title:  Vice President

                               WELLS FARGO BANK, N.A.,
                                 as Trustee

                               By:     /s/ Amy Doyle
                                  --------------------------------------------
                               Name:   Amy Doyle
                               Title:  Vice President

<PAGE>

STATE OF        )
                ) ss.:
COUNTY OF       )

         On the ___th day of April, 2004 before me, a notary public in and for
said State, personally appeared _______________ known to me to be a
______________ of Option One Mortgage Acceptance Corporation, a Delaware
corporation that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

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

                                            ___________________________________
                                                       Notary Public

<PAGE>

STATE OF           )
                   ) ss.:
COUNTY OF          )

         On the ___th day of April, 2004 before me, a notary public in and for
said State, personally appeared _______________ known to me to be a
_______________ of Option One Mortgage Corporation, a corporation that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

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

                                            ___________________________________
                                                      Notary Public

<PAGE>

STATE OF          )
                  ) ss.:
COUNTY OF         )

         On the ___th day of April, 2004 before me, a notary public in and for
said State, personally appeared________________, known to me to be
a________________ of Wells Fargo Bank, N.A., a national banking association that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said association, and acknowledged to me that such
corporation executed the within instrument.

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

                                            ___________________________________
                                                       Notary Public

<PAGE>
                                                                     Exhibit 4.2

                                   EXHIBIT A-1

                         FORM OF CLASS A-1A CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

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

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $336,690,000.00

Original Class
Certificate Principal
Balance of this Class     :   $336,690,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FB 5

Class                     :   A-1A

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                   Class A-1A

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class A-1A
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class A-1A
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class A Certificate (obtained by dividing the
Denomination of this Class A Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N. A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class A-1A
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class A-1A
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Reference is hereby made to the further provisions of this Class A-1A
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class A-1A Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By:
                                       ---------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  --------------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N. A.,
      as Trustee

<PAGE>

                       [Reverse of Class A-1A Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
________________________________________________________________________________
for the account of___________________________________________________________,
account number _______________________, or, if mailed by check, to_____________.
________________________________________________________________________________
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or___________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-2

                         FORM OF CLASS A-1B CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

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

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $200,000,000.00

Original Class
Certificate Principal
Balance of this Class     :   $200,000,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FC 3

Class                     :   A-1B

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                   Class A-1B

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class A-1B
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class A-1B
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class A Certificate (obtained by dividing the
Denomination of this Class A Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N. A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class A-1B
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class A-1B
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Reference is hereby made to the further provisions of this Class A-1B
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class A-1B Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By:
                                       ---------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  --------------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N. A.,
      as Trustee

<PAGE>

                       [Reverse of Class A-1B Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
________________________________________________________________________________
for the account of___________________________________________________________,
account number _______________________, or, if mailed by check, to_____________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or___________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-3

                         FORM OF CLASS A-2 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

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

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $97,530,000.00

Original Class
Certificate Principal
Balance of this Class     :   $97,530,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FD 1

Class                     :   A-2

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class A-2

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class A-2
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class A-2
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede&Co. is the registered owner of the Percentage
Interest evidenced by this Class A-2 Certificate (obtained by dividing the
Denomination of this Class A-2 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class A-2
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class A-2
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Reference is hereby made to the further provisions of this Class A-2
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class A-2 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By:
                                       ---------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  --------------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>
                       [Reverse of Class A-2 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check,
to_____________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by__________________________________________,
the assignee named above, or___________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-4

                         FORM OF CLASS A-3 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

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

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $159,710,000.00

Original Class
Certificate Principal
Balance of this Class     :   $159,710,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FE 9

Class                     :   A-3

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class A-3

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class A-3
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class A-3
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede&Co. is the registered owner of the Percentage
Interest evidenced by this Class A-3 Certificate (obtained by dividing the
Denomination of this Class A-3 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class A-3
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class A-3
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Reference is hereby made to the further provisions of this Class A-3
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class A-3 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By:
                                       ---------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  --------------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                       [Reverse of Class A-3 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>
                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-5

                         FORM OF CLASS A-4 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

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

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $31,070,000.00

Original Class
Certificate Principal
Balance of this Class     :   $31,070,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FF 6

Class                     :   A-4

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class A-4

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class A-4
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class A-4
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede&Co. is the registered owner of the Percentage
Interest evidenced by this Class A-4 Certificate (obtained by dividing the
Denomination of this Class A-4 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class A-4
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class A-4
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Reference is hereby made to the further provisions of this Class A-4
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class A-4 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By:
                                       ---------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  --------------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                       [Reverse of Class A-4 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-6

                         FORM OF CLASS M-1 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES AND THE A-4
CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $58,000,000.00

Original Class
Certificate Principal
Balance of this Class     :   $58,000,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FG 4

Class                     :   M-1

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-1

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-1
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-1
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-1 Certificate (obtained by dividing the
Denomination of this Class M-1 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-1
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-1
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-1
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

       This Class M-1 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                       [Reverse of Class M-1 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any, and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-7

                         FORM OF CLASS M-2 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES, THE CLASS
A-4 CERTIFICATES AND THE CLASS M-1 CERTIFICATES TO THE EXTENT DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $47,500,000.00

Original Class
Certificate Principal
Balance of this Class     :   $47,500,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FH  2

Class                     :   M-2

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-2

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-2
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-2
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-2 Certificate (obtained by dividing the
Denomination of this Class M-2 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-2
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-2
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-2
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

       This Class M-2 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                       [Reverse of Class M-2 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________.
_______________________________________________________________________________

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-8

                         FORM OF CLASS M-3 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES, THE CLASS
A-4 CERTIFICATES, THE CLASS M-1 CERTIFICATES AND THE CLASS M-2 CERTIFICATES TO
THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $14,000,000.00

Original Class
Certificate Principal
Balance of this Class     :   $14,000,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FJ 8

Class                     :   M-3

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-3

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-3
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-3
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-3 Certificate (obtained by dividing the
Denomination of this Class M-3 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-3
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-3
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-3
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

      This Class M-3 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                       [Reverse of Class M-3 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                   EXHIBIT A-9

                         FORM OF CLASS M-4 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES, THE CLASS
A-4 CERTIFICATES, THE CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES AND THE
CLASS M-3 CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $10,000,000.00

Original Class
Certificate Principal
Balance of this Class     :   $10,000,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FK 5

Class                     :   M-4

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-4

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-4
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-4
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-4 Certificate (obtained by dividing the
Denomination of this Class M-4 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-4
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-4
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-4
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

       This Class M-4 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.
      as Trustee

<PAGE>

                       [Reverse of Class M-4 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                    assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                  EXHIBIT A-10

                         FORM OF CLASS M-5 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES, THE CLASS
A-4 CERTIFICATES, THE CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE
CLASS M-3 CERTIFICATES AND THE CLASS M-4 CERTIFICATES TO THE EXTENT DESCRIBED IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $12,500,000.00

Original Class
Certificate Principal
Balance of this Class     :   $12,500,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FL 3

Class                     :   M-5

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-5

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-5
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-5
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-5 Certificate (obtained by dividing the
Denomination of this Class M-5 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-5
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-5
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-5
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

       This Class M-5 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.
      as Trustee

<PAGE>

                       [Reverse of Class M-5 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                  EXHIBIT A-11

                         FORM OF CLASS M-6 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES, THE CLASS
A-4 CERTIFICATES, THE CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE
CLASS M-3 CERTIFICATES, THE CLASS M-4 CERTIFICATES AND THE CLASS M-5
CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $10,000,000.00

Original Class
Certificate Principal
Balance of this Class     :   $10,000,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FM 1

Class                     :   M-6

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-6

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-6
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-6
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-6 Certificate (obtained by dividing the
Denomination of this Class M-6 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-6
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-6
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-6
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

       This Class M-6 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.
      as Trustee

<PAGE>

                       [Reverse of Class M-6 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                    assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                  EXHIBIT A-12

                         FORM OF CLASS M-7 CERTIFICATES

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS A-3 CERTIFICATES, THE CLASS
A-4 CERTIFICATES, THE CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE
CLASS M-3 CERTIFICATES, THE CLASS M-4 CERTIFICATES, THE CLASS M-5 CERTIFICATES
AND THE CLASS M-6 CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

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

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $10,500,000.00

Original Class
Certificate Principal
Balance of this Class     :   $10,500,000.00

Percentage Interest       :   100.00%

Pass-Through Rate         :   Variable

CUSIP                     :   68389F FN 9

Class                     :   M-7

Assumed Maturity Date     :   May 2034

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                    Class M-7

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class M-7
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class M-7
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class M-7 Certificate (obtained by dividing the
Denomination of this Class M-7 Certificate by the Original Class Certificate
Principal Balance) in certain monthly distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class M-7
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class M-7
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      Each Transferee of this Certificate will be deemed to have represented by
virtue of its purchase or holding of such Certificate (or interest therein) that
either (a) such Transferee is not a Plan or purchasing such Certificate with
Plan Assets, (b) it has acquired and is holding such Certificate in reliance on
the Prohibited Transaction Exemption (the "Exemption") set forth in the
Agreement and that it understands that there are certain conditions to the
availability of the Exemption including that such Certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by a Rating
Agency or (c) the following conditions are satisfied: (i) such Transferee is an
insurance company, (ii) the source of funds used to purchase or hold such
Certificate (or interest therein) is an "insurance company general account" (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60), and (iii) the conditions set forth in Sections I and III of
PTCE 95-60 have been satisfied.

      Reference is hereby made to the further provisions of this Class M-7
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

<PAGE>

       This Class M-7 Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.
      as Trustee

<PAGE>

                       [Reverse of Class M-7 Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                  EXHIBIT A-13

                          FORM OF CLASS C CERTIFICATES

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

THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1A CERTIFICATES, THE CLASS A-1B
CERTIFICATES, THE CLASS A-1C CERTIFICATES, THE CLASS A-2 CERTIFICATES, THE CLASS
M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3 CERTIFICATES, THE
CLASS M-5 CERTIFICATES, THE CLASS M-6 CERTIFICATES AND THE CLASS M-7
CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $12,559,899.74

Original Class
Certificate Principal
Balance of this Class     :   $12,559,899.74

Initial Notional Amount
of this Certificate       :   $1,000,059,899.74

Percentage Interest       :   100.00%

Class                     :   C

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                     Class C

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class C
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class C
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Option One Mortgage Corporation is the registered
owner of the Percentage Interest evidenced by this Class C Certificate (obtained
by dividing the Denomination of this Class C Certificate by the Original Class
Certificate Principal Balance) in certain distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class C
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class C
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under said Act and such laws. In the event that a transfer is to be
made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring to
effect such transfer and such Certificateholder's prospective transferee shall
each certify to the Trustee and the Depositor in writing the facts surrounding
the transfer. In the event that such a transfer is not to be made pursuant to
Rule 144A of the Act, there shall be delivered to the Trustee and the Depositor
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Act, which Opinion of Counsel shall not be obtained at the expense of
the Trustee or the Depositor; or there shall be delivered to the Trustee and the
Depositor a transferor certificate by the transferor and an investment letter
shall be executed by the transferee. The Holder hereof desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee and the
Depositor against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.

<PAGE>

      No transfer of this Certificate to a Plan subject to ERISA or Section 4975
of the Code, any Person acting, directly or indirectly, on behalf of any such
Plan or any person using Plan Assets to acquire this Certificate shall be made
except in accordance with Section 5.02(d) of the Agreement.

      Reference is hereby made to the further provisions of this Class C
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class C Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                       -----------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                        [Reverse of Class C Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-6
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates, but with the consent of the NIMS Insurer, if any.

<PAGE>

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                  EXHIBIT A-14

                           FORM OF CLASS P CERTIFICATE

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

THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

<PAGE>

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Initial Certificate
Principal Balance of
this Certificate
("Denomination")          :   $100.00

Original Class
Certificate Principal
Balance of this Class     :   $100.00

Percentage Interest       :   100.00%

Class                     :   P

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                     Class P

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Principal Balance of this Class P
Certificate at any time may be less than the Initial Certificate Principal
Balance set forth on the face hereof, as described herein. This Class P
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Master Servicer, or the Trustee referred to
below or any of their respective affiliates.

      This certifies that Option One Mortgage Corporation is the registered
owner of the Percentage Interest evidenced by this Class P Certificate (obtained
by dividing the Denomination of this Class P Certificate by the Original Class
Certificate Principal Balance) in certain distributions with respect to a Trust
consisting primarily of the Mortgage Loans deposited by Option One Mortgage
Acceptance Corporation (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement dated as of April 1, 2004 (the "Agreement")
among the Depositor, Option One Mortgage Corporation, as master servicer (the
"Master Servicer"), and Wells Fargo Bank, N.A., a national banking association,
as Trustee (the "Trustee"). To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Class P
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Class P
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound.

      This Certificate does not have a pass-through rate and will be entitled to
distributions only to the extent set forth in the Agreement.

      No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under said Act and such laws. In the event that a transfer is to be
made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring to
effect such transfer and such Certificateholder's prospective transferee shall
each certify to the Trustee and the Depositor in writing the facts surrounding
the transfer. In the event that such a transfer is not to be made pursuant to
Rule 144A of the Act, there shall be delivered to the Trustee and the Depositor
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Act, which Opinion of Counsel shall not be obtained at the expense of
the Trustee or the Depositor; or there shall be delivered to the Trustee and the
Depositor a transferor certificate by the transferor and an investment letter
shall be executed by the transferee. The Holder hereof desiring to effect such
transfer shall,

<PAGE>

and does hereby agree to, indemnify the Trustee and the Depositor against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.

      No transfer of this Certificate to a Plan subject to ERISA or Section 4975
of the Code, any Person acting, directly or indirectly, on behalf of any such
Plan or any person using Plan Assets to acquire this Certificate shall be made
except in accordance with Section 5.02(d) of the Agreement.

      Reference is hereby made to the further provisions of this Class P
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Class P Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A.
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.
      as Trustee

<PAGE>

                        [Reverse of Class P Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof,

<PAGE>

in certain limited circumstances, without the consent of the Holders of any of
the Certificates, but with the consent of the NIMS Insurer, if any.

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                  EXHIBIT A-15

                           FORM OF CLASS R CERTIFICATE

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

THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

THIS CLASS R CERTIFICATE HAS NO PRINCIPAL BALANCE, DOES NOT BEAR INTEREST AND
WILL NOT RECEIVE ANY DISTRIBUTIONS EXCEPT AS PROVIDED HEREIN.

NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA"), SHALL BE MADE EXCEPT IN COMPLIANCE WITH THE
PROCEDURES DESCRIBED HEREIN.

Certificate No.           :   1

Cut-off Date              :   With respect to any Mortgage Loan, the
                              later of (i) the date of origination of such
                              Mortgage Loan or (ii) April 1, 2004

First Distribution Date   :   May 25, 2004

Percentage Interest       :   100.00%

Class                     :   R

<PAGE>

                      Option One Mortgage Loan Trust 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2
                                     Class R

      evidencing the Percentage Interest in the distributions allocable to the
      Certificates of the above-referenced Class with respect to the Trust
      consisting of first and second lien, adjustable and fixed rate mortgage
      loans (the "Mortgage Loans")

            OPTION ONE MORTGAGE ACCEPTANCE CORPORATION, as Depositor

      This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Depositor, the Master Servicer or the Trustee
referred to below or any of their respective affiliates.

      This certifies that Option One Mortgage Corporation is the registered
owner of the Percentage Interest evidenced by this Certificate specified above
in the interest represented by all Certificates of the Class to which this
Certificate belongs in a Trust consisting primarily of the Mortgage Loans
deposited by Option One Mortgage Acceptance Corporation (the "Depositor"). The
Trust was created pursuant to a Pooling and Servicing Agreement dated as of
April 1, 2004 (the "Agreement") among the Depositor, Option One Mortgage
Corporation, as master servicer (the 'Master Servicer") and Wells Fargo Bank,
N.A., a national banking association, as trustee (the "Trustee"). To the extent
not defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.

      This Certificate does not have a principal balance or pass-through rate
and will be entitled to distributions only to the extent set forth in the
Agreement. In addition, any distribution of the proceeds of any remaining assets
of the Trust will be made only upon presentment and surrender of this
Certificate at the Corporate Trust Office or the office or agency maintained by
the Trustee in Minneapolis, Minnesota.

      No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under said Act and such laws. In the event that a transfer is to be
made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring to
effect such transfer and such Certificateholder's prospective transferee shall
each certify to the Trustee and the Depositor in writing the facts surrounding
the transfer. In the event that such a transfer is not to be made pursuant to
Rule 144A of the Act, there shall be delivered to the Trustee and the Depositor
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Act, which Opinion of Counsel shall not be obtained at the expense of
the Trustee or the Depositor; or there shall be delivered to the Trustee and the
Depositor a transferor certificate by the transferor and an investment letter
shall be executed by the transferee. The Holder hereof desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee and the
Depositor against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.

<PAGE>

       No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(d) of the Agreement.

       Each Holder of this Certificate will be deemed to have agreed to be bound
by the restrictions of the Agreement, including but not limited to the
restrictions that (i) each person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee, (ii) no Ownership Interest in
this Certificate may be transferred without delivery to the Trustee of (a) a
transfer affidavit of the proposed transferee and (b) a transfer certificate of
the transferor, each of such documents to be in the form described in the
Agreement, (iii) each person holding or acquiring any Ownership Interest in this
Certificate must agree to require a transfer affidavit and to deliver a transfer
certificate to the Trustee as required pursuant to the Agreement, (iv) each
person holding or acquiring an Ownership Interest in this Certificate must agree
not to transfer an Ownership Interest in this Certificate if it has actual
knowledge that the proposed transferee is not a Permitted Transferee and (v) any
attempted or purported transfer of any Ownership Interest in this Certificate in
violation of such restrictions will be absolutely null and void and will vest no
rights in the purported transferee. Pursuant to the Agreement, the Trustee will
provide the Internal Revenue Service and any pertinent persons with the
information needed to compute the tax imposed under the applicable tax laws on
transfers of residual interests to disqualified organizations, if any person
other than a Permitted Transferee acquires an Ownership Interest on a Class R
Certificate in violation of the restrictions mentioned above.

      Reference is hereby made to the further provisions of this Class R
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

      This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless manually countersigned by an authorized
signatory of the Trustee.

<PAGE>

      IN WITNESS WHEREOF, the Trustee on behalf of the Trust has caused this
Certificate to be duly executed.

Dated: April __, 2004

                                    OPTION ONE MORTGAGE LOAN TRUST 2004-2

                                    By:   WELLS FARGO BANK, N.A
                                          not in its individual capacity, but
                                          solely as Trustee

                                    By
                                      ------------------------------------------

This is one of the Certificates referenced
in the within-mentioned Agreement

By
  ----------------------------------
      Authorized Signatory of
      Wells Fargo Bank, N.A.,
      as Trustee

<PAGE>

                        [Reverse of Class R Certificate]

                      OPTION ONE MORTGAGE LOAN TRUST 2004-2
                           Asset-Backed Certificates,
                                  Series 2004-2

      This Certificate is one of a duly authorized issue of Certificates
designated as Option One Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
Series 2004-2 (herein collectively called the "Certificates"), and representing
a beneficial ownership interest in the Trust created by the Agreement.

      The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.

      This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business Day then the first
Business Day following such Distribution Date (the "Distribution Date"),
commencing on the first Distribution Date specified on the face hereof, to the
Person in whose name this Certificate is registered at the close of business on
the applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Certificates of the Class to which this Certificate belongs on
such Distribution Date pursuant to the Agreement.

      Distributions on this Certificate shall be made by check or money order
mailed to the address of the person entitled thereto as it appears on the
Certificate Register or by wire transfer or otherwise, as set forth in the
Agreement. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final distribution.

      The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer and the Trustee with the consent of the
NIMs Insurer, if any and of Holders of the requisite percentage of the
Percentage Interests of each Class of Certificates affected by such amendment,
as specified in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof,

<PAGE>

in certain limited circumstances, without the consent of the Holders of any of
the Certificates, but with the consent of the NIMS Insurer, if any.

      As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the office or agency maintained by the Trustee accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.

      The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.

      No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

      The Master Servicer, the Depositor, the Trustee, the NIMs Insurer, if any,
the Certificate Registrar, any Paying Agent and any agent of the Master
Servicer, the Depositor, the Trustee, the NIMs Insurer, if any, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner hereof for
all purposes, and none of the Master Servicer, the Trust, the Trustee nor any
agent of any of them shall be affected by notice to the contrary.

      On any Distribution Date following the date at which the remaining
aggregate Principal Balance of the Mortgage Loans is less than 10% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date plus the Original Pre-Funded Amounts, the Master Servicer may purchase, in
whole, from the Trust the Mortgage Loans at a purchase price determined as
provided in the Agreement. In the event that no such optional termination
occurs, the obligations and responsibilities created by the Agreement will
terminate upon notice to the Trustee upon the earliest of (i) the Distribution
Date on which the Certificate Principal Balances of the Regular Certificates
have been reduced to zero, (ii) the final payment or other liquidation of the
last Mortgage Loan in the Trust, (iii) the Distribution Date in May 2034.

      Capitalized terms used herein that are defined in the Agreement shall have
the meanings ascribed to them in the Agreement, and nothing herein shall be
deemed inconsistent with that meaning.

<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
    (Please print or typewrite name and address including postal zip code of
                                   assignee)

the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust.

      I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:

Dated:
      ------------------

                                    Signature by or on behalf of assignor

<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________,
account number___________________, or, if mailed by check, to__________________
_______________________________________________________________________________
_______________________________________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________.

      This information is provided by _________________________________________,
the assignee named above, or __________________________________________________,
as its agent.

<PAGE>

                                    EXHIBIT B

                                   [RESERVED]

<PAGE>

                                    EXHIBIT C

                    FORM OF MORTGAGE LOAN PURCHASE AGREEMENT

<PAGE>
================================================================================

                        OPTION ONE MORTGAGE CORPORATION,

                                    as Seller

                                       and

                   OPTION ONE MORTGAGE ACCEPTANCE CORPORATION,

                                  as Purchaser

                        MORTGAGE LOAN PURCHASE AGREEMENT

                            Dated as of April 8, 2004

                  Fixed Rate and Adjustable Rate Mortgage Loans

                      Option One Mortgage Loan Trust 2004-2
                    Asset-Backed Certificates, Series 2004-2

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

<PAGE>

<TABLE>
<CAPTION>

                                                 TABLE OF CONTENTS

                                                                                                               PAGE

                                                    ARTICLE I.

                                                    DEFINITIONS
<S>      <C>                                                                                                 <C>
         Section 1.01      DEFINITIONS............................................................................1
                           -----------

                                                    ARTICLE II.

                                 SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
         Section 2.01      SALE OF MORTGAGE LOANS AND CAP CONTRACTS...............................................2
                           -----------------------------------------
         Section 2.02      OBLIGATIONS OF SELLER UPON SALE........................................................2
                           -------------------------------
         Section 2.03      PAYMENT OF PURCHASE PRICE FOR THE MORTGAGE LOANS.......................................5
                           ------------------------------------------------

                                                   ARTICLE III.

                                REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
         Section 3.01      SELLER REPRESENTATIONS AND WARRANTIES RELATING TO THE MORTGAGE LOANS.
                           --------------------------------------------------------------------
                   ...............................................................................................6
         Section 3.02      SELLER REPRESENTATIONS AND WARRANTIES RELATING TO THE SELLER..........................15
                           ------------------------------------------------------------
         Section 3.03      REMEDIES FOR BREACH OF REPRESENTATIONS AND WARRANTIES.................................17
                           -----------------------------------------------------

                                                    ARTICLE IV.

                                                SELLER'S COVENANTS
         Section 4.01      COVENANTS OF THE SELLER. .............................................................18
                           -----------------------

                                                    ARTICLE V.

                                INDEMNIFICATION WITH RESPECT TO THE MORTGAGE LOANS
         Section 5.01      INDEMNIFICATION.......................................................................19
                           ---------------

                                                    ARTICLE VI.

                                                    TERMINATION
         Section 6.01      TERMINATION...........................................................................22
                           -----------

                                                   ARTICLE VII.

                                             MISCELLANEOUS PROVISIONS
         Section 7.01      AMENDMENT.............................................................................22
                           ---------
         Section 7.02      GOVERNING LAW.........................................................................22
                           -------------
         Section 7.03      NOTICES...............................................................................22
                           -------
         Section 7.04      SEVERABILITY OF PROVISIONS............................................................22
                           --------------------------

                                                         i

<PAGE>

         Section 7.05      COUNTERPARTS..........................................................................23
                           ------------
         Section 7.06      FURTHER AGREEMENTS....................................................................23
                           ------------------
         Section 7.07      INTENTION OF THE PARTIES..............................................................23
                           ------------------------
         Section 7.08      SUCCESSORS AND ASSIGNS, ASSIGNMENT OF PURCHASE AGREEMENT..............................23
                           --------------------------------------------------------
         Section 7.09      SURVIVAL..............................................................................24
                           --------

</TABLE>

                                       ii

<PAGE>

                  MORTGAGE LOAN PURCHASE AGREEMENT, dated as of April 8, 2004
(the "Agreement"), between Option One Mortgage Corporation (the "Seller") and
Option One Mortgage Acceptance Corporation (the "Purchaser").

                            W I T N E S S E T H

                  WHEREAS, the Seller is the owner of (a) the notes or other
evidence of indebtedness (the "Mortgage Notes") so indicated on Schedule I
hereto referred to below and (b) the other documents or instruments constituting
the Mortgage File (collectively, the "Mortgage Loans"); and

                  WHEREAS, the Seller, as of the date hereof, owns the mortgages
(the "Mortgages") on the properties (the "Mortgaged Properties") securing such
Mortgage Loans, including rights to (a) any property acquired by foreclosure or
deed in lieu of foreclosure or otherwise and (b) the proceeds of any insurance
policies covering the Mortgage Loans or the Mortgaged Properties or the obligors
on the Mortgage Loans; and

                  WHEREAS, the parties hereto desire that the Seller sell the
Mortgage Loans to the Purchaser pursuant to the terms of this Agreement; and

                  WHEREAS, pursuant to the terms of a Pooling and Servicing
Agreement dated as of April 1, 2004 (the "Pooling and Servicing Agreement")
among the Purchaser as depositor, the Seller as master servicer and Wells Fargo
Bank, N.A. as trustee (the "Trustee"), the Purchaser will convey the Mortgage
Loans to Option One Mortgage Loan Trust 2004-2 (the "Trust");

                  WHEREAS, the Seller is obligated, in connection with the
transactions contemplated by this Agreement, to make certain representations,
warranties and covenants with respect to itself and the Mortgage Loans.

                  NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:

                                   ARTICLE I.

                                   DEFINITIONS

         Section 1.01 DEFINITIONS. All capitalized terms used but not defined
herein and below shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.

         "SELLER INFORMATION": The information in the Prospectus Supplement as
         follows: under "SUMMARY OF TERMS--Mortgage Loans", the sentence under
         the fourth bullet point under "RISK FACTORS--Unpredictability of
         Prepayments and Effect on Yields", "RISK FACTORS--Substantially All of
         the Mortgage Loans have First Payment Due on or After March 1, 2004",
         the third sentence under "RISK FACTORS--Balloon Loan Risks", the first
         sentence under "RISK FACTORS--Second Lien Loan Risk", the first
         sentence under "RISK FACTORS--Interest Only Mortgage Loans", the second
         sentence under the third bullet

                                        1

<PAGE>

         point under "RISK FACTORS--Interest Generated by the Mortgage Loans May
         Be Insufficient to Maintain Overcollateralization", the second sentence
         under "RISK FACTORS--High Loan-to-Value Ratios Increase Risk of Loss",
         "THE MORTGAGE POOL", "OPTION ONE MORTGAGE CORPORATION", and the first
         sentence of the seventh paragraph under "YIELD, PREPAYMENT AND MATURITY
         CONSIDERATIONS".

                                   ARTICLE II.

                SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE

         Section 2.01      SALE OF MORTGAGE LOANS AND CAP CONTRACTS.

                  (a) The Seller, concurrently with the execution and delivery
of this Agreement, does hereby sell, and in connection therewith hereby assigns
to the Purchaser, effective as of the Closing Date, without recourse, (i) all of
its right, title and interest in and to each Mortgage Loan, including the
related Cut-off Date Principal Balance, all interest accruing thereon on and
after the Cut-off Date and all collections in respect of interest and principal
due after the Cut-off Date; (ii) property which secured such Mortgage Loan and
which has been acquired by foreclosure or deed in lieu of foreclosure; (iii) its
interest in any insurance policies (including the PMI Policy) in respect of the
Mortgage Loans and (iv) all proceeds of any of the foregoing.

                  (b) The Seller, concurrently with the execution and delivery
of this Agreement does hereby sell, and in connection therewith hereby assigns
to the Purchaser, effective as of the Closing Date, without recourse, (i) all of
its right, title and interest in the Cap Contract, dated January 16, 2004 and
(ii) all proceeds of the foregoing.

         Section 2.02 OBLIGATIONS OF SELLER UPON SALE. In connection with any
transfer pursuant to Section 2.01 hereof, the Seller further agrees, at its own
expense on or prior to the Closing Date, (a) to cause its books and records to
indicate that the Mortgage Loans have been sold to the Purchaser pursuant to
this Agreement, (b) to deliver to the Purchaser and the Trustee a computer file
containing a true and complete list of all such Mortgage Loans specifying for
each such Mortgage Loan, as of the Cut-off Date, (i) its account number and (ii)
the Cut-off Date Principal Balance. Such file, which forms a part of Exhibit D
to the Pooling and Servicing Agreement, shall also be marked as Schedule I to
this Agreement and is hereby incorporated into and made a part of this Agreement
and (c) to deliver to the Purchaser and the Trustee the Setup File (as defined
in the PMI Policy) with respect to the Mortgage Loans.

         In connection with any conveyance by the Seller, the Seller shall on
behalf of the Purchaser deliver to, and deposit with the Trustee, as assignee of
the Purchaser, on or before the Closing Date, the following documents or
instruments with respect to each Mortgage Loan:

                           (i) the original Mortgage Note, endorsed either (A)
in blank, in which case the Trustee shall cause the endorsement to be completed
or (B) in the following form: "Pay to the order of Wells Fargo Bank, N.A., as
Trustee, without recourse", or with respect to any lost Mortgage Note, an
original Lost Note Affidavit stating that the original mortgage note was lost,
misplaced or destroyed, together with a copy of the related mortgage note;
PROVIDED, HOWEVER, that such

                                       2

<PAGE>

substitutions of Lost Note Affidavits for original Mortgage Notes may occur only
with respect to Mortgage Loans, the aggregate Cut-off Date Principal Balance of
which is less than or equal to 1.00% of the Pool Balance as of the Cut-off Date;

                           (ii) the original Mortgage with evidence of recording
thereon, and the original recorded power of attorney, if the Mortgage was
executed pursuant to a power of attorney, with evidence of recording thereon;

                           (iii) an original Assignment of Mortgage, in form and
substance acceptable for recording. The Mortgage shall be assigned either (A) in
blank, or (B) to "Wells Fargo Bank, N.A., as Trustee, without recourse";

                           (iv) an original of any intervening assignment of
Mortgage showing a complete chain of assignments;

                           (v) the original or a certified copy of lender's
title insurance policy; and

(vi) the original or copies of each assumption,
modification, written assurance or substitution agreement, if any.

         The Seller hereby confirms to the Purchaser and the Trustee that it has
made the appropriate entries in its general accounting records to indicate that
such Mortgage Loans have been transferred to the Trustee and constitute part of
the Trust in accordance with the terms of the Pooling and Servicing Agreement.

         If any of the documents referred to in Section 2.02(ii), (iii) or (iv)
above has as of the Closing Date been submitted for recording but either (x) has
not been returned from the applicable public recording office or (y) has been
lost or such public recording office has retained the original of such document,
the obligations of the Seller to deliver such documents shall be deemed to be
satisfied upon (1) delivery to the Trustee or the Custodian no later than the
Closing Date, of a copy of each such document certified by the Seller in the
case of (x) above or the applicable public recording office in the case of (y)
above to be a true and complete copy of the original that was submitted for
recording and (2) if such copy is certified by the Seller, delivery to the
Trustee or the Custodian, promptly upon receipt thereof of either the original
or a copy of such document certified by the applicable public recording office
to be a true and complete copy of the original. If the original lender's title
insurance policy, or a certified copy thereof, was not delivered pursuant to
Section 2.02(v) above, the Seller shall deliver or cause to be delivered to the
Trustee or the Custodian, the original or a copy of a written commitment or
interim binder or preliminary report of title issued by the title insurance or
escrow company, with the original or a certified copy thereof to be delivered to
the Trustee or the Custodian, promptly upon receipt thereof. The Seller shall
deliver or cause to be delivered to the Trustee or the Custodian promptly upon
receipt thereof any other documents constituting a part of a Mortgage File
received with respect to any Mortgage Loan, including, but not limited to, any
original documents evidencing an assumption or modification of any Mortgage
Loan.

         Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File, the Seller
shall have 120 days to cure such defect or deliver such missing document to the
Purchaser. If the Seller does not cure such defect or deliver such

                                       3

<PAGE>

missing document within such time period, the Seller shall either repurchase or
substitute for such Mortgage Loan pursuant to Section 2.03 of the Pooling and
Servicing Agreement.

         The Purchaser hereby acknowledges its acceptance of all right, title
and interest to the Mortgage Loans and other property, now existing and
hereafter created, conveyed to it pursuant to Section 2.01.

         The parties hereto intend that the transaction set forth herein be a
sale by the Seller to the Purchaser of all the Seller's right, title and
interest in and to the Mortgage Loans and other property described above. In the
event the transaction set forth herein is deemed not to be a sale, the Seller,
hereby grants to the Purchaser a security interest in all of the Seller's right,
title and interest in, to and under the Mortgage Loans and other property
described above, whether now existing or hereafter created, to secure all of the
Seller's obligations hereunder; and this Agreement shall constitute a security
agreement under applicable law.

         The Seller shall cause the Assignments which were delivered in blank to
be completed and shall cause all Assignments referred to in Section 2.02(iii)
hereof and, to the extent necessary, in Section 2.02(iv) hereof to be recorded.
The Seller shall be required to deliver such Assignments for recording within 90
days of the Closing Date. Notwithstanding the foregoing, however, for
administrative convenience and facilitation of servicing and to reduce closing
costs, the Assignments of Mortgage shall not be required to be submitted for
recording with respect to any Mortgage Loan in any jurisdiction where the Rating
Agencies do not require recordation in order to receive the ratings on the
Certificates at the time of their initial issuance; PROVIDED, HOWEVER, each
Assignment shall be submitted for recording by the Seller in the manner
described above, at no expense to the Trust Fund or Trustee, upon the earliest
to occur of: (i) reasonable direction by Holders of Certificates entitled to at
least 25% of the Voting Rights, or the NIMS Insurer, (ii) the occurrence of a
Master Servicer Event of Termination, (iii) the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Master Servicer, (iv) the occurrence
of a servicing transfer as described in Section 7.02 of the Pooling and
Servicing Agreement, (v) if the Seller is not the Master Servicer and with
respect to any one Assignment the occurrence of a bankruptcy, insolvency or
foreclosure relating to the Mortgagor under the related Mortgage and (vi) any
Mortgage Loan that is 90 days or more Delinquent and such recordation would be
necessary to facilitate conversion of the Mortgaged Property as provided herein.
Upon (a) receipt of written notice from the Trustee that recording of the
Assignments is required pursuant to one or more of the conditions (excluding (v)
and (vi) above) set forth in the preceding sentence or (b) upon the occurrence
of condition (v) or (vi) in the preceding sentence, the Seller shall be required
to deliver such Assignments for recording as provided above, promptly and in any
event within 30 days following receipt of such notice. Notwithstanding the
foregoing, if the Seller fails to pay the cost of recording the Assignments,
such expense will be paid by the Trustee and the Trustee shall be reimbursed for
such expenses by the Trust. The Seller shall furnish the Trustee, or its
designated agent, with a copy of each Assignment submitted for recording. In the
event that any such Assignment is lost or returned unrecorded because of a
defect therein, the Seller shall promptly have a substitute Assignment prepared
or have such defect cured, as the case may be, and thereafter cause each such
Assignment to be duly recorded.

         The Seller shall forward to the Purchaser original documents evidencing
an assumption, modification, consolidation or extension of any Mortgage Loan
entered into in accordance with the Pooling and Servicing Agreement within two
weeks of their execution; PROVIDED, HOWEVER, that the

                                        4

<PAGE>

Seller shall provide the Purchaser with a certified true copy of any such
document submitted for recordation within two weeks of its execution, and shall
provide the original of any document submitted for recordation or a copy of such
document certified by the appropriate public recording office to be a true and
complete copy of the original within 365 days of its submission for recordation.
In the event that the Seller cannot provide a copy of such document certified by
the public recording office within such 365 day period, the Seller shall deliver
to the Purchaser, within such 365 day period, an Officer's Certificate of the
Master Servicer which shall (A) identify the recorded document, (B) state that
the recorded document has not been delivered to the Purchaser due solely to a
delay caused by the public recording office, (C) state the amount of time
generally required by the applicable recording office to record and return a
document submitted for recordation, if known, and (D) specify the date the
applicable recorded document is expected to be delivered to the Purchaser, and,
upon receipt of a copy of such document certified by the public recording
office, the Seller shall immediately deliver such document to the Purchaser. In
the event the appropriate public recording office will not certify as to the
accuracy of such document, the Seller shall deliver a copy of such document
certified by an officer of the Seller to be a true and complete copy of the
original to the Purchaser.

         Section 2.03      PAYMENT OF PURCHASE PRICE FOR THE MORTGAGE LOANS.
                           ------------------------------------------------

         In consideration of the sale of the Mortgage Loans from the Seller to
the Purchaser on the Closing Date, the Purchaser agrees to pay to the Seller on
the Closing Date (the "Mortgage Loan Purchase Price") by transfer of (i)
immediately available funds in an amount equal to $54,924,765.80 and (ii) a
7.29% percentage interest in the Class C Certificates, the Class P Certificates
and the Class R Certificates (collectively the "Option One Certificates") which
Option One Certificates shall be registered in the name of Option One Mortgage
Corporation, as designee of the Seller. The Seller has purchased Cap Contracts
on behalf of itself and Option One Owner Trust 2001-1A, Option One Owner Trust
2001-1B, Option One Owner Trust 2001-2, Option One Owner Trust 2003-4, Option
Owner Trust 2002-3 and Option One Owner Trust 2003-5 (the "Trust Sellers") in
consideration of a distribution by dividend of net cash proceeds and the
respective portions of retained Certificates (1) by the Trust Sellers to Option
One Loan Warehouse Corporation ("Loan Warehouse Corporation") pursuant to (i)
three Sale and Servicing Agreements, each dated April 1, 2001, among the Seller,
Loan Warehouse Corporation, Wells Fargo Bank, N.A (formerly known as Wells Fargo
Bank Minnesota, National Association). and those respective Trust Sellers, (ii)
the Sale and Servicing Agreement, dated July 2, 2002, among the Seller, Loan
Warehouse Corporation, Wells Fargo Bank, N.A. (formerly known as Wells Fargo
Bank Minnesota, National Association) and Option One Owner Trust 2002-3, (iii)
the Sale and Servicing Agreement, dated November 1, 2003, among the Seller, Loan
Warehouse Corporation, Wells Fargo Bank, N.A. (formerly known as Wells Fargo
Bank Minnesota, National Association) and Option One Owner Trust 2003-5, (iv)
three Trust Agreements, each dated April 1, 2002, between Loan Warehouse
Corporation and Wilmington Trust Company pursuant to which those respective
Trust Sellers were formed, (v) the Trust Agreement, dated July 2, 2002, between
Loan Warehouse Corporation and Wilmington Trust Company to which Option One
Owner Trust 2002-3 was formed, (vi) the Trust Agreement, dated August 8, 2003,
between Loan Warehouse Corporation and Wilmington Trust Company to which Option
One Owner Trust 2003-4 was formed, (vii) the Trust Agreement, dated November 1,
2003, between Loan Warehouse Corporation and Wilmington Trust Company to which
Option One Owner Trust 2003-5 was formed and (2) by Loan Warehouse Corporation
to Option One Mortgage Corporation pursuant to resolutions adopted on August 1,
2002. The Seller shall pay, and be billed directly for, all expenses incurred by
the Purchaser

                                        5

<PAGE>

in connection with the issuance of the Certificates, including, without
limitation, printing fees incurred in connection with the prospectus relating to
the Certificates, blue sky registration fees and expenses, fees and expenses of
Purchaser's counsel, fees of the Rating Agencies requested to rate the
Certificates, accountant's fees and expenses and the fees and expenses of the
Trustee and other out-of-pocket costs, if any.

                                  ARTICLE III.

               REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH

         Section 3.01 SELLER REPRESENTATIONS AND WARRANTIES RELATING TO THE
MORTGAGE LOANS. The Seller hereby represents and warrants with respect to the
Mortgage Loans to the Purchaser that as of the Closing Date or as of such date
specifically provided herein:

                  (a) The Seller has good title to and is the sole owner and
holder of the Mortgage Loan;

                  (b) Immediately prior to the transfer and assignment to the
Purchaser, the Mortgage Note and the Mortgage Loan were not subject to an
assignment or pledge, and the Seller has full right and authority to sell and
assign the Mortgage Loan;

                  (c) The Seller is transferring such Mortgage Loan to the
Purchaser free and clear of any and all liens, pledges, charges or security
interests of any nature encumbering the Mortgage Loans;

                  (d) The information set forth on Schedule I is true and
correct in all material respects as of the Cut-off Date or such other date as
may be indicated in such schedule;

                  (e) The Mortgage Loan has been acquired, serviced, collected
and otherwise dealt with by the Seller and any affiliate of the Seller in
compliance with all applicable federal, state and local laws and regulations and
the terms of the related Mortgage Note and Mortgage;

                  (f) The related Mortgage Note and Mortgage are genuine and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms except as such enforcement may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and by general equity
principles (regardless of whether such enforcement is considered in a proceeding
in equity or at law);

                  (g) The related Mortgage is a valid and enforceable first or
second lien on the related Mortgaged Property, which Mortgaged Property is free
and clear of all encumbrances and liens (including mechanics liens) having
priority over the first or second lien of the Mortgage except for: (i) liens for
real estate taxes and assessments not yet due and payable; (ii) covenants,
conditions and restrictions, rights of way, easements and other matters of
public record as of the date of recording of such Mortgage, such exceptions
appearing of record being acceptable to mortgage lending institutions generally
or specifically reflected or considered in the lender's title insurance policy
delivered to the originator of the Mortgage Loan and referred to in the
appraisal made in connection

                                        6

<PAGE>

with the origination of the related Mortgage Loan, (iii) other matters to which
like properties are commonly subject which do not materially interfere with the
benefits of the security intended to be provided by such Mortgage and (iv) the
first lien on the Mortgaged Property, in the case of the Mortgages that are
second liens;

                  (h) Any security agreement, chattel mortgage or equivalent
document related to such Mortgage Loan establishes and creates a valid and
enforceable first or second lien on the Mortgaged Property;

                  (i) As of the last calendar day of March 2004 and with respect
to any Mortgage Loan that had a payment due on or before April 1, 2004, except
with respect to 44.01% of the Mortgage Loans by the aggregate Cut-off Date
Principal Balance of the Mortgage Loans, the related Monthly Payment due on
April 1, 2004 has been received. In addition, 41.10% of the Mortgage Loans have
been 30 or more days delinquent in the last 12 months and 7.99% of the Mortgage
Loans have been 30 or more days delinquent for two payment periods in the last
12 months;

                  (j) The Seller has not advanced funds, or induced, solicited
or knowingly received any advance of funds by a party other than the Mortgagor,
directly or indirectly, for the payment of any amount required under the
Mortgage Loan;

                  (k) The Seller has not impaired, waived, altered or modified
the related Mortgage or Mortgage Note in any material respect, or satisfied,
canceled, rescinded or subordinated such Mortgage or Mortgage Note in whole or
in part or released all or any material portion of the Mortgaged Property from
the lien of the Mortgage, or executed any instrument of release, cancellation,
rescission or satisfaction of the Mortgage Note or Mortgage;

                  (l) As of the Cut-off Date, the Mortgage has not been
satisfied, canceled or subordinated, in whole or in part, or rescinded, and the
Mortgaged Property has not been released from the lien of the Mortgage, in whole
or in part (except for a release that does not materially impair the security of
the Mortgage Loan or a release the effect of which is reflected in the
Loan-to-Value Ratio or combined Loan-to-Value Ratio for the Mortgage Loan as set
forth in the Schedule of Mortgage Loans), nor has any instrument been executed
that would effect any such release, cancellation, subordination or rescission;

                  (m) No Mortgage Loan is subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury, nor will the
operation of any of the terms of any Mortgage Note or Mortgage, or the exercise
of any right thereunder, render either the Mortgage Note or the Mortgage
unenforceable in whole or in part, or subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury, and no such
right of rescission, set-off, counterclaim or defense has been asserted with
respect thereto;

                  (n) To the Seller's knowledge, there is no proceeding pending
for the total or partial condemnation and no eminent domain proceedings pending
affecting any Mortgaged Property;

                  (o) Each Mortgage Loan is covered by either (i) a mortgage
title insurance policy or other generally acceptable form of insurance policy
customary in the jurisdiction where the Mortgaged Property is located or (ii) if
generally acceptable in the jurisdiction where the Mortgaged

                                        7

<PAGE>

Property is located, an attorney's opinion of title given by an attorney
licensed to practice law in the jurisdiction where the Mortgaged Property is
located. All of the Seller's rights under such policies, opinions or other
instruments shall be transferred and assigned to Purchaser upon sale and
assignment of the Mortgage Loans hereunder. The title insurance policy has been
issued by a title insurer licensed to do business in the jurisdiction where the
Mortgaged Property is located, insuring the original lender, its successor and
assigns, as to the first or second priority lien of the Mortgage in the original
principal amount of the Mortgage Loan, subject to the exceptions contained in
such policy. The Seller is the sole insured of such mortgagee title insurance
policy, and such mortgagee title insurance policy is in full force and effect
and will be in force and effect upon the consummation of the transactions
contemplated by this Agreement. Neither the Seller nor any affiliate of the
Seller has made, and the Seller has no knowledge of, any claims under such
mortgagee title insurance policy. The Seller is not aware of any action by a
prior holder and neither the Seller nor any affiliate of the Seller has done, by
act or omission, anything which could impair the coverage or enforceability of
such mortgagee title insurance policy or the accuracy of such attorney's opinion
of title;

                  (p) There is no material default, breach, violation or event
of acceleration existing under the related Mortgage or the related Mortgage Note
and no event which, with the passage of time or with notice and the expiration
of any grace or cure period, would constitute a material default, breach,
violation or event of acceleration, other than a payment delinquency that is for
a payment due after the date specified in (i) above. Neither the Seller nor any
affiliate of the Seller has waived any default, breach, violation or event of
acceleration;

                  (q) With respect to any Mortgage Loan which provides for an
adjustable interest rate, all rate adjustments have been performed in accordance
with the terms of the related Mortgage Note or subsequent modifications, if any;

                  (r) To the Seller's knowledge, there are no delinquent taxes,
ground rents, water charges, sewer rents, assessments, insurance premiums,
leasehold payments, including assessments payable in future installments or
other outstanding charges, affecting the related Mortgaged Property;

                  (s) No foreclosure proceedings are pending against the
Mortgaged Property and the Mortgage Loan is not subject to any pending
bankruptcy or insolvency proceeding, and to the Seller's best knowledge, no
material litigation or lawsuit relating to the Mortgage Loan is pending;

                  (t) The Mortgage Loan obligates the mortgagor thereunder to
maintain a hazard insurance policy ("Hazard Insurance") in an amount at least
equal to the lesser of (i) the maximum insurable value of such improvements or
(ii) the principal balance of the Mortgage Loan with a standard mortgagee
clause, in either case in an amount sufficient to avoid the application of any
"co-insurance provisions," and, if it was in place at origination of the
Mortgage Loan, flood insurance, at the mortgagor's cost and expense. If the
Mortgaged Property is in an area identified in the Federal Register by the
Federal Emergency Management Agency ("FEMA") as having special flood hazards, a
flood insurance policy is in effect which met the requirements of FEMA at the
time such policy was issued. The Mortgage obligates the Mortgagor to maintain
the Hazard Insurance, and, if applicable, flood insurance policy at the
Mortgagor's cost and expense, and on the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
the Mortgagor's cost and expense, and to seek reimbursement therefor from the
Mortgagor. The Mortgaged Property is covered by Hazard Insurance;

                                        8

<PAGE>

                  (u) The Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage and the security
interest of any applicable security agreement or chattel mortgage;

                  (v) The Mortgage contains an enforceable provision for the
acceleration of the payment of the unpaid principal balance of the Mortgage Loan
in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the Mortgagee thereunder. The Mortgage contains
customary and enforceable provisions such as to render the rights and remedies
of the holder thereof adequate for the realization against the Mortgaged
Property of the benefits of the security provided thereby, including (i) in the
case of a Mortgage designated as a deed of trust, by trustee's sale and (ii)
otherwise by judicial foreclosure. Since the date of origination of the Mortgage
Loan, the Mortgaged Property has not been subject to any bankruptcy proceeding
or foreclosure proceeding and the Mortgagor has not filed for protection under
applicable bankruptcy laws. There is no homestead or other exemption available
to the Mortgagor that would interfere with the right to sell the Mortgaged
Property at a trustee's sale or the right to foreclose the Mortgage. In the
event the Mortgage constitutes a deed of trust, a trustee, duly qualified under
applicable law to serve as such, as been properly designated and currently so
serves and is named in the Mortgage, and no fees or expenses are or will become
payable by Purchaser to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the related Mortgagor. The
Mortgagor has not notified the Seller or any affiliate of the Seller and the
Seller has no knowledge of any relief requested or allowed to the Mortgagor
under the Soldiers and Sailors Civil Relief Act of 1940;

                  (w) Except as set forth in the appraisal which forms part of
the related Mortgage File, the Mortgaged Property, normal wear and tear
excepted, is undamaged by waste, fire, earthquake or earth movement, windstorm,
flood, tornado or other casualty so as to affect materially and adversely the
value of the Mortgaged Property as security for the Mortgage Loan or the use for
which the premises were intended;

                  (x) To the Seller's knowledge, there was no fraud involved in
the origination of the Mortgage Loan by the mortgagee or by the Mortgagor, any
appraiser or any other party involved in the origination of the Mortgage Loan;

                  (y) Each Mortgage File contains an appraisal of the Mortgaged
Property indicating the appraised value at the time of origination for such
Mortgaged Property. Each appraisal has been performed in accordance with the
provisions of the Financial Institutions Reform, Recovery and Enforcement Act of
1989;

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

                  (aa) No improvements on the related Mortgaged Property (upon
which value was given) encroach on adjoining properties (and in the case of a
condominium unit, such improvements are within the project with respect to that
unit), and no improvements on adjoining properties encroach

                                        9

<PAGE>

upon the Mortgaged Property unless there exists in the Mortgage File a title
Policy with endorsements which insure against losses sustained by the insured as
a result of such encroachments;

                  (bb) Each Mortgage Loan was originated or acquired by a
savings and loan association, a savings bank, a commercial bank or similar
banking institution which is supervised and examined by a federal or state
authority, or by a mortgagee approved by the Secretary of HUD. Each Mortgage
Loan was originated substantially in accordance with the Seller's underwriting
criteria, which are at least as stringent as the underwriting criteria set forth
in the Prospectus Supplement. Each Mortgage Loan is currently being serviced by
the Seller and has been serviced by the Seller since the date of origination of
such Mortgage Loan;

                  (cc) (i) Principal payments on the Mortgage Loan commenced no
more than two months after the proceeds of the Mortgage Loan were disbursed and
(ii) each Mortgage Note is payable on the first day of each month;

                  (dd) [Reserved];

                  (ee) The Mortgage Loan bears interest at the Mortgage Rate and
the Mortgage Note does not permit negative amortization. No Mortgage Loan
bearing interest at an adjustable rate permits the Mortgagor to convert the
Mortgage Loan to a fixed rate Mortgage Loan;

                  (ff) With respect to escrow deposits, if any, all such
payments are in the possession of, or under the control of, the Master Servicer
and there exist no deficiencies in connection therewith for which customary
arrangements for repayment thereof have not been made. No escrow deposits or
escrow advances or other charges or payments due the Master Servicer have been
capitalized under any Mortgage or the related Mortgage Note;

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

                  (hh) As of the origination date of each Mortgage Loan, the
related Mortgaged Property is lawfully permitted to be occupied under applicable
law;

                  (ii) No law relating to servicing, collection or notification
practices and no law relating to origination practices, has been violated in
connection with any Mortgage Loan transferred to the Purchaser pursuant to this
Agreement, including, without limitation, usury, truth in lending, real estate
settlement procedures, consumer credit protection, equal credit opportunity or
disclosure laws. The Mortgage Loan has been serviced in accordance with the
terms of the Mortgage Note;

                  (jj) No Mortgage Loan was made in connection with (a) the
construction or rehabilitation of a Mortgaged Property or (b) facilitating the
trade-in or exchange of a Mortgaged Property;

                                                        10

<PAGE>

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

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

                  (mm) As to each Mortgage Loan, interest is calculated on the
Mortgage Note on the basis of twelve 30-day months and a 360 day year;

                  (nn) The Mortgaged Property consists of one of the following:
detached or semi-detached one- to four-family dwelling units, townhouses,
individual condominium units and individual units in planned unit developments,
or manufactured homes;

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

                  (pp) The Mortgage Loans were not intentionally selected by the
Seller in a manner intended to adversely affect the Purchaser or the Trust;

                  (qq) The representations, warranties and covenants, set forth
in this Section shall survive the Closing Date;

                  (rr)  The Mortgage Loans have original terms to maturity
ranging from 10 to 30 years;

                  (ss) With respect to the Mortgage Loans, no more than 15.89%;
15.75%; 7.85%, 6.19% and 5.46% of the Mortgage Loans, by Cut-off Date Principal
Balance will be secured by Mortgaged Properties located in California, New York,
Massachusetts, Florida and New Jersey, respectively; and 73.51% of the Mortgage
Loans, by Cut-off Date Principal Balance will be secured by real property with a
single family residence erected thereon and approximately 6.32% of the Mortgage
Loans, by the Cut-off Date Principal Balance are secured by condominiums;

                  (tt) As of the Cut-off Date, each Mortgage Loan had a
Loan-to-Value-Ratio that was less than or equal to 100%;

                  (uu) With respect to each Mortgage Loan, the Mortgage Note
related thereto bears a fixed Mortgage Rate or an adjustable Mortgage Rate which
will be adjusted on each Adjustment Date to equal the Index plus the Gross
Margin, rounded to the nearest or next highest 0.125%, subject to the Periodic
Rate Cap, the Maximum Mortgage Rate and the Minimum Mortgage Rate;

                                       11

<PAGE>

                  (vv) The average Cut-off Date Principal Balance of the
Mortgage Loans is $146,076.50;

                  (ww) No Mortgage Loan is subject to the requirements of the
Home Ownership and Equity Protection Act of 1994 ("HOEPA"), or any state law,
ordinance or regulation similar to HOEPA;

                  (xx) No proceeds from any Mortgage Loan were used to purchase
single premium credit insurance policies as part of the origination of, or as a
condition to closing, such Mortgage Loan;

                  (yy) No Mortgage Loan originated before October 1, 2002 has a
Prepayment Charge term longer than five years after its origination and no
Mortgage Loan originated on or after October 1, 2002 has a Prepayment Charge
term longer than three years after its origination;

                  (zz) Each Group I Mortgage Loan had a Principal Balance at
origination which conformed with Fannie Mae/Freddie Mac guidelines;

                  (aaa) Each Mortgage Loan conforms, and all Mortgage Loans in
the aggregate conform, in all material respects, to the description thereof set
forth in the Prospectus Supplement;

                  (bbb) With respect to second lien Mortgage Loans, either (a)
no consent for the Mortgage Loan is required by the holder of the related first
lien or (b) such consent has been obtained and is contained in the Mortgage
File;

                  (ccc) Each Mortgage Note is comprised of one original
promissory note and each such promissory note constitutes an "instrument" for
purposes of section 9-102(a)(65) of the UCC;

                  (ddd) [Reserved];

                  (eee) No borrower was encouraged or required to select a Group
I Mortgage Loan product offered by the Originator which is a higher cost product
designed for less creditworthy borrowers, unless at the time of the Group I
Mortgage Loan's origination, such borrower did not qualify taking into account
credit history and debt to income ratios for a lower cost credit product then
offered by the Originator or any affiliate of the Originator. If, at the time of
loan application, the borrower may have qualified for a lower cost credit
product then offered by any mortgage lending affiliate of the Originator, the
Originator referred the borrower's application to such affiliate for
underwriting consideration;

                  (fff) The methodology used in underwriting the extension of
credit for each Group I Mortgage Loan employs objective mathematical principles
which relate the borrower's income, assets and liabilities to the proposed
payment, in accordance with the Originator's Underwriting Guidelines, and does
not rely on the extent of the borrower's equity in the collateral as the
principal determining factor in approving such credit extension. Such
underwriting methodology confirmed that at the time of origination the borrower
had a reasonable ability to make timely payments on the Group I Mortgage Loan;

                                       12

<PAGE>

                  (ggg) With respect to any Group I Mortgage Loan that contains
a provision permitting imposition of a premium upon a prepayment prior to
maturity: (i) prior to the Group I Mortgage Loan's origination, the borrower
agreed to such premium in exchange for a monetary benefit, including but not
limited to a rate or fee reduction, (ii) prior to the Group I Mortgage Loan's
origination, the borrower was offered the option of obtaining a Group I Mortgage
Loan that did not require payment of such a premium, (iii) the prepayment
premium is disclosed to the borrower in the loan documents pursuant to
applicable state and federal law, and (iv) notwithstanding any state or federal
law to the contrary, the Master Servicer shall not impose such prepayment
premium in any instance when the mortgage debt is accelerated as the result of
the borrower's default in making the loan payments;

                  (hhh) No borrower was required to purchase any credit life,
disability, accident or health insurance product as a condition of obtaining the
extension of credit. No borrower obtained a prepaid single premium credit life,
disability, accident or health insurance policy in connection with the
origination of the GroupI Mortgage Loan. No proceeds from any Group I Mortgage
Loan were used to purchase single premium credit insurance policies as part of
the origination of, or as a condition to closing, such Group I Mortgage Loan;

                  (iii) All points and fees related to each Group I Mortgage
Loan were disclosed in writing to the borrower in accordance with applicable
state and federal law and regulation. Except in the case of a Group I Mortgage
Loan in an original principal amount of less than $60,000 which would have
resulted in an unprofitable origination, no borrower was charged "points and
fees" (whether or not financed) in an amount greater than 5% of the principal
amount of such loan, such 5% limitation calculated in accordance with Fannie
Mae's anti-predatory lending requirements as set forth in the Fannie Mae Selling
Guide;

                  (jjj) None of the Mortgage Loans originated in Georgia are
subject to the Georgia Fair Lending Act effective from October 1, 2002 to March
6, 2003;

                  (kkk) No Group I Mortgage Loan originated on or after October
1, 2002 through March 6, 2003 is secured by a Mortgaged Property located in the
State of Georgia;

                  (lll) Each Mortgage Loan at the time it was made complied in
all material respects with applicable local, state, and federal laws, including,
but not limited to, all applicable predatory and abusive lending laws;

                  (mmm) None of the Mortgage Loans are High Cost as defined by
the applicable predatory and abusive lending laws;

                  (nnn) Each Group I Mortgage Loan is in compliance with the
anti-predatory lending eligibility for purchase requirements of the Fannie Mae
Lender Letter, LL03-00: Eligibility of Mortgages to Borrowers with Blemished
Credit Records (04/11/00) other than the requirements regarding Escrow Deposit
Accounts;

                  (ooo) No Group I Mortgage Loan is a "High Cost Home Loan" as
defined in the Georgia Fair Lending Act, as amended (the "Georgia Act"). No
Group I Mortgage Loan secured by owner occupied real property or an owner
occupied manufactured home located in the State of Georgia was originated (or
modified) on or after October 1, 2002 through an including March 6, 2003;

                                       13

<PAGE>

                  (ppp) No Mortgage Loan is a "High Cost Home Loan" as defined
in New York Banking Law 6-1;

                  (qqq) All fees and charges (including finance charges) and
whether or not financed, assessed, collected or to be collected in connection
with the origination and servicing of each Group I Mortgage Loan has been
disclosed in writing to the borrower in accordance with applicable state and
federal law and regulation;

                  (rrr) The Master Servicer will transmit full-file credit
reporting data for each Group I Mortgage Loan pursuant to Fannie Mae Guide
Announcement 95-19 and that for each Group I Mortgage Loan, Master Servicer
agrees it shall report one of the following statuses each month as follows: new
origination, current, delinquent (30-, 60-, 90-days, etc.), foreclosed, or
charged-off;

                  (sss) No Group I Mortgage Loan is a "High Cost Home Loan" as
defined in the Arkansas Home Loan Protection Act effective July 16, 2003 (Act
1340 or 2003);"

                  (ttt) No Group I Mortgage Loan is a "High Cost Home Loan" as
defined in Kentucky high-cost loan statute effective June 24, 2003 (Ky. Rev.
Stat. Section 360.100);

                  (uuu) No Mortgage Loan is subject to the requirements of any
local law, ordinance or regulation similar to HOEPA;

                  (vvv) No Mortgage Loan is a "High-Cost Home Loan" as defined
in the New Jersey Home Ownership Act effective November 27, 2003 (N.J.S.A. 46;
10B-22 et seq.);

                  (www) No Group I Mortgage Loan is a High-Cost Home Loan" as
defined in the New Mexico Home Loan Protection Act effective January 1, 2004
(N.M. Stat. Ann. ss. 58-21A-1 et seq.);

                  (xxx) No Group I Mortgage Loan is a "High-Risk Home Loan" as
defined in the Illinois High-Risk Home Loan Act effective January 1, 2004 (815
Ill. Comp. Stat. 137/1 et seq.);

                  (yyy) No Mortgage Loan is a "High-Cost Home Loan" as defined
under the Maine House Bill 383 L.D. 494, effective as of September 13, 2003;

                  (zzz) No Group I Mortgage Loan in the trust is a "high cost
home," "covered" (excluding home loans defined as "covered home loans" pursuant
to clause (1) of the definition of that term in the New Jersey Home Ownership
Security Act of 2002), "high risk home" or "predatory" loan under any other
applicable state, federal or local law (or a similarly classified loan using
different terminology under a law imposing heightened regulatory scrutiny or
additional legal liability for residential mortgage loans having high interest
rates, points and/or fees."

         Section 3.02 SELLER REPRESENTATIONS AND WARRANTIES RELATING TO THE
SELLER. The Seller represents, warrants and covenants to the Purchaser as of the
Closing Date or as of such other date specifically provided herein or in the
applicable Assignment and Conveyance:

                  (i) The Seller is duly organized, validly existing and in good
standing as a corporation under the laws of the State of California and is and
will remain in compliance with the

                                       14

<PAGE>

laws of each state in which any Mortgaged Property is located to the extent
necessary to ensure the enforceability of each Mortgage Loan in accordance with
the terms of this Agreement;

                  (ii) The Seller has the full power and authority to hold each
Mortgage Loan, to sell each Mortgage Loan, to execute, deliver and perform, and
to enter into and consummate, all transactions contemplated by this Agreement.
The Seller has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement and this Agreement,
assuming due authorization, execution and delivery by the Purchaser and the
Seller, constitutes a legal, valid and binding obligation of the Seller,
enforceable against it in accordance with its terms except as the enforceability
thereof may be limited by bankruptcy, insolvency or reorganization. At the time
of the sale of each Mortgage Loan by the Seller, the Seller had the full power
and authority to hold each Mortgage Loan and to sell each Mortgage Loan;

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

                  (iv) The Seller is not in violation of, and the execution and
delivery of this Agreement by the Seller and its performance and compliance with
the terms of this Agreement will not constitute a violation with respect to, any
order or decree of any court or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction over the Seller or its
assets, which violation might have consequences that would materially and
adversely affect the condition (financial or otherwise) or the operation of the
Seller or its assets or might have consequences that would materially and
adversely affect the performance of its obligations and duties hereunder;

                  (v) The Seller is a HUD approved mortgagee pursuant to Section
203 and Section 211 of the National Housing Act. No event has occurred,
including but not limited to a change in insurance coverage, which would make
the Seller unable to comply with HUD eligibility requirements or which would
require notification to HUD;

                  (vi) The Seller does not believe, nor does it have any reason
or cause to believe, that it cannot perform each and every covenant contained in
this Agreement;

                  (vii) There are no actions or proceedings against, or
investigations known to it of, the Seller before any court, administrative or
other tribunal (A) that might prohibit its entering into this Agreement, (B)
seeking to prevent the sale of the Mortgage Loans or the consummation of the
transactions contemplated by this Agreement or (C) that might prohibit or
materially and adversely affect the performance by the Seller of its obligations
under, or validity of enforceability of, this Agreement;

                  (viii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution, delivery and
performance by the Seller of, or compliance by the Seller with, this Agreement
or the consummation of the transactions contemplated by this

                                       15

<PAGE>

Agreement, except for such consents, approvals, authorizations or orders, if
any, that have been obtained;

                  (ix) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Seller. The sale of the
Mortgage Loans was in the ordinary course of business of the Seller and the
assignment and conveyance of the Mortgage Notes and the Mortgages by the Seller
are not subject to the bulk transfer or any similar statutory provisions;

                  (x) The information delivered by the Seller to the Purchaser
with respect to the Seller's loan loss, foreclosure and delinquency experience
on mortgage loans underwritten to similar standards as the Mortgage Loans and
covering mortgaged properties similar to the Mortgaged Properties, is true and
correct in all material respects as of the date of such report;

                  (xi) Except with respect to any statement regarding the
intentions of the Purchaser, or any other statement contained herein the truth
or falsity of which is dependant solely upon the actions of the Purchaser, this
Agreement does not contain any untrue statement of material fact or omit to
state a material fact necessary to make the statements contained herein not
misleading. The written statements, reports and other documents prepared and
furnished or to be prepared and furnished by the Seller pursuant to this
Agreement or in connection with the transactions contemplated hereby taken in
the aggregate do not contain any untrue statement of material fact or omit to
state a material fact necessary to make the statements contained therein not
misleading; and

                  (xii) The Seller has not transferred the Mortgage Loans with
any intent to hinder, delay or defraud any of its creditors.

         Section 3.03 REMEDIES FOR BREACH OF REPRESENTATIONS AND WARRANTIES. It
is understood and agreed that the representations and warranties set forth in
Sections 3.01 and 3.02 shall survive the sale of the Mortgage Loans to the
Purchaser and shall inure to the benefit of the Purchaser, notwithstanding any
restrictive or qualified endorsement on any Mortgage Note or Assignment or the
examination or lack of examination of any Mortgage File. With respect to the
representations and warranties contained herein that are made to the knowledge
or the best knowledge of the Seller or as to which the Seller has no knowledge,
if it is discovered that the substance of any such representation and warranty
is inaccurate and the inaccuracy materially and adversely affects the value of
the related Mortgage Loan, or the interest therein of the Purchaser or the
Purchaser's assignee, designee or transferee, then notwithstanding the Seller's
lack of knowledge with respect to the substance of such representation and
warranty being inaccurate at the time the representation and warranty was made,
such inaccuracy shall be deemed a breach of the applicable representation and
warranty and the Seller shall take such action described in the following
paragraphs of this Section 3.03 in respect of such Mortgage Loan. Upon discovery
by either the Seller, the Master Servicer or the Purchaser of a breach of any of
the foregoing representations and warranties that materially and adversely
affects the value of the Mortgage Loans or the interest of the Purchaser (or
which materially and adversely affects the interests of the Purchaser in the
related Mortgage Loan in the case of a representation and warranty relating to a
particular Mortgage Loan), the party discovering such breach shall give prompt
written notice to the others. It is understood by the parties hereto that a
breach of the representations and warranties made in Section 3.01(ww), (xx),
(yy), (kkk) and (zzz) will be deemed to materially and adversely affect the
value of the related Mortgage Loan or the interest of the Purchaser.

                                       16

<PAGE>

         Within 120 days of the earlier of either discovery by or notice to the
Seller of any breach of a representation or warranty made by the Seller that
materially and adversely affects the value of a Mortgage Loan or the Mortgage
Loans or the interest therein of the Purchaser, the Seller shall use its best
efforts promptly to cure such breach in all material respects and, if such
breach cannot be cured, the Seller shall, at the Purchaser's option, repurchase
such Mortgage Loan at the Purchase Price. In the event that a breach shall
involve any representation or warranty set forth in Section 3.02 and such breach
cannot be cured within 120 days of the earlier of either discovery by or notice
to the Seller of such breach, all of the Mortgage Loans shall, at the
Purchaser's option, be repurchased by the Seller at the Purchase Price. The
Seller may, at the request of the Purchaser and assuming the Seller has a
Qualified Substitute Mortgage Loan, rather than repurchase a deficient Mortgage
Loan as provided above, remove such Mortgage Loan and substitute in its place a
Qualified Substitute Mortgage Loan or Loans. If the Seller does not provide a
Qualified Substitute Mortgage Loan or Loans, it shall repurchase the deficient
Mortgage Loan. Any repurchase of a Mortgage Loan(s) pursuant to the foregoing
provisions of this Section 3.03 shall occur on a date designated by the
Purchaser and shall be accomplished by deposit in accordance with Section 2.03
of the Pooling and Servicing Agreement. Any repurchase or substitution required
by this Section shall be made in a manner consistent with Section 2.03 of the
Pooling and Servicing Agreement.

         At the time of substitution or repurchase of any deficient Mortgage
Loan, the Purchaser and the Seller shall arrange for the reassignment of the
repurchased or substituted Mortgage Loan to the Seller and the delivery to the
Seller of any documents held by the Trustee relating to the deficient or
repurchased Mortgage Loan. In the event the Purchase Price is deposited in the
Collection Account, the Seller shall, simultaneously with such deposit, give
written notice to the Purchaser that such deposit has taken place. Upon such
repurchase, the Mortgage Loan Schedule shall be amended to reflect the
withdrawal of the repurchased Mortgage Loan from this Agreement.

         As to any Deleted Mortgage Loan for which the Seller substitutes a
Qualified Substitute Mortgage Loan or Loans, the Seller shall effect such
substitution by delivering to the Purchaser or its designee for such Qualified
Substitute Mortgage Loan or Loans the Mortgage Note, the Mortgage, the
Assignment and such other documents and agreements as are required by the
Pooling and Servicing Agreement, with the Mortgage Note endorsed as required
therein. The Seller shall deposit in the Collection Account the Monthly Payment
less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans
in the month following the date of such substitution. Monthly Payments due with
respect to Qualified Substitute Mortgage Loans in the month of substitution will
be retained by the Seller. For the month of substitution, distributions to the
Purchaser will include the Monthly Payment due on such Deleted Mortgage Loan in
the month of substitution, and the Seller shall thereafter be entitled to retain
all amounts subsequently received by the Seller in respect of such Deleted
Mortgage Loan. Upon such substitution, the Qualified Substitute Mortgage Loans
shall be subject to the terms of this Agreement in all respects, and the Seller
shall be deemed to have made with respect to such Qualified Substitute Mortgage
Loan or Loans as of the date of substitution, the covenants, representations and
warranties set forth in Sections 3.01 and 3.02.

         It is understood and agreed that the representations and warranties set
forth in Section 3.01 shall survive delivery of the respective Mortgage Files to
the Trustee on behalf of the Purchaser.

         It is understood and agreed that the obligations of the Seller set
forth in Section 3.03 to cure, repurchase and substitute for a defective
Mortgage Loan and to indemnify the Purchaser as provided

                                       17

<PAGE>

in Section 5.01 constitute the sole remedies of the Purchaser respecting a
missing or defective document or a breach of the representations and warranties
contained in Section 3.01 or 3.02.

                                   ARTICLE IV.

                               SELLER'S COVENANTS

         Section 4.01 COVENANTS OF THE SELLER. The Seller hereby covenants that
except for the transfer hereunder, the Seller will not sell, pledge, assign or
transfer to any other Person, or grant, create, incur, assume or suffer to exist
any Lien on any Mortgage Loan, or any interest therein; the Seller will notify
the Trustee, as assignee of the Purchaser, of the existence of any Lien on any
Mortgage Loan immediately upon discovery thereof, and the Seller will defend the
right, title and interest of the Trust, as assignee of the Purchaser, in, to and
under the Mortgage Loans, against all claims of third parties claiming through
or under the Seller or the Seller; provided, however, that nothing in this
Section 4.01 shall prevent or be deemed to prohibit the Seller from suffering to
exist upon any of the Mortgage Loans any Liens for municipal or other local
taxes and other governmental charges if such taxes or governmental charges shall
not at the time be due and payable or if the Seller shall currently be
contesting the validity thereof in good faith by appropriate proceedings and
shall have set aside on its books adequate reserves with respect thereto.

                                   ARTICLE V.

               INDEMNIFICATION WITH RESPECT TO THE MORTGAGE LOANS

         Section 5.01      INDEMNIFICATION.

                  (a) The Seller agrees to indemnify and hold harmless the
Purchaser, each of its directors, each of its officers and each person or entity
who controls the Purchaser or any such person, within the meaning of Section 15
of the Securities Act, against any and all losses, claims, damages or
liabilities, joint and several, as incurred, to which the Purchaser, or any such
person or entity may become subject, under the Securities Act or otherwise, and
will reimburse the Purchaser, each such director and officer and each such
controlling person for any legal or other expenses incurred by the Purchaser or
such controlling person in connection with investigating or defending any such
losses, claims, damages or liabilities, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in the Prospectus Supplement or any amendment or supplement to the
Prospectus Supplement approved in writing by the Seller or the omission or the
alleged omission to state therein a material fact necessary in order to make the
statements in the Prospectus Supplement or any amendment or supplement to the
Prospectus Supplement approved in writing by the Seller, in the light of the
circumstances under which they were made, not misleading, but only to the extent
that such untrue statement or alleged untrue statement or omission or alleged
omission relates to the Seller Information contained in the Prospectus
Supplement, (ii) any untrue statement or alleged untrue statement of any
material fact contained in the information on any computer tape furnished to the
Purchaser or an affiliate thereof by or on behalf of the Seller containing
information regarding the assets of the Trust or (iii) any untrue statement or
alleged untrue statement of any material fact contained in any information
provided by the Seller to the Purchaser or any affiliate thereof, or any
material omission from the information purported to be provided hereby, and
disseminated to KPMG

                                       18

<PAGE>

LLP or prospective investors (directly or indirectly through available
information systems) in connection with the issuance, marketing or offering of
the Certificates. This indemnity agreement will be in addition to any liability
which the Seller may otherwise have.

                  (b) The Purchaser agrees to indemnify and hold harmless the
Seller, its officers, directors and each person or entity who controls the
Seller, or any such person, against any and all losses, claims, damages or
liabilities, joint and several, to which the Seller or any such person or entity
may become subject, under the Securities Act or otherwise, and will reimburse
the Seller for any legal or other expenses incurred by the Seller, each officer
and director and controlling person in connection with investigating or
defending any such losses, claims, damages or liabilities insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Prospectus Supplement or any amendment or
supplement to the Prospectus Supplement or the omission or the alleged omission
to state therein a material fact necessary in order to make the statements in
the Prospectus Supplement or any amendment or supplement to the Prospectus
Supplement, in the light of the circumstances under which they were made, not
misleading, but only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission is not contained in the Seller
Information in the Prospectus Supplement. This indemnity agreement will be in
addition to any liability which the Purchaser may otherwise have.

                  (c) Promptly after receipt by any indemnified party under this
Article V of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against any
indemnifying party under this Article V, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Article V except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify any indemnifying party shall not relieve it from any liability
which it may have to any indemnified party otherwise than under this Article V.

         If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Article V for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation.

         Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised in writing by such counsel that there may be one or more legal defenses
available to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing

                                       19

<PAGE>

that it elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the defense of
such action on behalf of such indemnified party, it being understood, however,
the indemnifying party shall not, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties, which
firm shall be designated in writing by the Purchaser, if the indemnified parties
under this Article V consist of the Purchaser or by the Seller, if the
indemnified parties in this Article V consist of the Seller.

         Each indemnified party, as a condition of the indemnity agreements
contained in Section 5.01 (a) and (b) hereof, shall use its best efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested an
indemnifying party to consent to a settlement of any action, the indemnifying
party agrees that it shall be liable for any settlement of any proceeding
effected without its written consent if such settlement is entered into more
than 30 days after receipt by such indemnifying party of the aforesaid request
and the indemnifying party has not previously provided the indemnified party
with written notice of its objection to such settlement. No indemnifying party
shall effect any settlement of any pending or threatened proceeding in respect
of which an indemnified party is or could have been a party and indemnity is or
could have been sought hereunder, without the written consent of such
indemnified party, unless settlement includes an unconditional release of such
indemnified party from all liability and claims that are the subject matter of
such proceeding.

                  (d) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in this Article is
for any reason held to be unenforceable although applicable in accordance with
its terms, the Seller, on the one hand, and the Purchaser, on the other, shall
contribute to the aggregate losses, liabilities, claims, damages and expenses of
the nature contemplated by said indemnity agreement incurred by the Seller and
the Purchaser in such proportions as shall be appropriate to reflect the
relative benefits received by the Seller on the one hand and the Purchaser on
the other from the sale of the Mortgage Loans such that the Purchaser is
responsible for the lesser of (i) 0.25% thereof and (ii) 0.25% of the aggregate
proceeds to the Seller from the sale of the Mortgage Loans and the Seller shall
be responsible for the balance; PROVIDED, HOWEVER, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section, each
officer and director of the Purchaser and each person, if any, who controls the
Purchaser within the meaning of Section 15 of the Securities Act shall have the
same rights to contribution as the Purchaser and each director of the Seller,
each officer of the Seller, and each person, if any, who controls the Seller
within the meaning of Section 15 of the Securities Act shall have the same
rights to contribution as the Seller.

                  (e) The Seller agrees to indemnify and to hold each of the
Purchaser, the Trustee, each of the officers and directors of each such entity
and each person or entity who controls each such

                                       20

<PAGE>

entity or person and each Certificateholder harmless against any and all claims,
losses, penalties, fines, forfeitures, legal fees and related costs, judgments,
and any other costs, fees and expenses that the Purchaser, the Trustee, or any
such person or entity and any Certificateholder may sustain in any way (i)
related to the failure of the Seller to perform its duties in compliance with
the terms of this Agreement, (ii) arising from a breach by the Seller of its
representations and warranties in Section 3.01 or 3.02 of this Agreement or
(iii) related to the origination or prior servicing of the Mortgage Loans by
reason of any acts, omissions, or alleged acts or omissions of the Seller or any
servicer. The Seller shall immediately notify the Purchaser, the Trustee and
each Certificateholder if a claim is made by a third party with respect to this
Agreement. The Seller shall assume the defense of any such claim and pay all
expenses in connection therewith, including reasonable counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be entered
against the Purchaser, the Trustee or any such person or entity and/or any
Certificateholder in respect of such claim.

                                   ARTICLE VI.

                                   TERMINATION

         Section 6.01 TERMINATION. The respective obligations and
responsibilities of the Seller and the Purchaser created hereby shall terminate,
except for the Seller's indemnity obligations as provided herein upon the
termination of the Trust as provided in Article X of the Pooling and Servicing
Agreement.

                                  ARTICLE VII.

                            MISCELLANEOUS PROVISIONS

         Section 7.01 AMENDMENT. This Agreement may be amended from time to
time, with the consent of the NIMS Insurer, if any, by the Originator, the
Seller and the Purchaser, by written agreement signed by the Originator, the
Seller and the Purchaser.

         Section 7.02 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.

         Section 7.03 NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by registered mail, postage prepaid, addressed as
follows:

         if to the Seller:

                  Option One Mortgage Corporation
                  3 Ada
                  Irvine, CA 92618
                  Attention: William L. O'Neill

or such other address as may hereafter be furnished to the Purchaser in writing
by the Seller.

                                       21

<PAGE>

         if to the Purchaser:

                  Option One Mortgage Acceptance Corporation
                  3 Ada
                  Irvine, CA 92618
                  Attention: William L. O'Neill

or such other address as may hereafter be furnished to the Seller in writing by
the Purchaser.

         Section 7.04 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions of terms of this Agreement shall be held
invalid for any reason whatsoever, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity of
enforceability of the other provisions of this Agreement.

         Section 7.05 COUNTERPARTS. This Agreement may be executed in one or
more counterparts and by the different parties hereto on separate counterparts,
each of which, when so executed, shall be deemed to be an original and such
counterparts, together, shall constitute one and the same agreement.

         Section 7.06 FURTHER AGREEMENTS. The Purchaser and the Seller each
agree to execute and deliver to the other such additional documents, instruments
or agreements as may be necessary or reasonable and appropriate to effectuate
the purposes of this Agreement or in connection with the issuance of any series
of Certificates representing interests in the Mortgage Loans.

         Without limiting the generality of the foregoing, as a further
inducement for the Purchaser to purchase the Mortgage Loans from the Seller, the
Seller will cooperate with the Purchaser in connection with the sale of any of
the securities representing interests in the Mortgage Loans. In that connection,
the Seller will provide to the Purchaser any and all information and appropriate
verification of information, whether through letters of its auditors and counsel
or otherwise, as the Purchaser shall reasonably request and will provide to the
Purchaser such additional representations and warranties, covenants, opinions of
counsel, letters from auditors, and certificates of public officials or officers
of the Seller as are reasonably required in connection with such transactions
and the offering of investment grade securities rated by the Rating Agencies.

         Section 7.07 INTENTION OF THE PARTIES. It is the intention of the
parties that the Purchaser is purchasing, and the Seller is selling, the
Mortgage Loans rather than pledging the Mortgage Loans to secure a loan by the
Purchaser to the Seller. Accordingly, the parties hereto each intend to treat
the transaction for federal income tax purposes and all other purposes as a sale
by the Seller, and a purchase by the Purchaser, of the Mortgage Loans. The
Purchaser will have the right to review the Mortgage Loans and the related
Mortgage Files to determine the characteristics of the Mortgage Loans which will
affect the federal income tax consequences of owning the Mortgage Loans and the
Seller will cooperate with all reasonable requests made by the Purchaser in the
course of such review.

         Section 7.08 SUCCESSORS AND ASSIGNS, ASSIGNMENT OF PURCHASE AGREEMENT.
This Agreement shall bind and inure to the benefit of and be enforceable by the
Seller, the Purchaser, the Trustee and the NIMs Insurer, if any. The NIMs
Insurer, if any, shall be a third party beneficiary hereof and may enforce the
terms hereof as if a party hereto. The obligations of the Seller under this
Agreement cannot

                                       22

<PAGE>

be assigned or delegated to a third party without the consent of the Purchaser
which consent shall be at the Purchaser's sole discretion, except that the
Purchaser acknowledges and agrees that the Seller may assign its obligations
hereunder to any Person into which the Seller is merged or any corporation
resulting from any merger, conversion or consolidation to which the Seller is a
party or any Person succeeding to the business of the Seller. The parties hereto
acknowledge that the Purchaser is acquiring the Mortgage Loans for the purpose
of contributing them to a trust that will issue a series of Certificates
representing undivided interests in such Mortgage Loans. As an inducement to the
Purchaser to purchase the Mortgage Loans, the Seller acknowledges and consents
to the assignment by the Purchaser to the Trustee of all of the Purchaser's
rights against the Seller pursuant to this Agreement insofar as such rights
relate to Mortgage Loans transferred to the Trustee and to the enforcement or
exercise of any right or remedy against the Seller pursuant to this Agreement by
the Trustee. Such enforcement of a right or remedy by the Trustee shall have the
same force and effect as if the right or remedy had been enforced or exercised
by the Purchaser directly.

         Section 7.09 SURVIVAL. The representations and warranties set forth in
Sections 3.01 and 3.02 and the provisions of Article V hereof shall survive the
purchase of the Mortgage Loans hereunder.

                                       23

<PAGE>

                  IN WITNESS WHEREOF, the Seller and the Purchaser have caused
their names to be signed to this Mortgage Loan Purchase Agreement by their
respective officers thereunto duly authorized as of the day and year fist above
written.

                             OPTION ONE MORTGAGE ACCEPTANCE
                             CORPORATION,
                             as Purchaser

                             By:   __________________________________
                                   Name:
                                   Title:

                             OPTION ONE MORTGAGE CORPORATION,
                             as Seller

                             By:   __________________________________
                                   Name:
                                   Title:

                                       24

<PAGE>

                                   SCHEDULE I

                                 MORTGAGE LOANS

                             AVAILABLE UPON REQUEST

                                       I-1

<PAGE>

                                    EXHIBIT D

                             MORTGAGE LOAN SCHEDULE
                                [FILED BY PAPER]

<PAGE>

                                    EXHIBIT E

                        REQUEST FOR RELEASE OF DOCUMENTS

To:   Wells Fargo Bank, N.A.,
      1015 10th Avenue S.E.
      Minneapolis, MN 55414
      Attn: Inventory Control

            Re:   Pooling and Servicing Agreement dated as of April 1, 2004
                  among Option One Mortgage Acceptance Corporation, as
                  Depositor, Option One Mortgage Corporation, as Master Servicer
                  and Wells Fargo Bank, N.A., as Trustee

      In connection with the administration of the Mortgage Loans held by you as
Trustee pursuant to the above-captioned Pooling and Servicing Agreement, we
request the release, and hereby acknowledge receipt of the Trustee's Mortgage
File for the Mortgage Loan described below, for the reason indicated.

Mortgage Loan Number:

Mortgagor Name. Address & Zip Code:

Reason for Requesting Documents (check one):

1.    Mortgage Paid in Full

      2.    Foreclosure

      3.    Substitution

      4.    Other Liquidation (Repurchases, etc.)

      5.    Nonliquidation Reason:

Address to which Trustee should deliver the Trustee's Mortgage File:

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

--------------------------------------------------------------------------------
<PAGE>

                                     By:
                                       ---------------------------------------
                                          (authorized signer)

                                     Issuer:
                                           -----------------------------------

                                     Address:
                                            ----------------------------------

                                     Date:
                                         -------------------------------------

Trustee

Wells Fargo Bank, N. A. on
           Please acknowledge the execution of the above request by your
           signature and date below:

           Signature                     Date

           Documents returned to Trustee:

           Trustee                       Date

<PAGE>

                                   EXHIBIT F-1

                     FORM OF TRUSTEE'S INITIAL CERTIFICATION

                                                April __, 2004

Option One Mortgage Acceptance            Option One Mortgage Corporation
Corporation                               3 Ada
3 Ada                                     Irvine, California 92618
Irvine, California 92618

            Re:   Pooling and Servicing Agreement dated as of April 1, 2004
                  among Option One Mortgage Acceptance Corporation, as
                  Depositor, Option One Mortgage Corporation, as Master Servicer
                  and Wells Fargo Bank, N.A., as Trustee

Ladies and Gentlemen:

            Attached is the Trustee's preliminary exception report delivered in
accordance with Section 2.02 of the referenced Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"). Capitalized terms used but not
otherwise defined herein shall have the meanings set forth in the Pooling and
Servicing Agreement.

            The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to (i)
the validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in the Mortgage File pertaining to the Mortgage Loans
identified on the Mortgage Loan Schedule, (ii) the collectability, insurability,
effectiveness or suitability of any such Mortgage Loan or (iii) whether any
Mortgage File included any of the documents specified in clause (vi) of Section
2.01 of the Pooling and Servicing Agreement.

                                          WELLS FARGO BANK, N.A.

                                          By:
                                             ---------------------------------
                                             Name:
                                             Title:

<PAGE>

                                   EXHIBIT F-2

                      FORM OF TRUSTEE'S FINAL CERTIFICATION

                                                    [Date]

Option One Mortgage Acceptance
Corporation
3 Ada
Irvine, California 92618

            Re:   Pooling and Servicing Agreement dated as of April 1, 2004
                  among Option One Mortgage Acceptance Corporation, as
                  Depositor, Option One Mortgage Corporation, as Master Servicer
                  and Wells Fargo Bank, N.A., as Trustee

Ladies and Gentlemen:

            In accordance with Section 2.02 of the Pooling and Servicing
Agreement, the undersigned, as Trustee, hereby certifies that as to each
Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage loan
paid in full or listed on Schedule I hereto) it (or its custodian) has received
the applicable documents listed in Section 2.01 of the Pooling and Servicing
Agreement.

            The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedule, other than any Mortgage Loan listed on
Schedule I hereto, it has reviewed the documents listed above and has determined
that each such document appears to be complete and, based on an examination of
such documents, the information set forth in the Mortgage Loan Schedule is
correct.

            The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to (i)
the validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in the Mortgage File pertaining to the Mortgage Loans
identified on the Mortgage Loan Schedule, (ii) the collectability, insurability,
effectiveness or suitability of any such Mortgage Loan or (iii) whether any
Mortgage File included any of the documents specified in clause (vi) of Section
2.01 of the Pooling and Servicing Agreement.

<PAGE>

            Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement. This
Certificate is qualified in all respects by the terms of said Pooling and
Servicing Agreement.

                                       WELLS FARGO BANK, N.A., as Trustee

                                       By:
                                          --------------------------------------
                                       Name:
                                       Title:

<PAGE>
                                   EXHIBIT F-3

                        FORM OF RECEIPT OF MORTGAGE NOTE

Option One Mortgage Acceptance
Corporation
3 Ada
Irvine, California 92618

                  Re:   Option One Mortgage Loan Trust 2004-2,
                        Asset-Backed Certificates Series 2004-2

Ladies and Gentlemen:

      Pursuant to Section 2.01 of the Pooling and Servicing Agreement, dated as
of April 1, 2004, among Option One Mortgage Acceptance Corporation as Depositor,
Option One Mortgage Corporation as Master Servicer and Wells Fargo Bank, N.A. as
Trustee (the "Trustee"), we hereby acknowledge the receipt of the original
Mortgage Notes (a copy of which is attached hereto as Exhibit 1) with any
exceptions thereto listed on Exhibit 2.

                                    WELLS FARGO BANK, N.A.
                                    as Trustee

                                    By:
                                       ---------------------------------------
                                    Name:
                                    Title:

<PAGE>
                                    EXHIBIT G

                           LOSS MITIGATION PROCEDURES

<PAGE>

                                    EXHIBIT H

                           FORM OF LOST NOTE AFFIDAVIT

      Personally appeared before me the undersigned authority to administer
oaths,______________ ___________________ who first being duly sworn deposes and
says: Deponent is ______________of _____________, successor by merger
to________________________ ("Seller") and who has personal knowledge of the
facts set out in this affidavit.

On _______________, ________________ did execute and deliver a promissory note
in the principal amount of $_________.

      That said note has been misplaced or lost through causes unknown and is
presently lost and unavailable after diligent search has been made. Seller's
records show that an amount of principal and interest on said note is still
presently outstanding, due, and unpaid, and Seller is still owner and holder in
due course of said lost note.

      Seller executes this Affidavit for the purpose of inducing Wells Fargo
Bank, N.A., as trustee on behalf of Option One Mortgage Loan Trust 2004-2,
Asset-Backed Certificates Series 2004-2, to accept the transfer of the above
described loan from Seller.

      Seller agrees to indemnify Wells Fargo Bank, N.A., Option One Mortgage
cceptance Corporation and Option One Mortgage Corporation harmless for any
losses incurred by such parties resulting from the above described promissory
note has been lost or misplaced.

By:
   ---------------------

STATE OF                )
                        )     SS:
COUNTY OF               )

      On this _____ day of _______, 20__, before me, a Notary Public, in and for
said County and State, appeared _______, who acknowledged the extension of the
foregoing and who, having been duly sworn, states that any representations
therein contained are true.

      Witness my hand and Notarial Seal this           day of 20__.
                                             ---------
My commission expires         .
                     ---------

<PAGE>

                                    EXHIBIT I

                                   [RESERVED]

<PAGE>

                                    EXHIBIT J

                    FORM OF INVESTMENT LETTER [NON-RULE 144A]

                                     [DATE]

Option One Mortgage Acceptance          Wells Fargo Bank, N.A.
Corporation                             9062 Old Annapolis Road
3 Ada                                   Columbia, Maryland 21045-1951
Irvine, California 92618

                  Re:   Option One Mortgage Loan Trust 2004-2,
                        Asset-Backed Certificates Series 2004-2

Ladies and Gentlemen:

      In connection with our acquisition of the above-captioned Certificates, we
certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is exempt
from the registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are not an employee benefit plan that is
subject to the Employee Retirement Income Security Act of 1974, as amended, or a
plan that is subject to Section 4975 of the Internal Revenue Code of 1986, as
amended, nor are we acting on behalf of any such plan, (e) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with clause
(g) below), (f) we have not offered or sold any Certificates to, or solicited
offers to buy any Certificates from, any person, or otherwise approached or
negotiated with any person with respect thereto, or taken any other action which
would result in a violation of Section 5 of the Act, and (g) we will not sell,
transfer or otherwise dispose of any Certificates unless (1) such sale, transfer
or other disposition is made pursuant to an effective registration statement
under the Act or is exempt from such registration requirements, and if
requested, we will at our expense provide an opinion of counsel satisfactory to
the addressees of this Certificate that such sale, transfer or other disposition
may be made pursuant to an exemption from the Act, (2) the purchaser or
transferee of such Certificate has executed and delivered to you a certificate
to substantially the same effect as this certificate, and (3) the purchaser or
transferee has otherwise complied with any conditions for transfer set forth in
the Pooling and Servicing Agreement.

<PAGE>

                                        Very truly yours,

                                        [NAME OF TRANSFEREE]

                                        By:
                                           -------------------------------------
                                                   Authorized Officer

<PAGE>

                       FORM OF RULE 144A INVESTMENT LETTER

                                     [DATE]

Option One Mortgage Acceptance          Wells Fargo Bank, N.A.
Corporation                             9062 Old Annapolis Road
3 Ada                                   Columbia, Maryland 21045-1951
Irvine, California 92618

                  Re:   Option One Mortgage Loan Trust 2004-2,
                        Asset-Backed Certificates Series 2004-2

Ladies and Gentlemen:

      In connection with our acquisition of the above Certificates we certify
that:

      (a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws;

      (b) we have had the opportunity to ask questions of and receive answers
from the Depositor concerning the purchase of the Certificates and all matters
relating thereto or any additional information deemed necessary to our decision
to purchase the Certificates;

      (c) we are not an employee benefit plan that is subject to the Employee
Retirement Income Security Act of 1974, as amended, or a plan that is subject to
Section 4975 of the Internal Revenue Code of 1986, as amended, nor are we acting
on behalf of any such plan;

      (d) we have not, nor has anyone acting on our behalf offered, transferred,
pledged, sold or otherwise disposed of the Certificates, any interest in the
Certificates or any other similar security to, or solicited any offer to buy or
accept a transfer, pledge or other disposition of the Certificates, any interest
in the Certificates or any other similar security from, or otherwise approached
or negotiated with respect to the Certificates, any interest in the Certificates
or any other similar security with, any person in any manner, or made any
general solicitation by means of general advertising or in any other manner, or
taken any other action, that would constitute a distribution of the Certificates
under the Securities Act or that would render the disposition of the
Certificates a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will act, nor has authorized or will
authorize any person to act, in such manner with respect to the Certificates;

      (e) we are a "qualified institutional buyer" as that term is defined in
Rule 144A under the Securities Act and have completed either of the forms of
certification to that effect attached hereto as Annex 1 or Annex 2. We are aware
that the sale to us is being made in reliance on Rule 144A. We are acquiring the
<PAGE>

Certificates for our own account or for resale pursuant to Rule 144A and
further, understand that such Certificates may be resold, pledged or transferred
only (i) to a person reasonably believed to be a qualified institutional buyer
that purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that the resale, pledge or transfer
is being made in reliance on Rule 144A, or (ii) pursuant to another exemption
from registration under the Securities Act; and

      (f) either (i) we are not an employee benefit or other plan subject to the
prohibited transaction provisions of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA), or Section 4975 of the Internal Revenue Code of
1986, as amended ("Plan"), or any other person (including an investment manager,
a named fiduciary or a trustee of any Plan) acting, directly or indirectly, on
behalf of or purchasing any Certificate with "plan assets" of any Plan within
the meaning of the Department of Labor ("DOL") regulation at 29 C.F.R.
ss.2510.3-101 or (ii) we have provided the Trustee, the Depositor and the Master
Servicer with an opinion of counsel acceptable to and in form and substance
satisfactory to such parties to the effect that the purchase of Certificates is
permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code and
will not subject the Trustee, the Depositor or the Master Servicer to any
obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in the Pooling and
Servicing Agreement.

                                    Very truly yours,

                                    [NAME OF TRANSFEREE]

                                    By:
                                       ---------------------------------------
                                                Authorized Officer

<PAGE>

                                                            ANNEX 1 TO EXHIBIT J

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

          [For Transferees Other Than Registered Investment Companies]

            The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:

            1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.

            2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $_______(1) in securities (except for
the excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule 144A
and (ii) the Buyer satisfies the criteria in the category marked below.

                   Corporation, etc. The Buyer is a corporation (other than a
            bank, savings and loan association or similar institution),
            Massachusetts or similar business trust, partnership, or charitable
            organization described in Section 501 (c) (3) of the Internal
            Revenue Code of 1986, as amended.

                   Bank. The Buyer (a) is a national bank or banking institution
            organized under the laws of any State, territory or the District of
            Columbia, the business of which is substantially confined to banking
            and is supervised by the State or territorial banking commission or
            similar official or is a foreign bank or equivalent institution, and
            (b) has an audited net worth of at least $25,000,000 as demonstrated
            in its latest annual financial statements, a copy of which is
            attached hereto.

                   Savings and Loan. The Buyer (a) is a savings and loan
            association, building and loan association, cooperative bank,
            homestead association or similar institution, which is supervised
            and examined by a State or Federal authority having supervision over
            any such institutions or is a foreign savings and loan association
            or equivalent institution and (b) has

--------
(1)   Buyer must own and/or invest on a discretionary basis at least
      $100,000,000 in securities unless Buyer is a dealer, and, in that case,
      Buyer must own and/or invest on a discretionary basis at least $10,000,000
      in securities.
<PAGE>

            an audited net worth of at least $25,000,000 as demonstrated in its
            latest annual financial statements, a copy of which is attached
            hereto.

                  Broker-dealer. The Buyer is a dealer registered pursuant to
            Section 15 of the Securities Exchange Act of 1934.

                  Insurance Company. The Buyer is an insurance company whose
            primary and predominant business activity is the writing of
            insurance or the reinsuring of risks underwritten by insurance
            companies and which is subject to supervision by the insurance
            commissioner or a similar official or agency of a State, territory
            or the District of Columbia.

                  State or Local Plan. The Buyer is a plan established and
      maintained by a State, its political subdivisions, or any agency or
      instrumentality of the State or its political subdivisions, for the
      benefit of its employees.

                  ERISA Plan. The Buyer is an employee benefit plan within the
      meaning of Title I of the Employee Retirement Income Security Act of 1974.

                  Investment Advisor. The Buyer is an investment advisor
            registered under the Investment Advisors Act of 1940.

                  Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business Administration under
Section 301(c) or (d) of the Small Business Investment Act of 1958.

                  Business Development Company. Buyer is a business development
            company as defined in Section 202(a)(22) of the Investment Advisors
            Act of 1940.

            3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit (v)
loan participations, (vi) repurchase agreements, (vii) securities owned but
subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.

            4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction.

<PAGE>

However, such securities were not included if the Buyer is a majority-owned,
consolidated subsidiary of another enterprise and the Buyer is not itself a
reporting company under the Securities Exchange Act of 1934, as amended.

            5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.

            6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.

                                      ------------------------------------------
                                                Print Name of Buyer

                                      By:
                                         ---------------------------------------
                                      Name:
                                      Title:

                                      Date:
                                           -------------------------------------

<PAGE>

                              ANNEX 2 TO EXHIBIT J

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

           [For Transferees That are Registered Investment Companies]

            The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:

            1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.

            2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyers Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.

                   The Buyer owned $ _____________ in securities (other than the
            excluded securities referred to below) as of the end of the Buyer's
            most recent fiscal year (such amount being calculated in accordance
            with Rule 144A).

                   The Buyer is part of a Family of Investment Companies which
            owned in the aggregate $_____________ in securities (other than the
            excluded securities referred to below) as of the end of the Buyer's
            most recent fiscal year (such amount being calculated in accordance
            with Rule 144A).

                        3. The term "Family of Investment Companies" as used
            herein means two or more registered investment companies (or series
            thereof) that have the same investment adviser or investment
            advisers that are affiliated (by virtue of being majority owned
            subsidiaries of the same parent or because one investment adviser is
            a majority owned subsidiary of the other).

                        4. The term "securities" as used herein does not include
            (i) securities of issuers that are affiliated with the Buyer or are
            part of the Buyer's Family of Investment

<PAGE>

            Companies, (ii) securities issued or guaranteed by the U.S. or any
            instrumentality thereof, (iii) bank deposit notes and certificates
            of deposit, (iv) loan participations, (v) repurchase agreements,
            (vi) securities owned but subject to a repurchase agreement and
            (vii) currency, interest rate and commodity swaps.

                        5. The Buyer is familiar with Rule 144A and understands
            that the parties listed in the Rule 144A Transferee Certificate to
            which this certification relates are relying and will continue to
            rely on the statements made herein because one or more sales to the
            Buyer will be in reliance on Rule 144A. In addition, the Buyer will
            only purchase for the Buyer's own account.

                        6. Until the date of purchase of the Certificates, the
            undersigned will notify the parties listed in the Rule 144A
            Transferee Certificate to which this certification relates of any
            changes in the information and conclusions herein. Until such notice
            is given, the Buyer's purchase of the Certificates will constitute a
            reaffirmation of this certification by the undersigned as of the
            date of such purchase.

                                       ---------------------------------------
                                       Print Name of Buyer or Adviser

                                       By:
                                          ------------------------------------
                                       Name:
                                       Title

                                       IF AN ADVISER:

                                       ---------------------------------------
                                               Print Name of Buyer

                                       Date:
                                            ----------------------------------

<PAGE>
                                    EXHIBIT K

                     AFFIDAVIT OF TRANSFER OF R CERTIFICATES
                           PURSUANT TO SECTION 5.02(d)

                     OPTION ONE MORTGAGE LOAN TRUST 2004-2,
                    ASSET-BACKED CERTIFICATES, SERIES 2004-2

STATE OF                )
                        ) ss..
COUNTY OF               )

            The undersigned, being first duly sworn, deposes and says as follows

            1. The undersigned is an officer of, the proposed Transferee of an
Ownership Interest in Class R Certificates (the "Certificate") issued pursuant
to the Pooling and Servicing Agreement (the "Agreement"), relating to the
above-referenced Certificates, among Option One Mortgage Acceptance Corporation,
as Depositor, Option One Mortgage Corporation, as Master Servicer (the "Master
Servicer") and Wells Fargo Bank, N.A., as Trustee (the "Trustee"). Capitalized
terms used, but not defined herein shall have the meanings ascribed to such
terms in the Agreement. The Transferee has authorized the undersigned to make
this affidavit on behalf of the Transferee.

            2. The Transferee is, as of the date hereof and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificate either (i) for its own account or (ii) as
nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit. The
Transferee has no knowledge that any such affidavit is false.

            3. The Transferee has been advised of, and understands that (i) a
tax will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) to a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
            4. The Transferee has been advised of, and understands that a tax
will be imposed on a "pass-through entity" holding the Certificate if at any
time during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common

<PAGE>

trust fund, a partnership, trust or estate, and certain cooperatives and, except
as may be provided in Treasury Regulations, persons holding interests in
pass-through entities as a nominee for another Person.)

            5. The Transferee has reviewed the provisions of Section 5.02(d) of
the Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(d) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.

            6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit L to the Agreement (a "Transferor Certificate") to the
effect that such Transferee has no actual knowledge that the Person to which the
Transfer is to be made is not a Permitted Transferee.

            7. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect to
the Certificate.

            8. The Transferee's taxpayer identification number is______________.

            9. The Transferee is a United States Person as defined in the
Agreement.

            10. The Transferee is aware that the Certificate may be a
"non-economic residual interest" within the meaning of proposed Treasury
regulations promulgated pursuant to the Code and that the transferor of a
non-economic residual interest will remain liable for any taxes due with respect
to the income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.

            11. The Transferee is not an employee benefit plan that is subject
to ERISA or a plan that is subject to Section 4975 of the Code, nor is it acting
on behalf of such a plan.

<PAGE>

            IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer and its corporate seal to be hereunto affixed, duly
attested, this _______ day of ______, ____.

                                   [NAME OF TRANSFEREE]

                                   By:
                                      ---------------------------
                                   Name:
                                   Title:

[Corporate Seal]

ATTEST:

[Assistant] Secretary

      Personally appeared before me the above-named___________________________,
known or proved to me to be the same person who executed the foregoing
instrument and to be the_________ of the Transferee, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.

      Subscribed and sworn before me this ____ day of __________, ____.

                                  NOTARY PUBLIC

            My Commission expires the_______________ day of  __________, ____.

<PAGE>

                                    EXHIBIT L

                         FORM OF TRANSFEROR CERTIFICATE

                                     [DATE]

Option One Mortgage Acceptance
Corporation
3 Ada
Irvine, California 92618

            Re:       Option One Mortgage Loan Trust 2004-2,
                      Asset-Backed Certificates Series 2004-2

Ladies and Gentlemen:

      In connection with our disposition of the above Certificates we certify
that (a) we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act, (c) to
the extent we are disposing of a Class [ ] Certificate, we have no knowledge the
Transferee is not a Permitted Transferee and (d) no purpose of the proposed
disposition of a Class [ ] Certificate is to impede the assessment or collection
of tax.

                                   Very truly yours,

                                   TRANSFEROR

                                   By:
                                   Name:
                                   Title:

<PAGE>

                                    EXHIBIT M

            FORM OF CERTIFICATION WITH RESPECT TO ERISA AND THE CODE

                                          _____________, 20__

Option One Mortgage Acceptance Corporation Wells Fargo Bank, N.A.
3 Ada                                      9062 Old Annapolis Road
Irvine, California 92618                   Columbia, Maryland 21045-1951

Option One Mortgage Corporation
3 Ada
Irvine, California 92618

            Re:   Option One Mortgage Loan Trust 2004-2,
                  Asset-Backed Certificates Series 2004-2

Dear Sirs:

            _______________________ (the "Transferee") intends to acquire from
_____________________ (the "Transferor") $____________ Initial Certificate
Principal Balance Option One Mortgage Loan Trust 2004-2, Asset-Backed
Certificates Series 2004-2, Class [C][P][R] (the "Certificates"), issued
pursuant to a Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement") dated as of April 1, 2004 among Option One Mortgage Acceptance
Corporation as depositor (the "Depositor"), Option One Mortgage Corporation as
master servicer (the "Master Servicer") and Wells Fargo Bank, N.A. as trustee
(the "Trustee"). Capitalized terms used herein and not otherwise defined shall
have the meanings assigned thereto in the Pooling and Servicing Agreement. The
Transferee hereby certifies, represents and warrants to, and covenants with the
Depositor, the Trustee and the Master Servicer the following:

            The Certificates (i) are not being acquired by, and will not be
transferred to, any employee benefit plan within the meaning of section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
other retirement arrangement, including individual retirement accounts and
annuities, Keogh plans and bank collective investment funds and insurance
company general or separate accounts in which such plans, accounts or
arrangements are invested, that is subject to Section 406 of ERISA or Section
4975 of the Internal Revenue Code of 1986 (the "Code") (any of the foregoing, a
"Plan"), (ii) are not being acquired with "plan assets" of a Plan within the
meaning of the Department of Labor ("DOL") regulation, 29 C.F.R.ss.2510.3-101,
and (iii) will not be transferred to any entity that is deemed to be investing
in plan assets within the meaning of the DOL regulation at 29 C.F.R.ss.
2510.3-101.

<PAGE>

                                       Very truly yours,

                                       _______________________________
                                       By:____________________________
                                       Name:
                                       Title:

<PAGE>

                                    EXHIBIT N

                              FORM OF CAP CONTRACT

                             Available Upon Request

<PAGE>

                                    EXHIBIT O

                     FORM OF SUBSEQUENT TRANSFER INSTRUMENT

      Pursuant to this Subsequent Transfer Instrument, dated ________, 2004 (the
"Instrument"), between Option One Mortgage Acceptance Corporation as seller (the
"Depositor"), and Wells Fargo Bank, N.A. as trustee of the Option One Mortgage
Loan Trust 2004-2 Asset-Backed Certificates, Series 2004-2, as purchaser (the
"Trustee"), and pursuant to the Pooling and Servicing Agreement, dated as of
April 1, 2004 (the "Pooling and Servicing Agreement"), among the Depositor as
depositor, Option One Mortgage Corporation as master servicer and the Trustee as
trustee, the Depositor and the Trustee agree to the sale by the Depositor and
the purchase by the Trustee in trust, on behalf of the Trust, of the Mortgage
Loans listed on the attached Schedule of Mortgage Loans (the "Subsequent
Mortgage Loans").

      Capitalized terms used but not otherwise defined herein shall have the
meanings set forth in the Pooling and Servicing Agreement.

      Section 1. Conveyance of Subsequent Mortgage Loans.

      (a) The Depositor does hereby sell, transfer, assign, set over and convey
to the Trustee in trust, on behalf of the Trust, without recourse, all of its
right, title and interest in and to the Subsequent Mortgage Loans, and including
all amounts due on the Subsequent Mortgage Loans after the related Subsequent
Cut-off Date, and all items with respect to the Subsequent Mortgage Loans to be
delivered pursuant to Section 2.01 of the Pooling and Servicing Agreement;
provided, however that the Depositor reserves and retains all right, title and
interest in and to amounts due on the Subsequent Mortgage Loans on or prior to
the related Subsequent Cut-off Date. The Depositor, contemporaneously with the
delivery of this Agreement, has delivered or caused to be delivered to the
Trustee each item set forth in Section 2.01 of the Pooling and Servicing
Agreement. The transfer to the Trustee by the Depositor of the Subsequent
Mortgage Loans identified on the Mortgage Loan Schedule shall be absolute and is
intended by the Depositor, the Master Servicer, the Trustee and the
Certificateholders to constitute and to be treated as a sale by the Depositor to
the Trust Fund.

      (b) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the Trustee
without recourse for the benefit of the Certificateholders all the right, title
and interest of the Depositor, in, to and under the Subsequent Mortgage Loan
Purchase Agreement, dated the date hereof, between the Depositor as purchaser
and the Master Servicer as seller, to the extent of the Subsequent Mortgage
Loans.

      (c) Additional terms of the sale are set forth on Attachment A hereto.

      Section 2. Representations and Warranties; Conditions Precedent.

      (a) The Depositor hereby confirms that each of the conditions precedent
and the representations and warranties set forth in Section 2.08 of the Pooling
and Servicing Agreement are satisfied as of the date hereof.

<PAGE>

      (b) All terms and conditions of the Pooling and Servicing Agreement are
hereby ratified and confirmed; provided, however, that in the event of any
conflict, the provisions of this Instrument shall control over the conflicting
provisions of the Pooling and Servicing Agreement.

      Section 3.  Recordation of Instrument.

      To the extent permitted by applicable law, this Instrument, or a
memorandum thereof if permitted under applicable law, is subject to recordation
in all appropriate public offices for real property records in all of the
counties or other comparable jurisdictions in which any or all of the properties
subject to the Mortgages are situated, and in any other appropriate public
recording office or elsewhere, such recordation to be effected by the Master
Servicer at the Certificateholders' expense on direction of the related
Certificateholders, but only when accompanied by an Opinion of Counsel to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders or is necessary for the administration or servicing of
the Mortgage Loans.

      Section 4. Governing Law.

      This Instrument shall be construed in accordance with the laws of the
State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws, without giving
effect to principles of conflicts of law.

      Section 5. Counterparts.

      This Instrument may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same instrument.

      Section 6. Successors and Assigns.

      This Instrument shall inure to the benefit of and be binding upon the
Depositor and the Trustee and their respective successors and assigns.

<PAGE>

                        OPTION ONE MORTGAGE ACCEPTANCE CORPORATION

                        By:
                           ---------------------------------------------
                        Name:
                        Title:

                        WELLS FARGO BANK,  N.A.,  as Trustee for Option One
                        Mortgage Loan Trust 2004-2, Asset-Backed Certificates,
                        Series 2004-2

                        By:________________________________________
                        Name:
                        Title:

Attachments
A. Additional terms of sale.
B. Schedule of Subsequent Mortgage Loans.

<PAGE>

                                  ATTACHMENT A

                            ADDITIONAL TERMS OF SALE

      A. General

            1.    Subsequent Cut-off Date: ______________________, 2004

            2.    Subsequent Transfer Date: _______________________, 2004

            3.    Aggregate Principal Balance of the Subsequent Mortgage Loans
                  as of the Subsequent Cut-off Date: $________

            4.    Purchase Price: 100.00%

      B. The following representations and warranties with respect to each
Subsequent Mortgage Loan determined as of the applicable Subsequent Cut-off
Date: (i) such Subsequent Mortgage Loan may not be 30 or more days delinquent as
of the last day of the month preceding the Subsequent Cut-off Date; (ii) the
original term to stated maturity of such Subsequent Mortgage Loan will not be
less than 120 months and will not exceed 360 months; (iii) the Subsequent
Mortgage Loan may not provide for negative amortization; (iv) such Subsequent
Mortgage Loan will not have a loan-to-value ratio greater than 100.00%; (v) such
Subsequent Mortgage Loans will have, as of the Subsequent Cut-off Date, a
weighted average term since origination not in excess of 6 months; (vi) such
Subsequent Mortgage Loan, if a Fixed Rate Mortgage Loan, shall have a Mortgage
Rate that is not less than [_____] % or greater than [_____] %; (vii) such
Subsequent Mortgage Loan shall have been serviced by the Master Servicer since
origination or the date of purchase; (viii) such Subsequent Mortgage Loan must
have a first payment date occurring on or before [_____], 2004 (ix) if the
Subsequent Mortgage Loan is an Adjustable Rate Mortgage Loan, the Subsequent
Mortgage Loan will have a Gross Margin not less than [_____] %; (x) if the
Subsequent Mortgage Loan is an Adjustable Rate Mortgage Loan, the Subsequent
Mortgage Loan will have a Maximum Mortgage Rate not less than [_____]%; (xi) if
the Subsequent Mortgage Loan is an Adjustable Rate Mortgage Loan, the Subsequent
Mortgage Loan will have a Minimum Mortgage Rate not less than [_____] % and
(xii) such Subsequent Mortgage Loan shall have been underwritten in accordance
with the criteria set forth under "Option One Mortgage Corporation Underwriting
Standards" in the Prospectus Supplement.

      C. Following the purchase of any Subsequent Mortgage Loan by the Trust,
the Mortgage Loans (including such Subsequent Mortgage Loans) will as of the
Subsequent Cut-off Date: (i) have a weighted average original term to stated
maturity of not more than 360 months; (ii) have a weighted average Mortgage Rate
of not less than [_____] % and not more than [_____] %; (iii) have a weighted
average Loan-to-Value Ratio of not more than [_____] %; (iv) have no Mortgage
Loan with a principal balance in excess of $[_____]; (v) will consist of
Mortgage Loans covered by the PMI Policy representing no less than [_____] % of
the aggregate Principal Balance thereof; (v) will consist of Mortgage Loans with
Prepayment Charges representing no less than approximately [_____] % of the
aggregate Principal Balance thereof and (vi) have no more than [___] % of Fixed
Rate Mortgage Loans by aggregate principal balance of the Mortgage Loans as of
the Subsequent Cut-off Date. In addition, the Adjustable Rate Mortgage Loans
will as of the Subsequent Cut-off Date have a weighted average Gross Margin not
less than

<PAGE>

[_____]% by aggregate principal balance of the Adjustable Rate Mortgage Loans as
of the Subsequent Cut-off Date.

      D. Notwithstanding the foregoing, any Subsequent Mortgage Loan may be
rejected by (i) the NIMs Insurer, if any, or (ii) either Rating Agency if the
inclusion of such Subsequent Mortgage Loan would adversely affect the ratings on
any class of Offered Certificates.

<PAGE>
                                    EXHIBIT P

                             FORM OF ADDITION NOTICE

                                     [Date]

Wells Fargo Bank, N.A.
9062 Old Annapolis Road
Columbia, Maryland 21045-1951

            Re:   Pooling and Servicing Agreement dated as of April 1, 2004
                  among Option One Mortgage Acceptance Corporation, as
                  Depositor, Option One Mortgage Corporation, as Master Servicer
                  and Wells Fargo Bank, N.A., as Trustee

Ladies and Gentlemen:

      Pursuant to Section 2.08 of the referenced Pooling and Servicing
Agreement, Option One Mortgage Acceptance Corporation has designated Subsequent
Mortgage Loans to be sold to the Trust on __________, 2004, with an aggregate
principal balance of $ . Capitalized terms not otherwise defined herein have the
meaning set forth in the Pooling and Servicing Agreement.

      Please acknowledge your receipt of this notice by countersigning the
enclosed copy in the space indicated below and returning it to the attention of
the undersigned.

<PAGE>

                                Very truly yours,

                                OPTION ONE MORTGAGE ACCEPTANCE CORPORATION

                                By:
                                   ---------------------------------------
                                Name:
                                Title:

Acknowledged and Agreed:

WELLS FARGO BANK, N.A.

By:
   ---------------
Name:
Title:

<PAGE>

                                   EXHIBIT R-1

      FORM OF CERTIFICATION TO BE PROVIDED BY THE DEPOSITOR WITH FORM 10-K

            I, _______________, the senior officer of Option One Mortgage
Acceptance Corporation, certify that:

            l. I have reviewed this annual report on Form 10-K, and all reports
on Form 8-K containing distribution and servicing reports filed in respect of
periods included in the year covered by this annual report, of Option One
Mortgage Loan Trust 2004-2, Asset-Backed Certificates, Series 2004-2;

            2. Based on my knowledge, the information in these reports, taken as
a whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by this annual report;

            3. Based on my knowledge, the distribution or servicing information
required to be provided to the trustee by the master servicer under the pooling
and servicing, or similar, agreement, for inclusion in these reports is included
in these reports;

            4. Based on my knowledge and upon the annual compliance statement
included in the report and required to be delivered to the trustee in accordance
with the terms of the pooling and servicing, or similar, agreement, and except
as disclosed in the reports, the master servicer has fulfilled its obligations
under the servicing agreement; and

            5. The reports disclose all significant deficiencies relating to the
master servicer's compliance with the minimum servicing standards based upon the
report provided by an independent public accountant, after conducting a review
in compliance with the Uniform Single Attestation Program for Mortgage Bankers
or similar procedure, as set forth in the pooling and servicing, or similar,
agreement, that is included in these reports.

            In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: Wells Fargo
Bank, N.A.

Date: ___________________

                              OPTION ONE MORTGAGE ACCEPTANCE
                              CORPORATION

                              By:____________________________________
                              Name:
                              Title:

<PAGE>

                                   EXHIBIT R-2

        FORM OF CERTIFICATION TO BE PROVIDED TO DEPOSITOR BY THE TRUSTEE

            I, [identify the certifying individual], a [title] of Wells Fargo
Bank, N.A., as Trustee, hereby certify to Option One Mortgage Acceptance
Corporation (the "Depositor"), and its officers, directors and affiliates, and
with the knowledge and intent that they will rely upon this certification, that:

            1. I have reviewed the annual report on Form 10-K for the fiscal
year [___], and all reports on Form 8-K containing distribution reports filed in
respect of periods included in the year covered by that annual report, of the
Depositor relating to the above-referenced trust;

            2. Based on my knowledge, the information in these distribution
reports prepared by the Trustee, taken as a whole, does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading as of the last day of the period covered by that
annual report; and

            3. Based on my knowledge, the distribution information required to
be provided by the Trustee under the Pooling and Servicing Agreement is included
in these distribution reports.

            Capitalized terms used but not defined herein have the meanings
ascribed to them in the Pooling and Servicing Agreement, dated April 1, 2004
(the "Pooling and Servicing Agreement"), among the Registrant as depositor,
Option One Mortgage Corporation as master servicer and Wells Fargo Bank, N.A. as
trustee.

                              WELLS FARGO BANK, N.A., as Trustee

                              By:__________________________________
                              Name:
                              Title:
                              Date:

<PAGE>

                                    EXHIBIT S

                              OFFICER'S CERTIFICATE
                    REGARDING ANNUAL STATEMENT OF COMPLIANCE

___________________ Trust, Series 200_-___
_______________ Pass-Through Certificates

            I, _____________________, hereby certify that I am a duly appointed
__________________________ of _______________________________ (the "[Master
Servicer]"), and further certify as follows:

            1. This certification is being made pursuant to the terms of the
Pooling and Servicing Agreement, dated as of ____________, _____ (the
"Agreement"), among ______________________, as depositor, the [Master Servicer],
as [master servicer] and ________________, as trustee.

            2. I have reviewed the activities of the [Master Servicer] during
the preceding year and the [Master Servicer's] performance under the Agreement
and to the best of my knowledge, based on such review, the [Master Servicer] has
fulfilled all of its obligations under the Agreement throughout the year.

            Capitalized terms not otherwise defined herein have the meanings set
forth in the Agreements.

Dated: _________________

<PAGE>

            IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of _____________.

                        By: _____________________________
                        Name:
                        Title:

            I, _________________________, a (an) __________________ of the
[Master Servicer], hereby certify that _________________ is a duly elected,
qualified, and acting _______________________ of the [Master Servicer] and that
the signature appearing above is his/her genuine signature.

            IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of ______________.

                       By: ______________________________
                       Name:
                       Title:

<PAGE>

                                   SCHEDULE I

                           PREPAYMENT CHARGE SCHEDULE

                            (Available Upon Request)

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