Document:

MERRILL LYNCH MORTGAGE INVESTORS, INC.
                                   Depositor,

                          CENDANT MORTGAGE CORPORATION
                                    Servicer,

                                       and

                             WELLS FARGO BANK, N.A.
                                     Trustee

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

                         POOLING AND SERVICING AGREEMENT

                          Dated as of November 1, 2004

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

            MERRILL LYNCH MORTGAGE INVESTORS TRUST SERIES MLCC 2004-1
                       MORTGAGE PASS-THROUGH CERTIFICATES

<PAGE>

                                TABLE OF CONTENTS

                                                                            PAGE

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

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

    Section 1.02.    Calculations Respecting Mortgage Loans...................30

ARTICLE II. DECLARATION OF TRUST;  ISSUANCE OF CERTIFICATES...................30

     Section 2.01.   Creation and Declaration of Trust Fund; Conveyance
                     of Mortgage Loans........................................30

     Section 2.02.   Acceptance of Trust Fund by Trustee; Review of
                     Documentation for Trust Fund.............................32

     Section 2.03.   Representations and Warranties of the Depositor
                     and the Servicer.........................................34

     Section 2.04.   Discovery of Breach; Repurchase or Substitution
                     of Mortgage Loans........................................39

     Section 2.05.   Grant Clause.............................................41

ARTICLE III. THE CERTIFICATES.................................................42

    Section 3.01.    The Certificates.........................................42

    Section 3.02.    Registration.............................................43

    Section 3.03.    Transfer and Exchange of Certificates....................43

    Section 3.04.    Cancellation of Certificates.............................47

    Section 3.05.    Replacement of Certificates..............................47

    Section 3.06.    Persons Deemed Owners....................................48

    Section 3.07.    Temporary Certificates...................................48

    Section 3.08.    Appointment of Paying Agent..............................48

    Section 3.09.    Book-Entry Certificates..................................49

ARTICLE IV. ADMINISTRATION OF THE TRUST FUND..................................50

    Section 4.01.    Custodial Accounts; Distribution Account.................50

    Section 4.02.    Reports to Trustee and Certificateholders................51

ARTICLE V. DISTRIBUTIONS TO HOLDERS OF CERTIFICATES...........................54

    Section 5.01.    Distributions Generally..................................54

    Section 5.02.    Distributions from the Distribution Account..............54

    Section 5.03.    Allocation of Losses.....................................56

    Section 5.04.    Advances.................................................57

    Section 5.05.    Distributions On The REMIC 1 Regular Interests...........57

ARTICLE VI. CONCERNING THE TRUSTEE; EVENTS OF DEFAULT.........................58

    Section 6.01.    Duties of Trustee........................................58

                                      -i-

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                                TABLE OF CONTENTS
                                   (continued)
                                                                            PAGE

    Section 6.02.    Certain Matters Affecting the Trustee....................60

    Section 6.03.    Trustee Not Liable for Certificates......................62

    Section 6.04.    Trustee May Own Certificates.............................62

    Section 6.05.    Eligibility Requirements for Trustee.....................62

    Section 6.06.    Resignation and Removal of Trustee.......................62

    Section 6.07.    Successor Trustee........................................63

    Section 6.08.    Merger or Consolidation of Trustee.......................64

    Section 6.09.    Appointment of Co-Trustee, Separate Trustee
                     or Custodian.............................................64

    Section 6.10.    Authenticating Agents....................................65

    Section 6.11.    Indemnification of Trustee...............................66

    Section 6.12.    Fees and Expenses of the Trustee.........................67

    Section 6.13.    Collection of Monies.....................................67

    Section 6.14.    Events of Default; Trustee To Act; Appointment of
                     Successor................................................67

    Section 6.15.    Additional Remedies of Trustee Upon Event of Default.....69

    Section 6.16.    Waiver of Defaults.......................................70

    Section 6.17.    Notification to Holders..................................70

    Section 6.18.    Directions by Certificateholders and Duties of
                     Trustee During Event of Default..........................70

    Section 6.19.    Preparation of Tax Returns and Other Reports.............70

    Section 6.20.    Annual Certificate by Trustee............................71

ARTICLE VII. PURCHASE OF MORTGAGE LOANS AND TERMINATION OF THE TRUST FUND.....72

    Section 7.01.    Purchase of Mortgage Loans; Termination of Trust Fund
                     Upon Purchase or Liquidation of All Mortgage Loans.......72

    Section 7.02.    Procedure Upon Termination of Trust Fund.................72

    Section 7.03.    Additional Trust Fund Termination Requirements...........73

ARTICLE VIII. RIGHTS OF CERTIFICATEHOLDERS....................................74

    Section 8.01.    Limitation on Rights of Holders..........................74

    Section 8.02.    Access to List of Holders................................75

    Section 8.03.    Acts of Holders of Certificates..........................75

ARTICLE IX. ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS................76

    Section 9.01.    Servicer to Act as Servicer..............................76

    Section 9.02.    Title, Management and Disposition of REO Property........77

                                      -ii-

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)
                                                                            PAGE

    Section 9.03.    Trustee and Depositor's Right to Examine
                     Servicer Records.........................................79

    Section 9.04.    Legal Proceedings Involving the Servicer and/or the
                     Mortgage Loans...........................................79

    Section 9.05.    Material Changes.........................................79

    Section 9.06.    Servicer Shall Provide Information as Reasonably
                     Required.................................................80

    Section 9.07.    Servicer Not to Resign...................................80

    Section 9.08.    Custodial Accounts and Escrow Accounts...................81

    Section 9.09.    Assumption Processing....................................81

    Section 9.10.    Books and Records........................................81

    Section 9.11.    Annual Statement as to Compliance........................81

    Section 9.12.    Annual Independent Certified Public Accountants'
                     Servicing Reports........................................81

    Section 9.13.    Officer's Certificate....................................82

    Section 9.14.    Servicing Compensation...................................82

    Section 9.15.    Indemnification..........................................83

    Section 9.16.    Non Solicitation.........................................83

    Section 9.17.    Successor to the Servicer................................83

    Section 9.18.    Statements to the Trustee................................84

    Section 9.19.    Merger or Consolidation of the Servicer..................84

    Section 9.20.    Limitation on Liability of the Servicer..................84

ARTICLE X. REMIC ADMINISTRATION...............................................85

    Section 10.01.   REMIC Administration.....................................85

    Section 10.02.   Prohibited Transactions and Activities...................87

    Section 10.03.   Indemnification with Respect to Prohibited
                     Transactions or Loss of REMIC Status.....................87

    Section 10.04.   REO Property.............................................87

ARTICLE XI. MISCELLANEOUS PROVISIONS..........................................88

    Section 11.01.   Binding Nature of Agreement; Assignment..................88

    Section 11.02.   Entire Agreement.........................................88

    Section 11.03.   Amendment................................................88

    Section 11.04.   Voting Rights............................................90

    Section 11.05.   Provision of Information.................................90

    Section 11.06.   Governing Law............................................90

                                     -iii-

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                                TABLE OF CONTENTS
                                   (continued)
                                                                            PAGE

    Section 11.07.   Notices..................................................90

    Section 11.08.   Severability of Provisions...............................91

    Section 11.09.   Indulgences; No Waivers..................................91

    Section 11.10.   Headings Not To Affect Interpretation....................91

    Section 11.11.   Benefits of Agreement....................................91

    Section 11.12.   Special Notices to the Rating Agencies...................91

    Section 11.13.   [RESERVED]...............................................92

    Section 11.14.   Counterparts.............................................92

    Section 11.15    No Petitions ............................................92

                                      -iv-

<PAGE>

         This POOLING AND SERVICING AGREEMENT, dated as of November 1, 2004 (the
"Agreement"), by and among MERRILL LYNCH MORTGAGE INVESTORS, INC., a Delaware
corporation, as depositor (the "Depositor"), CENDANT MORTGAGE CORPORATION, a New
Jersey corporation, as servicer (the "Servicer") and WELLS FARGO BANK, N.A., as
Trustee (the "Trustee"), and acknowledged by MERRILL LYNCH MORTGAGE LENDING,
INC. a Delaware corporation, as seller (the "Seller"), for purposes of Section
2.04.

                              PRELIMINARY STATEMENT

         The Depositor intends to sell mortgage pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Mortgage Loans (as defined herein). As provided herein, the Trustee will
make, in accordance with Section 9.12, an election to treat the entire
segregated pool of assets described in the definition of REMIC 1 (as defined
herein), and subject to this Agreement, as a real estate mortgage investment
conduit (a "REMIC") for federal income tax purposes and such segregated pool of
assets will be designated as "REMIC 1." The REMIC 1 Regular Interests will be
the "regular interests" in REMIC 1 and the Class R-1 Certificates will be the
sole class of "residual interests" in REMIC 1 for purposes of the REMIC
Provisions (as defined herein) under the federal income tax law. A segregated
pool of assets consisting of the REMIC 1 Regular Interests will be designated as
"REMIC 2" and the REMIC Administrator will make a separate REMIC election with
respect thereto. The Class 1-A, Class 2-A-1, Class 2-A-2, Class 2-A-3, Class
M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3 Certificates will
be "regular interests" in REMIC 2, and the Class R-2 Certificates will be the
sole class of "residual interests" therein for purposes of the REMIC Provisions
(as defined herein) under federal income tax law.

         The following table irrevocably sets forth the designation, the 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 the REMIC 1 Regular Interest. The REMIC 1
Regular Interests will not be certificated.

 REMIC I
 Regular                                   Initial
 Interest              REMIC I          Uncertificated         Latest Possible
Designation      Pass-Through Rate     Principal Balance       Maturity Date(1)
--------------------------------------------------------------------------------
   1-A               Variable (2)       $        229.32        November 25, 2034
   1-B               Variable (2)       $      7,643.52        November 25, 2034
   2-A               Variable (2)       $      1,606.83        November 25, 2034
   2-B               Variable (2)       $     53,559.03        November 25, 2034
   ZZZ               Variable (2)       $                      November 25, 2034
                                         611,962,493.97
-----------------

(1)      Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
         regulations, the Distribution Date immediately following the latest
         possible maturity date for the Mortgage Loans has been designated as
         the "latest possible maturity date" for each REMIC 1 Regular Interest.

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

                                       1

<PAGE>

THE CERTIFICATES

         The following table sets forth (or describes) the Class designation,
Certificate Interest Rate, initial Class Principal Amount and minimum
denomination for each Class of Certificates comprising interests in the Trust
Fund created hereunder.

                    Certificate       Initial Class                Minimum
    Class             Interest          Principal              Denominations or
 Designation           Rate              Amount              Percentage Interest
-------------       -----------       --------------         -------------------
Class 1-A              (1)              $74,142,000              $ 50,000.00
Class 2-A-1            (2)             $262,022,000              $ 50,000.00
Class 2-A-2            (2)             $250,000,000              $ 50,000.00
Class 2-A-3            (2)               $7,500,000              $ 50,000.00
Class R-1              N/A                  N/A                      100%
Class R-2              N/A                  N/A                      100%
Class M-1              (3)               $6,733,000              $ 50,000.00
Class M-2              (3)               $4,590,000              $ 50,000.00
Class M-3              (3)               $2,754,000           $    50,000.00
Class B-1              (3)                 $918,000             $ 250,000.00
Class B-2              (3)               $1,224,000             $ 250,000.00
Class B-3              (3)            $2,142,532.68             $ 250,000.00

(1)      The Certificate Interest Rate with respect to any Distribution Date
         (and the related Accrual Period) for the Class 1-A Certificates will
         accrue based upon the weighted average of the net mortgage rates on the
         Pool 1 Mortgage Loans as described in this prospectus supplement.

(2)      The Certificate Interest Rate with respect to any Distribution Date
         (and the related Accrual Period) for the Class 2-A-1, Class 2-A-2 and
         Class 2-A-3 Certificates will accrue based upon the weighted average of
         the net mortgage rates on the Pool 2 Mortgage Loans as described in
         this prospectus supplement.

(3)      The Certificate Interest Rates with respect to any Distribution Date
         (and the related Accrual Period) for the Class M-1, Class M-2, Class
         M-3, Class B-1, Class B-2 and Class B-3 Certificates will be equal to
         the Subordinate Net WAC.

         As of the Cut-off Date, the Mortgage Loans had an aggregate Scheduled
Principal Balance of $612,025,532.68.

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

                                       2
<PAGE>

                                   ARTICLE I.

                                   DEFINITIONS

         Section 1.01. DEFINITIONS.

         The following words and phrases, unless the context otherwise requires,
shall have the following meanings:

         ACCEPTED SERVICING PRACTICES: The Servicer's normal servicing
practices, which will conform to the mortgage servicing practices of prudent
mortgage lending institutions which service for their own account mortgage loans
of the same type as the Mortgage Loans in the jurisdictions in which the related
Mortgaged Properties are located.

         ACCOUNTANT: A Person engaged in the practice of accounting who (except
when this Agreement provides that an Accountant must be Independent) may be
employed by or affiliated with the Depositor or an Affiliate of the Depositor.

         ACCRUAL PERIOD: With respect to each Distribution Date, for each Class
of Certificates, the calendar month preceding the month in which such
Distribution Date occurs. Interest shall accrue on all Classes of Certificates
on the basis of a 360-day year consisting of twelve 30-day months.

         ACT:  The Securities Act of 1933, as amended.

         ADDITIONAL COLLATERAL: With respect to any Additional Collateral
Mortgage Loan, the meaning assigned thereto in the Mortgage Loan Purchase
Agreement.

         ADDITIONAL COLLATERAL MORTGAGE LOAN: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule.

         ADJUSTMENT DATE: As to any Mortgage Loan, the date on which the related
Mortgage Rate adjusts in accordance with the terms of the related Mortgage Note.

         ADVERSE REMIC EVENT: As defined in Section 10.01(f) hereof.

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

         AGGREGATE SENIOR PERCENTAGE: As to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate of
the Class Principal Amounts of the Class 1-A, Class 2-A-1, Class 2-A-2 and Class
2-A-3 Certificates and the denominator of which is the Aggregate Stated
Principal Balance, but in no event greater than 100%.

         AGGREGATE STATED PRINCIPAL BALANCE: As to any Distribution Date, the
aggregate of the Stated Principal Balances for all Mortgage Loans (and when such
term is used with respect to a particular Mortgage Pool, the aggregate of the
Stated Principal Balances of the Mortgage Loans

                                       3
<PAGE>

in such Mortgage Pool) which were outstanding on the Due Date in the month
preceding the month of such Distribution Date.

         AGGREGATE SUBORDINATE PERCENTAGE: As to any Distribution Date, the
difference between 100% and the Aggregate Senior Percentage for such
Distribution Date, but in no event less than zero.

         AGGREGATE VOTING INTERESTS: The aggregate of the Voting Interests of
all the Certificates under this Agreement.

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

         ALLOCABLE SHARE: With respect to each Class of Subordinate Certificates
and any Distribution Date, the percentage equivalent of a fraction, the
numerator of which is the Class Principal Amount of such Class and the
denominator of which is the aggregate of the Class Principal Amounts of each
Class of Subordinate Certificates.

         ANCILLARY FEES: With respect to any Mortgage Loan, (i) all late
charges, (ii) all fees payable pursuant to Cendant's "Speed Pay" program, (iii)
all returned-item charges (e.g. insufficient funds charges) and (iv)
modification or conversion fees.

         APPLICABLE CREDIT SUPPORT PERCENTAGE: As to any Class of Subordinate
Certificates and any Distribution Date, the sum of the Class Subordination
Percentages of such Class and the aggregate Class Subordination Percentage of
all other Classes of Subordinate Certificates having higher numerical Class
designations than such Class.

         APPORTIONED PRINCIPAL BALANCE: As to any Distribution Date and each
Class of Subordinate Certificates and any Mortgage Pool, the Class Principal
Amount thereof multiplied by a fraction, the numerator of which is the
applicable Pool Subordinate Amount (i.e., the Pool 1 Subordinate Amount or the
Pool 2 Subordinate Amount, as the case may require), and the denominator of
which is the sum of such Pool Subordinate Amounts on such date.

         APPRAISED VALUE: With respect to any Mortgage Loan, the Appraised Value
of the related Mortgaged Property shall be: (i) with respect to a Mortgage Loan
other than a Refinancing Mortgage Loan, the lesser of (a) the value of the
Mortgaged Property based upon the appraisal made at the time of the origination
of such Mortgage Loan and (b) the sales price of the Mortgaged Property at the
time of the origination of such Mortgage Loan; and (ii) with respect to a
Refinancing Mortgage Loan, the value of the Mortgaged Property based upon the
appraisal made at the time of the origination of such Refinancing Mortgage Loan.

         ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
the sale of the Mortgage to the Trustee, which assignment, notice of transfer or
equivalent instrument may be in the form of one or more blanket assignments
covering the Mortgage Loans secured by Mortgaged Properties located in the same
jurisdiction, if permitted by law; provided, however, that the Trustee shall not
be responsible for determining whether any such assignment is in recordable
form.

                                       4
<PAGE>

         AUTHENTICATING AGENT: The Trustee or any authenticating agent appointed
by the Trustee pursuant to Section 6.10 until any successor authenticating agent
for the Certificates is named, and thereafter "Authenticating Agent" shall mean
any such successor.

         AUTHORIZED OFFICER: Any Person who may execute an Officer's Certificate
on behalf of the Depositor.

         AVAILABLE DISTRIBUTION AMOUNT: With respect to any Distribution Date
and each Mortgage Pool, the total amount of all cash received by the Trustee on
the Mortgage Loans in such Mortgage Pool from the Servicer or otherwise through
the Distribution Account Deposit Date for deposit into the Distribution Account
in respect of such Distribution Date, including (1) all scheduled installments
of interest (net of the Servicing Fee) and principal collected on the related
Mortgage Loans and due during the Due Period related to such Distribution Date,
together with any Monthly Advances in respect thereof, (2) all Insurance
Proceeds, Liquidation Proceeds, Subsequent Recoveries and the proceeds of any
Additional Collateral from the related Mortgage Loans, in each case for such
Distribution Date, (3) all partial or full Principal Prepayments, together with
any accrued interest thereon, identified as having been received from the
related Mortgage Loans during the related Prepayment Period, (4) any amounts
received from the Servicer in respect of Prepayment Interest Shortfalls with
respect to the related Mortgage Loans; and (5) the aggregate Purchase Price of
all Defective Mortgage Loans in such Mortgage Pool purchased from the Trust Fund
during the related Prepayment Period, minus:

         (A) all related fees, charges and amounts payable or reimbursable to
the Trustee under this Agreement, to the extent that, if paid by the Trust Fund,
such fees, charges or other amounts would constitute "unanticipated expenses"
(within the meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii)) of any
of the REMICs provided for herein and up to an aggregate maximum amount equal to
$300,000 annually; provided, such annual aggregate maximum amount shall exclude
(i) any Servicing Transfer Costs, or amounts reimbursable to the Servicer under
this Agreement and (ii) any costs, damages or expenses incurred by the Trustee
in connection with any "high cost" home loans or any predatory or abusive
lending laws, which amounts shall in no case be subject to any such limitation;

         (B) in the case of (2), (3), (4) and (5) above, any related
unreimbursed expenses incurred by the Servicer in connection with a liquidation
or foreclosure and any unreimbursed Monthly Advances Advances due to the
Servicer (or, pursuant to Section 5.04, the Trustee);

         (C) any related unreimbursed nonrecoverable Monthly Advances due to the
Servicer (or, pursuant to Section 5.04, the Trustee); and

         (D) in the case of (1) through (4) above, any related amounts collected
which are determined to be attributable to a subsequent Due Period or Prepayment
Period.

         BANKRUPTCY: As to any Person, the making of an assignment for the
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry of an order for relief in a
bankruptcy or insolvency proceeding, the seeking of reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief, or
seeking, consenting to or acquiescing in the appointment of a trustee, receiver
or liquidator, dissolution, or termination, as the case may be, of such Person
pursuant to the provisions of either the Bankruptcy Code or any other similar
state laws.

         BANKRUPTCY CODE: The United States Bankruptcy Code of 1986, as amended.

                                       5
<PAGE>

         BBA:  The British Banker's Association.

         BOOK-ENTRY CERTIFICATES: Beneficial interests in Certificates
designated as "Book-Entry Certificates" in this Agreement, ownership and
transfers of which shall be evidenced or made through book entries by a Clearing
Agency as described in Section 3.09; provided, that after the occurrence of a
Book-Entry Termination whereupon book-entry registration and transfer are no
longer permitted and Definitive Certificates are to be issued to Certificate
Owners, such Book-Entry Certificates shall no longer be "Book-Entry
Certificates." As of the Closing Date, the following Classes of Certificates
constitute Book-Entry Certificates: Class 1-A, Class 2-A-1, Class 2-A-2, Class
2-A-3, Class M-1, Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3
Certificates.

         BOOK-ENTRY TERMINATION: The occurrence of any of the following events:
(i) the Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Book Entry Certificates, and the Depositor
is unable to locate a qualified successor; or (ii) the Depositor at its option
advises the Trustee and the Certificate Registrar in writing that it elects to
terminate the book-entry system through the Clearing Agency.

         BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in New York, New York or, if other than New
York, any city in which the Corporate Trust Office of the Trustee is located, or
the States of Maryland or Minnesota, are authorized or obligated by law or
executive order to be closed.

         CENDANT: Cendant Mortgage Corporation or its successors in interest.

         CERTIFICATE: Any one of the certificates signed by the Trustee and
authenticated by the Authenticating Agent in substantially the forms attached
hereto as Exhibit A.

         CERTIFICATE GROUP: Each of the Group 1 Certificates and the Group 2
Certificates.

         CERTIFICATE INTEREST RATE: With respect to each Class of Certificates
and any Distribution Date, the applicable per annum rate described in the
Preliminary Statement hereto.

         CERTIFICATE OWNER: With respect to a Book-Entry Certificate, the Person
who is the owner of such Book-Entry Certificate, as reflected on the books of
the Clearing Agency, or on the books of a Person maintaining an account with
such Clearing Agency (directly or as an indirect participant, in accordance with
the rules of such Clearing Agency).

         CERTIFICATE PRINCIPAL AMOUNT: With respect to any Certificate, at the
time of determination, the maximum specified dollar amount of principal to which
the Holder thereof is then entitled hereunder, such amount being equal to the
initial principal amount set forth on the face of such Certificate, less (i) the
amount of all principal distributions previously made with respect to such
Certificate; (ii) all Realized Losses allocated to such Certificate; and (iii)
in the case of a Subordinate Certificate, any Subordinate Certificate Writedown
Amount allocated to such Certificates. Notwithstanding the foregoing, on any
Distribution Date relating to a Due Period in which a Subsequent Recovery has
been received by the Servicer, the Certificate Principal Amount of any Class of
Certificates then outstanding for which any Realized Loss or any Subordinate
Certificate Writedown Amount has been applied will be increased, in order of
seniority, by an amount equal to the lesser of (i) the amount such Class of
Certificates has been written down in respect of Realized Losses or Subordinate
Certificate Writedown Amounts, to the extent not previously offset by increases
in Certificate Principal Amount pursuant to this sentence

                                       6
<PAGE>

and (ii) the total of any Subsequent Recovery distributed on such date to the
Certificateholders (reduced (x) by the amount of the increase in the Certificate
Principal Amount of any more senior Class of Certificates pursuant to this
sentence on such Distribution Date and (y) to reflect a proportionate amount of
the increase in the Certificate Principal Amount of any pari passu Class of
Certificates on such Distribution Date pursuant to this sentence). For purposes
of Article V hereof, unless specifically provided to the contrary, Certificate
Principal Amounts shall be determined as of the close of business of the
immediately preceding Distribution Date, after giving effect to all
distributions made on such date.

         CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register maintained
and the registrar appointed pursuant to Section 3.02.

         CERTIFICATEHOLDER: The meaning provided in the definition of "Holder."

         CIVIL RELIEF ACT: The Servicemembers Civil Relief Act as amended.

         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 1-A CERTIFICATES: Any of the Class 1-A Certificates.

         CLASS 2-A CERTIFICATES: Any of the Class 2-A-1, Class 2-A-2 or Class
2-A-3 Certificates.

         CLASS R CERTIFICATES: The Class R-1 Certificate and Class R-2
Certificates executed by the Trustee, and authenticated and delivered by the
Authenticating Agent, substantially in the form annexed hereto as Exhibit A.

         CLASS PRINCIPAL AMOUNT: With respect to each Class of Certificates, the
aggregate of the Certificate Principal Amounts of all Certificates of such Class
at the date of determination.

         CLASS SUBORDINATION PERCENTAGE: With respect to each Class of
Subordinate Certificates, for each Distribution Date, the percentage obtained by
dividing the Class Principal Amount of such Class immediately prior to such
Distribution Date by the sum of the Class Principal Amounts of all Classes of
Certificates immediately prior to such Distribution Date.

         CLEARING AGENCY: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended. As
of the Closing Date, the Clearing Agency shall be The Depository Trust Company.

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

         CLOSING DATE:  November 30, 2004.

         CODE: The Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.

                                       7
<PAGE>

         COMPENSATING INTEREST PAYMENT: As to any Distribution Date, the lesser
of (1) the Servicing Fee for such date and (2) any Prepayment Interest Shortfall
for such date.

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

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

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

         COOPERATIVE SHARES: Shares issued by a Cooperative Corporation.

         CORPORATE TRUST OFFICE: With respect to the presentment of Certificates
for registration of transfer, exchange or final payment, Wells Fargo Bank, N.A.,
Sixth Street and Marquette Avenue, Minneapolis, Minnesota 55479, Attention:
Corporate Trust Services - MLMI Series MLCC 2004-1 and for all other purposes,
Wells Fargo Bank, N.A., 9062 Old Annapolis Road, Columbia, Maryland 21045,
Attention: Corporate Trust Services - MLMI Series MLCC 2004-1, or such other
address as the Trustee may designate from time to time by notice to the
Certificateholders.

         CREDIT SUPPORT DEPLETION DATE: The first Distribution Date, if any, on
which the aggregate Certificate Principal Amounts of the Subordinate
Certificates have been reduced to zero.

         CURRENT INTEREST: With respect to each Class of Certificates on each
Distribution Date, the aggregate amount of interest accrued at the applicable
Certificate Interest Rate during the related Accrual Period on the Class
Principal Amount of such Class.

         CUSTODIAL ACCOUNT: The separate trust account or accounts created and
maintained by the Servicer pursuant to the Fannie Mae Servicing Guide which
shall be entitled "Wells Fargo Bank, N.A., in trust for the registered holders
for Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1 Mortgage
Pass-Through Certificates." The Custodial Account shall be an Eligible Account.

         CUSTODIAL AGREEMENT: The Custodial Agreement, dated as of November 30,
2004, between Merrill Lynch Mortgage Lending, Inc. and Wells Fargo Bank, N.A.,
as custodian, a copy of which (excluding all exhibits thereto) is attached
hereto as Exhibit O.

         CUSTODIAN: Wells Fargo Bank, N.A., any successor in interest or any
successor custodian appointed pursuant to the Custodial Agreement.

         CUT-OFF DATE:  November 1, 2004.

         CUT-OFF DATE BALANCE: With respect to the Mortgage Loans in the Trust
Fund on the Closing Date, the Aggregate Stated Principal Balance as of the
Cut-off Date.

                                       8
<PAGE>

         DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan which became final and
non-appealable, except such a reduction resulting from a Deficient Valuation or
any reduction that results in a permanent forgiveness of principal.

         DEFECTIVE MORTGAGE LOAN: The meaning specified in Section 2.04(a).

         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 indebtedness under the Mortgage Loan, or any
reduction in the amount of principal to be paid in connection with any Scheduled
Payment that results in a permanent forgiveness of principal, which valuation or
reduction results from an order of such court which is final and non-appealable
in a proceeding under the Bankruptcy Code.

         DEFINITIVE CERTIFICATE: A Certificate of any Class issued in
definitive, fully registered, certificated form.

         DELETED MORTGAGE LOAN:  As defined in Section 2.04(a).

         DELINQUENT: Any Mortgage Loan with respect to which the Scheduled
Payment due on a Due Date is not received.

         DEPOSITOR: Merrill Lynch Mortgage Investors, Inc., a Delaware
corporation, having its principal place of business at 250 Vesey Street, 4 World
Financial Center, 10th Floor, New York, New York 10080, or its successors in
interest.

         DETERMINATION DATE: With respect to each Distribution Date, the 15th
day of the month in which such Distribution Date occurs, or, if such 15th day is
not a Business Day, the next succeeding Business Day.

         DISQUALIFIED ORGANIZATION: A "disqualified organization" as defined in
Section 860E(e)(5) of the Code.

         DISTRIBUTION ACCOUNT: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 4.01 in the name of the Trustee
for the benefit of the Certificateholders and designated "Wells Fargo Bank,
N.A., in trust for registered holders of Merrill Lynch Mortgage Investors Trust
Series MLCC 2004-1, Mortgage Pass-Through Certificates." Funds in the
Distribution Account (exclusive of any earnings on investments made with funds
deposited in the Distribution Account) shall be held in trust for the Trustee
and the Certificateholders for the uses and purposes set forth in this
Agreement.

         DISTRIBUTION ACCOUNT DEPOSIT DATE: The 18th day of each calendar month
after the initial issuance of the Certificates or, if such 18th day is not a
Business Day, the immediately preceding Business Day, commencing in December
2004.

         DISTRIBUTION DATE: The 25th day of each month or, if such 25th day is
not a Business Day, the next succeeding Business Day, commencing in December
2004.

         DUE DATE: With respect to any Mortgage Loan, the date on which a
Scheduled Payment is due under the related Mortgage Note as indicated in the
Mortgage Note, which is the first day of the calendar month.

                                       9
<PAGE>

         DUE PERIOD: As to any Distribution Date, the period beginning on the
second day of the month preceding the month of such Distribution Date, and
ending on the first day of the month of such Distribution Date.

         EDP: The electronic data processing system used by the Seller and the
Servicer, which are licensees of ALLTEL Information Services, Inc.

         EFFECTIVE LOAN-TO-VALUE RATIO: A fraction, expressed as a percentage,
the numerator of which is the original Stated Principal Balance of the Mortgage
Loan, less the amount of Additional Collateral required to secure such Mortgage
Loan at the time of origination, if any, and the denominator of which is the
Appraised Value of the related Mortgage Property at such date, or in the case of
a Mortgage Loan financing the acquisition of the Mortgaged Property, the sales
price of the Mortgaged Property if such sales price is less than such Appraised
Value.

         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 debt obligations of such holding company) have the highest
short-term ratings of each Rating Agency at the time any amounts are held on
deposit therein, or (ii) an account or accounts in a depository institution or
trust company in which such accounts are insured by the FDIC or the SAIF (to the
limits established by the FDIC or the SAIF) and the uninsured deposits in which
accounts are otherwise secured such that, as evidenced by an Opinion of Counsel
delivered to the Trustee and to each Rating Agency, the Certificateholders have
a claim with respect to the funds in such account or a perfected first priority
security interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in which
such account is maintained, or (iii) a trust account or accounts maintained with
the trust department of a federal or state chartered depository institution or
trust company, acting in its fiduciary capacity or (iv) any other account
acceptable to each Rating Agency. Eligible Accounts may bear interest, and may
include, if otherwise qualified under this definition, accounts maintained with
the Trustee, any Paying Agent, or the Servicer.

         ERISA: The Employee Retirement Income Security Act of 1974, as amended,
and as it may be further amended from time to time, any successor statutes
thereto, and applicable U.S. Department of Labor regulations issued pursuant
thereto in temporary or final form.

         ERISA-QUALIFYING UNDERWRITING: A best efforts or firm commitment
underwriting or private placement that meets the requirements of an
Underwriter's Exemption.

         ERISA-RESTRICTED CERTIFICATES: The Class B-1, Class B-2, Class B-3,
Class R-1 or Class R-2 Certificates.

         ESCROW ACCOUNT: The separate trust account or accounts created and
maintained by the Servicer pursuant to the Fannie Mae Servicing Guide which
shall be entitled "Wells Fargo Bank, N.A., in trust for the registered holders
for Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1 Mortgage
Pass-Through Certificates." The Escrow Account shall be an Eligible Account.

         EVENT OF DEFAULT: As defined in Section 6.14.

                                       10
<PAGE>

         FANNIE MAE: The entity formerly known as the Federal National Mortgage
Association, a federally chartered and privately owned corporation organized and
existing under the Federal National Mortgage Association Charter Act, or any
successor thereto.

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

         FHA: The Federal Housing Administration or any successor thereto.

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

         FINAL CERTIFICATION: As referred to in Section 2.02(c), the form of
which is set forth at Exhibit L.

         FITCH RATINGS: Fitch, Inc., or any successor in interest.

         GNMA: The Government National Mortgage Association, or any successor
thereto.

         GLOBAL SECURITIES: The global certificates representing the Book-Entry
Certificates.

         GROUP 1:  All of the Group 1 Certificates.

         GROUP 1 CERTIFICATE:  Any Class 1-A Certificate.

         GROUP 2:  All of the Group 2 Certificates.

         GROUP 2 CERTIFICATE: Any Class 2-A-1, Class 2-A-2 or Class 2-A-3
Certificate.

         HOLDER OR CERTIFICATEHOLDER: The registered owner of any Certificate as
recorded on the books of the Certificate Registrar except that, solely for the
purposes of taking any action or giving any consent pursuant to this Agreement,
any Certificate registered in the name of the Depositor, the Trustee or the
Servicer, or any Affiliate thereof shall be deemed not to be outstanding in
determining whether the requisite percentage necessary to effect any such
consent has been obtained, except that, in determining whether the Trustee shall
be protected in relying upon any such consent, only Certificates which a
Responsible Officer of the Trustee knows to be so owned shall be disregarded.
The Trustee may request and conclusively rely on certifications by the Depositor
and the Servicer in determining whether any Certificates are registered to an
Affiliate of the Depositor or the Servicer.

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

         INDEMNIFIED PARTIES:  As defined in Section 9.15.

         INDEPENDENT: When used with respect to any Accountants, a Person who is
"independent" within the meaning of Rule 2-01(b) of the Securities and Exchange
Commission's Regulation S-X. When used with respect to any other Person, a
Person who (a) is in fact independent of another specified Person and any
Affiliate of such other Person, (b) does not have any material direct financial
interest in such other Person or any Affiliate of such other Person, and (c) is
not connected with such other Person or any Affiliate of such other Person as an
officer,

                                       11
<PAGE>

employee, promoter, underwriter, trustee, partner, director or Person performing
similar functions.

         INDEX: As to each Mortgage Loan, the index from time to time in effect
for adjustment of the Mortgage Rate as set forth as such on the related Mortgage
Note.

         INITIAL CERTIFICATION: As referred to in Section 2.02(a), the form of
which is set forth at Exhibit K.

         INITIAL OPTIONAL PURCHASE DATE: The first Distribution Date following
the date on which the Aggregate Stated Principal Balance is less than 10.00% of
the Cut-off Date Balance.

         INSURANCE POLICY: With respect to any Mortgage Loan, any insurance
policy, including all names and endorsements thereto in effect, including any
replacement policy or policies for any Insurance Policies.

         INSURANCE PROCEEDS: Proceeds paid by any Insurance Policy (excluding
proceeds required to be applied to the restoration and repair of the related
Mortgaged Property or released to the Mortgagor), in each case other than any
amount included in such Insurance Proceeds in respect of Insured Expenses and
the proceeds from any Limited Purpose Surety Bond.

         INSURED EXPENSES: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.

         INTEREST DISTRIBUTION AMOUNT: For each Class of Certificates, on any
Distribution Date, the Current Interest for such Class, as reduced by such
Class's share of Net Interest Shortfalls and Relief Act Reductions.

         INTEREST SHORTFALL: As to any Class of Certificates and any
Distribution Date, (i) the amount by which the Interest Distribution Amount for
such Class on such Distribution Date and all prior Distribution Dates exceeds
(ii) amounts distributed in respect thereof to such Class on prior Distribution
Dates (as determined without reduction for amounts not paid to such Class as a
result of the provisos set forth in Sections 5.02(a)(i) and 5.02(b) hereof).

         INTEREST TRANSFER AMOUNT: For any Distribution Date and for any
Undercollateralized Group, an amount equal to one month's interest on the
applicable Principal Transfer Amount at the related Mortgage Pool's Net WAC,
plus any shortfall of interest on the Senior Certificates related to such
Undercollateralized Group remaining unpaid from prior Distribution Dates.

         INTERVENING ASSIGNMENTS: The original intervening assignments of the
Mortgage, notices of transfer or equivalent instrument.

         IRS: As defined in Section 4.02.

         LATEST POSSIBLE MATURITY DATE: The Distribution Date in December 2034.

         LIMITED PURPOSE SURETY BOND: Any Limited Purpose Surety Bond listed in
Exhibit F.

         LIQUIDATED MORTGAGE LOAN: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
Servicer has certified (in accordance with

                                       12
<PAGE>

this Agreement) that it has received all amounts it expects to receive in
connection with the liquidation of such Mortgage Loan including the final
disposition of an REO Property.

         LIQUIDATION PROCEEDS: Amounts, including Insurance Proceeds, received
in connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or amounts
received in connection with any condemnation or partial release of a Mortgaged
Property and any other proceeds received in connection with an REO Property.

         LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator of
which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator of which is (a) in the case of a purchase, the
lesser of the selling price of the Mortgaged Property and its Appraised Value
determined in an appraisal obtained by the originator at origination of such
Mortgage Loan, or (b) in the case of a refinance, the Appraised Value of the
Mortgaged Property at the time of such refinance.

         LOSS: With respect to any indemnification arising under Section 9.15 of
this Agreement, any and all losses, claims, damages, penalties, liabilities,
obligations, judgments, settlements, awards, demands, offsets, defenses,
counterclaims, actions or proceedings, reasonable out-of-pocket costs, expenses
and attorneys' fees of an Indemnified Party (including but not limited to, (a)
any reasonable costs, expenses and attorneys' fees incurred by such Indemnified
Party in enforcing such right of indemnification against any indemnifying party
or with respect to any appeal, and (b) interest on any amount for which an
Indemnified Party is entitled to be indemnified from the date such Indemnified
Party notifies the Servicer of the expenditure or such amounts until such
amounts are paid by the Servicer; provided, however, that in no event shall a
"Loss" include a claim for consequential damages, indirect damages or lost
profits except when the Loss results from the gross negligence, fraud or willful
misconduct of the Servicer.

         MATERIAL DEFECT:  As defined in Section 2.02(b).

         MAXIMUM RATE: As to any Mortgage Loan, the maximum rate set forth on
the related Mortgage Note at which interest can accrue on such Mortgage Loan.

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

         MERS MORTGAGE LOAN: Any Mortgage Loan registered with MERS on the MERS
System.

         MERS SYSTEM: The system of recording transfers of mortgages
electronically maintained by MERS.

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

         MONTHLY ADVANCE: With respect to a Mortgage Loan, the payments required
to be made by the Trustee solely in its capacity as successor servicer or by the
Servicer with respect to any Distribution Date pursuant to this Agreement, the
amount of any such payment being equal to the aggregate of the payments of
principal and interest (net of the applicable Servicing Fee and net of any net
income in the case of any REO Property) on the Mortgage Loans that were due on
the related Due Date and not received as of the close of business on the related
Determination Date,

                                       13
<PAGE>

less the aggregate amount of any such delinquent payment that either the Trustee
or the Servicer has determined would constitute Nonrecoverable Advances if
advanced.

         MONTHLY STATEMENT: The statement delivered to the Certificateholders
pursuant to Section 4.02.

         MORTGAGE: A mortgage, deed of trust or other instrument encumbering a
fee simple interest in real property securing a Mortgage Note, together with
improvements thereto.

         MORTGAGE DOCUMENTS: With respect to each Mortgage Loan, the mortgage
documents required to be delivered to the Trustee pursuant to this Agreement.

         MORTGAGE LOAN: A Mortgage and the related notes or other evidences of
indebtedness secured by each such Mortgage conveyed, transferred, sold, assigned
to or deposited with the Trustee pursuant to Section 2.01 (including any
Replacement Mortgage Loan and REO Property), including without limitation, each
Mortgage Loan listed on the Mortgage Loan Schedule, as amended from time to
time.

         MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement,
dated as of November 1, 2004, between the Seller and the Depositor with respect
to the sale and purchase of the Mortgage Loans.

         MORTGAGE LOAN SCHEDULE: The schedule attached hereto as Schedule A,
which shall identify each Mortgage Loan, as such schedule may be amended by the
Depositor or the Servicer from time to time to reflect the addition of
Replacement Mortgage Loans to, or the deletion of Deleted Mortgage Loans from,
the Trust Fund. Such schedule shall, among other things (1) identify the
designated Mortgage Pool in which such Mortgage Loan is included and (2)
separately identify Six-Month LIBOR Loans, One-Year U.S. Treasury Loans and
Additional Collateral Mortgage Loans.

         MORTGAGE NOTE: The original executed note or other evidence of the
indebtedness of a Mortgagor secured by a Mortgage under a Mortgage Loan.

         MORTGAGE POOLS:  Any of Pool 1 and Pool 2.

         MORTGAGE RATE: As to any Mortgage Loan, the annual rate of interest
borne by the related Mortgage Notes.

         MORTGAGED PROPERTY: The underlying property, including any Additional
Collateral, securing a Mortgage Loan which, with respect to a Cooperative Loan,
is the related Cooperative Shares and property lease.

         MORTGAGOR: The obligor on a Mortgage Note.

         NET INTEREST SHORTFALLS: With respect to any Distribution Date, any Net
Prepayment Interest Shortfalls for that Distribution Date and the amount of
interest that would otherwise have been received with respect to any Mortgage
Loan which was subject to (i) a Relief Act Reduction or (ii) the interest
portion of any Debt Service Reduction or Deficient Valuation, after exhaustion
of the respective amounts of coverage provided by the Subordinate Certificates
for those type of losses.

                                       14
<PAGE>

         NET LIQUIDATION PROCEEDS: With respect to any Liquidated Mortgage Loan
or any other disposition of related Mortgaged Property, the related Liquidation
Proceeds net of Monthly Advances, related Servicing Fees and any other accrued
and unpaid fees received and retained in connection with the liquidation of such
Mortgage Loan or Mortgaged Property.

         NET MORTGAGE RATE: With respect to any Mortgage Loan and any
Distribution Date, the related Mortgage Rate as of the Due Date in the month
preceding the month of such Distribution Date reduced by the Servicing Fee Rate
for such Mortgage Loan.

         NET PREPAYMENT INTEREST SHORTFALL: With respect to any Mortgage Loan
and any Distribution Date, the amount by which any Prepayment Interest Shortfall
for the related Due Period exceeds the amount payable by the Servicer in respect
of such shortfall.

         NET WAC: As to any Distribution Date, the weighted average of the Net
Mortgage Rates of the Mortgage Loans as of the first day of the calendar month
immediately preceding the calendar month of such Distribution Date, weighted on
the basis of their outstanding Stated Principal Balances at such time. When the
term "Net WAC" is used herein with reference to only the Six-Month LIBOR Loans
and One-Year U.S. Treasury Loans, such weighted average shall be computed with
reference solely to the Mortgage Loans in the relevant group.

         NON-BOOK-ENTRY CERTIFICATE: Any Certificate other than a Book-Entry
Certificate.

         NON-PERMITTED FOREIGN HOLDER: As defined in Section 3.03(f).

         NONRECOVERABLE ADVANCE: Any portion of a Monthly Advance previously
made or proposed to be made by the Servicer (as certified in an Officer's
Certificate of the Servicer) or by the Trustee pursuant to Section 5.04, which
in the good faith judgment of such party, shall not be ultimately recoverable by
such party from the related Mortgagor, related Liquidation Proceeds or
otherwise.

         NON-U.S. PERSON: Any person other than a "United States person" within
the meaning of Section 7701(a)(30) of the Code.

         OFFERED CERTIFICATE: Any Senior Certificate or Offered Subordinate
Certificate.

         OFFERED SUBORDINATE CERTIFICATES: The Class M-l, Class M-2 and Class
M-3 Certificates.

         OFFERING DOCUMENT:  The Prospectus.

         OFFICER'S CERTIFICATE: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President, a vice president (however
denominated), an Assistant Vice President, the Treasurer, the Secretary, or one
of the assistant treasurers or assistant secretaries (or any other officer
customarily performing functions similar to those performed by any of the above
designated officers and also to whom, with respect to a particular matter, such
matter is referred because of such officer's knowledge of and familiarity with a
particular subject) of the Depositor or the Trustee, as the case may be, and
delivered to the Depositor or the Trustee, as the case may be, as required by
this Agreement.

         OFFICER'S CERTIFICATE OF THE SERVICER: A certificate (i) signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a Managing
Director, a Vice President (however denominated), an Assistant Vice President,
the Treasurer, the Secretary, or one of the

                                       15
<PAGE>

Assistant Treasurers or Assistant Secretaries of the Servicer, or (ii) if
provided for herein, signed by a Servicing Officer, as the case may be, and
delivered to the Trustee or the Depositor, as the case may be.

         ONE-YEAR U.S. TREASURY LOAN: Each Mortgage Loan bearing a Mortgage Rate
that adjusts in accordance with the U.S. Treasury for one-year U.S. dollar
deposits.

         OPINION OF COUNSEL: A written opinion of counsel, who may be an
employee of the Depositor or the Servicer, that is reasonably acceptable to each
addressee of such opinion; provided that any Opinion of Counsel relating to (a)
qualification of the Mortgage Loans in a REMIC or (b) compliance with the REMIC
Provisions, must be an opinion of counsel reasonably acceptable to each
addressee of such opinion, who (i) is in fact independent of the Servicer and
the Depositor, (ii) does not have any material direct or indirect financial
interest in the Servicer or the Depositor or in an affiliate of either and (iii)
is not connected with the Servicer or the Depositor as an officer, employee,
director or person performing similar functions.

         OPTIONAL TERMINATION PRICE: An amount equal to the sum of (i) 100% of
the Stated Principal Balance of the Mortgage Loans (other than any Mortgage Loan
that has become an REO Property) plus accrued interest thereon at the applicable
Mortgage Rate through the Due Date in the month in which the Optional
Termination Price is to be distributed to the Certificateholders and the fair
market value of any REO Property plus accrued interest thereon; (ii) any
unreimbursed costs and damages incurred by the Trust Fund (or the Trustee on
behalf of the Trust Fund) in connection with the violation of any anti-predatory
or anti-abusive lending laws; and (iii) the payment of all amounts (including,
without limitation, all previously unreimbursed Monthly Advances and accrued and
unpaid Servicing Fees) payable or reimbursable to the Servicer or Trustee.

         ORIGINAL APPLICABLE CREDIT SUPPORT PERCENTAGE: With respect to each
Class of Subordinate Certificates, the corresponding percentage set forth
opposite its Class designation: Class M-1 - 3.00%; Class M-2 - 1.90%; Class M-3
- 1.15%; Class B-1 - 0.70%; Class B-2 - 0.55%; and Class B-3 - 0.35%.

         ORIGINAL SUBORDINATE CLASS PRINCIPAL AMOUNT: The aggregate Class
Principal Amounts of the Subordinate Certificates as of the Closing Date.

         ORIGINATOR:  Merrill Lynch Credit Corporation.

         OVERCOLLATERALIZED GROUP: On any Distribution Date, any Certificate
Group which is not an Undercollateralized Group.

         PAYING AGENT: Any paying agent appointed by the Trustee pursuant to
Section 3.08.

         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 Amount represented by such
Certificate and the denominator of which is the initial Class Principal Amount
of the related Class. With respect to any Class of Class R Certificates, the
portion of such 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%.

                                       16
<PAGE>

         PERMITTED INVESTMENTS: At any time, any one or more of the following
obligations and securities:

                           (i) obligations of the United States or any agency
                  thereof, provided that such obligations are backed by the full
                  faith and credit of the United States;

                           (ii) general obligations of or obligations guaranteed
                  by any state of the United States or the District of Columbia
                  receiving the highest long-term debt rating of each Rating
                  Agency, or such lower rating as shall not result in the
                  downgrading or withdrawal of the ratings then assigned to the
                  Certificates by the Rating Agencies, as evidenced by a signed
                  writing delivered by each Rating Agency;

                           (iii) commercial or finance company paper which is
                  then receiving the highest commercial or finance company paper
                  rating of each Rating Agency rating such paper, or such lower
                  rating as shall not result in the downgrading or withdrawal of
                  the ratings then assigned to the Certificates by the Rating
                  Agencies, as evidenced by a signed writing delivered by each
                  Rating Agency;

                           (iv) certificates of deposit, demand or time
                  deposits, or bankers' acceptances issued by any depository
                  institution or trust company incorporated under the laws of
                  the United States or of any state thereof and subject to
                  supervision and examination by federal and/or state banking
                  authorities, provided that the commercial paper and/or
                  long-term unsecured debt obligations of such depository
                  institution or trust company (or in the case of the principal
                  depository institution in a holding company system, the
                  commercial paper or long-term unsecured debt obligations of
                  such holding company, but only if Moody's is not the
                  applicable Rating Agency) are then rated one of the two
                  highest long-term and the highest short-term ratings of each
                  Rating Agency for such securities, or such lower ratings as
                  shall not result in the downgrading or withdrawal of the
                  ratings then assigned to the Certificates by the Rating
                  Agencies, as evidenced by a signed writing delivered by each
                  Rating Agency;

                           (v) guaranteed reinvestment agreements issued by any
                  bank, insurance company or other corporation acceptable to the
                  Rating Agencies at the time of the issuance of such
                  agreements, as evidenced by a signed writing delivered by each
                  Rating Agency;

                           (vi) repurchase obligations with respect to any
                  security described in clauses (i) and (ii) above, in either
                  case entered into with a depository institution or trust
                  company (acting as principal) described in clause (iv) above;

                           (vii) securities (other than stripped bonds, stripped
                  coupons or instruments sold at a purchase price in excess of
                  115% of the face amount thereof) bearing interest or sold at a
                  discount issued by any corporation incorporated under the laws
                  of the United States or any state thereof which, at the time
                  of such investment, have one of the two highest ratings of
                  each Rating Agency (except if the Rating Agency is Moody's,
                  such rating shall be the highest commercial paper rating of
                  Moody's for any such series), or such lower rating as shall
                  not result in the downgrading or withdrawal of the ratings
                  then assigned to

                                       17
<PAGE>

                  the Certificates by the Rating Agencies, as evidenced by a
                  signed writing delivered by each Rating Agency;

                           (viii) interests in any money market fund which at
                  the date of acquisition of the interests in such fund and
                  throughout the time such interests are held in such fund has
                  the highest applicable rating by each Rating Agency rating
                  such fund or such lower rating as shall not result in a change
                  in the rating then assigned to the Certificates by each Rating
                  Agency including funds for which the Trustee or any of its
                  Affiliates is investment manager or adviser;

                           (ix) short-term investment funds sponsored by any
                  trust company or national banking association incorporated
                  under the laws of the United States or any state thereof which
                  on the date of acquisition has been rated by each applicable
                  Rating Agency in their respective highest applicable rating
                  category or such lower rating as shall not result in a change
                  in the rating then specified stated maturity and bearing
                  interest or sold at a discount acceptable to each Rating
                  Agency as shall not result in the downgrading or withdrawal of
                  the ratings then assigned to the Certificates by the Rating
                  Agencies; and

                           (x) such other investments having a specified stated
                  maturity and bearing interest or sold at a discount acceptable
                  to the Rating Agencies as shall not result in the downgrading
                  or withdrawal of the ratings then assigned to the Certificates
                  by the Rating Agencies;

         provided, that no such instrument shall be a Permitted Investment if
(i) such instrument evidences the right to receive interest only payments with
respect to the obligations underlying such instrument, (ii) such instrument
would require the Depositor to register as an investment company under the
Investment Company Act of 1940, as amended, or (iii) such instrument would not
be a "permitted investment" within the meaning of such term as provided for in
Section 860G(a)(5) of the Code and the Treasury Regulations thereunder.

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

         POOL NET WAC: The Pool 1 Net WAC or Pool 2 Net WAC, as the context may
require.

         POOL 1: The aggregate of Mortgage Loans identified on the Mortgage Loan
Schedule as being included in Pool 1.

         POOL 1 MORTGAGE LOANS: Any Mortgage Loan in Pool 1.

         POOL 1 NET WAC: With respect to any Distribution Date, the weighted
average of the Net Mortgage Rates of the Pool 1 Mortgage Loans as of the first
day of the calendar month immediately preceding the calendar month of such
Distribution Date, weighted on the basis of their Stated Principal Balances at
such time.

         POOL 1 SUBORDINATE AMOUNT: For any Distribution Date, the excess of (a)
the Aggregate Stated Principal Balance of the Pool 1 Mortgage Loans as of the
first day of the month preceding the month in which such Distribution Date
occurs over (b) the Class Principal Amount of the Class 1-A Certificates
immediately before such Distribution Date.

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<PAGE>

         POOL 2: The aggregate of Mortgage Loans identified on the Mortgage Loan
Schedule as being included in Pool 2.

         POOL 2 MORTGAGE LOANS: Any Mortgage Loan in Pool 2.

         POOL 2 NET WAC: With respect to any Distribution Date, the weighted
average of the Net Mortgage Rates of the Pool 2 Mortgage Loans as of the first
day of the calendar month immediately preceding the calendar month of such
Distribution Date, weighted on the basis of their Stated Principal Balances at
such time.

         POOL 2 SUBORDINATE AMOUNT: For any Distribution Date, the excess of (a)
the Aggregate Stated Principal Balance of the Pool 2 Mortgage Loans as of the
first day of the month preceding the month in which such Distribution Date
occurs over (b) the Class Principal Amounts of the Class 2-A-1, Class 2-A-2 and
Class 2-A-3 Certificates immediately before such Distribution Date.

         POOL PERCENTAGE: With respect to each Mortgage Pool and any
Distribution Date, a fraction, expressed as a percentage, the numerator of which
is the Aggregate Stated Principal Balance of such Mortgage Pool and the
denominator of which is the Aggregate Stated Principal Balance as of such Due
Date.

         POOL SUBORDINATE AMOUNT: Any of the Pool 1 Subordinate Amount or the
Pool 2 Subordinate Amount.

         PREPAYMENT INTEREST SHORTFALL: With respect to any full or partial
Principal Prepayment of a Mortgage Loan, the excess, if any, of (i) one full
month's interest at the applicable Mortgage Rate on the outstanding principal
balance of such Mortgage Loan immediately prior to such Principal Prepayment
over (ii) the amount of interest actually received with respect to such Mortgage
Loan in connection with such Principal Prepayment.

         PREPAYMENT PERIOD: With respect to each Distribution Date, the calendar
month immediately preceding the month in which the Distribution Date occurs.

         PRIMARY MORTGAGE INSURANCE POLICY: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.

         PRINCIPAL PREPAYMENT: Any Mortgagor payment of principal or other
recovery of principal on a Mortgage Loan that is recognized as having been
received or recovered in advance of its scheduled Due Date and applied to reduce
the principal balance of the Mortgage Loan in accordance with the terms of the
Mortgage Note or this Agreement.

         PRINCIPAL PREPAYMENT IN FULL: Any Principal Prepayment of the entire
principal balance of the Mortgage Loans.

         PRINCIPAL TRANSFER AMOUNT: For any Distribution Date and for any
Undercollateralized Group, the excess, if any, of the aggregate Class Principal
Amount of such Undercollateralized Group immediately prior to such Distribution
Date over the Aggregate Stated Principal Balance of the Mortgage Loans in the
related Mortgage Pool immediately prior to such Distribution Date.

         PROCEEDING: Any suit in equity, action at law or other judicial or
administrative proceeding.

                                       19
<PAGE>

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

         PRO RATA SENIOR PERCENTAGE: With respect to each Distribution Date and
each Mortgage Pool, the percentage equivalent of a fraction the numerator of
which is the aggregate Class Principal Amount of the senior class or classes of
the related Certificate Group immediately prior to such Distribution Date and
the denominator of which is the Aggregate Stated Principal Balance of the
Mortgage Loans in the related Mortgage Pool for such Distribution Date.

         PROSPECTUS: The supplement to the prospectus supplement, dated November
29, 2004, and the prospectus supplement, dated November 24, 2004, together with
the accompanying prospectus dated June 18, 2004, relating to the initial sale of
the Class 1-A, Class 2-A-1, Class 2-A-2, Class 2-A-3, Class M-1, Class M-2 and
Class M-3 Certificates.

         PURCHASE DATE: Any Distribution Date on which Certificates may be
repurchased pursuant to Section 7.01(c).

         PURCHASE PRICE: With respect to any Mortgage Loan required or permitted
to be purchased by the Depositor pursuant to this Agreement, by the Servicer
pursuant to this Agreement, or by the Seller pursuant to the Mortgage Loan
Purchase Agreement, an amount equal to the sum of (i) 100% of the unpaid
principal balance of the Mortgage Loan on the date of such purchase, (ii)
accrued interest thereon at the applicable Net Mortgage Rate from the date
through which interest was last paid by the Mortgagor to the Due Date in the
month in which the Purchase Price is to be distributed to Certificateholders and
(iii) any unreimbursed costs, penalties and/or damages incurred by the Trust
Fund in connection with any violation relating to such Mortgage Loan of any
predatory or abusive lending law.

         RAPID PREPAYMENT CONDITIONS: As to any Distribution Date either of the
following conditions: if (1) the Aggregate Subordinate Percentage on such date
is less than 200% of the Aggregate Subordinate Percentage on the Closing Date or
(2) the outstanding Stated Principal Balance of the Mortgage Loans in any
Mortgage Pool delinquent 60 days or months, as a percentage of such Mortgage
Pool's Pool Subordinate Amount, is greater than or equal to 50%.

         RATING AGENCY: Each of Moody's and Fitch Ratings.

         REALIZED LOSS: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Stated Principal
Balance of the Liquidated Mortgage Loan as of the date of such liquidation, plus
(ii) interest at the Net Mortgage Rate from the Due Date as to which interest
was last paid or advanced (and not reimbursed) to Certificateholders up to the
Due Date in the month in which Liquidation Proceeds are required to be
distributed on the Stated Principal Balance of such Liquidated Mortgage Loan
from time to time, minus (iii) the Net Liquidation Proceeds and the proceeds of
any Additional Collateral, if any, received during the month in which such
liquidation occurred, to the extent applied as recoveries of interest at the Net
Mortgage Rate and to principal of the Liquidated Mortgage Loan. With respect to
each Mortgage Loan which has become the subject of a Deficient Valuation, if the
principal amount due under the related Mortgage Note has been reduced, the
difference between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation and the principal balance of the
Mortgage Loan as reduced by the Deficient Valuation.

                                       20
<PAGE>

         RECORD DATE: With respect to each Distribution Date and each class of
Offered Certificates, the close of business on the last Business Day of the
month immediately preceding the month in which the related Distribution Date
occurs.

         REFINANCING MORTGAGE LOAN: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.

         RELATED CERTIFICATE GROUP: The Certificate Group related to a
particular Mortgage Pool as indicated by the same numerical designation (i.e.,
Group 1 Certificates are related to Pool 1 and Group 2 Certificates are related
to Pool 2).

         RELIEF ACT REDUCTIONS: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Civil Relief Act, the amount, if any, by which (i)
interest collectible on such Mortgage Loan for the most recently ended calendar
month is less than (ii) interest accrued thereon for such month pursuant to the
Mortgage Note.

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

         REMIC 1: The segregated pool of assets, with respect to which a REMIC
election is to be made, consisting of: (i) each Mortgage Loan (exclusive of
payments of principal and interest due on or before the Cut off Date, if any,
received by the Servicer which shall not constitute an asset of the Trust Fund)
as from time to time are subject to this Agreement and all payments under and
proceeds of such Mortgage Loans (exclusive of any prepayment fees and late
payment charges received on the Mortgage Loans), together with all documents
included in the related Trustee Mortgage File, subject to Section 2.02; (ii) any
REO Property; (iii) the primary hazard insurance policies, if any, the Primary
Mortgage Insurance Policies, if any, and all other insurance policies with
respect to the Mortgage Loans; and (iv) the Depositor's interest in respect of
the representations and warranties made by the Seller in the Mortgage Loan
Purchase Agreement.

         REMIC 1 PASS-THROUGH RATE: With respect to REMIC 1 Regular Interests
1-A, 2-A and ZZZ, the weighted average of the Net Mortgage Rates of the Mortgage
Loans, weighted on the basis of the respective Stated Principal Balance of each
such Mortgage Loan as of the beginning of the Due Period immediately preceding
the related Distribution Date. With respect to REMIC 1 Regular Interest 1-B, the
weighted average of the Net Mortgage Rates of the Pool 1 Mortgage Loans,
weighted on the basis of the respective Stated Principal Balance of each such
Mortgage Loan as of the beginning of the Due Period immediately preceding the
related Distribution Date. With respect to REMIC 1 Regular Interest 2-B, the
weighted average of the Net Mortgage Rates of the Pool 2 Mortgage Loans,
weighted on the basis of the respective Stated Principal Balance of each such
Mortgage Loan as of the beginning of the Due Period immediately preceding the
related Distribution Date

         REMIC 1 REGULAR INTERESTS: Each uncertificated partial undivided
beneficial ownership interest in REMIC 1 as designated in the Preliminary
Statement having a principal balance equal to its Uncertificated Principal
Balance, and which bears interest at a rate equal to its REMIC 1 Pass Through
Rate.

         REMIC 1 SUBORDINATED BALANCE RATIO: The ratio among the Uncertificated
Principal Balances of each of the REMIC 1 Regular Interests ending with the
designation "A," equal to the ratio among:

                                       21
<PAGE>

         (1) the excess of (x) the aggregate Stated Principal Balance of the
Pool 1 Mortgage Loans over (y) the Class Principal Amount of the Class 1-A
Certificates; and

         (2) the excess of (x) the aggregate Stated Principal Balance of the
Pool 2 Mortgage Loans over (y) the Class Principal Amount of the Class 2-A-1,
Class 2-A-2 and Class 2-A-3 Certificates;

         REMIC 2: The segregated pool of assets consisting of the REMIC 1
Regular Interests conveyed in trust to the Trustee for the benefit of the
holders of the Class 1-A, Class 2-A-1, Class 2-A-2, Class 2-A-3, Class M-1,
Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class R-2
Certificates, with respect to which a separate REMIC election is to be made.

         REMIC 2 CERTIFICATES: Any of the Class 1-A, Class 2-A-1, Class 2-A-2,
Class 2-A-3, Class M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class B-3
and Class R-2 Certificates.

         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 COMPONENTS: Each of the X-A1 Component, X-A2A Component, X-A2B
Component, X-A2C Component, X-A2D Component, Component XB1, Component XB2 and
Component XB3.

         REMIC INTERESTS: Any regular or residual interest in any of REMIC 1,
REMIC 2 or the Upper Tier REMIC, as described in the Preliminary Statement.

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

         REMIC 1: As described in the Preliminary Statement.

         REMIC 1 INTEREST: Each class of interest in REMIC 1 as described in the
Preliminary Statement.

         REMIC 1 REGULAR INTEREST: Each of the REMIC 1 Interests other than the
Class LT1-R Interest.

         REMIC 1 SUBORDINATED BALANCE RATIO: The ratio among the uncertificated
principal balances of each of the REMIC 1 Interests ending with the designation
"A" that is equal to the ratio among, with respect to each such REMIC 1
Interest, the excess of (x) the aggregate Scheduled Principal Balance of the
Mortgage Loans in the related Mortgage Pool over (y) the aggregate Class
Principal Amount of the Certificates in the Certificate Group related to such
Mortgage Pool.

         REMIC 2:  As described in the Preliminary Statement.

                                       22
<PAGE>

         REMIC 2 INTEREST: Each class of interest in REMIC 2 as described in the
Preliminary Statement.

         REMIC 2 REGULAR INTEREST: Each of the REMIC 2 Interests other than the
Class LT2-R Interest.

         REO DISPOSITION: The final sale by the Servicer of an REO Property.

         REO PROPERTY: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan or otherwise treated as having been acquired pursuant to the REMIC
Provisions.

         REPLACEMENT MORTGAGE LOAN: A mortgage loan substituted by the Seller
for a Deleted Mortgage Loan which must, on the date of such substitution, as
confirmed in a Request for Release substantially in the form attached to this
Agreement, (i) have a Stated Principal Balance, after deduction of the principal
portion of the Scheduled Payment due in the month of substitution, not in excess
of, and not more than 10% less than, the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) have a Maximum Rate not less than (and not more than two
percentage points greater than) the Maximum Rate of the Deleted Mortgage Loan;
(iii) have a gross margin not less than that of the Deleted Mortgage Loan and,
if Mortgage Loans equal to 1% or more of the balance of the related Mortgage
Pool as of the Cut-off Date have become Deleted Mortgage Loans, not more than
two percentage points more than that of the Deleted Mortgage Loan; (iv) have an
Effective Loan-to-Value Ratio no higher than that of the Deleted Mortgage Loan;
(v) have Adjustment Dates that are no more or less frequent than the Deleted
Mortgage Loan; (vi) have a remaining term to maturity no greater than (and not
more than one year less than that of) the Deleted Mortgage Loan; (vii) not
permit conversion of the related Mortgage Rate to a permanent fixed Mortgage
Rate; (viii) not be a Cooperative Loan unless the Deleted Mortgage Loan was a
Cooperative Loan; (ix) have the same or better FICO credit score; (x) have an
initial interest adjustment date no earlier than five months before (and no
later than five months after) the initial adjustment date of the Deleted
Mortgage Loan, (xi) comply with each representation and warranty set forth in
Schedule B of this Agreement; and (xii) shall be accompanied by an Opinion of
Counsel that such Replacement Mortgage Loan would not adversely affect the REMIC
status of the Trust Estate or would not otherwise be prohibited by this
Indenture.

         REQUEST FOR RELEASE: A request for release, substantially in the form
of Exhibit N attached hereto, properly completed and signed by a Servicing
Officer (or, if delivered on behalf of the Seller or Depositor, an Authorized
Officer thereof).

         RESIDUAL CERTIFICATES: The Class R-1 Certificates and the Class R-2
Certificates.

         RESPA: The Real Estate Settlement Procedures Act, 12 U.S.C ss. 2601 et
seq., and Regulation X, 24 C.F.R. ss. 3500.21, thereunder, as the foregoing may
be amended from time to time.

         RESPONSIBLE OFFICER: With respect to the Trustee, any officer in the
corporate trust department or similar group of the Trustee with direct
responsibility for the administration of this Agreement and also, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his or her knowledge of and familiarity with the particular
subject.

                                       23
<PAGE>

         RESTRICTED CERTIFICATE: Any Class B-1, Class B-2 or Class B-3
Certificate.

         RESTRICTED GLOBAL SECURITY: As defined in Section 3.01(c).

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

         SAIF: The Saving's Association Insurance Fund, or any successor
thereto.

         SCHEDULE OF EXCEPTIONS: As defined in Section 2.02(a) of this
Agreement.

         SCHEDULED PAYMENT: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified in this Agreement, shall give effect to any
related Debt Service Reduction and any Deficient Valuation that affects the
amount of the monthly payment due on such Mortgage Loan.

         SECTION 302 REQUIREMENTS: Any rules or regulations promulgated pursuant
to the Sarbanes-Oxley Act of 2002 (as such may be amended from time to time).

         SELLER: Merrill Lynch Mortgage Lending, Inc., a Delaware corporation.

         SENIOR CERTIFICATE: Any one of the Class 1-A, Class 2-A-1, Class 2-A-2
or Class 2-A-3 Certificates.

         SENIOR PERCENTAGE: With respect to each Mortgage Pool for any
Distribution Date, the related Pro Rata Senior Percentage. With respect to any
Distribution Date after the related Senior Termination Date, the related Senior
Percentage will be 0%.

         SENIOR PREPAYMENT PERCENTAGE: With respect to any Distribution Date,
during the ten years beginning on the first Distribution Date, 100%. Except as
provided herein, the related Senior Prepayment Percentage for each Mortgage Pool
and any Distribution Date occurring on or after the fifth anniversary of the
first Distribution Date shall be as follows: (i) from December 2009 through
November 2010, the Senior Percentage plus 70% of the Subordinate Percentage for
that Distribution Date; (ii) from December 2010 through November 2011, the
Senior Percentage plus 60% of the Subordinate Percentage for that Distribution
Date; (iii) from December 2011 through November 2012, the Senior Percentage plus
40% of the Subordinate Percentage for that Distribution Date; (iv) from December
2012 through November 2013, the related Senior Percentage plus 20% of the
Subordinate Percentage for that Distribution Date; and (v) from and after
December 2013, the Senior Percentage for that Distribution Date; provided,
however, that there shall be no reduction in the Senior Prepayment Percentage
for a Mortgage Pool unless both Step Down Conditions are satisfied; and
provided, further, that if on any such Distribution Date the Pro Rata Senior
Percentage exceeds the initial Pro Rata Senior Percentage, the Senior Prepayment
Percentage for a Mortgage Pool for that Distribution Date shall again equal
100%.

         Notwithstanding the above, if on any Distribution Date the Two Times
Test is satisfied, the Senior Prepayment Percentage for a Mortgage Pool shall
equal the related Senior Percentage for such Distribution Date. In addition, if
on any Distribution Date the allocation to the Senior Certificates of the
related Certificate Group then entitled to distributions of principal of full
and partial principal prepayments and other amounts in the percentage required
above would reduce the sum of the Class Principal Amounts of those Certificates
to below zero, the Senior

                                       24
<PAGE>

Prepayment Percentage for a Mortgage Pool for such Distribution Date shall be
limited to the percentage necessary to reduce the related Class Principal
Amounts to zero.

         SENIOR PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Certificate
Group and Distribution Date, the sum of:

                  (i)      the product of (a) the related Senior Percentage and
                           (b) the principal portion of each Scheduled Payment
                           (without giving effect to any Deficient Valuations or
                           Debt Service Reductions) on each Mortgage Loan in the
                           related Mortgage Pool due during the related Due
                           Period;

                  (ii)     the product of (a) the related Senior Prepayment
                           Percentage and (b) each of the following amounts: (i)
                           the principal portion of each full and partial
                           principal prepayment made by a borrower on a Mortgage
                           Loan in the related Mortgage Pool during the related
                           Prepayment Period; (ii) each other unscheduled
                           collection, including Insurance Proceeds and Net
                           Liquidation Proceeds (other than with respect to any
                           Mortgage Loan in the related Mortgage Pool that was
                           finally liquidated during the related Prepayment
                           Period) representing or allocable to recoveries of
                           principal of the related Mortgage Loans received
                           during the related Prepayment Period; and (iii) the
                           principal portion of the purchase price of each
                           Mortgage Loan purchased by the Seller or any other
                           person pursuant to the Mortgage Loan Purchase
                           Agreement due to a defect in documentation or a
                           material breach of a representation and warranty with
                           respect to such Mortgage Loan or, in the case of a
                           permitted substitution of a Defective Mortgage Loan,
                           the amount representing any principal adjustment in
                           connection with any such replaced Mortgage Loan in
                           the related Mortgage Pool with respect to the related
                           Prepayment Period;

                  (iii)    with respect to unscheduled recoveries allocable to
                           principal of any Mortgage Loan in the related
                           Mortgage Pool that was fully liquidated during the
                           related Prepayment Period, the lesser of (a) the
                           product of (1) the Senior Percentage for that date
                           and (2) the remaining Stated Principal Balance of the
                           related Mortgage Loan at the time of liquidation and
                           (b) the product of (1) the Senior Prepayment
                           Percentage for that date and (2) the Net Liquidation
                           Proceeds allocable to principal; and

                  (iv)     any amounts described in clauses (i) through (iii)
                           above that remain unpaid with respect to such
                           Certificate Group from prior Distribution Dates.

         SENIOR TERMINATION DATE: For each Certificate Group, the Distribution
Date when the aggregate Class Principal Amount of the Senior Certificates
related to a Mortgage Pool has been reduced to zero.

         SERVICER:  Cendant and its successors and assigns.

         SERVICING FEE: As to any Distribution Date and each Mortgage Loan, an
amount equal to the product of (a) the outstanding principal balance of such
Mortgage Loan as of the first day of the related Due Period and (b) one-twelfth
of the Servicing Fee Rate.

                                       25
<PAGE>

         SERVICING FEE RATE: With respect to each Mortgage Loan and any
Distribution Date, 0.25% per annum.

         SERVICING OFFICER: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished to
the Trustee by the Servicer on the Closing Date and attached hereto as Exhibit
M, as such list may from time to time be amended.

         SERVICING TRANSFER COSTS:  As defined in Section 6.14(b).

         SIX-MONTH LIBOR LOAN: Each Mortgage Loan bearing a Mortgage Rate that
adjusts in accordance with LIBOR for six-month U.S. dollar deposits.

         STARTUP DAY: The day designated as such pursuant to Section 10.01(b)
hereof.

         STATED PRINCIPAL BALANCE: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as specified
in the amortization schedule at the time relating thereto (before any adjustment
to such amortization schedule by reason of any moratorium or similar waiver or
grace period) after giving effect to any previous Principal Prepayments and
Liquidation Proceeds allocable to principal and to the payment of principal due
on such Due Date and irrespective of any delinquency in payment by the related
Mortgagor.

         STEP-DOWN TEST: As of the first Distribution Date as to which any
decrease in any Senior Prepayment Percentage applies, (i) the outstanding Stated
Principal Balance of all Mortgage Loans Delinquent 60 days or more (including
Mortgage Loans in bankruptcy, foreclosure and REO Property), averaged over the
preceding six month period, as a percentage of the aggregate Class Principal
Amounts on such Distribution Date (without giving effect to any payments on such
Distribution Date) of the Subordinate Certificates, does not equal or exceed 50%
and (ii) cumulative Realized Losses with respect to the Mortgage Loans do not
exceed (a) with respect to each Distribution Date occurring in the period from
December 2009 to November 2010, 30% of the Original Subordinate Class Principal
Amount, (b) with respect to each Distribution Date occurring in the period from
December 2010 through November 2011, 35% of the Original Subordinate Class
Principal Amount, (c) with respect to each Distribution Date occurring in the
period from December 2011 through November 2012, 40% of the Original Subordinate
Class Principal Amount, (d) with respect to each Distribution Date occurring in
the period from December 2012 through November 2013, 45% of the Original
Subordinate Class Principal Amount and (e) with respect to each Distribution
Date occurring in December 2013 and thereafter, 50% of the Original Subordinate
Class Principal Amount.

         SUBORDINATE CERTIFICATE: Any of the Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2 and Class B-3 Certificates.

         SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: The amount equal to the
excess of the total Certificate Principal Amount of all the Certificates on any
Distribution Date (after giving effect to distributions of principal and
allocation or Realized Losses on that date) over the total Stated Principal
Balance of the Mortgage Loans for the related Distribution Date by which the
Class Principal Amount of the lowest ranking class of Subordinate Certificates
then outstanding will be reduced.

         SUBORDINATE CLASS PERCENTAGE: As to any Distribution Date and any Class
of Subordinate Certificates, the percentage obtained by dividing the Class
Principal Amount of such class

                                       26
<PAGE>

immediately prior to such Distribution Date by the aggregate Class Principal
Amount of all classes of Subordinate Certificates immediately prior to such
date.

         SUBORDINATE NET WAC: For any Distribution Date, the weighted average of
the Pool 1 Net WAC and the Pool 2 Net WAC, in each case weighted on the basis of
the relative Pool Subordinate Amounts for Pool 1 and Pool 2, respectively, for
such Distribution Date.

         SUBORDINATE PERCENTAGE: With respect to each Mortgage Pool and any
Distribution Date, the difference between 100% and the related Senior Percentage
for such Mortgage Pool on such Distribution Date; provided, however, that on any
Distribution Date after a Senior Termination Date has occurred with respect to a
Mortgage Pool, the Subordinate Percentage will represent the entire interest of
the Subordinate Certificates in the Mortgage Loans and will be equal to the
difference between 100% and the Senior Percentage related to the Mortgage Loans
in the aggregate for such Distribution Date.

         SUBORDINATE PREPAYMENT PERCENTAGE: With respect to any Distribution
Date and for any Mortgage Pool, the difference between 100% and the related
Senior Prepayment Percentage for such Mortgage Pool for that Distribution Date;
provided; however, that on any Distribution Date after a Senior Termination Date
has occurred with respect to a Mortgage Pool, the Subordinate Prepayment
Percentage will represent the entire interest of the Subordinate Certificates in
the Mortgage Loans and will be equal to the difference between 100% and the
Senior Prepayment Percentage related to the Mortgage Loans in the aggregate for
such Distribution Date.

         SUBORDINATE PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date and each Mortgage Pool, an amount equal to the sum of:

                  (i)      the product of (a) the related Subordinate Percentage
                           and (b) the principal portion of each related
                           Scheduled Payment (without giving effect to any
                           Deficient Valuations or Debt Service Reductions) on
                           each Mortgage Loan in the related Mortgage Pool due
                           during the related Due Period;

                  (ii)     the product of (a) the related Subordinate Prepayment
                           Percentage and (b) each of the following amounts: (1)
                           the principal portion of each full and partial
                           principal prepayment made by a borrower on a Mortgage
                           Loan in the related Mortgage Pool during the related
                           Prepayment Period, (2) each other unscheduled
                           collection, including Insurance Proceeds and Net
                           Liquidation Proceeds (other than with respect to any
                           Mortgage Loan in the related Mortgage Pool that was
                           finally liquidated during the related Prepayment
                           Period), representing or allocable to recoveries of
                           principal of Mortgage Loans in the related Mortgage
                           Pool received during the related Prepayment Period
                           and (3) the principal portion of the purchase price
                           of each Mortgage Loan in the related Mortgage Pool
                           that was purchased by the Seller or any other person
                           pursuant to the Mortgage Loan Purchase Agreement due
                           to a defect in documentation or a material breach of
                           a representation or warranty with respect to such
                           Mortgage Loan or, in the case of a permitted
                           substitution of a Defective Mortgage Loan, the amount
                           representing any principal adjustment in connection
                           with any such replaced Mortgage Loan in the related
                           Mortgage Pool with respect to such Distribution Date;

                                       27
<PAGE>

                  (iii)    with respect to unscheduled recoveries allocable to
                           principal of any Mortgage Loan in the related
                           Mortgage Pool that was finally liquidated during the
                           related Prepayment Period, the related Net
                           Liquidation Proceeds allocable to principal, to the
                           extent not distributed pursuant to clause (iii) of
                           the definition of Senior Principal Distribution
                           Amount; and

                  (iv)     any amounts described in clauses (i) through (iii)
                           for any previous Distribution Date that remain
                           unpaid;

         minus the sum of:

                  (A)      if the aggregate Class Principal Amount of any
                           Certificate Group has been reduced to zero, principal
                           paid from the Available Distribution Amount from the
                           related Mortgage Pool to the remaining Certificate
                           Group; and

                  (B)      the amounts paid from the Available Distribution
                           Amount for an Overcollateralized Group to the Senior
                           Certificates related to an Undercollateralized Group.

         SUBSEQUENT RECOVERY: The amount, if any, recovered by the Servicer with
respect to a Liquidated Mortgage Loan with respect to which a Realized Loss has
been incurred after liquidation and disposition of such Mortgage Loan.

         SUBSTITUTION AMOUNT: As defined in the second paragraph of Section
2.04(b).

         TAX MATTERS PERSON: The "tax matters person" as specified in the REMIC
Provisions hereof which shall initially be the Holder of each Class of Residual
Certificates for the related REMIC.

         TELERATE PAGE 3750: The display currently so designated as "Page 3750"
on the Bridge Telerate Service (or such other page selected by the Trustee as
may replace Page 3750 on that service for the purpose of displaying daily
comparable rates on prices).

         TRUST FUND: The corpus of the trust created pursuant to this Agreement,
consisting of (i) the Mortgage Loans, including the right to all payments of
principal and interest received on or with respect to the Mortgage Loans on and
after the Cut-off Date (other than Scheduled Payments due on or before such
date), and all such payments due after such date but received prior to such date
and intended by the related Mortgagors to be applied after such date; (ii) all
of the Depositor's right, title and interest in and to all amounts from time to
time credited to and the proceeds of the Distribution Account, any Custodial
Accounts or any Escrow Accounts established with respect to the Mortgage Loans;
(iii) all of the Depositor's rights under the Mortgage Loan Purchase Agreement;
(iv) all of the Depositor's right, title or interest in REO Property and the
proceeds thereof; (v) all of the Depositor's rights under any Insurance Policies
relating to the Mortgage Loans; (vi) all proceeds of the conversion, voluntary
or involuntary, of any of the foregoing into cash or other liquid assets,
including without limitation, all Insurance Proceeds, Liquidation Proceeds and
condemnation awards; and (vii) the Depositor's security interest in any
collateral pledged to secure the Mortgage Loans, including the Mortgaged
Properties and any Additional Collateral relating to the Additional Collateral
Mortgage Loans, including, but not limited to, any pledge, control and guaranty
agreements and the Limited Purpose Surety Bond and any proceeds of the
foregoing.

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<PAGE>

         TRUSTEE: Wells Fargo Bank, N.A. and any Person succeeding the Trustee
hereunder, or if any separate trustee or any co-trustee shall be appointed as
herein provided, then such separate trustee and such co-trustee, as the case may
be.

         TRUSTEE MORTGAGE FILES: With respect to each Mortgage Loan, the
Mortgage Documents to be retained in the custody and possession of the Trustee.

         TWO TIMES TEST: As to any Distribution Date, (i) the related
Subordinate Percentage is at least two times the related Subordinate Percentage
as of the Closing Date; (ii) the outstanding Stated Principal Balance of all
Mortgage Loans Delinquent 60 days or more (including Mortgage Loans in
bankruptcy, foreclosure and REO Property), averaged over the preceding six month
period, as a percentage of the aggregate Class Principal Amounts on such
Distribution Date (without giving effect to any payments on such Distribution
Date) of the Subordinate Certificates, does not equal or exceed 50%; and (iii)
cumulative Realized Losses with respect to the Mortgage Loans do not exceed 20%
of the aggregate Class Principal Amount of the Subordinate Certificates as of
the Closing Date.

         UCC: The Uniform Commercial Code as enacted in the relevant
jurisdiction.

         UNDERCOLLATERALIZED GROUP: With respect to any Distribution Date, and
any Certificate Group, the aggregate Class Principal Amount of such Certificate
Group is greater than the aggregate Stated Principal Balance of the Mortgage
Loans in the related Mortgage Pool immediately prior to such Distribution Date.

         UNDERWRITER:  Merrill Lynch, Pierce, Fenner & Smith Incorporated.

         UNDERWRITER'S EXEMPTION: Prohibited Transaction Exemption ("PTE") 90-29
(Exemption Application No. D-8019, 55 Fed. Reg. 21459 (1990)) as amended, or any
substantially similar administrative exemption granted by the U.S. Department of
Labor to an Underwriter.

         UNDERWRITING AGREEMENT: The underwriting agreement, dated October 28,
2003 and the related terms agreement, dated November 24, 2004, each between the
Depositor and the Underwriter, referred to collectively.

         UNDERWRITING STANDARDS: As to each Mortgage Loan, the Originator's
written underwriting guidelines in effect as of the origination date of such
Mortgage Loan.

         UNIFORM COMMERCIAL CODE: The Uniform Commercial Code as in effect in
any applicable jurisdiction from time to time.

         UNCERTIFICATED PRINCIPAL BALANCE: With respect to each REMIC 1 Regular
Interest on any date of determination, the amount set forth in the Preliminary
Statement hereto minus the sum of (x) the aggregate of all amounts previously
deemed distributed with respect to such interest and applied to reduce the
Uncertificated Principal Balance thereof pursuant to Section 5.05 and (y) the
aggregate of all reductions in Class Principal Amount deemed to have occurred in
connection with Realized Losses that were previously deemed allocated to the
Uncertificated Principal Balance of such REMIC 1 Regular Interest pursuant to
Section 5.05.

         UNCERTIFICATED REMIC ACCRUED INTEREST: With respect to each
Distribution Date, as to any REMIC 1 Regular Interest, interest accrued during
the related Accrual Period at the related REMIC 1 Pass Through Rate on the
Uncertificated Principal Balance thereof immediately prior

                                       29
<PAGE>

to such Distribution Date. Uncertificated REMIC Accrued Interest will be
calculated on the basis of a 360 day year, consisting of twelve 30 day months.
In each case Uncertificated REMIC Accrued Interest on any REMIC 1 Regular
Interest will be reduced by the amount of: (i) Prepayment Interest Shortfalls on
all Mortgage Loans (to the extent not offset by the Servicer with a Compensating
Interest Payment), (ii) the interest portion (adjusted to the Net Mortgage Rate)
of Realized Losses not allocated solely to one or more specific Classes of
Certificates pursuant to Section 6.02, (iii) the interest portion of Monthly
Advances previously made with respect to a Mortgage Loan or REO Property which
remained unreimbursed following the liquidation or other disposition of such
Mortgage Loan or REO Property by the Servicer or the Servicer that were made
with respect to delinquencies that were ultimately determined to be Excess
Losses and (iv) any other interest shortfalls not covered by the subordination
provided by the Class M Certificates and the Class B Certificates with all such
reductions allocated among all of the REMIC 1 Regular Interests in proportion to
their respective amounts of Uncertificated REMIC Accrued Interest payable on
such Distribution Date which would have resulted absent such reductions.

         USAP REPORT: A report in compliance with the Uniform Single Attestation
Program for Mortgage Bankers delivered in accordance with Section 9.13.

         VOTING INTERESTS: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. The voting rights allocated
among Holders of such Certificates outstanding shall be the fraction, expressed
as a percentage, the numerator of which is the aggregate Certificate Principal
Amounts of all the Certificates of such Class then outstanding and the
denominator of which is the Aggregate Stated Principal Balance of all the
Certificates then outstanding (other than the Class R Certificates). 99.00% of
all voting rights will be allocated among all holders of the Certificates (other
than the Class R Certificates) in proportion to their then outstanding
Certificate Principal Amount, 0.5% and 0.5% of all voting rights will be
allocated among the holders of the Class R-1 Certificates and Class R-2
Certificates, respectively, in proportion to the Percentage Interests evidenced
by their respective Certificates; provided, however, that any Certificate
registered in the name of the Servicer, the Depositor or the Trustee or any of
their respective affiliates shall not be included in the calculation of voting
rights.

         Section 1.02. CALCULATIONS RESPECTING MORTGAGE LOANS.

         Calculations required to be made pursuant to this Agreement with
respect to any Mortgage Loan in the Trust Fund shall be made based upon current
information as to the terms of the Mortgage Loans and reports of payments
received from the Mortgagor on such Mortgage Loans and payments to be made to
the Trustee as provided by the Servicer. The Trustee shall not be required to
recompute, verify or recalculate the information supplied to it by the Servicer.

                                  ARTICLE II.

                              DECLARATION OF TRUST;
                            ISSUANCE OF CERTIFICATES

         Section 2.01. CREATION AND DECLARATION OF TRUST FUND; CONVEYANCE OF
MORTGAGE LOANS.

                           (a) Concurrently with the execution and delivery of
this Agreement, the Depositor does hereby establish the Trust Fund and transfer,
assign, set over, deposit with and otherwise convey to the Trustee, without
recourse, subject to Sections 2.02 and 2.04, in trust, all the right, title and
interest of the Depositor in and to the Trust Fund. Such conveyance includes,

                                       30
<PAGE>

without limitation, (i) the Mortgage Loans, including the right to all payments
of principal and interest received on or with respect to the Mortgage Loans on
and after the Cut-off Date (other than Scheduled Payments due on or before such
date), and all such payments due after such date but received prior to such date
and intended by the related Mortgagors to be applied after such date; (ii) all
of the Depositor's right, title and interest in and to all amounts from time to
time credited to and the proceeds of the Distribution Account, any Custodial
Accounts or any Escrow Account established with respect to the Mortgage Loans;
(iii) all of the Depositor's rights under the Mortgage Loan Purchase Agreement;
(iv) all of the Depositor's right, title or interest in REO Property and the
proceeds thereof; (v) all of the Depositor's rights under any Insurance Policies
relating to the Mortgage Loans; (vi) all proceeds of the conversion, voluntary
or involuntary, of any of the foregoing into cash or other liquid assets,
including, without limitation, all Insurance Proceeds, Liquidation Proceeds and
condemnation awards; and (vii) the Depositor's security interest in any
collateral pledged to secure the Mortgage Loans, including the Mortgaged
Properties and any Additional Collateral relating to the Additional Collateral
Mortgage Loans, including, but not limited to, any pledge, control and guaranty
agreements and the Limited Purpose Surety Bond and any proceeds of the
foregoing, to have and to hold, in trust; and the Trustee declares that, subject
to the review provided for in Section 2.02, it has received and shall hold the
Trust Fund, as trustee, in trust, for the benefit and use of the Holders of the
Certificates and for the purposes and subject to the terms and conditions set
forth in this Agreement, and, concurrently with such receipt, has caused to be
executed, authenticated and delivered to or upon the order of the Depositor, in
exchange for the Trust Fund, Certificates in the authorized denominations
evidencing the entire ownership of the Trust Fund. Notwithstanding anything to
the contrary in this Agreement, the Trust Fund shall not obtain title to or
beneficial ownership of any Additional Collateral as a result of or in lieu of
the disposition thereof or otherwise.

         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 of REMIC 1 for the benefit of the holders of the REMIC 1
Regular Interests. The Trustee acknowledges receipt of the assets 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.

         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 and the other assets of REMIC 2 for the
benefit of the holders of the REMIC 2 Certificates. The Trustee acknowledges
receipt of the REMIC 1 Regular Interests (which are uncertificated) and the
other assets of REMIC 2 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
Certificates.The foregoing sale, transfer, assignment, set-over, deposit and
conveyance does not and is not intended to result in the creation or assumption
by the Trustee of any obligation of the Depositor, the Seller or any other
Person in connection with the Mortgage Loans or any other agreement or
instrument relating thereto except as specifically set forth therein.

         It is agreed and understood by the parties hereto that it is not
intended that any Mortgage Loan be included in the Trust Fund that is a
"High-Cost Home Loan" as defined in the New Jersey Home Ownership Act, effective
November 27, 2003, the New Mexico Home Loan Protection Act, effective January 1,
2004, and the Massachusetts Predatory Home Loan Practices Act, effective
November 7, 2004.

                                       31
<PAGE>

         In connection with such transfer and assignment of the Mortgage Loans,
the Depositor shall deliver to, and deposit with, or cause to be delivered to
and deposited with, the Trustee, the documents or instruments described in
Section 2 of the Custodial Agreement with respect to each Mortgage Loan;
provided that in Section 2a thereof, a lost note affidavit (including a copy of
the original Mortgage Note) may be delivered in lieu of the original Mortgage
Note (each a "Trustee Mortgage File") (the Custodial Agreement to be deemed
modified by the foregoing) so transferred and assigned.

                           (b) The Depositor shall cause the Mortgage Notes with
respect to each Mortgage Loan to be completed either (A) in blank, without
recourse, or (B) endorsed to "Wells Fargo Bank, N.A., as Trustee of the Merrill
Lynch Mortgage Investors Trust Series MLCC 2004-1, Mortgage Pass-Through
Certificates, without recourse" and the Depositor shall cause Assignments of
Mortgage with respect to each Mortgage Loan other than a Cooperative Mortgage
Loan to be completed either (A) in blank or (B) to "Wells Fargo Bank, N.A., as
Trustee of the Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1,
Mortgage Pass-Through Certificates," within 30 days of the Closing Date for
purpose of their recording; provided, however, that such Assignments of Mortgage
need not be recorded unless required in writing by the Rating Agencies;
provided, further, that with respect to each MERS Mortgage Loan where MERS is
not the Mortgagee of record, the original Assignment of Mortgage showing MERS as
the assignee of the Mortgage, with the evidence of recording thereon or copies
thereof certified by an officer of the Depositor to have been submitted for
recordation, shall be delivered to the Trustee.

         If any Mortgage has been recorded in the name of MERS or its designee,
no Assignment of Mortgage in favor of the Trustee will be required to be
prepared or delivered and instead, the Servicer shall take all actions as are
necessary to cause the Trustee to be shown as the owner of the related Mortgage
Loan on the records of MERS for the purpose of the system of recording transfer
of beneficial ownership of mortgages maintained by MERS.

                           (c) In instances where a title insurance policy is
required to be delivered to the Trustee and is not so delivered, the Depositor
will provide a copy of such title insurance policy to the Trustee, as promptly
as practicable after the execution and delivery hereof, but in any case within
270 days of the Closing Date.

                           (d) For Mortgage Loans (if any) that have been
prepaid in full after the Cut-off Date and prior to the Closing Date, the
Depositor, in lieu of delivering the above Trustee Mortgage File, shall deliver
to the Trustee an Officer's Certificate which shall include a statement to the
effect that all amounts received in connection with such prepayment that are
required to be deposited in the Distribution Account pursuant to Section 4.01
have been so deposited. All original documents that are not delivered to the
Trustee shall be held by the Servicer in trust for the benefit of the Trustee
and the Certificateholders.

         Section 2.02. ACCEPTANCE OF TRUST FUND BY TRUSTEE; REVIEW OF
DOCUMENTATION FOR TRUST FUND.

                           (a) The Trustee, by execution and delivery hereof,
acknowledges receipt by it of the Trustee Mortgage Files pertaining to the
Mortgage Loans listed on the Mortgage Loan Schedule, subject to review thereof
as provided herein. Upon receipt by the Trustee of each Trustee Mortgage File,
the Trustee shall review each Trustee Mortgage File in accordance with the
review procedures set forth in Section 2 of Amendment No. 1 to the Custodial
Agreement.

                                       32
<PAGE>

         In making such verifications, the Trustee may rely conclusively on the
Mortgage Loan Schedule and the documents constituting the Trustee Mortgage File,
and the Trustee shall have no obligation to independently verify the validity,
enforceability, recordability, sufficiency, due authorization or genuineness of
any document in any Trustee Mortgage File or any Mortgage Loan hereunder, nor
the collectibility, insurability, effectiveness or suitability of any Mortgage
Loan hereunder. The Trustee shall prepare an initial certification to be
delivered to the Depositor, the Seller and the Servicer on the Closing Date in
the form annexed hereto as Exhibit K (the "Initial Certification") with respect
to the Mortgage Loans (other than any Mortgage Loan paid in full or any Mortgage
Loan specifically identified on the Schedule of Exceptions attached to the
Initial Certification (the "Schedule of Exceptions") as not covered by such
Initial Certification) listed on the Mortgage Loan Schedule. If the Trustee
determines from such verification that any discrepancy or deficiency exists with
respect to a Trustee Mortgage File, the Trustee shall note such omission,
discrepancy or deficiency on the Schedule of Exceptions attached to the Initial
Certification, and shall deliver a copy (which shall be electronic, if
requested) of the Schedule of Exceptions to the Depositor on the Closing Date.
During the life of the Mortgage Loans (while subject to this Agreement), in the
event the Trustee discovers any defect with respect to any Trustee Mortgage
File, the Trustee shall give written specification of such defect to the
Depositor. Except as specifically provided above, the Trustee shall be under no
duty to review, inspect or examine such documents to determine that any of them
are enforceable or appropriate for their prescribed purpose.

                           (b) If in the course of the review described in
paragraph (a) of this Section 2.02 the Trustee discovers any document or
documents constituting a part of a Trustee Mortgage File that is missing, does
not appear regular on its face (i.e., is mutilated, damaged, defaced, torn or
otherwise physically altered) or appears to be unrelated to the Mortgage Loans
identified in the Mortgage Loan Schedule (each, a "Material Defect"), the
Trustee, upon discovering such Material Defect shall promptly identify the
Mortgage Loan to which such Material Defect relates to the Depositor, the Seller
and the Servicer. Within 90 days of its receipt of such notice (but in no case
prior to the 270th day following the Closing Date), the Depositor shall be
required to cure such Material Defect (and, in such event, the Depositor shall
provide the Trustee with an Officer's Certificate confirming that such cure has
been effected). If the Servicer notifies the Depositor and the Trustee in
writing that (i) a loss has occurred and (ii) such loss relates to a Mortgage
Loan for which the Trustee previously identified a Material Defect or for which
the Servicer has identified a Material Defect and the Depositor has not cured
such Material Defect, then the Depositor shall repurchase such Mortgage Loan at
the Purchase Price therefor in the event that such loss would, if such Mortgage
Loan is not repurchased by the Depositor, constitute a Realized Loss and such
loss is attributable to the failure of the Depositor to have cured such Material
Defect. A loss shall be deemed to be attributable to the failure of the
Depositor to cure a Material Defect if, as determined by the Depositor, upon
mutual agreement with the Trustee each acting in good faith, absent such
Material Defect, such loss would not have been incurred. Within the two-year
period following the Closing Date, the Depositor may, in lieu of repurchasing a
Mortgage Loan pursuant to this Section 2.02(b), substitute for such Mortgage
Loan a Replacement Mortgage Loan subject to the provisions of Section 2.04.

                           (c) Within 270 days following the Closing Date, the
Trustee shall deliver to the Depositor, the Seller and the Servicer, a final
certification substantially in the form attached as Exhibit L (the "Final
Certification") evidencing the completeness of the Trustee Mortgage Files in its
possession or control, with any exceptions noted on the Schedule of Exceptions
attached to the Final Certification.

                                       33
<PAGE>

                           (d) Nothing in this Agreement shall be construed to
constitute an assumption by the Trust Fund, the Trustee or the
Certificateholders of any unsatisfied duty, claim or other liability on any
Mortgage Loan or to any Mortgagor.

                           (e) Upon execution of this Agreement, the Depositor
hereby delivers to the Trustee and the Trustee acknowledges receipt of the
Mortgage Loan Purchase Agreement.

         Section 2.03. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND THE
SERVICER.

A. The Depositor hereby represents and warrants to the Servicer and to the
Trustee , for the benefit of the Certificateholders as of the Closing Date or
such other date as is specified, that:

                           (i) the Depositor is a corporation duly organized,
                  validly existing and in good standing under the laws governing
                  its creation and existence and has full corporate power and
                  authority to own its property, to carry on its business as
                  presently conducted, to enter into and perform its obligations
                  under this Agreement, and to create the trust pursuant hereto;

                           (ii) the execution and delivery by the Depositor of
                  this Agreement have been duly authorized by all necessary
                  corporate action on the part of the Depositor; neither the
                  execution and delivery of this Agreement, nor the consummation
                  of the transactions herein contemplated, nor compliance with
                  the provisions hereof, will conflict with or result in a
                  breach of, or constitute a default under, any of the
                  provisions of any law, governmental rule, regulation,
                  judgment, decree or order binding on the Depositor or its
                  properties or the certificate of incorporation or bylaws of
                  the Depositor;

                           (iii) the execution, delivery and performance by the
                  Depositor of this Agreement and the consummation of the
                  transactions contemplated hereby do not require the consent or
                  approval of, the giving of notice to, the registration with,
                  or the taking of any other action in respect of, any state,
                  federal or other governmental authority or agency, except such
                  as has been obtained, given, effected or taken prior to the
                  date hereof;

                           (iv) this Agreement has been duly executed and
                  delivered by the Depositor and, assuming due authorization,
                  execution and delivery by the Trustee, constitutes a valid and
                  binding obligation of the Depositor enforceable against it in
                  accordance with its terms except as such enforceability may be
                  subject to (A) applicable bankruptcy and insolvency laws and
                  other similar laws affecting the enforcement of the rights of
                  creditors generally and (B) general principles of equity
                  regardless of whether such enforcement is considered in a
                  proceeding in equity or at law;

                           (v) there are no actions, suits or proceedings
                  pending or, to the knowledge of the Depositor, threatened or
                  likely to be asserted against or affecting the Depositor,
                  before or by any court, administrative agency, arbitrator or
                  governmental body (A) with respect to any of the transactions
                  contemplated by this Agreement or (B) with respect to any
                  other matter which in the judgment of the Depositor will be
                  determined adversely to the Depositor and will if determined
                  adversely to the Depositor materially and adversely affect it
                  or its

                                       34
<PAGE>

                  business, assets, operations or condition, financial or
                  otherwise, or adversely affect its ability to perform its
                  obligations under this Agreement;

                           (vi) immediately prior to the transfer and assignment
                  of the Mortgage Loans to the Trustee, the Depositor was the
                  sole owner of record and holder of each Mortgage Loan, and the
                  Depositor had good and marketable title thereto, and had full
                  right to transfer and sell each Mortgage Loan to the Trustee
                  free and clear, subject only to (1) liens of current real
                  property taxes and assessments not yet due and payable and, if
                  the related Mortgaged Property is a condominium unit, any lien
                  for common charges permitted by statute, (2) covenants,
                  conditions and restrictions, rights of way, easements and
                  other matters of public record as of the date of recording of
                  such Mortgage acceptable to mortgage lending institutions in
                  the area in which the related Mortgaged Property is located
                  and specifically referred to in the lender's title insurance
                  policy or attorney's opinion of title and abstract of title
                  delivered to the Originator of such Mortgage Loan, and (3)
                  such other matters to which like properties are commonly
                  subject which do not, individually or in the aggregate,
                  materially interfere with the benefits of the security
                  intended to be provided by the Mortgage, of any encumbrance,
                  equity, participation interest, lien, pledge, charge, claim or
                  security interest, and had full right and authority, subject
                  to no interest or participation of, or agreement with, any
                  other party, to sell and assign each Mortgage Loan pursuant to
                  this Agreement;

                           (vii) This Agreement creates a valid and continuing
                  security interest (as defined in the applicable Uniform
                  Commercial Code (the "UCC"), in the Mortgage Loans in favor of
                  the Trustee, which security interest is prior to all other
                  liens, and is enforceable as such against creditors of and
                  purchasers from the Depositor;

                           (viii) The Mortgage Loans constitute "instruments"
                  within the meaning of the applicable UCC;

                           (ix) Other than the security interest granted to the
                  Trustee pursuant to this Agreement, the Depositor has not
                  pledged, assigned, sold, granted a security interest in, or
                  otherwise conveyed any of the Mortgage Loans. The Depositor
                  has not authorized the filing of and is not aware of any
                  financing statement against the Depositor that includes a
                  description of the collateral covering the Mortgage Loans
                  other than a financing statement relating to the security
                  interest granted to the Trustee hereunder or that has been
                  terminated. The Depositor is not aware of any judgment or tax
                  lien filings against the Depositor;

                           (x) None of the Mortgage Loans have any marks or
                  notations indicating that such Mortgage Loans have been
                  pledged, assigned or otherwise conveyed to any Person other
                  than the Trustee; and

                           (xi) The Depositor has received all consents and
                  approvals required by the terms of the Mortgage Loans to
                  convey the Mortgage Loans hereunder to the Trustee;

                           (xii) As of the Closing Date, each Mortgage Loan is a
                  "qualified mortgage" within the meaning of Section 860G(a)(3)
                  of the Code (without regard

                                       35
<PAGE>

                  to Treasury Regulations Section 1.860G-2(f) or any similar
                  rule that provides that a defective obligation is a qualified
                  mortgage for a temporary period);

                           (xiii) As of the Closing Date, no Mortgage Loan
                  provides for interest other than at either (x) a single fixed
                  rate in effect throughout the term of the Mortgage Loan or (y)
                  a single "variable rate" (within the meaning of Treasury
                  Regulations Section 1.860G-1(a)(3)) in effect throughout the
                  term of the Mortgage Loan;

                           (xiv) As of the Closing Date, no Mortgage is the
                  subject of pending or final foreclosure proceedings; and

                           (xv) As of the Closing Date, the Depositor would not
                  initiate foreclosure proceedings with respect to any Mortgage
                  Loan based on such Mortgage Loan's delinquency status prior to
                  the next scheduled payment date for such Mortgage Loan.

         The foregoing representations made in this Section 2.03 by the
Depositor shall survive the termination of this Agreement and shall not be
waived by any party hereto

B. The Servicer hereby represents and warrants to the Depositor and to the
Trustee, for the benefit of the Certificateholders as of the Closing Date that:

                           (i) The Servicer is a corporation duly organized,
                  validly existing and in good standing under the laws of the
                  State of New Jersey. The Servicer has in full force and effect
                  (without notice of possible suspension, revocation or
                  impairment) all required qualifications, permits, approvals,
                  licenses, and registrations, or exemption therefrom, to
                  conduct all activities in all jurisdictions in which its
                  activities with respect to the Mortgage Loans require it to be
                  qualified or licensed;

                           (ii) The Servicer has all requisite corporate power,
                  authority and capacity to carry on its business as it is now
                  being conducted, to execute and deliver this Agreement, and to
                  perform all of its obligations hereunder. The Servicer does
                  not believe, nor does it have any cause or reason to believe,
                  that it cannot perform each and every covenant contained in
                  this Agreement;

                           (iii) The execution, delivery and performance of this
                  Agreement by the Servicer and consummation of the transactions
                  contemplated hereby have been duly and validly authorized by
                  all necessary corporate, shareholder or other action by the
                  Servicer; this Agreement has been duly and validly executed
                  and delivered by the Servicer; and this Agreement is a valid
                  and legally binding agreement of the Servicer, enforceable
                  against the Servicer in accordance with its respective terms,
                  subject to bankruptcy, insolvency and similar laws affecting
                  generally the enforcement of creditors' rights and the
                  discretion of a court to grant specific performance of
                  contracts;

                           (iv) Neither the execution and delivery of this
                  Agreement, nor the consummation of the transactions
                  contemplated hereby, nor compliance with their respective
                  terms and conditions shall (a) violate, conflict with, result
                  in the breach of, constitute a default under, be prohibited by
                  or require any additional

                                       36
<PAGE>

                  approval under any terms, conditions or provisions of the
                  Servicer's articles of incorporation or by-laws or any other
                  similar corporate or organizational document of the Servicer;
                  any mortgage, indenture, deed of trust, loan or credit
                  agreement or other agreement or instrument to which the
                  Servicer is now a party or by which it is bound; or any law,
                  ordinance, rule, regulation, order, judgment or decree of any
                  governmental authority applicable to the Servicer; or (b)
                  result in the creation or imposition of any lien, charge or
                  encumbrance of any material nature upon any of the properties
                  or assets of the Servicer;

                           (v) The Servicer holds all licenses, approvals,
                  permits and other authorizations, or exemptions therefrom,
                  required under applicable law to assume responsibility for
                  servicing the Mortgage Loans;

                           (vi) There is no litigation, claim, demand,
                  proceeding or governmental investigation existing or pending,
                  or to the knowledge of the Servicer, threatened, nor is there
                  any order, injunction or decree outstanding against or
                  relating to the Servicer that could (i) have a material
                  adverse effect upon the performance by the Servicer of its
                  obligations under this Agreement or (ii) to the Servicer's
                  knowledge, result in any material loss or liability to
                  Depositor, the Trustee, the Trust Fund or the Seller. Further,
                  to the Servicer's knowledge, there is no meritorious basis for
                  any such litigation, claim, demand, proceeding, or
                  governmental investigation;

                           (vii) The Servicer has been approved by GNMA, Fannie
                  Mae and FHLMC and will remain approved as an "eligible
                  seller/servicer" of residential mortgage loans as provided in
                  GNMA, Fannie Mae, or FHLMC guidelines and in good standing.
                  The Servicer has not received any notification from GNMA,
                  Fannie Mae or FHLMC that the Servicer is not in compliance
                  with the requirements of the approved "seller/servicer"
                  status. The Servicer is a mortgagee approved by the Secretary
                  of HUD pursuant to Section 203 and 211 of the National Housing
                  Act. The Servicer has not received any notification from HUD
                  that the Servicer is not in compliance with the requirements
                  of the approved mortgagee status;

                           (viii) The servicing practices to be used by the
                  Servicer under this Agreement are, and shall remain, in all
                  material respects in compliance with Accepted Servicing
                  Practices, including without limitation, all federal, state
                  and local laws, rules, all regulations and requirements in
                  connection therewith, and Fannie Mae guidelines, as
                  applicable;

                           (ix) The Servicer has not received written notice
                  from or on behalf of FHA, HUD, FDIC, Fannie Mae, FHLMC or
                  GNMA, advising the Servicer of its failure to comply with
                  applicable servicing or claims procedures, or resulted in a
                  request for repurchase of mortgage loans or indemnification in
                  connection with any mortgage loans;

                           (x) The Servicer has in place a contingency plan that
                  will enable it to perform its obligations under this Agreement
                  in all material respects, at another location within five (5)
                  Business Days in the event its primary location is rendered
                  inoperative as a result of a natural or other disaster or
                  emergency;

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<PAGE>

                           (xi) The Servicer maintains and shall maintain, in
                  good standing, all licenses and approvals necessary to service
                  the Mortgage Loans and maintains and shall at all times
                  maintain the capital requirements imposed by the licensing or
                  approving entities having jurisdiction over the Servicer. The
                  Servicer has filed applications for all applicable licenses
                  and qualifications to do business and to service the Mortgage
                  Loans in the U.S. Virgin Islands;

                           (xii) The Servicer maintains and shall at all times
                  maintain error and omissions and fidelity insurance coverage
                  of the type and in the amounts required by Fannie Mae;

                           (xiii) The Servicer has, and shall at all times
                  maintain during the term of this Agreement, sufficient
                  systems, including but not limited to the Servicer's EDP, and
                  trained and experienced personnel in place to perform its
                  obligations under this Agreement;

                           (xiv) For so long as, and to the extent that, the
                  Servicer services the Mortgage Loans, the Servicer will
                  continue to comply with each applicable federal, state, or
                  local, law, statute, and ordinance, and any rule, regulation,
                  or order issued thereunder, pertaining to the subject matter
                  of this Agreement, including, but not limited to, usury,
                  RESPA, Consumer Credit Reporting Act, Equal Credit Opportunity
                  Act, Federal Deposit Insurance Corporation Improvement Act,
                  Regulation B, Fair Credit Reporting Act, Fair Debt Collection
                  Practices Act, Fair Housing Act, Truth in Lending Act and
                  Regulation Z, Flood Disaster Protection Act of 1973, and any
                  applicable regulations related thereto, and such other fair
                  housing, anti-redlining, equal credit opportunity,
                  truth-in-lending, real estate settlement procedures, fair
                  credit reporting, and every other prohibition against unlawful
                  discrimination in residential mortgage lending or governing
                  consumer credit, and all state consumer credit statutes and
                  regulations, as amended. In the event the Depositor or the
                  Trustee has a reasonable good faith belief in the Servicer's
                  non-compliance with this representation and warranty and upon
                  the Depositor's or the Trustee's written request, the Servicer
                  shall deliver to the Depositor or the Trustee reasonable
                  evidence of compliance with any of the requirements of this
                  representation and warranty; and

                           (xv) Neither the Servicer, its parent, nor any of its
                  subsidiaries is in bankruptcy, receivership or
                  conservatorship. The Servicer has the requisite financial
                  resources and ability to meet its obligations under this
                  Agreement, including, but not limited to, any and all
                  indemnification obligations,

         Within 60 days of the earlier of either discovery by or notice to the
Servicer of any breach of a representation or warranty set forth in this Section
2.03(B) which materially and adversely affects the ability of the Servicer to
perform its duties and obligations under this Agreement or otherwise materially
and adversely affects the value of the Mortgage Loans, the Mortgaged Property or
the priority of the security interest on such Mortgaged Property, the Servicer
shall use its best efforts promptly to cure such breach in all material respects
and, if such breach cannot be cured, the Servicer shall, at the Trustee's
option, assign the Servicer's rights and obligations under this Agreement (or
respecting the affected Mortgage Loans) to a successor servicer selected by the
Depositor with the prior consent and approval of the Trustee. Such assignment
shall be made in accordance with this Agreement.

                                       38
<PAGE>

         Section 2.04. DISCOVERY OF BREACH; REPURCHASE OR SUBSTITUTION OF
MORTGAGE LOANS.

                           (a) Pursuant to Section 7 of the Mortgage Loan
Purchase Agreement, the Seller has made certain representations and warranties
as to the characteristics of the Mortgage Loans (such representations and
warranties are set out in full in Schedule B of this Agreement) as of the
Closing Date and the conveyance thereof from the Seller to the Depositor, for
the benefit of the Trustee and the Certificateholders, and the Seller has agreed
to comply with the provisions of this Section 2.04 in respect of a breach of any
of such representations and warranties.

         It is understood and agreed that (i) the representations and warranties
of the Depositor and the Servicer set forth in Section 2.03 and (ii) the
representations and warranties of the Seller set forth in Section 7 of the
Mortgage Loan Purchase Agreement shall survive delivery of the Trustee Mortgage
Files and the Assignment of Mortgage of each Mortgage Loan to the Trustee and
shall continue throughout the term of this Agreement. Upon discovery (i) by the
Depositor, the Seller, the Servicer or the Trustee of a breach of any
representation or warranty made by the Depositor under Section 2.03 which
materially adversely affects the value of a Mortgage Loan or the interest
therein of the Certificateholder (a "Defective Mortgage Loan"), or (ii) by the
Depositor or the Seller of the breach by the Seller of any representation or
warranty under the Mortgage Loan Purchase Agreement in respect of any Mortgage
Loan, which breach results in the Mortgage Loan being a "Defective Mortgage
Loan" (each of such parties hereby agreeing to give written notice of such
breach to the Trustee and the other of such parties), the Trustee, or its
designee, shall promptly notify the Depositor in writing of such breach and
request that the Depositor cure or cause the cure of such breach within 90 days
from the date that the Depositor discovered or was notified of such breach, and
if the Depositor does not cure such breach in all material respects during such
period, the Trustee shall (i) in the case of an uncured breach under Section
2.03, cause the Depositor to repurchase such Defective Mortgage Loan at the
Purchase Price and (ii) in the case of an uncured breach by the Seller under the
Mortgage Loan Purchase Agreement, cause the Depositor to enforce the Seller's
obligation under the Mortgage Loan Purchase Agreement to repurchase that
Defective Mortgage Loan from the Trust Fund at the Purchase Price, in each case
on or prior to the Determination Date following the expiration of such 90-day
period (subject to Section 2.04(b) below); provided, however, that, in
connection with any such breach under clause (ii) above that could not
reasonably have been cured within such 90-day period, if the Seller shall have
commenced to cure such breach within such 90-day period and, if the defective
Mortgage Loan qualifies as a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code following such 90-day period, the Seller shall be
permitted to proceed thereafter diligently and expeditiously to cure the same
within an additional 90-day period. The Purchase Price for the repurchased
Defective Mortgage Loan shall be deposited in the related Distribution Account,
and the Trustee, or its designee, upon receipt of such deposit and two copies of
a Request for Release with respect to such Defective Mortgage Loan, shall
release to the Seller or the Depositor, as applicable, the related Trustee
Mortgage File and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, representation or warranties, as
either party shall furnish to it and as shall be necessary to vest in such party
any Defective Mortgage Loan released pursuant hereto and the Trustee, or its
designee, shall have no further responsibility with regard to such Trustee
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 Defective Mortgage Loan as provided above, the
Seller may cause such Defective Mortgage Loan to be removed from the Trust Fund
(in which case it shall become a Deleted Mortgage Loan) and substitute one or
more Replacement Mortgage Loans in the manner and subject to the limitations set
forth in Section 2.04(b) below. It is understood and agreed that the obligation
of the Seller (or the Depositor, if applicable) to cure or to repurchase (or to
substitute for) any Mortgage Loan as to which a breach has occurred and is
continuing shall constitute the sole remedy against the Seller (or the
Depositor, if

                                       39
<PAGE>

applicable) respecting such breach available to the Trustee on behalf of the
Certificateholders. With respect to the representations and warranties described
in Schedule B which are made to the best of the Seller's knowledge, if it is
discovered by any of the Depositor, the Seller or the Trustee that the substance
of such representation and warranty is inaccurate and such inaccuracy materially
and adversely affects the value of the related Mortgage Loan, then
notwithstanding the Seller's lack of knowledge with respect to the substance of
such representation and warranty, such inaccuracy shall be deemed a breach of
the applicable representation or warranty.

                           (b) Any substitution of Replacement Mortgage Loans
for Deleted Mortgage Loans made pursuant to Section 2.04(a) above 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 Seller substitutes a
Replacement Mortgage Loan or Loans, such substitution shall be effected by
delivering to the Trustee for such Replacement 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, together with
an Officers' Certificate stating that each such Replacement Mortgage Loan
satisfies the definition thereof and specifying the Substitution Amount (as
described below), if any, in connection with such substitution. The Trustee
shall acknowledge receipt for such Replacement Mortgage Loan and, within 45 days
thereafter, shall review such Mortgage Documents as specified in this Agreement
under Section 2.02(a) and deliver to the Depositor, with respect to such
Replacement Mortgage Loans, a certification substantially in the form of a
revised Initial Certification, with any exceptions noted thereon. Within one
year of the date of substitution, the Trustee shall deliver to the Depositor a
certification substantially in the form of a revised Final Certification, with
respect to such Replacement Mortgage Loans, with any exceptions noted thereon.
Monthly Payments due with respect to Replacement Mortgage Loans in the month of
substitution shall not be included as part of the Trust Fund and shall be
retained by the Seller. For the month of substitution, distributions to
Certificateholders shall reflect the collections and recoveries in respect of
such Deleted Mortgage in the Due Period preceding the month of substitution and
the Seller shall thereafter be entitled to retain all amounts subsequently
received in respect of such Deleted Mortgage Loan. Upon such substitution, such
Replacement Mortgage Loan shall constitute part of the Trust Fund and shall be
subject in all respects to the terms of this Agreement and the Mortgage Loan
Purchase Agreement, including all representations and warranties thereof
included in the Mortgage Loan Purchase Agreement, in each case as of the date of
substitution.

         For any month in which the Seller substitutes one or more Replacement
Mortgage Loans for one or more Deleted Mortgage Loans, the Trustee, based upon
information provided by the Servicer, shall determine the excess (each, a
"Substitution Amount"), if any, by which the aggregate Purchase Price of all
such Deleted Mortgage Loans exceeds the aggregate Stated Principal Balance of
the Replacement Mortgage Loans replacing such Deleted Mortgage Loans, together
with one month's interest on such excess amount at the applicable Net Mortgage
Rate. On the date of such substitution, the Seller shall deliver or cause to be
delivered to the Servicer for deposit in the Custodial Account an amount equal
to the related Substitution Amount, if any, and the Trustee, upon receipt of the
related Replacement Mortgage Loan or Loans and two copies of a Request for
Release with respect to the Deleted Mortgage Loan or Loans, shall release to the
Seller the related Trustee Mortgage File or Files and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse, as
the Seller shall deliver to it and as shall be necessary to vest therein any
Deleted Mortgage Loan released pursuant hereto.

                                       40
<PAGE>

         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 (either
specifically or as a class of transactions) shall 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 created hereunder 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.

                           (c) Upon discovery by the Seller, the Depositor, 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 or Depositor, as
applicable, shall repurchase, or the Seller, subject to the limitations set
forth in Section 2.04(b), shall substitute one or more Replacement 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. Any such
repurchase or substitution shall be made in the same manner as set forth in
Sections 2.04(a) and 2.04(b) above. The Trustee shall re-convey 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.

         The Seller indemnifies and holds the Trust Fund, the Trustee, the
Depositor, the Servicer and each Certificateholder harmless against any and all
taxes, claims, losses, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments, and any other costs, fees and expenses that the Trust
Fund, the Trustee, the Depositor, the Servicer and any Certificateholder may
sustain in connection with any actions of such party relating to a repurchase of
a Mortgage Loan other than in compliance with the terms of this Section 2.04 and
the Mortgage Loan Purchase Agreement, to the extent that any such action causes
(i) any federal or state tax to be imposed on the Trust Fund, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(1) of the Code or on "contributions after the startup date" under
Section 860G(d)(1) of the Code, or (ii) any REMIC formed hereby to fail to
qualify as a REMIC at any time that any Certificate is outstanding.

                           (d) Notwithstanding anything to the contrary in this
Agreement, Seller shall service and administer the Additional Collateral, it
being understood and agreed that only Seller shall service and administer the
related securities accounts, lines of credit and guarantees with respect to
Additional Collateral.

         Section 2.05. GRANT CLAUSE.

                           (a) It is intended that the conveyance of the
Depositor's right, title and interest in and to property constituting the Trust
Fund pursuant to this Agreement shall constitute, and shall be construed as, a
sale of such property and not a grant of a security interest to secure a loan.
However, if such conveyance is deemed to be in respect of a loan, it is intended
that: (1) the rights and obligations of the parties shall be established
pursuant to the terms of this Agreement; (2) the Depositor hereby grants to the
Trustee for the benefit of the Holders of the Certificates a first priority
security interest in all of the Depositor's right, title and interest in, to and
under, whether now owned or hereafter acquired, the Trust Fund and all proceeds
of any and all property constituting the Trust Fund to secure payment of the
Certificates; and (3) this Agreement shall constitute a security agreement under
applicable law. If such conveyance is deemed to be in respect of a loan and the
trust created by this Agreement terminates prior to the

                                       41
<PAGE>

satisfaction of the claims of any Person holding any Certificate, the security
interest created hereby shall continue in full force and effect and the Trustee
shall be deemed to be the collateral agent for the benefit of such Person, and
all proceeds shall be distributed as herein provided.

                           (b) The Depositor shall, to the extent consistent
with this Agreement, take such reasonable actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the
Mortgage Loans and the other property described above, such security interest
would be deemed to be a perfected security interest of first priority under
applicable law and will be maintained as such throughout the term of this
Agreement. The Depositor will, at its own expense, make all initial filings on
or about the Closing Date and shall forward a copy of such filing or filings to
the Trustee. Without limiting the generality of the foregoing, the Depositor
shall prepare and forward for filing, or shall cause to be forwarded for filing,
at the expense of the Depositor, all filings necessary to maintain the
effectiveness of any original filings necessary under the relevant UCC to
perfect the Trustee's security interest in or lien on the Mortgage Loans and the
other property described above, including without limitation (x) continuation
statements, and (y) such other statements as may be occasioned by (1) any change
of name of Seller, the Depositor or the Trustee, (2) any change of location of
the place of business or the chief executive office of the Seller or the
Depositor, (3) any transfer of any interest of the Depositor in any Mortgage
Loan or (4) any change under the relevant UCC or other applicable laws. The
Depositor shall not organize under the law of any jurisdiction other than the
State under which each is organized as of the Closing Date (whether changing its
jurisdiction of organization or organizing under an additional jurisdiction)
without giving 30 days prior written notice of such action to its immediate and
intermediate transferee, including the Trustee. Before effecting such change,
the Depositor proposing to change its jurisdiction of organization shall prepare
and file in the appropriate filing office any financing statements or other
statements necessary to continue the perfection of the interests of its
immediate and mediate transferees, including the Trustee, in the Mortgage Loans
and the other property described above. In connection with the transactions
contemplated by this Agreement, the Depositor authorizes its immediate or
mediate transferee to file in any filing office any initial financing
statements, any amendments to financing statements, any continuation statements,
or any other statements or filings described in this paragraph (b).

                                  ARTICLE III.

                                THE CERTIFICATES

         Section 3.01. THE CERTIFICATES.

                           (a) The Certificates shall be issuable in registered
form only and shall be securities governed by Article 8 of the New York Uniform
Commercial Code. The Book-Entry Certificates will be evidenced by one or more
certificates, beneficial ownership of which will be held in the dollar
denominations in Certificate Principal Amount, or in the Percentage Interests,
specified herein. Each Class of Book-Entry Certificates will be issued in the
minimum denominations in Certificate Principal Amount specified in the
Preliminary Statement hereto and in integral multiples of $1 in excess thereof.
Each Class of Non-Book-Entry Certificates other than the Residual Certificates
shall be issued in definitive, fully registered form in the minimum
denominations in Certificate Principal Amount specified in the Preliminary
Statement hereto and in integral multiples of $1 in excess thereof. The Residual
Certificates will be issued in registered, certificated form in minimum
denominations of a 25% Percentage Interest. Provided however, that one
Certificate of each such Class of Certificates may be in a

                                       42
<PAGE>

different denomination so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Class Certificate Balance of such
Class on the Closing Date.

                           (b) The Certificates shall be executed by manual or
facsimile signature on behalf of the Trustee by an authorized officer. Each
Certificate shall, on original issue, be authenticated by the Trustee or an
Authenticating Agent upon the order of the Depositor upon receipt by the Trustee
of the Trustee Mortgage Files described in Section 2.01. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
unless there appears on such Certificate a certificate of authentication
substantially in the form provided for herein, executed by an authorized officer
of the Trustee or of an Authenticating Agent, by manual signature, and such
certification 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. At
any time and from time to time after the execution and delivery of this
Agreement, the Depositor may deliver Certificates executed by the Trustee to the
Trustee or the Authenticating Agent for authentication and the Trustee or the
Authenticating Agent shall authenticate and deliver such Certificates as in this
Agreement provided and not otherwise.

                           (c) The Class B-1, Class B-2 and Class B-3
Certificates offered and sold in reliance on the exemption from registration
under Rule 144A under the Act shall be issued initially in the form of one or
more permanent global Certificates in definitive, fully registered form without
interest coupons with the applicable legends set forth in Exhibit A added to the
forms of such Certificates (each, a "Restricted Global Security").

         Section 3.02. REGISTRATION.

         The Trustee is hereby appointed, and the Trustee hereby accepts its
appointment as, initial Certificate Registrar in respect of the Certificates and
shall maintain books for the registration and for the transfer of Certificates
(the "Certificate Register"). The Trustee may appoint a bank or trust company to
act as successor Certificate Registrar. A registration book shall be maintained
for the Certificates collectively. The Certificate Registrar may resign or be
discharged or removed and a new successor may be appointed in accordance with
the procedures and requirements set forth in Sections 6.06 and 6.07 hereof with
respect to the resignation, discharge or removal of the Trustee and the
appointment of a successor Trustee. The Certificate Registrar may appoint, by a
written instrument delivered to the Holders, any bank or trust company to act as
co-registrar under such conditions as the Certificate Registrar may prescribe;
provided, however, that the Certificate Registrar shall not be relieved of any
of its duties or responsibilities hereunder by reason of such appointment.

         Section 3.03. TRANSFER AND EXCHANGE OF CERTIFICATES.

                           (a) A Certificate (other than Book-Entry Certificates
which shall be subject to Section 3.09 hereof) may be transferred by the Holder
thereof only upon presentation and surrender of such Certificate at the office
of the Certificate Registrar duly endorsed or accompanied by an assignment duly
executed by such Holder or his duly authorized attorney in such form as shall be
satisfactory to the Certificate Registrar. Upon the transfer of any Certificate
in accordance with the preceding sentence, the Trustee shall execute, and the
Authenticating Agent shall authenticate and deliver to the transferee, one or
more new Certificates of the same Class and evidencing, in the aggregate, the
same aggregate Certificate Principal Amount as the Certificate being
transferred. No service charge shall be made to a Certificateholder for any
registration of transfer of Certificates, but the Certificate Registrar may
require payment of a sum

                                       43
<PAGE>

sufficient to cover any tax or governmental charge that may be imposed in
connection with any registration of transfer of Certificates.

                           (b) A Certificate may be exchanged by the Holder
thereof for any number of new Certificates of the same Class, in authorized
denominations, representing in the aggregate the same Certificate Principal
Amount as the Certificate surrendered, upon surrender of the Certificate to be
exchanged at the office of the Certificate Registrar duly endorsed or
accompanied by a written instrument of transfer duly executed by such Holder or
his duly authorized attorney in such form as is satisfactory to the Certificate
Registrar. Certificates delivered upon any such exchange will evidence the same
obligations, and will be entitled to the same rights and privileges, as the
Certificates surrendered. No service charge shall be made to a Certificateholder
for any exchange of Certificates, 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 exchange of Certificates. Whenever any
Certificates are so surrendered for exchange, the Trustee shall execute, and the
Authenticating Agent shall authenticate, date and deliver the Certificates which
the Certificateholder making the exchange is entitled to receive.

                           (c) By acceptance of a Restricted Certificate,
whether upon original issuance or subsequent transfer, each Holder of such a
Certificate acknowledges the restrictions on the transfer of such Certificate
set forth thereon and agrees that it will transfer such a Certificate only as
provided herein.

         The following restrictions shall apply with respect to the transfer and
registration of transfer of a Restricted Certificate to a transferee that takes
delivery in the form of a Definitive Certificate:

                           (i) The Certificate Registrar shall register the
                  transfer of a Restricted Certificate if the requested transfer
                  is (x) to the Depositor or an affiliate (as defined in Rule
                  405 under the 1933 Act) of the Depositor or (y) being made to
                  a "qualified institutional buyer" (a "QIB") as defined in Rule
                  144A under the Securities Act of 1933, as amended (the "Act")
                  by a transferor that has provided the Certificate Registrar
                  with a certificate in the form of Exhibit G hereto; and

                           (ii) The Certificate Registrar shall register the
                  transfer of a Restricted Certificate if the requested transfer
                  is being made to an "accredited investor" under Rule
                  501(a)(1), (2), (3) or (7) under the Act, or to any Person all
                  of the equity owners in which are such accredited investors,
                  by a transferor who furnishes to the Certificate Registrar a
                  letter of the transferee substantially in the form of Exhibit
                  H hereto.

                           (d)(i) No transfer of an ERISA-Restricted Certificate
shall be made unless the prospective transferee provides the Trustee and the
Depositor with (A) a representation as set forth in Exhibit I to the effect that
such transferee is not an employee benefit plan subject to Title I of ERISA, a
plan subject to Section 4975 of the Code or a plan or arrangement subject to any
provisions under any federal, state, local, non-U.S. or other laws or
regulations that are substantively similar to the foregoing provisions of ERISA
or the Code ("Similar Law") (collectively, a "Plan"), and is not directly or
indirectly acquiring the Certificate for, on behalf of or with any assets of any
such Plan, (B) a representation or certification to the Trustee to the effect
that the proposed transfer and holding of the Certificate and the servicing,
management and operation of the Trust Fund will not result in a prohibited
transaction under Section 406 of ERISA

                                       44
<PAGE>

or Section 4975 of the Code which is not covered under an individual or class
prohibited transaction exemption including but not limited to Department of
Labor Prohibited Transaction Class Exemption ("PTCE") 84-14 (Class Exemption for
Plan Asset Transactions Determined by Independent Qualified Professional Asset
Managers); PTCE 91-38 (Class Exemption for Certain Transactions Involving Bank
Collective Investment Funds); 90-1 (Class Exemption for Certain Transactions
Involving Insurance Company Pooled Separate Accounts), PTCE 95-60 (Class
Exemption for Certain Transactions Involving Insurance Company General
Accounts), PTCE 96-23 (Class Exemption for Plan Asset Transactions Determined by
In-House Asset Managers) and will not subject the Depositor, the Servicer or the
Trustee to any obligation in addition to those undertaken in this Agreement, or
(C) solely in the case of a Definitive Certificate, an Opinion of Counsel
satisfactory to the Trustee to the effect that the acquisition or holding of
such Certificate 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
and the Code, will not result in such a prohibited transaction, and will not
subject the Depositor, the Servicer or the Trustee to any obligation in addition
to those expressly undertaken in this Agreement, which Opinion of Counsel shall
not be an expense of the Certificate Registrar, the Depositor, the Servicer or
the Trustee.

                           (ii) For purposes of paragraph (i) of this Subsection
3.03(d), other than subparagraph (i)(C), the representation as set forth in
Exhibit B or Exhibit I, as applicable, shall be deemed to have been made to the
Trustee or the Depositor by the transferee's acceptance of an ERISA Restricted
Certificate (or the acceptance by a Certificate Owner of the beneficial interest
in any Class of ERISA Restricted Certificates). Notwithstanding any other
provision herein to the contrary, any purported transfer of an ERISA Restricted
Certificate to or on behalf of a Plan without the delivery to the Trustee or the
Depositor of a representation or an Opinion of Counsel satisfactory to the
Trustee or the Depositor as described above shall be void and of no effect. None
of the Certificate Registrar, the Depositor, the Servicer or the Trustee shall
be under any liability to any Person for any registration or transfer of any
ERISA Restricted Certificate that is in fact not permitted by this Section
3.03(d) nor shall the Paying Agent be under any liability for making any
payments due on such 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 transfer was registered by the Certificate Registrar in accordance
with the foregoing requirements. The Certificate Registrar, Depositor, Servicer,
Paying Agent and/or Trustee shall be entitled, but not obligated, to recover
from any Holder of any ERISA Restricted Certificate that was in fact a Plan and
that held such Certificate in violation of this Section 3.03(d) all payments
made on such ERISA Restricted Certificate at and after the time it commenced
such holding. Any such payments so recovered shall be paid and delivered to the
last preceding Holder of such Certificate that is not a Plan.

                           (iii) Each beneficial owner of a Class M-1, Class M-2
or Class M-3 Certificate or any interest therein shall be deemed to have
represented, by virtue of its acquisition and holding of such Certificate or
interest therein, that either (A) it is not a Plan or investing with Plan
assets, (B) it has acquired and is holding such Certificate in reliance on the
Underwriter's Exemption, and that it understands that there are certain
conditions to the availability of the Underwriter's Exemption, including that
the certificate must be rated, at the time of purchase, not lower than "BBB-"
(or its equivalent) by Fitch, Moody's or Standard & Poor's, a division of the
McGraw-Hill Companies, Inc., or (C) (i) it is an insurance company, (ii) the
source of funds used to acquire or hold the Certificate or interest therein is
an "insurance company general account," as defined in Prohibited Transaction
Class Exemption ("PTCE") 95-60, and (iii) the conditions in Sections I and III
of PTCE 95-60 have been satisfied.

                                       45
<PAGE>

                           (iv) Notwithstanding the foregoing, no representation
or Opinion of Counsel shall be required for the initial issuance of the ERISA
Restricted Certificates.

                           (e) As a condition of the registration of transfer or
exchange of any Certificate, the Certificate Registrar may require the certified
taxpayer identification number of the owner of the Certificate and the payment
of a sum sufficient to cover any tax or other governmental charge imposed in
connection therewith; provided, however, that the Certificate Registrar shall
have no obligation to require such payment or to determine whether or not any
such tax or charge may be applicable. No service charge shall be made to the
Certificateholder for any registration, transfer or exchange of a Certificate.

                           (f) Notwithstanding anything to the contrary
contained herein, no Residual Certificate or beneficial interest therein may be
owned, pledged or transferred, directly or indirectly, by or to (i) a
Disqualified Organization or (ii) an individual, corporation or partnership or
other person unless, in the case of clause (ii), such person is (A) not a
Non-U.S. Person or (B) is a Non-U.S. Person that holds a Residual Certificate in
connection with the conduct of a trade or business within the United States and
has furnished the transferor and the Certificate Registrar with an effective
Internal Revenue Service Form W-8ECI or successor form at the time and in the
manner required by the Code (any such person who is not covered by clause (A) or
(B) above is referred to herein as a "Non-permitted Foreign Holder").

         Prior to and as a condition of the registration of any transfer, sale
or other disposition of a Residual Certificate or a beneficial interest therein,
the proposed transferee shall deliver to the Trustee and the Certificate
Registrar an affidavit in substantially the form attached hereto as Exhibit B
representing and warranting, among other things, that such transferee is neither
a Disqualified Organization, an agent or nominee acting on behalf of a
Disqualified Organization, nor a Non-permitted Foreign Holder (any such
transferee, a "Permitted Transferee"), and the proposed transferor shall deliver
to the Trustee and the Certificate Registrar an affidavit in substantially the
form attached hereto as Exhibit C. In addition, the Trustee or the Certificate
Registrar may (but shall have no obligation to) require, prior to and as a
condition of any such transfer, the delivery by the proposed transferee of an
Opinion of Counsel, addressed to the Trustee and the Certificate Registrar, that
such proposed transferee or, if the proposed transferee is an agent or nominee,
the proposed beneficial owner, is not a Disqualified Organization, agent or
nominee thereof, or a Non-permitted Foreign Holder. Notwithstanding the
registration in the Certificate Register of any transfer, sale, or other
disposition of a Residual Certificate to a Disqualified Organization, an agent
or nominee thereof, or Non-permitted Foreign Holder, such registration shall be
deemed to be of no legal force or effect whatsoever and such Disqualified
Organization, agent or nominee thereof, or Non-permitted Foreign Holder shall
not be deemed to be a Certificateholder for any purpose hereunder, including,
but not limited to, the receipt of distributions on such Residual Certificate.
The Depositor, the Certificate Registrar and the Trustee shall be under no
liability to any Person for any registration or transfer of a Residual
Certificate to a Disqualified Organization, agent or nominee thereof or
Non-permitted Foreign Holder or for the Paying Agent making any payments due on
such Residual Certificate to the Holder thereof or for taking any other action
with respect to such Holder under the provisions of the Agreement, so long as
the transfer was effected in accordance with this Section 3.03(f), unless the
Certificate Registrar shall have actual knowledge at the time of such transfer
or the time of such payment or other action that the transferee is a
Disqualified Organization, or an agent or nominee thereof, or Non-permitted
Foreign Holder. The Certificate Registrar shall be entitled to recover from any
Holder of a Residual Certificate that was a Disqualified Organization, agent or
nominee thereof, or Non-permitted Foreign Holder at the time it became a Holder
or at any subsequent time became a Disqualified Organization, agent or nominee
thereof, or Non-permitted

                                       46
<PAGE>

Foreign Holder, all payments made on such Residual Certificate at and after
either of such times (and all costs and expenses, including but not limited to
attorneys' fees, incurred in connection therewith). Any payment (not including
any such costs and expenses) so recovered by the Certificate Registrar shall be
paid and delivered to the last preceding Holder of such Residual Certificate.

         If any purported transferee shall become a registered Holder of a
Residual Certificate in violation of the provisions of this Section 3.03(f),
then upon receipt of written notice to the Trustee that the registration of
transfer of such Residual Certificate was not in fact permitted by this Section
3.03(f), such transfer shall be absolutely null and void and shall vest no
rights in the purported transferee and the last preceding Permitted Transferee
shall be restored to all rights as Holder thereof retroactive to the date of
such registration of transfer of such Residual Certificate. The Depositor, the
Certificate Registrar and 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 3.03(f), or for the Paying Agent making any payment
due on such Certificate to the registered Holder thereof or for taking any other
action with respect to such Holder under the provisions of this Agreement so
long as the transfer was registered upon receipt of the affidavit described in
the preceding paragraph of this Section 3.03(f).

                           (g) Each Holder or Certificate Owner of a Restricted
Certificate, ERISA-Restricted Certificate or Residual Certificate, or an
interest therein, by such Holder's or Owner's acceptance thereof, shall be
deemed for all purposes to have consented to the provisions of this section.

         Section 3.04. CANCELLATION OF CERTIFICATES.

         Any Certificate surrendered for registration of transfer or exchange
shall be cancelled and retained in accordance with normal retention policies
with respect to cancelled certificates maintained by the Trustee or the
Certificate Registrar.

         Section 3.05. REPLACEMENT OF CERTIFICATES.

         If (i) any Certificate is mutilated and is surrendered to the Trustee
or the Certificate Registrar or (ii) the Trustee or the Certificate Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and there is delivered to the Trustee and the Certificate Registrar
such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Depositor, the Trustee or the
Certificate Registrar that such destroyed, lost or stolen Certificate has been
acquired by a protected purchaser, the Trustee shall execute and the
Authenticating Agent 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 Certificate Principal Amount. Upon the issuance of any new
Certificate under this Section 3.05, the Trustee, the Depositor 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, the Depositor or
the Certificate Registrar) connected therewith. Any replacement Certificate
issued pursuant to this Section 3.05 shall constitute complete and indefeasible
evidence of ownership in the applicable Trust Fund, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.

         If after the delivery of such new Certificate, a protected purchaser of
the original Certificate in lieu of which such new Certificate was issued
presents for payment such original

                                       47
<PAGE>

Certificate, the Depositor, the Certificate Registrar and the Trustee or any
agent shall be entitled to recover such new Certificate from the Person to whom
it was delivered or any Person taking therefrom, except a protected purchaser,
and shall be entitled to recover upon the security or indemnity provided
therefor to the extent of any loss, damage, cost or expenses incurred by the
Depositor, the Certificate Registrar, the Trustee or any agent in connection
therewith.

         Section 3.06. PERSONS DEEMED OWNERS.

         Subject to the provisions of Section 3.09 with respect to Book-Entry
Certificates, the Depositor, the Trustee, the Certificate Registrar, the Paying
Agent and any agent of any of them shall treat the Person in whose name any
Certificate is registered upon the books of the Certificate Registrar as the
owner of such Certificate for the purpose of receiving distributions pursuant to
Sections 5.01 and 5.02 and for all other purposes whatsoever, and neither the
Depositor, the Trustee, the Certificate Registrar, the Paying Agent nor any
agent of any of them shall be affected by notice to the contrary.

         Section 3.07. TEMPORARY CERTIFICATES.

                           (a) Pending the preparation of definitive
Certificates, upon the order of the Depositor, the Trustee shall execute and the
Authenticating Agent shall authenticate and deliver temporary Certificates that
are printed, lithographed, typewritten, mimeographed or otherwise produced, in
any authorized denomination, substantially of the tenor of the definitive
Certificates in lieu of which they are issued and with such variations as the
authorized officers executing such Certificates may determine, as evidenced by
their execution of such Certificates.

                           (b) If temporary Certificates are issued, the
Depositor will cause definitive Certificates to be prepared without unreasonable
delay. After the preparation of definitive Certificates, the temporary
Certificates shall be exchangeable for definitive Certificates upon surrender of
the temporary Certificates at the office or agency of the Certificate Registrar
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Trustee shall execute and the Authenticating Agent
shall authenticate and deliver in exchange therefor a like aggregate Certificate
Principal Amount of definitive Certificates of the same Class in the authorized
denominations. Until so exchanged, the temporary Certificates shall in all
respects be entitled to the same benefits under this Agreement as definitive
Certificates of the same Class.

         Section 3.08. APPOINTMENT OF PAYING AGENT.

         The Trustee may appoint a Paying Agent (which may be the Trustee) for
the purpose of making distributions to Certificateholders hereunder. The Trustee
shall cause any Paying Agent to execute and deliver to the Trustee an instrument
in which such Paying Agent shall agree with the Trustee that such Paying Agent
will hold all sums held by it for the payment to Certificateholders in an
Eligible Account (which shall be the Distribution Account) in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be paid
to the Certificateholders. All funds remitted by the Trustee to any such Paying
Agent for the purpose of making distributions shall be paid to
Certificateholders on each Distribution Date and any amounts not so paid shall
be returned on such Distribution Date to the Trustee. If the Paying Agent is not
the Trustee, the Trustee shall cause to be remitted to the Paying Agent on or
before the Business Day prior to each Distribution Date, by wire transfer in
immediately available funds, the funds to be distributed on such Distribution
Date. Any Paying Agent shall be either a bank or trust company or otherwise
authorized under law to exercise corporate trust powers.

                                       48
<PAGE>

         Section 3.09. BOOK-ENTRY CERTIFICATES.

                           (a) Each Class of Book-Entry Certificates, upon
original issuance, shall be issued in the form of one or more typewritten
Certificates representing the Book-Entry Certificates. The Book-Entry
Certificates shall initially be registered on the Certificate Register in the
name of the nominee of the Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's interest
in the Book-Entry Certificates, except as provided in Section 3.09(c). Unless
Definitive Certificates have been issued to Certificate Owners of Book-Entry
Certificates pursuant to Section 3.09(c):

                           (i) the provisions of this Section 3.09 shall be in
                  full force and effect;

                           (ii) the Certificate Registrar, the Paying Agent and
                  the Trustee shall deal with the Clearing Agency for all
                  purposes (including the making of distributions on the
                  Book-Entry Certificates) as the authorized representatives of
                  the Certificate Owners and the Clearing Agency and shall be
                  responsible for crediting the amount of such distributions to
                  the accounts of such Persons entitled thereto, in accordance
                  with the Clearing Agency's normal procedures;

                           (iii) to the extent that the provisions of this
                  Section 3.09 conflict with any other provisions of this
                  Agreement, the provisions of this Section 3.09 shall control;
                  and

                           (iv) the rights of Certificate Owners shall be
                  exercised only through the Clearing Agency and the Clearing
                  Agency Participants and shall be limited to those established
                  by law and agreements between such Certificate Owners and the
                  Clearing Agency and/or the Clearing Agency Participants.
                  Unless and until Definitive Certificates are issued pursuant
                  to Section 3.09(c), the initial Clearing Agency will make
                  book-entry transfers among the Clearing Agency Participants
                  and receive and transmit distributions of principal of and
                  interest on the Book-Entry Certificates to such Clearing
                  Agency Participants.

                           (b) Whenever notice or other communication to the
Certificateholders is required under this Agreement, unless and until Definitive
Certificates shall have been issued to Certificate Owners pursuant to Section
3.09(c), the Trustee shall give all such notices and communications specified
herein to be given to Holders of the Book-Entry Certificates to the Clearing
Agency.

                           (c) If (i) (A) the Clearing Agency or the Depositor
advises the Paying Agent in writing that the Clearing Agency is no longer
willing or able to discharge properly its responsibilities with respect to the
Book-Entry Certificates, and (B) the Depositor is unable to locate a qualified
successor satisfactory to the Depositor and the Paying Agent, (ii) the
Depositor, at its option, advises the Paying Agent in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after the
occurrence of an Event of Default, Certificate Owners representing beneficial
interests aggregating not less than 50% of the Class Principal Amount of a Class
of Book-Entry Certificates advise the Paying Agent and the Clearing Agency
through the Clearing Agency Participants in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Certificate Owners of a Class of Book-Entry Certificates, the Certificate
Registrar shall notify the Clearing Agency to effect notification to all
Certificate Owners, through the Clearing Agency, of the occurrence of

                                       49
<PAGE>

any such event and of the availability of Definitive Certificates to Certificate
Owners requesting the same. Upon surrender to the Certificate Registrar of the
Book-Entry Certificates by the Clearing Agency, accompanied by registration
instructions from the Clearing Agency for registration, the Certificate
Registrar shall issue the Definitive Certificates. Neither the Depositor, the
Certificate Registrar 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 all
references herein to obligations imposed upon or to be performed by the Clearing
Agency shall be deemed to be imposed upon and performed by the Certificate
Registrar, to the extent applicable, with respect to such Definitive
Certificates and the Certificate Registrar shall recognize the holders of the
Definitive Certificates as Certificateholders hereunder. Notwithstanding the
foregoing, the Certificate Registrar, upon the instruction of the Depositor,
shall have the right to issue Definitive Certificates on the Closing Date in
connection with credit enhancement programs.

                                  ARTICLE IV.

                        ADMINISTRATION OF THE TRUST FUND

         Section 4.01. CUSTODIAL ACCOUNTS; DISTRIBUTION ACCOUNT.

                           (a) On or prior to the Closing Date, the Servicer
shall establish and maintain one or more Custodial Accounts, as provided herein,
into which the Servicer shall deposit daily, within two Business Days of receipt
thereof, in immediately available funds, any Scheduled Payments and unscheduled
payments with respect to the Mortgage Loans, net of any deductions or
reimbursements permitted under this Agreement. Prior to 1:00 p.m. New York City
time on each Distribution Account Deposit Date, the Servicer shall remit to the
Trustee for deposit into the Distribution Account, all amounts so required to be
deposited into such account in accordance with the terms of this Agreement.

                           (b) Funds in the Custodial Accounts may be invested
in Permitted Investments selected by the Servicer, which shall mature not later
than one Business Day prior to the Distribution Account Deposit Date (except
that if such Permitted Investment is an obligation of the Servicer or is managed
or advised by the Servicer or its affiliates, then such Permitted Investment
shall mature not later than such applicable Distribution Account Deposit Date)
and any such Permitted Investment shall not be sold or disposed of prior to its
maturity. All such Permitted Investments shall be made in the name of the
Servicer (in its capacity as such) or its nominee. All income and gain realized
from any Permitted Investment shall be for the benefit of the Servicer as
servicing compensation and shall be subject to its withdrawal or order from time
to time, and shall not be part of the Trust Fund. The amount of any losses
incurred in respect of any such investments shall be deposited in the Custodial
Accounts by the Servicer out of its own funds, without any right of
reimbursement therefor, immediately as realized. Any such funds that are not
invested in Permitted Investments may be held uninvested.

                           (c) The Trustee, shall establish and maintain an
Eligible Account entitled "Distribution Account of Wells Fargo Bank, N.A., as
Trustee, for the benefit of Merrill Lynch Mortgage Investors Trust Series MLCC
2004-1 Holders of Mortgage Pass-Through Certificates." The Trustee shall,
promptly upon receipt from the Servicer on each Distribution Account Deposit
Date, deposit into the Distribution Account and retain on deposit until the
related Distribution Date the following amounts:

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<PAGE>

                           (i) the aggregate of collections with respect to the
                  Mortgage Loans remitted by the Servicer from the Custodial
                  Accounts in accordance with this Agreement, including the
                  amount of any Monthly Advances or Compensating Interest
                  Payments with respect to the Mortgage Loans required to be
                  paid by the Servicer; and

                           (ii) any other amounts so required to be deposited in
                  the Distribution Account in the related Due Period pursuant to
                  this Agreement.

                           (c) In the event Servicer has remitted in error to
the Distribution Account any amount not required to be remitted in accordance
with the definition of Available Distribution Amount, it may at any time direct
the Trustee to withdraw such amount from the Distribution Account for repayment
to the Servicer, as applicable, by delivery of an Officer's Certificate of the
Servicer to the Trustee which describes the amount deposited in error.

                           (d) On each Distribution Date and Purchase Date, the
Trustee shall distribute the Available Distribution Amount to the
Certificateholders and any other parties entitled thereto in the amounts and
priorities set forth in Section 5.02. The Trustee may from time to time withdraw
from the Distribution Account and pay itself or the Servicer any amounts
permitted to be paid or reimbursed to such Person from funds in the Distribution
Account pursuant to the clauses (A) through (D) of the definition of Available
Distribution Amount.

                           (e) Funds in the Distribution Account may be invested
in Permitted Investments selected by the Trustee, which shall mature not later
than one Business Day prior to the Distribution Date (except that if such
Permitted Investment is an obligation of the Trustee or is managed or advised by
the Trustee or its affiliates, then such Permitted Investment shall mature not
later than such applicable Distribution Date) and any such Permitted Investment
shall not be sold or disposed of prior to its maturity. All such Permitted
Investments shall be made in the name of the Trustee (in its capacity as such)
or its nominee. All income and gain realized from any Permitted Investment shall
be for the benefit of the Trustee and shall be subject to its withdrawal or
order from time to time, and shall not be part of the Trust Fund. The amount of
any losses incurred in respect of any such investments shall be deposited in
such Distribution Account by the Trustee out of its own funds, without any right
of reimbursement therefor, immediately as realized. Any such funds that are not
invested in Permitted Investments may be held uninvested.

         Section 4.02. REPORTS TO TRUSTEE AND CERTIFICATEHOLDERS.

         On each Distribution Date, the Trustee shall have prepared and shall
make available to each Certificateholder and other interested parties a written
report setting forth the following information (based solely on the report
provided to the Trustee by the Servicer pursuant to Section 9.18).

                           (i) the amount of the distributions, separately
                  identified, with respect to each Class of Certificates;

                           (ii) the amount of the distributions set forth in the
                  clause (i) allocable to principal, separately identifying the
                  aggregate amount of any Principal Prepayments or other
                  unscheduled recoveries of principal included in that amount;

                                       51
<PAGE>

                           (iii) the amount of the distributions set forth in
                  the clause (i) allocable to interest and how it was
                  calculated;

                           (iv) the amount of any unpaid Interest Shortfall and
                  the related accrued interest thereon, with respect to each
                  Class of Certificates;

                           (v) the Class Principal Amount of each Class of
                  Certificates after giving effect to the distribution of
                  principal on that Distribution Date;

                           (vi) the Aggregated Stated Principal Balance of the
                  Mortgage Loans in each Mortgage Pool and the applicable Net
                  WAC of the Mortgage Loans at the end of the related Prepayment
                  Period;

                           (vii) the Stated Principal Balance of the Mortgage
                  Loans in each Mortgage Pool whose Mortgage Rates adjust on the
                  basis of the Six-Month LIBOR index and the One-Year Treasury
                  index at the end of the related Prepayment Period;

                           (viii) the Pro Rata Senior Percentage, Senior
                  Percentage and the Subordinate Percentage for each Mortgage
                  Pool for the following Distribution Date;

                           (ix) the Senior Prepayment Percentage and Subordinate
                  Prepayment Percentage for each Mortgage Pool the following
                  Distribution Date;

                           (x) in the aggregate and with respect to each
                  Mortgage Pool, the amount of Servicing Fee paid to or retained
                  by the Servicer;

                           (xi) in the aggregate and with respect to each
                  Mortgage Pool, the amount of Monthly Advances for the related
                  Due Period;

                           (xii) in the aggregate and with respect to each
                  Mortgage Pool, the number and Stated Principal Balance of the
                  Mortgage Loans that were (A) Delinquent (exclusive of Mortgage
                  Loans in foreclosure) (1) 30 to 59 days, (2) 60 to 89 days and
                  (3) 90 or more days, (B) in foreclosure and Delinquent (1) 30
                  to 59 days, (2) 60 to 89 days and (3) 90 or more days and (C)
                  in bankruptcy as of the close of business on the last day of
                  the calendar month preceding that Distribution Date;

                           (xiii) in the aggregate and with respect to each
                  Mortgage Pool, for any Mortgage Loan as to which the related
                  Mortgaged Property was an REO property during the preceding
                  calendar month, the principal balance of that Mortgage Loan as
                  of the close of business on the last day of the related Due
                  Period;

                           (xiv) in the aggregate and with respect to each
                  Mortgage Pool, the total number and principal balance of any
                  REO properties as of the close of business on the last day of
                  the preceding Due Period;

                           (xv) in the aggregate and with respect to each
                  Mortgage Pool, the amount of Realized Losses incurred during
                  the preceding calendar month;

                                       52
<PAGE>

                           (xvi) in the aggregate and with respect to each
                  Mortgage Pool, the cumulative amount of Realized Losses
                  incurred since the Closing Date;

                           (xvii) the Realized Losses, if any, allocated to each
                  Class of Certificates on that Distribution Date;

                           (xviii) the Certificate Interest Rate for each Class
                  of Certificates for that Distribution Date;

                           (xix) the amount of any Principal Transfer Amounts or
                  Interest Transfer Amounts paid to an Undercollateralized Group
                  or Principal Transfer Amounts between Groups in the event of
                  Rapid Prepayment Conditions; and

                           (xx) for each Class of Certificates, the amounts
                  accrued or paid in respect of each deemed interest rate cap
                  agreement under which such Class of Certificates is deemed
                  entitled to receive or deemed obligated to make payments as
                  provided for in Section 10.01 hereof.

         The Trustee shall make such reports available each month via its
website at HTTP://WWW.CTSLINK.COM. Assistance in using the website may be
obtained by calling the Trustee's customer service desk at (301) 815-6600.
Certificateholders and other parties that are unable to use the website are
entitled to have a paper copy mailed to them via first class mail by contacting
the Trustee and indicating such. In preparing or furnishing the foregoing
information, the Trustee shall be entitled to rely conclusively on the accuracy
of the information or data regarding the Mortgage Loans and the related REO
Properties that has been provided to the Trustee by the Servicer, and the
Trustee shall not be obligated to verify, recompute, reconcile or recalculate
any such information or data.

         Upon receipt by the Trustee of the reasonable advance written request
of any Certificateholder that is a savings and loan, bank or insurance company,
the Trustee shall provide, or cause to be provided (or, to the extent that such
information or documentation is not required to be provided by a Servicer under
this Agreement, shall use reasonable efforts to obtain such information and
documentation from the Servicer, and provide) to such Certificateholders such
reports and access to information and documentation regarding the Mortgage Loans
as such Certificateholders may reasonably deem necessary to comply with
applicable regulations of the Office of Thrift Supervision or its successor or
other regulatory authorities with respect to an investment in the Certificates;
PROVIDED, HOWEVER, that the Trustee shall be entitled to be reimbursed by such
Certificateholders for the Trustee's actual expenses incurred in providing such
reports and access.

         The Trustee shall prepare and file with the Internal Revenue Service
("IRS"), on behalf of the Trust Fund, an application for an employer
identification number on IRS Form SS-4 or by any other acceptable method. The
Trustee shall also file a Form 8811 as required. The Trustee, upon receipt from
the IRS of the Notice of Taxpayer Identification Number Assigned, shall upon
request promptly forward a copy of such notice to the Depositor. The Trustee
shall furnish any other information that is required by the Code and regulations
thereunder to be made available to Certificateholders. The Depositor shall cause
the Servicer to provide the Trustee with such information as is necessary for
the Trustee to prepare such reports.

                                       53
<PAGE>

                                   ARTICLE V.

                    DISTRIBUTIONS TO HOLDERS OF CERTIFICATES

         Section 5.01. DISTRIBUTIONS GENERALLY.

                           (a) Subject to Section 7.01 respecting the final
distribution on the Certificates, on each Distribution Date the Trustee or the
Paying Agent shall make distributions in accordance with this Article V. Payment
of the above amounts to each Certificateholder shall be made (i) by check mailed
to each Certificateholder entitled thereto at the address appearing in the
Certificate Register or (ii) upon receipt by the Trustee on or before the fifth
Business Day preceding the Record Date of written instructions from a
Certificateholder by wire transfer to a United States dollar account maintained
by the payee at any United States depository institution with appropriate
facilities for receiving such a wire transfer; provided, however, that the final
payment in respect of each Class of Certificates will be made only upon
presentation and surrender of such respective Certificates at the office or
agency of the Trustee specified in the notice to Certificateholders of such
final payment. Wire transfers will be made at the expense of the Holder
requesting such wire transfer by deducting a wire transfer fee from the related
distribution. Notwithstanding such final payment of principal of any of the
Certificates, each Residual Certificate will remain outstanding until the
termination of each REMIC and the payment in full of all other amounts due with
respect to the Residual Certificates and at such time such final payment in
retirement of any Residual Certificate will be made only upon presentation and
surrender of such Certificate at the Certificate Registrar's Corporate Trust
Office. If any payment required to be made on the Certificates is to be made on
a day that is not a Business Day, then such payment will be made on the next
succeeding Business Day.

                           (b) All distributions or allocations made with
respect to Certificateholders within each Class on each Distribution Date shall
be allocated among the outstanding Certificates in such Class equally in
proportion to their respective initial Class Principal Amounts (or Percentage
Interests).

         Section 5.02. DISTRIBUTIONS FROM THE DISTRIBUTION ACCOUNT.

                           (a) Subject to Sections 5.02(g) and 5.02(h), on each
Distribution Date, the Available Distribution Amount for the related Mortgage
Pool (in the case of the Senior Certificates) and the Mortgage Pools in the
aggregate (in the case of the Subordinate Certificates) shall be withdrawn by
the Trustee from the Distribution Account and allocated among the classes of
Senior Certificates and Subordinate Certificates in the following order of
priority:

                           (i) Concurrently, to the Class 1-A, Class 2-A-1,
                  Class 2-A-2 and Class 2-A-3 Certificates, on a pro rata basis
                  based on the amount of interest accrued thereon, the payment
                  of the related Interest Distribution Amount and any accrued
                  but unpaid related Interest Shortfalls with respect to each
                  class of Senior Certificates;

                           (ii) Concurrently, to the Senior Certificates from
                  the Available Distribution Amount remaining in the related
                  Mortgage Pool after application of amounts pursuant to clause
                  (i) above, as follows:

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<PAGE>

                                    (A) to the Class 1-A Certificates, the
                           Senior Principal Distribution Amount for Pool 1,
                           until their Class Principal Amount has been reduced
                           to zero; and

                                    (B) to the Class 2-A-1, Class 2-A-2 and
                           Class 2-A-3 Certificates, pro rata, the Senior
                           Principal Distribution Amount for Pool 2, until their
                           respective Class Principal Amounts have been reduced
                           to zero.

                           (iii) From the Available Distribution Amount from the
                  Mortgage Pools in the aggregate remaining after the
                  application of amounts pursuant to clauses (i) and (ii) above,
                  to the Class M-1, Class M-2, Class M-3, Class B-1, Class B-2
                  and Class B-3 Certificates, sequentially, in that order, the
                  Interest Distribution Amount and any Interest Shortfalls, in
                  each case, for such Class on such date;

                           (iv) From the Available Distribution Amount from the
                  Mortgage Pools in the aggregate remaining after application of
                  amounts pursuant to clauses (i) through (iii) above, to the
                  Class M-1, Class M-2, Class M-3, Class B-1, Class B-2 and
                  Class B-3 Certificates, sequentially, in that order, such
                  Class' Subordinate Class Percentage of the Subordinate
                  Principal Distribution Amount for each Mortgage Pool, until
                  its Class Principal Amount has been reduced to zero; and

                           (v) To the Class R-2 Certificate, any remaining
                  amount of the Available Distribution Amount from the Mortgage
                  Pools in the aggregate allocated as provided in Section
                  5.02(d).

                           (b) On each Distribution Date on and after the Credit
Support Depletion Date, the Available Distribution Amount for each Mortgage Pool
shall be distributed to the remaining Classes of Certificates of the related
Certificate Group on a pro rata basis, first, to pay the Interest Distribution
Amount and any accrued but unpaid Interest Shortfalls; second, to pay the Senior
Principal Distribution Amount for such Mortgage Pool; and third, to the Class
R-2 Certificate, any remaining Available Distribution Amount from such Mortgage
Pool.

                           (c) Notwithstanding the priority and allocation set
forth in Section 5.02(a)(iv) and Section 5.02(a)(v) above, if with respect to
any Class of Subordinate Certificates on any Distribution Date the sum of the
related Class Subordination Percentages of such Class and of all other Classes
of Subordinate Certificates which have a higher numerical Class designation than
such Class is less than the Original Applicable Credit Support Percentage for
such Class, no distribution of Principal Prepayments shall be made to any such
Classes and the amount of such Principal Prepayment otherwise distributable to
such Classes shall be distributed to any Classes of Subordinate Certificates
having lower numerical Class designations than such Class, pro rata, based on
the Class Principal Amounts of the respective Classes immediately prior to such
Distribution Date and shall be distributed in the sequential order provided in
Section 5.02(a)(iv) and Section 5.02(a)(v) above.

                           (d) Amounts distributed to the Residual Certificates
pursuant to subparagraph (a)(vi) of this Section 5.02 on any Distribution Date
shall be allocated among the REMIC residual interests represented thereby such
that each such interest is allocated the excess

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of funds available to the related REMIC over required distributions to the
regular interests in such REMIC on such Distribution Date.

                           (e) For purposes of distributions provided in this
Section 5.02, each Mortgage Pool shall "relate" to the Senior Class or Classes
of the applicable Related Certificate Group.

                           (f) For purposes of distributions of interest in
paragraph (a) of this Section 5.02 such distributions to a Class of Certificates
on any Distribution Date shall be made first, in respect of Current Interest;
and second, in respect of Interest Shortfalls.

                           (g) Notwithstanding the priority of distributions set
forth in paragraph (a) of this Section 5.02, if on any Distribution Date prior
to the Credit Support Depletion Date (1) either one of the Rapid Prepayment
Conditions is satisfied on such date and (2) the Certificate Principal Amount of
the Senior Certificates relating to one of the Mortgage Pools has been reduced
to zero, then that portion of the Available Distribution Amount for such
Mortgage Pool described in Section 5.02(a)(ii) that represents principal
collections on the Mortgage Loans shall be applied as an additional distribution
to the remaining Classes of Senior Certificates on a pro rata basis in reduction
of, and in proportion to, the Class Principal Amounts thereof; provided,
however, that (x) any such amounts distributable to the Class R and Class 1-A
Certificates shall be distributed sequentially thereto in such order and (y) any
such amounts distributable to the Class 2-A-1, Class 2-A-2 and Class 2-A-3
Certificates shall be distributed pro rata.

                           (h) If, on any Distribution Date, any Certificate
Group would constitute an Undercollateralized Group and the other Certificate
Group constitutes an Overcollateralized Group, then notwithstanding Section
5.02(a)(ii), the Available Distribution Amount for the Overcollateralized Group
to the extent remaining following distributions of interest and principal to the
related Senior Certificates of that Certificate Group, shall be distributed up
to the sum of the Interest Transfer Amount and the Principal Transfer Amount for
the Undercollateralized Group to the Senior Certificates related to the
Undercollateralized Group in payment of accrued but unpaid interest, if any, and
then to such Senior Certificates as principal, in the same order and priority as
such Certificates would receive other distributions of principal.

         Section 5.03. ALLOCATION OF LOSSES.

                           (a) On or prior to each Distribution Date, the
Trustee shall aggregate the information provided by the Servicer with respect to
the total amount of Realized Losses, with respect to the Mortgage Loans for the
related Distribution Date.

                           (b) On each Distribution Date, the principal portion
of Realized Losses with respect to such Distribution Date shall be allocated as
follows:

                           (i) Realized Losses shall be allocated in the
                  following order:

                  FIRST, to the Classes of Subordinate Certificates in reverse
         order of their respective numerical Class designations (beginning with
         the Class of Subordinate Certificates with the highest numerical Class
         designation) until the Class Principal Amount of each such Class is
         reduced to zero; and

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<PAGE>

                  SECOND, to each Class of Senior Certificates relating to the
         Mortgage Pool which sustained such loss (allocated among the Senior
         Classes relating to such Mortgage Pool on a pro rata basis, provided,
         however, that any portion of any Realized Loss that would otherwise be
         allocated to the Class 2-A-2 Certificates will instead be allocated to
         the Class 2-A-3 Certificates until the Class Principal Amount thereof
         has been reduced to zero), in each case, until the Class Principal
         Amount of each Class of Senior Certificates is reduced to zero.

                           (ii) Reserved.

                           (iii) The Class Principal Amount of the Class of
                  Subordinate Certificates then outstanding with the highest
                  numerical Class designation shall be reduced on each
                  Distribution Date by the amount, if any, by which the
                  aggregate of the Class Principal Amounts of all outstanding
                  Classes of Certificates (after giving effect to the
                  distribution of principal and the allocation of Realized
                  Losses, on such Distribution Date) exceeds the Aggregate
                  Stated Principal Balance for the following Distribution Date.

                           (iv) Any allocation of a loss pursuant to this
                  section to a Class of Certificates shall be achieved by
                  reducing the Class Principal Amount thereof by the amount of
                  such loss.

                           (c) Notwithstanding the other provisions of Section
5.03, the first $0.84 of Realized Losses shall not be allocated to any Class of
Certificates.

         Section 5.04. ADVANCES.

         If the Servicer fails to remit any Monthly Advance required to be made
under this Agreement, the Trustee solely in its capacity as successor Servicer
shall itself make, or shall cause the successor Servicer to make, such Monthly
Advance. If the Trustee solely in its capacity as successor Servicer determines
that a Monthly Advance is required, it shall on the Business Day preceding the
related Distribution Date immediately following such Determination Date remit
from its own funds (or funds advanced by the successor Servicer) for deposit in
the Distribution Account immediately available funds in an amount equal to such
Monthly Advance. Each of the Trustee and the Servicer shall be entitled to be
reimbursed for all Monthly Advances made by it, respectively. Notwithstanding
anything to the contrary herein, in the event the Trustee (or successor
servicer) determines in its reasonable judgment that a Monthly Advance is
nonrecoverable, the Trustee (or successor servicer) shall be under no obligation
to make such Monthly Advance.

         Section 5.05.     DISTRIBUTIONS ON THE REMIC 1 REGULAR INTERESTS.

                           (a) On each Distribution Date the Trustee shall be
deemed to distribute to itself, as the holder of the REMIC 1 Regular Interests,
Uncertificated REMIC Accrued Interest on the REMIC 1 Regular Interests for such
Distribution Date, plus any Uncertificated REMIC Accrued Interest thereon
remaining unpaid from any previous Distribution Date.

                           (b) On each Distribution Date, distributions of
principal shall be deemed to be made from amounts received on the Mortgage Loans
to REMIC 1 Regular Interests 1-A, 1-B, 2-A, 2-B and ZZZ first, so as to keep the
Uncertificated Principal Balance of each

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<PAGE>

REMIC 1 Regular Interest ending with the designation "B" equal to 0.01% of the
aggregate Stated Principal Balance of the Mortgage Loans in the related Group;
second, to each REMIC 1 Regular Interest ending with the designation "A," 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 Stated Principal Balance of
the Mortgage Loans in the related Group over (y) the Class Principal Amount of
the Senior Certificates in the related 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 ZZZ. Realized Losses on the Mortgage Loans
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 "B" equal to 0.01% of the aggregate
Stated Principal Balance of the Mortgage Loans in the related Group; second, to
each REMIC 1 Regular Interest ending with the designation "A," 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 Stated Principal Balance of the
Mortgage Loans in the related Group over (y) the Class Principal Amount of the
Senior Certificates in the related 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 on the Mortgage Loans shall be allocated to REMIC 1 Regular
Interest ZZZ.

                           (c) Notwithstanding the deemed distributions on the
REMIC 1 Regular Interests described in this Section 5.05(a), distributions of
funds from the Distribution Account shall be made only in accordance with
Section 5.02.

                                  ARTICLE VI.

                    CONCERNING THE TRUSTEE; EVENTS OF DEFAULT

         Section 6.01. DUTIES OF TRUSTEE.

                           (a) The Trustee, except during the continuance of an
Event of Default, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. Any permissive right of the Trustee
provided for in this Agreement shall not be construed as a duty of the Trustee.
If an Event of Default has occurred and has not otherwise been cured or waived,
the Trustee shall exercise such of the rights and powers vested in it by this
Agreement and use the same degree of care and skill in their exercise as a
prudent Person would exercise or use under the circumstances in the conduct of
such Person's own affairs.

                           (b) The Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they are in the form required by this Agreement; PROVIDED,
HOWEVER, that the Trustee shall not be responsible for the accuracy or content
of any such resolution, certificate, statement, opinion, report, document, order
or other instrument furnished by the Servicer to the Trustee pursuant to this
Agreement, and shall not be required to recalculate or verify any numerical
information furnished to the Trustee pursuant to this Agreement. Subject to the
immediately preceding sentence, if any such resolution, certificate, statement,
opinion,

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<PAGE>

report, document, order or other instrument is found not to conform to the form
required by this Agreement in a material manner the Trustee shall take such
action as it deems appropriate to cause the instrument to be corrected, and if
the instrument is not corrected to the Trustee's satisfaction, the Trustee will
provide notice thereof to the Certificateholders and will, at the expense of the
Trust Fund, which expense shall be reasonable given the scope and nature of the
required action, take such further action as directed by the Certificateholders.

                           (c) The Trustee shall not have any liability arising
out of or in connection with this Agreement, except for its negligence or
willful misconduct. Notwithstanding anything in this Agreement to the contrary,
the Trustee shall not be liable for special, indirect or consequential losses or
damages of any kind whatsoever (including, but not limited to, lost profits). No
provision of this Agreement shall be construed to relieve the Trustee of
liability for its own negligent action, its own negligent failure to act or its
own willful misconduct; PROVIDED, HOWEVER, that:

                           (i) 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 Holders of
                  Certificates as provided in Section 6.18 hereof;

                           (ii) For all purposes under this Agreement, the
                  Trustee shall not be deemed to have notice of any Event of
                  Default (other than resulting from a failure by the Servicer
                  (i) to remit funds (or to make Monthly Advances) or (ii) to
                  furnish information to the Trustee when required to do so)
                  unless a Responsible Officer of the Trustee has actual
                  knowledge thereof or unless written notice of any event which
                  is in fact such a default is received by the Trustee at the
                  Corporate Trust Office of the Trustee, and such notice
                  references the Holders of the Certificates and this Agreement;

                           (iii) No provision of this Agreement shall require
                  the Trustee to expend or risk its own funds or otherwise incur
                  any financial liability in the performance of any of its
                  duties hereunder, or in the exercise of any of its rights or
                  powers, if it shall have reasonable grounds for believing that
                  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;

                           (iv) The Trustee shall not be responsible for any act
                  or omission of the Servicer, the Depositor or the Seller.

                           (d) The Trustee shall have no duty hereunder with
respect to any complaint, claim, demand, notice or other document it may receive
or which may be alleged to have been delivered to or served upon it by the
parties as a consequence of the assignment of any Mortgage Loan hereunder;
PROVIDED, HOWEVER, that the Trustee shall promptly remit to the Servicer upon
receipt any such complaint, claim, demand, notice or other document (i) which is
delivered to the Corporate Trust Office of the Trustee, (ii) of which a
Responsible Officer has actual knowledge, and (iii) which contains information
sufficient to permit the Trustee to make a determination that the real property
to which such document relates is a Mortgaged Property.

                           (e) 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

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<PAGE>

the Certificateholders of any Class holding Certificates which evidence, as to
such Class, Percentage Interests aggregating not less than 25% as to the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred upon the Trustee under this
Agreement.

                           (f) The Trustee shall not be required to perform
services under this Agreement, or to expend or risk its own funds or otherwise
incur financial liability for the performance of any of its duties hereunder or
the exercise of any of its rights or powers if there is reasonable ground for
believing that the timely payment of its fees and expenses or 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 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.

                           (g) The Trustee shall not be held liable by reason of
any insufficiency in the Distribution Account 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).

                           (h) Except as otherwise provided herein, the Trustee
shall not have any duty (A) to see to 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
re-recording, refiling or redepositing of any thereof, (B) to see to the
provision of any insurance, (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, or (D) to confirm
or verify the contents of any reports or certificates of the Servicer delivered
to the Trustee pursuant to this Agreement believed by the Trustee to be genuine
and to have been signed or presented by the proper party or parties.

                           (i) The Trustee shall not be liable in its individual
capacity for an error of judgment made in good faith by a Responsible Officer or
other officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts.

                           (j) Notwithstanding anything in this Agreement to the
contrary, Trustee shall not be liable for special, indirect or consequential
losses or damages 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.

         Section 6.02. CERTAIN MATTERS AFFECTING THE TRUSTEE.

Except as otherwise provided in Section 6.01:

                           (i) The Trustee may request, and may rely 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, approval, bond or other paper
                  or document

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<PAGE>

                  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 of its counsel 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 personally liable for
                  any action taken, suffered or omitted by it in good faith and
                  reasonably believed by it to be authorized or within the
                  discretion or rights or powers conferred upon it by this
                  Agreement;

                           (iv) Unless an Event of Default shall have occurred
                  and be continuing, the Trustee shall not be bound to make any
                  investigation into the facts or matters stated in any
                  resolution, certificate, statement, instrument, opinion,
                  report, notice, request, consent, order, approval, bond or
                  other paper or document (provided the same appears regular on
                  its face), unless requested in writing to do so by the Holders
                  of at least a majority in Class Principal Amount (or
                  Percentage Interest) of each Class of Certificates; PROVIDED,
                  HOWEVER, that, if the payment within a reasonable time to the
                  Trustee of the costs, expenses or liabilities likely to be
                  incurred by it in the making of such investigation is, in the
                  opinion of the Trustee, not reasonably assured to the Trustee
                  by the security afforded to it by the terms of this Agreement,
                  the Trustee may require reasonable indemnity against such
                  expense or liability or payment of such estimated expenses
                  from the Certificateholders as a condition to proceeding. The
                  reasonable expense thereof shall be paid by the party
                  requesting such investigation and if not reimbursed by the
                  requesting party shall be reimbursed to the Trustee by the
                  Trust Fund;

                           (v) The Trustee may execute any of the trusts or
                  powers hereunder or perform any duties hereunder either
                  directly or by or through agents, custodians or attorneys,
                  which agents, custodians or attorneys shall have any and all
                  of the rights, powers, duties and obligations of the Trustee
                  conferred on it by such appointment, provided that the Trustee
                  shall continue to be responsible for its duties and
                  obligations hereunder to the extent provided herein, and
                  provided further that the Trustee shall not be responsible for
                  any misconduct or negligence on the part of any such agent or
                  attorney appointed with due care by the Trustee;

                           (vi) The Trustee shall not be under any obligation to
                  exercise any of the trusts or powers vested in it by this
                  Agreement or to institute, conduct or defend any litigation
                  hereunder or in relation hereto, in each case at the request,
                  order or direction of any of the Certificateholders pursuant
                  to the provisions of this Agreement, unless such
                  Certificateholders shall have offered to the Trustee
                  reasonable security or indemnity against the costs, expenses
                  and liabilities which may be incurred therein or thereby;

                           (vii) 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; and

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<PAGE>

                           (viii) The Trustee shall not be required to give any
                  bond or surety in respect of the execution of the Trust Fund
                  created hereby or the powers granted hereunder.

         Section 6.03. TRUSTEE NOT LIABLE FOR CERTIFICATES.

         The Trustee make no representations as to the validity or sufficiency
of this Agreement or of the Certificates (other than the certificate of
authentication on the Certificates) or of any Mortgage Loan, or related document
save that the Trustee represents that, assuming due execution and delivery by
the other parties hereto, this Agreement has been duly authorized, executed and
delivered by it and constitutes its valid and binding obligation, enforceable
against it in accordance with its terms except as such enforceability may be
subject to (A) applicable bankruptcy and insolvency laws and other similar laws
affecting the enforcement of the rights of creditors generally, and (B) general
principles of equity regardless of whether such enforcement is considered in a
proceeding in equity or at law. The Trustee shall not be accountable for the use
or application by the Depositor of funds paid to the Depositor in consideration
of the assignment of the Mortgage Loans to the Trust Fund by the Depositor or
for the use or application of any funds deposited into the Distribution Account
or any other fund or account maintained with respect to the Certificates. The
Trustee shall not be responsible for the legality or validity of this Agreement
or the validity, priority, perfection or sufficiency of the security for the
Certificates issued or intended to be issued hereunder. Except as otherwise
provided herein, 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 or to record this Agreement.

         Section 6.04. TRUSTEE MAY OWN CERTIFICATES.

         The Trustee and any Affiliate or agent of the Trustee in its individual
or any other capacity may become the owner or pledgee of Certificates and may
transact banking and trust business with the other parties hereto and their
Affiliates with the same rights it would have if it were not Trustee or such
agent.

         Section 6.05. ELIGIBILITY REQUIREMENTS FOR TRUSTEE.

         The Trustee hereunder shall at all times (i) be an institution insured
by the FDIC, (ii) a corporation or national banking association, organized and
doing business 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 not less than $50,000,000 and subject to
supervision or examination by federal or state authority and (iii) not be an
Affiliate of the Servicer. If such corporation or national banking association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then, for the
purposes of this Section, the combined capital and surplus of such corporation
or national banking association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect specified in Section 6.06.

         Section 6.06. RESIGNATION AND REMOVAL OF TRUSTEE.

                           (a) The Trustee may at any time resign and be
discharged from the trust hereby created by giving written notice thereof to the
Depositor and the Servicer. Upon

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<PAGE>

receiving such notice of resignation, the Depositor will promptly appoint a
successor trustee by written instrument, one copy of which instrument shall be
delivered to the resigning Trustee, one copy to the successor trustee and one
copy to the Servicer. If no successor trustee shall have been so appointed and
shall have accepted appointment within 30 days after the giving of such notice
of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.

                           (b) If at any time (i) the Trustee shall cease to be
eligible in accordance with the provisions of Section 6.05 and shall fail to
resign after written request therefor by the Depositor, (ii) the Trustee shall
become incapable of acting, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of either of their
property or affairs for the purpose of rehabilitation, conservation or
liquidation, (iii) a tax is imposed or threatened with respect to the Trust Fund
by any state in which the Trustee or the Trust Fund held by the Trustee is
located, or (iv) the continued use of the Trustee would result in a downgrading
of the rating by any Rating Agency of any Class of Certificates with a rating,
then the Depositor shall remove the Trustee and the Depositor shall appoint a
successor trustee by written instrument, one copy of which instrument shall be
delivered to the Trustee so removed, one copy each to the successor trustee and
one copy to the Servicer.

                           (c) The Holders of more than 50% of the Class
Principal Amount (or Percentage Interest) of each Class of Certificates may at
any time upon 30 days' written notice to the Trustee and to the Depositor remove
the Trustee by such written instrument, signed by such Holders or their
attorney-in-fact duly authorized, one copy of which instrument shall be
delivered to the Depositor and one copy to the Trustee; the Depositor shall
thereupon appoint a successor trustee in accordance with this Section.

                           (d) Any resignation or removal of the Trustee and
appointment of a successor trustee pursuant to any of the provisions of this
Section shall become effective upon acceptance by the successor trustee of
appointment, as provided in Section 6.07.

         Section 6.07. SUCCESSOR TRUSTEE.

                           (a) Any successor trustee appointed as provided in
Section 6.06 shall execute, acknowledge and deliver to the Depositor and to its
predecessor trustee, an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, 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 predecessor trustee shall deliver to the successor trustee
all Trustee Mortgage Files and documents and statements related to each Trustee
Mortgage File held by it hereunder, and shall duly assign, transfer, deliver and
pay over to the successor trustee the entire Trust Fund, together with all
necessary instruments of transfer and assignment or other documents properly
executed necessary to effect such transfer and such of the records or copies
thereof maintained by the predecessor trustee in the administration hereof as
may be requested by the successor trustee and shall thereupon be discharged from
all duties and responsibilities under this Agreement. In addition, the Depositor
and the predecessor trustee shall execute and deliver such other instruments and
do such other things as may reasonably be required to more fully and certainly
vest and confirm in the successor trustee all such rights, powers, duties and
obligations.

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<PAGE>

                           (b) No successor trustee shall accept appointment as
provided in this Section unless at the time of such appointment such successor
trustee shall be eligible under the provisions of Section 6.05.

                           (c) Upon acceptance by a successor trustee of
appointment as provided in this Section, the predecessor trustee shall mail
notice of the succession of such successor trustee hereunder to all Holders of
Certificates at their addresses as shown in the Certificate Register and to any
Rating Agency. The expenses of such mailing shall be borne by the Depositor.

         Section 6.08. MERGER OR CONSOLIDATION OF TRUSTEE.

         Any Person into which the Trustee may be merged or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Persons succeeding
to the business of the Trustee shall be the successor to the Trustee hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding,
provided that, in the case of the Trustee, such Person shall be eligible under
the provisions of Section 6.05.

         Section 6.09. APPOINTMENT OF CO-TRUSTEE, SEPARATE TRUSTEE OR CUSTODIAN.

                           (a) Notwithstanding any other provisions hereof, at
any time, the Trustee, the Depositor or the Certificateholders evidencing more
than 50% of the Class Principal Amount (or Percentage Interest) of every Class
of Certificates shall have the power from time to time to appoint one or more
Persons, approved by the Trustee, to act either as co-trustees jointly with the
Trustee, or as separate trustees, or as custodians, for the purpose of holding
title to, foreclosing or otherwise taking action with respect to any Mortgage
Loan outside the state where the Trustee has its principal place of business
where such separate trustee or co-trustee is necessary or advisable (or the
Trustee has been advised by the Servicer that such separate trustee or
co-trustee is necessary or advisable) under the laws of any state in which a
property securing a Mortgage Loan is located or for the purpose of otherwise
conforming to any legal requirement, restriction or condition in any state in
which a property securing a Mortgage Loan is located or in any state in which
any portion of the Trust Fund is located. The separate trustees, co-trustees, or
custodians so appointed shall be trustees or custodians for the benefit of all
the Certificateholders and shall have such powers, rights and remedies as shall
be specified in the instrument of appointment; PROVIDED, HOWEVER, that no such
appointment shall, or shall be deemed to, constitute the appointee an agent of
the Trustee. The obligation of the Trustee to make Monthly Advances pursuant to
Section 5.04 hereof shall not be affected or assigned by the appointment of a
co-trustee.

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

                           (i) all powers, duties, obligations and rights
                  conferred upon the Trustee in respect of the receipt, custody
                  and payment of moneys shall be exercised solely by the
                  Trustee;

                           (ii) all other 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, co-trustee, or custodian jointly,
                  except to the extent that under any law of any jurisdiction in
                  which any

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                  particular act or acts are to be performed the Trustee shall
                  be incompetent or unqualified to perform such act or acts, in
                  which event such rights, powers, duties and obligations,
                  including the holding of title to the Trust Fund or any
                  portion thereof in any such jurisdiction, shall be exercised
                  and performed by such separate trustee, co-trustee, or
                  custodian at the sole discretion of the Trustee;

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

                           (iv) the Trustee may at any time, by an instrument in
                  writing executed by it, with the concurrence of the Depositor,
                  accept the resignation of or remove any separate trustee,
                  co-trustee or custodian, so appointed by it or them, if such
                  resignation or removal does not violate the other terms of
                  this Agreement.

                           (c) Any notice, request or other writing given to the
Trustee shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee, co-trustee or custodian shall refer to this
Agreement and the conditions of this Article VI. 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 given to the Servicer.

                           (d) Any separate trustee, co-trustee or custodian
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, co-trustee or custodian 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.

                           (e) No separate trustee, co-trustee or custodian
hereunder shall be required to meet the terms of eligibility as a successor
trustee under Section 6.05 hereunder and no notice to Certificateholders of the
appointment shall be required under Section 6.07 hereof.

                           (f) The Trustee agrees to instruct the co-trustees,
if any, to the extent necessary to fulfill the Trustee's obligations hereunder.

                           (g) The Trust shall pay the reasonable compensation
of the co-trustees (which compensation shall not reduce any compensation payable
to the Trustee under such Section).

         Section 6.10. AUTHENTICATING AGENTS.

                           (a) The Trustee may appoint one or more
Authenticating Agents which shall be authorized to act on behalf of the Trustee
in authenticating Certificates. If such an agent is so appointed by the Trustee,
wherever reference is made in this Agreement to the authentication of
Certificates by the Trustee or the Trustee's certificate of authentication, such
reference shall be deemed to include authentication on behalf of the Trustee by
an Authenticating

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Agent and a certificate of authentication executed on behalf of the Trustee by
an Authenticating Agent. Each Authenticating Agent must be a corporation
organized and doing business under the laws of the United States of America or
of any state, having a combined capital and surplus of at least $15,000,000,
authorized under such laws to do a trust business and subject to supervision or
examination by federal or state authorities.

                           (b) Any Person into which any Authenticating Agent
may be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which any
Authenticating Agent shall be a party, or any Person succeeding to the corporate
agency business of any Authenticating Agent, shall continue to be the
Authenticating Agent without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

                           (c) Any Authenticating Agent may at any time resign
by giving at least 30 days' advance written notice of resignation to the Trustee
and the Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Depositor. Upon receiving a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section
6.10, the Trustee may appoint a successor authenticating agent, shall give
written notice of such appointment to the Depositor and shall mail notice of
such appointment to all Holders of Certificates. Any successor authenticating
agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers, duties and responsibilities of its predecessor hereunder,
with like effect as if originally named as Authenticating Agent. No successor
authenticating agent shall be appointed unless eligible under the provisions of
this Section 6.10. No Authenticating Agent shall have responsibility or
liability for any action taken by it as such at the direction of the Trustee.

         Section 6.11. INDEMNIFICATION OF TRUSTEE.

         The Trustee and its respective directors, officers, employees and
agents shall be entitled to indemnification from the Depositor and the Trust
Fund; provided that the Trust Fund's indemnification under this Section 6.11 is
limited by Section 4.01(d) for any loss, liability or expense (including,
without limitation, reasonable attorneys' fees and disbursements (and, in
connection with any custody agreement the Trustee may enter pursuant to this
Agreement, including the reasonable compensation and the expenses and
disbursements of its agents or counsel)), incurred without negligence or willful
misconduct on its part, arising out of, or in connection with, the acceptance or
administration of the trusts created hereunder or in connection with the
performance of their duties hereunder including the costs and expenses of
defending themselves against any claim in connection with the exercise or
performance of any of their powers or duties hereunder, provided that:

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

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

                           (iii) notwithstanding anything to the contrary in
                  this Section 6.11, the Trust Fund shall not be liable for
                  settlement of any such claim by the Trustee

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                  entered into without the prior consent of the Depositor, which
                  consent shall not be unreasonably withheld; and

                           (iv) the Trust's Fund's indemnification obligations
                  hereunder shall be limited to losses, liability, costs or
                  expenses, payments in respect of which by the Trust Fund would
                  constitute "unanticipated expenses" within the meaning of
                  Treasury Regulations Section 1.860G-1(b)(3)(ii).

         The provisions of this Section 6.11 shall survive any termination of
this Agreement and the resignation or removal of the Trustee and shall be
construed to include, but not be limited to, any loss, liability or expense
under any environmental law.

         Section 6.12. FEES AND EXPENSES OF THE TRUSTEE.

         As compensation for its services hereunder, the Trustee shall be
entitled to retain any and all investment earnings on amounts on deposit in the
Distribution Account pending the distribution of such funds to
Certificateholders on each Distribution Date (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust). Any expenses incurred by the Trustee shall be reimbursed to the
extent provided in Section 6.11.

         Section 6.13. COLLECTION OF MONIES.

         Except as otherwise expressly provided in this Agreement, the Trustee
may demand payment or delivery of, and shall receive and collect, all money and
other property payable to or receivable by the Trustee pursuant to this
Agreement. The Trustee shall hold all such money and property received by it as
part of the Trust Fund and shall distribute it as provided in this Agreement.

         Section 6.14. EVENTS OF DEFAULT; TRUSTEE TO ACT; APPOINTMENT OF
SUCCESSOR.

                           (a) "Event of Default," wherever used herein, means
any one of the following events:

                           (i) any failure by the Servicer to make any Monthly
                  Advance, to deposit in the Custodial Account or to remit to
                  the Trustee any payment required to be made under the terms of
                  this Agreement on the day it is due;

                           (ii) any material breach on the part of the Servicer
                  of any other term, agreement, covenant, representation or
                  warranty in this Agreement that has not been cured after
                  written notice and a thirty (30) day curative period;

                           (iii) following entry against the Servicer of a
                  decree or order of a court or agency or supervisory authority
                  having jurisdiction for the appointment of a trustee,
                  conservator, receiver, liquidator, assignee, custodian or
                  sequestrator (or other similar official) for the Servicer in
                  any federal or state bankruptcy, insolvency, readjustment of
                  debt, marshaling of assets and liabilities or similar
                  proceedings, or for the winding-up or liquidation of the
                  Servicer's affairs, if such decree or order has remained in
                  force undischarged or unstayed for a period of sixty (60)
                  days;

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                           (iv) upon consent by the Servicer to the appointment
                  of a trustee, conservator, receiver, liquidator, assignee,
                  custodian or sequestrator (or other similar official) in, or
                  commencement of a voluntary case under, any federal or state
                  bankruptcy insolvency, readjustment of debt, marshaling of
                  assets and liabilities or similar proceedings of or relating
                  to the Servicer or of or relating to all or substantially all
                  of the Servicer's property;

                           (v) upon the Servicer's (A) admitting in writing its
                  inability to pay its debts generally as they become due, (B)
                  filing a petition to take advantage of any applicable
                  insolvency or reorganization statute, (C) making an assignment
                  for the benefit of its creditors or (D) voluntarily suspending
                  payment of its obligations; or

                           (vi) the Servicer ceases to be eligible to sell
                  mortgage loans to or service mortgage loans for FNMA, FHLMC or
                  GNMA or ceases to be a HUD-approved mortgagee.

         If an Event of Default shall occur and be continuing, then, in each and
every case, subject to applicable law, so long as any such Event of Default
shall not have been remedied within any period of time prescribed by this
Agreement, by notice in writing to the Servicer either (x) the Depositor or (y)
the Trustee may (or the Trustee shall if so directed by Certificateholders
evidencing more than 50% of the Class Principal Amount of each Class of
Certificates) terminate all of the rights and obligations of the Servicer under
this Agreement in accordance with the terms of this Agreement. On or after the
receipt by the Servicer of such written notice, all authority and power of the
Servicer, whether with respect to the Mortgage Loans or otherwise, shall pass to
and be vested in the Trustee; and the Trustee is hereby authorized and empowered
to execute and deliver, on behalf of the defaulting Servicer as attorney-in-fact
or otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents or
otherwise.

         If any Event of Default shall occur, the Trustee, upon becoming aware
of the occurrence thereof, shall promptly notify the Depositor and each Rating
Agency of the nature and extent of such Event of Default.

                           (b) Within 90 days of the time the Servicer receives
a notice of termination from the Trustee pursuant to Section 6.14, the Trustee,
unless another Servicer shall have been appointed, shall be the successor in all
respects to the Servicer in its capacity as such under this Agreement and the
transactions set forth or provided for therein and shall have all the rights and
powers and be subject to all the responsibilities, duties and liabilities
relating thereto and arising thereafter placed on the Servicer thereunder,
including the obligation to make Monthly Advances; PROVIDED, HOWEVER, that any
failure to perform such duties or responsibilities caused by the Servicer's
failure to provide information required by this Agreement or this Agreement
shall not be considered a default by the Trustee hereunder. In addition, the
Trustee shall have no responsibility for any act or omission of the Servicer
prior to the issuance of any notice of termination. The Trustee shall have no
liability relating to any representations and warranties of the Servicer set
forth in this Agreement. In the Trustee's capacity as such successor, the
Trustee shall have the same limitations on liability provided to the Servicer in
this Agreement. As compensation therefor, the Trustee shall be entitled to
receive all compensation payable to the Servicer under this Agreement.

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<PAGE>

         The Trustee shall be entitled to be reimbursed by the Depositor and the
Trust Fund (pursuant to Section 6.11 but without regard to any annual limitation
thereunder), in the event that the Servicer does not reimburse the Trustee under
this Agreement, for all costs associated with the transfer of servicing from the
predecessor Servicer, including, without limitation, any costs or expenses
associated with the termination of the predecessor Servicer, the appointment of
a successor servicer, the complete transfer of all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the Trustee or any successor servicer to correct any errors or
insufficiencies in the servicing data or otherwise to enable the Trustee or
successor servicer to service the Mortgage Loans property and effectively (such
costs, "Servicing Transfer Costs").

                           (c) Notwithstanding the above, the Trustee may, if it
shall be unwilling to continue to so act, or shall, if it is unable to so act,
petition a court of competent jurisdiction to appoint, or, with the consent of
the Depositor, appoint on its own behalf any established housing and home
finance institution servicer, or servicing or mortgage servicing institution
having a net worth of not less than $15,000,000 and meeting such other standards
for a successor servicer as are set forth in this Agreement and reasonably
satisfactory to the Depositor, as the successor to the Servicer in the
assumption of all of the responsibilities, duties or liabilities of a servicer,
like the Servicer. Any entity designated by the Trustee as a successor servicer
may be an Affiliate of the Trustee; provided, however, that, unless such
Affiliate meets the net worth requirements and other standards set forth herein
for a successor servicer, the Trustee, in its individual capacity shall agree,
at the time of such designation, to be and remain liable to the Trust Fund for
such Affiliate's actions and omissions in performing its duties under this
Agreement. In connection with such appointment and assumption, the Trustee may
make such arrangements for the compensation of such successor out of payments on
Mortgage Loans as it and such successor shall agree; PROVIDED, HOWEVER, that no
such compensation shall be in excess of that permitted to the Servicer under
this Agreement. The Trustee and such successor shall take such actions,
consistent with this Agreement, as shall be necessary to effectuate any such
succession and may make other arrangements with respect to the servicing to be
conducted hereunder which are not inconsistent herewith and therewith. Neither
the Trustee nor any other successor servicer shall be deemed to be in default
hereunder by reason of any failure to make, or any delay in making, any
distribution hereunder or any portion thereof caused by (i) the failure of the
Servicer to deliver, or any delay in delivering, cash, documents or records to
it, (ii) the failure of the Servicer to cooperate as required by this Agreement,
(iii) the failure of the Servicer to deliver the Mortgage Loan data to the
Trustee as required by this Agreement or (iv) restrictions imposed by any
regulatory authority having jurisdiction over the Servicer.

         Section 6.15. ADDITIONAL REMEDIES OF TRUSTEE UPON EVENT OF DEFAULT.

         During the continuance of any Event of Default, so long as such Event
of Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 6.14, shall have the right, in its own name and as trustee
of the Trust Fund, to take all actions now or hereafter existing at law, in
equity or by statute to enforce its rights and remedies and to protect the
interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filings of proofs of claim and debt in connection
therewith). Except as otherwise expressly provided in this Agreement, no remedy
provided for by this Agreement shall be exclusive of any other remedy, and each
and every remedy shall be cumulative and in addition to any other remedy, and no
delay or omission to exercise any right or remedy shall impair any such right or
remedy or shall be deemed to be a waiver of any Event of Default.

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         Section 6.16. WAIVER OF DEFAULTS.

         More than 50% of the Aggregate Voting Interests of Certificateholders
may waive any default or Event of Default by the Servicer in the performance of
its obligations hereunder, except that a default in the making of any required
deposit to the Distribution Account that would result in a failure of the
Trustee to make any required payment of principal of or interest on the
Certificates may only be waived with the consent of 100% of the affected
Certificateholders. Upon any such waiver of a past default, such default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived.

         Section 6.17. NOTIFICATION TO HOLDERS.

         Upon termination of the Servicer or appointment of a successor to the
Servicer, in each case as provided herein, the Trustee shall promptly mail
notice thereof by first class mail to the Certificateholders at their respective
addresses appearing on the Certificate Register. The Trustee shall also, within
45 days after the occurrence of any Event of Default known to the Trustee, give
written notice thereof to the Certificateholders, unless such Event of Default
shall have been cured or waived prior to the issuance of such notice and within
such 45-day period.

         Section 6.18. DIRECTIONS BY CERTIFICATEHOLDERS AND DUTIES OF TRUSTEE
DURING EVENT OF DEFAULT.

         Subject to the provisions of Section 8.01 hereof, during the
continuance of any Event of Default, Holders of Certificates evidencing not less
than 25% of the Class Principal Amount (or Percentage Interest) of each Class of
Certificates affected thereby may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Agreement; PROVIDED,
HOWEVER, that the Trustee shall be under no obligation to pursue any such
remedy, or to exercise any of the trusts or powers vested in it by this
Agreement (including, without limitation, (i) the conducting or defending of any
administrative action or litigation hereunder or in relation hereto and (ii) the
terminating of the Servicer or any successor servicer from its rights and duties
as servicer) at the request, order or direction of any of the
Certificateholders, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the cost, expenses and
liabilities which may be incurred therein or thereby; and, provided further,
that, subject to the provisions of Section 8.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee, in accordance with
an Opinion of Counsel, determines that the action or proceeding so directed may
not lawfully be taken or if the Trustee in good faith determines that the action
or proceeding so directed would involve it in personal liability for which it is
not indemnified to its satisfaction or be unjustly prejudicial to the
non-assenting Certificateholders.

         Section 6.19. PREPARATION OF TAX RETURNS AND OTHER REPORTS.

                           (a) The Trustee shall prepare or cause to be prepared
on behalf of the Trust Fund, based upon information calculated in accordance
with this Agreement pursuant to instructions given by the Depositor, and the
Trustee shall file federal tax returns, all in accordance with Article X hereof.
The Trustee shall prepare and file such state income tax returns and such other
returns as may be required by applicable law relating to the Trust Fund, and, if
required by state law, and shall file any other documents to the extent required
by applicable state tax law (to the extent such documents are in the Trustee's
possession). The Trustee shall forward copies to

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the Depositor of all such returns and Form 1099 supplemental tax information and
such other information within the control of the Trustee as the Depositor may
reasonably request in writing, and shall distribute to each Certificateholder
such forms and furnish such information within the control of the Trustee as are
required by the Code and the REMIC Provisions to be furnished to them, and will
prepare and distribute to Certificateholders Form 1099 (supplemental tax
information) (or otherwise furnish information within the control of the
Trustee) to the extent required by applicable law.

                           (b) The Trustee shall prepare and file with the IRS,
on behalf of each of REMIC 1 and REMIC 2, an application on IRS Form SS-4 or
shall obtain a Taxpayer Identification Number for each of REMIC 1 and REMIC 2
using another reasonable method. If the application is filed on Form SS-4, the
Trustee, upon receipt from the IRS of the Notice of Taxpayer Identification
Number Assigned for each REMIC, shall promptly forward copies of such notices to
the Depositor, upon request. The Trustee will file an IRS Form 8811.

                           (c) The Depositor shall prepare or cause to be
prepared the initial current report on Form 8-K. Thereafter, within 15 days
after each Distribution Date, the Trustee shall, in accordance with industry
standards, file with the Securities and Exchange Commission (the "Commission")
via the Electronic Data Gathering and Retrieval System (EDGAR), a Form 8-K with
a copy of the statement to the Certificateholders for such Distribution Date as
an exhibit thereto. Prior to January 31, 2005, the Trustee shall, in accordance
with industry standards, file a Form 15 Suspension Notification with respect to
the Trust Fund, if applicable. Prior to March 31, 2005, the Trustee shall file a
Form 10-K executed by the Depositor, in substance conforming to industry
standards, with respect to the Trust Fund. The Depositor shall be responsible
for preparing all filings and certificates required by the Sarbanes-Oxley Act of
2002. The Trustee agrees to promptly furnish to the Depositor, from time to time
upon request, such further information, reports, and financial statements within
its control related to this Agreement and the Mortgage Loans as the Depositor
reasonably deems appropriate to prepare and file all necessary reports with the
Commission.

         Section 6.20. ANNUAL CERTIFICATE BY TRUSTEE.

                           (a) By March 15th of each year for which a Form 10-K
is to be filed with a certification by the Depositor, an officer of the Trustee
shall execute and deliver an Officer's Certificate, signed by the senior officer
in charge of the Trustee or any officer to whom that officer reports, to the
Depositor for the benefit of such Depositor and its officers, directors and
affiliates, certifying as to the matters described in the Officer's Certificate
attached hereto as Exhibit P.

                           (b) The Trustee shall indemnify and hold harmless the
Depositor and its officers, directors, agents and affiliates from and against
any losses, damages, penalties, fines, forfeitures, reasonable legal fees and
related costs, judgments and other costs and expenses arising out of or based
upon a breach by the Trustee or any of its officers, directors, agents or
affiliates of its obligations under this Section 6.20 any material misstatement
or omission in the Officer's Certificate required under this Section or the
negligence, bad faith or willful misconduct of the Trustee in connection
therewith. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Depositor, then 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 Trustee on the one had
and the Depositor on the other in connection with a breach of the Trustee's
obligations under this Section 6.20, any material misstatement or omission in
the

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Officer's Certificate required under this Section or the Trustee's negligence,
bad faith or willful misconduct in connection therewith.

                                  ARTICLE VII.

                         PURCHASE OF MORTGAGE LOANS AND
                          TERMINATION OF THE TRUST FUND

         Section 7.01. PURCHASE OF MORTGAGE LOANS; TERMINATION OF TRUST FUND
UPON PURCHASE OR LIQUIDATION OF ALL MORTGAGE LOANS.

                           (a) The respective obligations and responsibilities
of the Trustee, the Servicer and the Depositor created hereby (other than the
obligation of the Trustee to make payments to Certificateholders as set forth in
Section 7.02), shall terminate on the earliest of (i) the final payment or other
liquidation of the last Mortgage Loan remaining in the Trust Fund and the
disposition of all REO Property, (ii) the sale of the property held by the Trust
Fund at auction in accordance with Section 7.01(c) and (iii) the Latest Possible
Maturity Date; PROVIDED, HOWEVER, that in no event shall the Trust Fund 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. Any
termination of the Trust Fund shall be carried out in such a manner so that the
termination of each REMIC included therein shall qualify as a "qualified
liquidation" under the REMIC Provisions.

                           (b) [Reserved]

                           (c) Any termination of the Trust Fund pursuant to
clause (a)(ii) above shall be effected by the auction by the Trustee of all of
the Mortgage Loans and REO Properties via a solicitation of bids in accordance
with procedures to be agreed upon by the Trustee and the Depositor. The Trustee
shall accept the highest such bid, provided that such bid equals or exceeds the
amount described in the definition of "Optional Termination Price."
Notwithstanding anything to the contrary herein, the Optional Termination Price
received by the Trustee shall be deposited by the Trustee directly into the
Distribution Account no later than the Business Day prior to the date of
termination.

         The right of the Trustee to conduct an auction pursuant to the
preceding paragraph shall be conditioned upon the aggregate outstanding Stated
Principal Balance of the Mortgage Loans, at the time of such auction,
aggregating ten (10) percent or less of the Stated Principal Balance of the
Mortgage Loans as of the Cut-off Date.

                           (d) The Servicer and the Trustee shall be reimbursed
from the Optional Termination Price for any Monthly Advances, accrued and unpaid
Servicing Fees, the cost of any auction conducted pursuant to (c) above or other
amounts with respect to the Mortgage Loans that are reimbursable to such parties
under this Agreement.

         Section 7.02. PROCEDURE UPON TERMINATION OF TRUST FUND.

                           (a) Notice of any optional termination pursuant to
the provisions of Section 7.01(c) specifying the Distribution Date upon which
the final distribution shall be made or the Purchase Date, shall be given
promptly by the Trustee by first class mail to Certificateholders mailed no
later than the first day of the month in which the Distribution Date selected
for purchase of the Mortgage Loans occurs or upon (x) the sale of all of the
property of

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the Trust Fund by the Trustee or in the case of a sale of assets of the Trust
Fund, or (y) upon the final payment or other liquidation of the last Mortgage
Loan or REO Property in the Trust Fund. Such notice shall specify (A) the
Purchase Date and the Distribution Date upon which final distribution on the
Certificates of all amounts required to be distributed to Certificateholders
pursuant to Section 5.02 will be made upon presentation and surrender of the
Certificates at the Certificate Registrar's Corporate Trust Office, and (B) that
the Record Date otherwise applicable to such Distribution Date is not
applicable, distribution being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified. The
Trustee shall give such notice to the Certificate Registrar at the time such
notice is given to Holders of the Certificates. Upon any such termination, the
duties of the Trustee and the Certificate Registrar with respect to the
Certificates shall terminate and the Trustee shall terminate the Distribution
Account and any other account or fund maintained with respect to the
Certificates, subject to the Trustee's obligation hereunder to hold all amounts
payable to Certificateholders in trust without interest pending such payment.

                           (b) In the event that all of the Holders do not
surrender their Certificates for cancellation within three months after the time
specified in the above-mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice any Certificates shall not
have been surrendered for cancellation, the Trustee may take appropriate steps
to contact the remaining Certificateholders concerning surrender of such
Certificates, and the cost thereof shall be paid out of the amounts
distributable to such Holders. If within two years after the second notice any
Certificates shall not have been surrendered for cancellation, the Trustee
shall, subject to applicable state law relating to escheatment, hold all amounts
distributable to such Holders for the benefit of such Holders. No interest shall
accrue on any amount held by the Trustee and not distributed to a
Certificateholder due to such Certificateholder's failure to surrender its
Certificate(s) for payment of the final distribution thereon in accordance with
this Section.

                           (c) Any reasonable expenses incurred by the Trustee,
to the extent that such expenses, if paid or reimbursed by the Trust Fund, would
constitute "unanticipated expenses" within the meaning of Treasury Regulations
Section 1.860G-1(b)(3)(ii), in connection with any redemption or termination or
liquidation of the Trust Fund shall be reimbursed from proceeds received from
the liquidation of the Trust Fund.

         Section 7.03. ADDITIONAL TRUST FUND TERMINATION REQUIREMENTS.

                           (a) Any termination of the Trust Fund shall be
effected in accordance with the following additional requirements, unless the
Trustee seeks and receives an Opinion of Counsel (at the expense of such
requesting party), addressed to the Trustee, to the effect that the failure of
the Trust Fund to comply with the requirements of this Section 7.03 will not (I)
result in the imposition of taxes on any REMIC under the REMIC Provisions or
(II) cause any REMIC established hereunder to fail to qualify as a REMIC at any
time that any Certificates are outstanding:

                           (i) Within 89 days prior to the time of the making of
                  the final payment on the Certificates upon notification by the
                  Depositor that it intends to exercise its option to cause the
                  termination of the Trust Fund, the Trustee shall adopt a plan
                  of complete liquidation prepared by the Depositor of the Trust
                  Fund on behalf of each REMIC, meeting the requirements of a
                  qualified liquidation under the REMIC Provisions;

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                           (ii) Any sale of the assets of the Trust Fund
                  pursuant to Section 7.01 or 7.02 shall be a sale for cash and
                  shall occur at or after the time of adoption of such a plan of
                  complete liquidation and prior to the time of making of the
                  final payment on the Certificates;

                           (iii) On the date specified for final payment of the
                  Certificates, the Trustee shall make final distributions of
                  principal and interest on the Certificates in accordance with
                  Section 5.02 and, after payment of, or provision for any
                  outstanding expenses, distribute or credit, or cause to be
                  distributed or credited, to the Holders of the Residual
                  Certificates all cash on hand after such final payment (other
                  than cash retained to meet claims), and the Trust Fund (and
                  each REMIC) shall terminate at that time; and

                           (iv) In no event may the final payment on the
                  Certificates or the final distribution or credit to the
                  Holders of the Residual Certificates be made after the 89th
                  day from the date on which the plan of complete liquidation is
                  adopted.

                           (b) By its acceptance of a Residual Certificate, each
Holder thereof hereby agrees to accept the plan of complete liquidation adopted
by the Trustee under this Section and to take such other action in connection
therewith as may be reasonably requested by the Trustee.

                                 ARTICLE VIII.

                          RIGHTS OF CERTIFICATEHOLDERS

         Section 8.01. LIMITATION ON RIGHTS OF HOLDERS.

                           (a) The death or incapacity of any Certificateholder
shall not operate to terminate this Agreement or this Trust Fund, nor entitle
such Certificateholder's legal representatives or heirs to claim an accounting
or take any action or proceeding in any court for a partition or winding up of
this Trust Fund, nor otherwise affect the rights, obligations and liabilities of
the parties hereto or any of them. Except as otherwise expressly provided
herein, no Certificateholder, solely by virtue of its status as a
Certificateholder, shall have any right to vote or in any manner otherwise
control the Trustee or the operation and management of the Trust Fund, or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Certificates, be construed so as to constitute the
Certificateholders from time to time as partners or members of an association,
nor shall any Certificateholder be under any liability to any third person by
reason of any action taken by the parties to this Agreement pursuant to any
provision hereof.

                           (b) No Certificateholder, solely by virtue of its
status as Certificateholder, shall have any right by virtue or by availing
itself of any provision of this Agreement to institute any suit, action or
proceeding in equity or at law upon, under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of an Event of Default and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of Certificates evidencing not less than 25% of the
Class Principal Amount (or Percentage Interest) of Certificates of each Class
affected thereby 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 cost, expenses and liabilities to be incurred therein or thereby, and the
Trustee, for sixty days after its

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receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding and no direction
inconsistent with such written request has been given such Trustee during such
sixty-day period by such Certificateholders; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself 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, or to enforce any right
under this Agreement, except in the manner herein provided and for the benefit
of all Certificateholders. For the protection and enforcement of the provisions
of this Section, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.

         Section 8.02. ACCESS TO LIST OF HOLDERS.

                           (a) If the Trustee is not acting as Certificate
Registrar, the Certificate Registrar will furnish or cause to be furnished to
the Trustee, within fifteen days after receipt by the Certificate Registrar of a
request by the Trustee in writing, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Certificateholders of each
Class as of the most recent Record Date.

                           (b) If three or more Holders or Certificate Owners
(hereinafter referred to as "Applicants") apply in writing to the Trustee, and
such application states that the Applicants desire to communicate with other
Holders with respect to their rights under this Agreement or under the
Certificates and is accompanied by a copy of the communication which such
Applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, afford such Applicants reasonable
access during the normal business hours of the Trustee to the most recent list
of Certificateholders held by the Trustee or shall, as an alternative, send, at
the Applicants' expense, the written communication proffered by the Applicants
to all Certificateholders at their addresses as they appear in the Certificate
Register.

                           (c) Every Holder or Certificate Owner, if the Holder
is a Clearing Agency, by receiving and holding a Certificate, agrees with the
Depositor, the Certificate Registrar and the Trustee that neither the Depositor,
the Certificate Registrar nor the Trustee shall be held accountable by reason of
the disclosure of any information as to the names and addresses of the
Certificateholders hereunder, regardless of the source from which such
information was derived.

         Section 8.03. ACTS OF HOLDERS OF CERTIFICATES.

                           (a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Agreement to be given
or taken by Holders or Certificate Owners, if the Holder is a Clearing Agency,
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee. Such instrument or instruments (as the action embodies therein and
evidenced thereby) are herein sometimes referred to as an "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agents shall be sufficient for
any purpose of this Agreement and conclusive in favor of the Trustee, if made in
the manner provided in this Section.

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                           (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 any notary public or other officer
authorized by law to take acknowledgments or deeds, certifying that the
individual signing such instrument or writing acknowledged to him the execution
thereof. Whenever such execution is by an officer of a corporation or a member
of a partnership on behalf of such corporation or partnership, such certificate
or affidavit shall also constitute sufficient proof of his authority. The fact
and date of the execution of any such instrument or writing, or the authority of
the individual executing the same, may also be proved in any other manner which
the Trustee deems sufficient.

                           (c) The ownership of Certificates (whether or not
such Certificates shall be overdue and notwithstanding any notation of ownership
or other writing thereon made by anyone other than the Trustee) shall be proved
by the Certificate Register, and neither the Trustee nor the Depositor shall be
affected by any notice to the contrary.

                           (d) Any request, demand, authorization, direction,
notice, consent, waiver or other action by the Holder of any Certificate shall
bind every future Holder of the same 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 in reliance thereon, whether or not notation of such
action is made upon such Certificate.

                                  ARTICLE IX.

               ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS

         Section 9.01. SERVICER TO ACT AS SERVICER.

                           (a) Commencing on the Closing Date, the Servicer
shall service each Mortgage Loan in accordance with Accepted Servicing
Practices.

                           (b) The Servicer shall maintain an EDP containing all
information and programming necessary to service the Mortgage Loans in
accordance with Section 2.01(a) hereof. The Mortgage Loans shall be grouped on
the Servicer's EDP to reflect the Trust Fund as the owner of the Mortgage Loans.

                           (c) The Servicer may not waive, modify or vary any
term of a Mortgage Note without the Depositor's prior written consent. The
Servicer shall comply with all applicable federal, state and local legal and
regulatory requirements (including laws, statutes, rules, regulations and
ordinances) in connection with the modification of the Mortgage Note.

                           (d) Notwithstanding anything herein to the contrary,
the Servicer shall follow any reasonable directions given by the Trustee and/or
the Depositor with respect to the servicing of the Mortgage Loans.

                           (e) With the exception of Ancillary Fees and any
other charges expressly permitted by the Mortgage Note and applicable law, the
Servicer covenants and agrees that it will not, without the prior written
consent of the Seller, charge or collect from any Mortgagor, or trustee under a
deed of trust, any fees of any kind including, but not limited to charges for
amounts expended by the Servicer, regardless of the characterization of the fee
or charge.

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                           (f) The Trustee agrees to execute such limited powers
of attorney provided to it by the Servicer as are necessary and appropriate to
assist the Servicer to carry out its servicing and administrative
responsibilities under this Agreement.

                           (g) In connection with its duties hereunder, in the
event the Servicer requires an original of any document contained in a
Mortgagor's file to service a Mortgage Loan, it shall submit a written request
to the Custodian and the Custodian shall provide the original document to the
Servicer within two (2) Business Days after receipt of the written request,
provided that (a) as to any recorded document, the applicable recorder's office
has returned the recorded document to the Servicer or (b) as to the original
title insurance policy, the Servicer has received such policy. When requesting a
release of documents from the Custodian, the Servicer shall use the form
attached hereto as Exhibit N. Notwithstanding the foregoing, the Servicer
acknowledges and agrees that the Seller maintains agreements with document
custodians selected by it from time to time, pursuant to which such custodians
maintain Mortgage Loan files on behalf of the Seller. The Servicer agrees to
cooperate with such custodians and request from such custodians the documents
and Mortgage Files required by the Servicer which are maintained by such
custodians (with a copy of such request sent to the Seller).

                           (h) The Servicer shall not, unless default by the
related Mortgagor has occurred or is imminent, knowingly permit any
modification, waiver or amendment of any material term of any Mortgage Loan
(including but not limited to the interest rate, the principal balance, the
amortization schedule, or any other term affecting the amount or timing of
payments on the Mortgage Loan or the collateral therefor) unless the Servicer
shall have provided to the Depositor and the Trustee an Opinion of Counsel in
writing to the effect that such modification, waiver or amendment would not
cause an Adverse REMIC Event.

         Section 9.02. TITLE, MANAGEMENT AND DISPOSITION OF REO PROPERTY.

                           (a) If 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 in the name of the Trustee or its designee. Notwithstanding the
foregoing, the Servicer shall not acquire title to any Mortgaged Property, or
proceed with the management of any REO Property, for which the Servicer has
knowledge that such Mortgaged Property or REO Property is affected by hazardous
waste. The Servicer shall either itself, or through an agent, manage, conserve,
protect and operate each REO Property (and may temporarily rent the same) on
behalf of the Trust Fund.

         In the event that the Trust Fund acquires any REO Property in
connection with a default or imminent default on a Mortgage Loan, the Servicer
shall dispose of such REO Property not later than the end of the third taxable
year after the year of its acquisition by the Trust Fund unless the Servicer has
applied for and received a grant of extension from the Internal Revenue Service
to the effect that, under the REMIC Provisions and any relevant proposed
legislation and under applicable state law, the Trust Fund may hold REO Property
for a longer period without adversely affecting the REMIC status of such REMIC
or causing the imposition of a federal or state tax upon such REMIC. If the
Servicer has received such an extension, then the Servicer shall continue to
attempt to sell the REO Property for its fair market value for such period
longer than three years as such extension permits (the "Extended Period"). If
the Servicer has not received such an extension and the Servicer is unable to
sell the REO Property within the period ending 3 months before the end of such
third taxable year after its acquisition by the Trust Fund or if the Servicer
has received such an extension, and the Servicer is unable to sell the REO
Property within the period ending three months before the close of the Extended
Period, the Servicer shall, before the end of the three year period or the
Extended Period, as applicable, (i)

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purchase such REO Property at a price equal to the REO Property's fair market
value or (ii) auction the REO Property to the highest bidder (which may be the
Servicer) in an auction reasonably designed to produce a fair price prior to the
expiration of the three-year period or the Extended Period, as the case may be.
The Trustee shall sign any document prepared by the Servicer or take any other
action reasonably requested by the Servicer which would enable the Servicer, on
behalf of the Trust Fund, to request such grant of extension.

         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 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.

                           (b) The Servicer shall deposit or cause to be
deposited in the applicable Custodial Account, on a daily basis, all revenues
received with respect to each REO Property and shall be permitted to withdraw
therefrom, to the extent of the amount of such revenues on deposit therein,
funds necessary for the proper operation, management and maintenance of such REO
Property, including but not limited to the cost of maintaining any hazard
insurance and the fees of any managing agent acting on behalf of the Servicer.

                           (c) If the Servicer elects to dispose of an REO
Property without utilizing the services of an agent, the Servicer shall notify
the Trustee of its receipt of any and all bona fide offers to purchase that REO
Property. Each such REO Disposition shall be carried out by the Servicer at such
price, and upon such terms and conditions.

         If the Servicer utilizes the services of an approved agent to dispose
of an REO Property, the Servicer shall provide the Trustee with a copy of such
agent's marketing plan, which shall include, but not be limited to, (i) the
marketing time period, (ii) an estimate of the costs of any repairs or
improvements, (iii) the lowest acceptable sale price for the REO Property and
(iv) other proposed terms and conditions of sale. The REO Disposition shall be
carried out by the Servicer in accordance with the terms thereof. If the
Servicer receives a bona fide offer to purchase an REO Property and would like
to accept the offer, but the offer is outside the parameters of the approved
marketing plan, the Servicer shall provide the Trustee with written notification
of the terms and conditions of the offer.

         The Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related unreimbursed Monthly Advances from proceeds
received in connection with such REO Disposition. If the proceeds from an REO
Disposition are insufficient to reimburse the Servicer for any related
unreimbursed Monthly Advances, to the extent such reimbursement will constitute
an "unanticipated expense" (within the meaning of Treasury Regulations Section
1.860G-1(b)(3)(ii)) of a REMIC provided for herein, the Servicer shall be
entitled to withdraw any such deficiency from amounts on deposit in the
applicable Custodial Account. All proceeds from an REO Disposition, net of any
reimbursement to the Servicer as provided above, shall be remitted to the
Trustee within three (3) Business Days following receipt thereof.

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         Section 9.03. TRUSTEE AND DEPOSITOR'S RIGHT TO EXAMINE SERVICER
RECORDS.

                           (a) The Servicer shall cooperate with the Depositor
and/or the Trustee, its counsel, accountants (including outside accountants),
supervisory agents, examiners and other representatives in providing reasonable
access during normal business hours to examine and audit any and all of the
books, records, documentation or other information of the Servicer related to
the Mortgage Loans, which may be relevant to the performance or observance by
the Servicer of the terms, covenants or conditions of this Agreement.

                           (b) The examination and audit rights and other rights
to access described in clause (a) above shall be afforded by the Servicer at its
offices without charge, upon reasonable request, and during normal business
hours or at such other times as may be reasonable under applicable
circumstances. The Servicer, at its expense, shall make available all customary,
reasonable office space, facilities, and equipment for the visiting party and
shall provide the visiting party with access to reasonable cooperation with its
officers and employees. The salaries, travel, subsistence and other related
expenses for the Depositor's and/or the Trustee's representatives shall be borne
by the Depositor and/or the Trustee.

         Section 9.04. LEGAL PROCEEDINGS INVOLVING THE SERVICER AND/OR THE
MORTGAGE LOANS.

                           (a) The Servicer shall commence, defend, appear, or
otherwise participate in any foreclosure, condemnation, bankruptcy, or other
legal proceedings relating to a Mortgage Loan in the name of the Trustee and/or
the Trust Fund. The Servicer shall provide the Trustee, on a monthly basis, with
such written reports as it receives regarding any legal proceedings.

                           (b) The Servicer shall commence all foreclosures,
bankruptcies and other legal proceedings in the name of the Trustee and/or the
Trust Fund unless otherwise directed in writing by the Trustee.

         Section 9.05. MATERIAL CHANGES.

         The Servicer shall promptly report to the Trustee and the Depositor any
change in its business operations, financial condition, properties or assets
that could have a material adverse effect on the Servicer's ability to perform
its obligations hereunder. Events for which the Trustee and the Depositor must
receive notice include, but are not limited to, the following:

                           (a) any merger or consolidation, any changes in the
Servicer's ownership whether directly or indirectly (including any change in
ownership of the Servicer's parent), or any significant reorganization;

                           (b) any material changes in management ordered or
required by a regulatory authority supervising or licensing the Servicer;

                           (c) the entry against the Servicer of a decree or
order of a court or agency or supervisory authority having jurisdiction for the
appointment of a trustee, conservator, receiver, liquidator, assignee, custodian
or sequestrator (or other similar official) in any federal or state bankruptcy,
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, if
such decree or order has remained in force undischarged or unstayed for a period
of sixty (60) days;

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                           (d) the consent by the Servicer to the appointment of
a trustee, conservator, receiver, liquidator, assignee, custodian or
sequestrator (or other similar official) in, or commencement of a voluntary case
under, any federal or state bankruptcy, insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings;

                           (e) upon the Servicer's (A) admitting in writing its
inability to pay its debts generally as they become due, (B) filing a petition
to take advantage of any applicable insolvency or reorganization statute, (C)
making an assignment for the benefit of its creditors or (D) voluntarily
suspending payment of its obligations;

                           (f) entry of any court judgment or regulatory order
in which the Servicer is or may be required to pay a claim or claims that may
have a material adverse effect on the Servicer's financial condition;

                           (g) any admission by the Servicer to the commission
of, or any finding that the Servicer has committed, any violation of any law,
regulation or order in any proceeding or audit commenced by any governmental, or
regulatory authority, or any proceeding commenced in any court of law;

                           (h) the commencement of any class action law suits
against the Servicer; and

                           (i) the Servicer's entry into any agreement with a
third party that would result in any material change in the financial status or
ownership of the Servicer or any merger of the Servicer.

         Section 9.06. SERVICER SHALL PROVIDE INFORMATION AS REASONABLY
REQUIRED.

         During the term of this Agreement, the Servicer shall furnish any
reports or documentation that the Trustee and/or the Depositor may reasonably
request. Reports requested may include reports not specified or otherwise
required by this Agreement or reports required to comply with any regulations
regarding any supervisory agents or examiners of the Trustee and/or the
Depositor, as applicable. All reports will be delivered in accordance with the
Trustee and/or the Depositor's reasonable instructions and directions. The
Servicer agrees to execute and deliver all such instruments and take all such
action as the Trustee and/or the Depositor, as applicable, from time to time,
may reasonably request in order to effectuate the purpose and to carry out the
terms of this Agreement.

         Section 9.07. SERVICER NOT TO RESIGN.

         The Servicer shall neither assign this Agreement or the servicing
hereunder or delegate its rights or duties hereunder or any portion hereof (to
other than a third party in the case of outsourcing routine tasks such as taxes,
insurance and property inspection, in which case the Servicer shall be fully
liable for such tasks as if the Servicer performed them itself) nor sell or
otherwise dispose of all or substantially all of its property or assets without
the prior written consent of the Trustee and the Depositor, which consent shall
be granted or withheld in the reasonable discretion of such parties, provided,
however, that (i) the Servicer may assign its rights and obligations hereunder
without prior written consent of the Trustee and the Depositor to any entity
that is directly owned or controlled by the Servicer, and the Servicer
guarantees the performance of such entity hereunder, (ii) the Servicer is no
longer permitted to act as Servicer under applicable law as evidenced by an
Opinion of Counsel or (iii) upon a sale of its servicing

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rights with respect to the Mortgage Loans with the prior written consent of the
Seller. In the case of item (i) above, the Servicer shall provide the Trustee
and the Depositor with a written statement guaranteeing the successor entity's
performance of the Servicer's obligations under the Agreement.

         Section 9.08. CUSTODIAL ACCOUNTS AND ESCROW ACCOUNTS.

         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. The Servicer shall create and maintain Custodial Accounts and
Escrow Accounts for the deposit of all funds, except as otherwise provided
herein, received by the Servicer on the Mortgage Loans.

         Section 9.09. ASSUMPTION PROCESSING.

         Within three (3) Business Days of receipt by the Servicer of a request
by a Mortgagor to be released from liability for payment of a Mortgage Loan in
connection with an assumption of the related Mortgage Note, the Servicer shall
notify the Trustee of such request. Upon the completion of the assumption
processing, the Seller shall provide the Servicer with all necessary information
to enable the Servicer to update its EDP.

         Section 9.10. BOOKS AND RECORDS.

         The Servicer shall be responsible for maintaining, and shall maintain,
a complete set of records for the Mortgage Loans. The Servicer's books and
records shall clearly reflect the ownership of the Mortgage Loans by the Trust
Fund. All documents, records and correspondence, regardless of the media in
which they are stored or maintained, are property of the Trust Fund, and the
Servicer shall hold the same in a fiduciary capacity for the Trust Fund. The
Servicer may retain copies of all such documents, records and correspondence as
may be necessary to service the Mortgage Loans under this Agreement.

         Section 9.11. ANNUAL STATEMENT AS TO COMPLIANCE.

         The Servicer will deliver to the Depositor and the Trustee on or before
February 28 of each year, beginning in 2005 or such other date that the
Depositor gives the Servicer at least 30 days prior notice of in order to remain
in compliance with the Section 302 Requirements, an Officer's Certificate of the
Servicer stating that (i) a review of the activities of the Servicer during the
preceding calendar year and of performance under this Agreement has been made
under such officer's supervision, and (ii) to the best of such officer's
knowledge, based on such review, the Servicer 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.

         Section 9.12. ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS'
SERVICING REPORTS.

         On or before March 15 of each year, beginning in 2005 or such other
date as to which the Depositor gives the Servicer at least 30 days prior written
notice, in order to remain in compliance with the Section 302 Requirements, the
Servicer at its expense shall cause a nationally recognized firm of independent
certified public accountants that is a member of the American Institute of
Certified Public Accountants to furnish a USAP Report to the Trustee and the
Depositor.

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         Section 9.13. OFFICER'S CERTIFICATE.

                           (a) By February 28th of each year beginning in 2005
or such other date specified in a written notice within 15 days prior to the
date on which a Form 10-K is required to be filed with a certification by the
Depositor, an officer of the Servicer shall execute and deliver an Officer's
Certificate substantially in the form of Exhibit R attached hereto, signed by
the senior officer in charge of servicing of the Servicer or any officer to whom
that officer reports, to the Trustee and Depositor for the benefit of such
parties and their respective officers, directors and affiliates.

                           (b) The Servicer shall indemnify and hold harmless
the Depositor and its officers, directors, agents and affiliates from and
against any losses, damages, penalties, fines, forfeitures, reasonable legal
fees and related costs, judgments and other costs and expenses arising out of or
based upon a breach by the Servicer or any of its officers, directors, agents or
affiliates of its obligations under this Section 9.13 any material misstatement
or omission in the Officer's Certificate required under this Section 9.13 or the
negligence, bad faith or willful misconduct of the Servicer in connection
therewith. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Depositor, then 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 Servicer on the one had
and the Depositor on the other in connection with a breach of the Servicer's
obligations under this Section 9.13, any material misstatement or omission in
the Officer's Certificate required under this Section 9.13 or the Servicer's
negligence, bad faith or willful misconduct in connection therewith.

         Section 9.14. SERVICING COMPENSATION.

                           (a) Subject to the following paragraph, as
compensation for its services hereunder, the Servicer shall be entitled to a
Servicing Fee payable with respect to each Mortgage Loan. As to each Mortgage
Loan, the Servicing Fee shall be payable monthly from payments of interest on
such Mortgage Loan prior to the deposit of such payments into the applicable
Custodial Account, shall accrue at the applicable Servicing Fee Rate, and shall
be computed on the basis of the same principal amount and for the same period
respecting which such interest payment was computed.

                           (b) The Servicing Fee for each Mortgage Loan shall be
payable solely from (i) the interest portion of the related Monthly Payment (to
the extent paid by the Mortgagor, but only if a full interest payment is
received), or (ii) from any payment of interest made with respect to the
Mortgage Loan from the proceeds of foreclosure or any judgment, writ of
attachment or levy against the Mortgagor or the Mortgagor's assets, or (iii)
from funds paid in connection with any prepayment in full, or (iv) from
Insurance Proceeds or Liquidation Proceeds.

                           (c) As additional compensation hereunder, the
Servicer may retain (i) all net interest earnings on balances maintained in the
Custodial Account and Escrow Accounts and (ii) the Ancillary Fees.

                           (d) The Servicer's right to the Servicing Fee shall
not be transferred in whole or in part except in connection with any permitted
transfer of all the Servicer's obligations under this Agreement. The Servicer
shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder and shall not be entitled to reimbursement
therefor except as specifically provided for herein.

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         Section 9.15. INDEMNIFICATION.

         The Servicer shall indemnify and hold the Trustee, the Trust Fund and
the Depositor and their respective officers, directors, employees and agents
(collectively, the "Indemnified Parties") harmless from, and will reimburse the
Indemnified Parties for, any and all Losses incurred by any of the Indemnified
Parties to the extent that such Losses result from, are caused by or arise out
of any one or more of the following:

                           (i) Any material misrepresentations made by the
                  Servicer in this Agreement, or in any schedule, exhibit, or
                  certificate furnished pursuant hereto;

                           (ii) Any material breach of any of the
                  representations and warranties of the Servicer or the
                  nonfulfillment of any term, covenant, condition or obligation
                  of the Servicer set forth in this Agreement or in any
                  schedule, statement, exhibit, or certificate furnished
                  pursuant hereto, or any default or failure to perform by the
                  Servicer hereunder;

                           (iii) Any failure of the Servicer to comply with
                  Accepted Servicing Practices in connection with servicing the
                  Mortgage Loans;

                           (iv) Any liabilities or obligations, contingent or
                  otherwise, of the Servicer of any nature whatsoever relating
                  to the Servicer's obligations under this Agreement, to the
                  extent that any related Loss to the Trustee, Trust Fund or
                  Depositor is not increased by negligence, bad faith or willful
                  misconduct on the part of the Trustee, Trust Fund or
                  Depositor; or

                           (v) Any non-compliance with the terms of the powers
                  of attorney or the use thereof that results in a Loss to the
                  Trustee, Trust Fund or Depositor.

         The indemnity provided in this Section 9.15 shall remain in full force
and effect regardless of any investigation made by the Trustee, Trust Fund or
Depositor or its representatives. The provisions of this Section 9.15 shall
survive the termination of this Agreement and the payment of the outstanding
Certificates.

         Section 9.16. NON SOLICITATION.

         For as long as the Servicer services the Mortgage Loans, the Servicer
covenants that it will not, and that it will ensure that its affiliates and
agents, will not, directly solicit or provide information for any other party to
solicit for prepayment or refinancing of any of the Mortgage Loans by the
related Mortgagors. It is understood that the promotions undertaken by the
Servicer which are directed to the general public at large, or certain segments
thereof, shall not constitute solicitation as that term is used in this Section
9.16.

         Section 9.17. SUCCESSOR TO THE SERVICER.

         Simultaneously with the termination of the Servicer's responsibilities
and duties under this Agreement (a) the Trustee shall, in accordance with the
provisions of this Agreement (i) succeed to and assume all of the Servicer's
responsibilities, rights, duties and obligations under this Agreement, or (ii)
appoint a successor meeting the eligibility requirements set forth herein and
which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Servicer under this Agreement with the termination of the
Servicer's responsibilities, duties

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and liabilities under this Agreement. If the Trustee shall succeed to and assume
the Servicer's responsibilities, rights, duties and obligations under this
Agreement, such succession shall not be effective prior to 90 days after the
Trustee's knowledge that the Servicer shall be terminated hereunder. The
Servicer shall not be removed hereunder prior to the effectiveness of the
assumption of its responsibilities, rights, duties and obligations by the
successor thereto. Any successor to the Servicer shall be subject to the
approval of the Depositor, the Trustee and each Rating Agency. Each Rating
Agency must deliver to the Trustee a letter to the effect that such transfer of
servicing will not result in a qualification, withdrawal or downgrade of the
then-current rating of any of the Certificates. In connection with such
appointment and assumption, the Trustee or the Depositor, as applicable, may
make such arrangements for the compensation of such successor out of payments on
the Mortgage Loans as it and such successor shall agree; PROVIDED, HOWEVER, that
no such compensation shall be in excess of that permitted the Servicer under
this Agreement. In the event that the Servicer's duties, responsibilities and
liabilities under this Agreement should be terminated pursuant to the
aforementioned sections, the Servicer shall discharge such duties and
responsibilities during the period from the date it acquires knowledge of such
termination until the effective date thereof with the same degree of diligence
and prudence which it is obligated to exercise under this Agreement, and shall
take no action whatsoever that might impair or prejudice the rights or financial
condition of its successor. The resignation or removal of the Servicer pursuant
to the aforementioned sections shall not become effective until a successor
shall be appointed pursuant to this Section 9.17 and shall in no event relieve
the Servicer of the representations and warranties made herein and the remedies
available to the Trustee herein, it being understood and agreed that the
provisions of this Agreement regarding indemnification and nonsolicitation shall
be applicable to the Servicer notwithstanding any such resignation or
termination of the Servicer, or the termination of this Agreement.

         Section 9.18. STATEMENTS TO THE TRUSTEE.

                           (a) Not later than the 15th calendar day of each
month (or if such calendar day is not a Business Day, the immediately succeeding
Business Day), the Servicer shall furnish to the Trustee (i) a monthly
remittance advice in the format set forth in Exhibit D-1 hereto and a monthly
defaulted loan report in the format set forth in Exhibit D-2 hereto relating to
the period ending on the first day of the current calendar month and (ii) all
such information required on a magnetic tape or other similar media mutually
agreed upon by the Trustee and the Servicer.

                           (b) The Servicer shall provide the Trustee with such
information concerning the Mortgage Loans as is necessary for the Trustee to
prepare its federal income tax return as the Trustee may reasonably request from
time to time.

         Section 9.19. MERGER OR CONSOLIDATION OF THE SERVICER.

         Any entity into which the Servicer may be merged or consolidated, or
any entity resulting from any merger, conversion or consolidation to which the
Servicer shall be a party, or any corporation succeeding to the business of the
Servicer, shall be the successor of the Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however that the successor Servicer shall satisfy all the requirements of
Section 9.17 with respect to the qualifications of a successor Servicer.

         Section 9.20. LIMITATION ON LIABILITY OF THE SERVICER.

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         Neither the Servicer nor any of its directors, officers, employees or
agents shall be under any liability to 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 Servicer or any such Person against any breach
of representations or warranties made by it herein or protect the Servicer or
any such Person from any liability which would otherwise be imposed by reasons
of willful misfeasance, bad faith or negligence in the performance of its duties
or by reason of reckless disregard of its obligations and duties hereunder. The
Servicer and any director, officer, employee or agent of the Servicer shall be
indemnified by the Trust Fund and held harmless against any loss, liability or
expense incurred in connection with any audit, controversy or judicial
proceeding relating to a governmental taxing authority or any legal action
relating to this Agreement or the Certificates or any other unanticipated or
extraordinary expense, other than any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or negligence in the performance of
duties hereunder or by reason of reckless disregard of obligations and duties
hereunder. The Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its respective
duties hereunder and which in its opinion may involve it in any expense or
liability; PROVIDED, HOWEVER, that the Servicer may in its discretion undertake
any such action that it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties hereto and interests of the
Trustee and the Certificateholders hereunder. In such event, the legal expenses
and costs of such action and any liability resulting therefrom shall be
expenses, costs and liabilities of the Trust Fund, and the Servicer shall be
entitled to be reimbursed therefor out of the Custodial Account.

                                   ARTICLE X.

                              REMIC ADMINISTRATION

         Section 10.01. REMIC ADMINISTRATION.

                           (a) REMIC elections as set forth in the Preliminary
Statement shall be made on Forms 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 and
Section 1.01.

                           (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. The latest possible maturity date for purposes of Treasury Regulation
1.860G-1(a)(4) will be the Latest Possible Maturity Date.

                           (c) The Trustee shall represent the Trust Fund in any
administrative or judicial proceeding relating to an examination or audit by any
governmental taxing authority with respect thereto. The Trustee 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 such 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 Trustee in
fulfilling its duties hereunder (including its duties as tax return preparer).
The Trustee shall be entitled to reimbursement of expenses to the extent
provided in clause (i) above from the Distribution Account, provided, however,
the

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<PAGE>

Trustee shall not be entitled to reimbursement for expenses incurred in
connection with the preparation of tax returns and other reports as required by
Section 6.19 and this Section.

                           (d) The Trustee shall prepare, sign and file all of
each REMIC's federal and appropriate state tax and information returns as such
REMIC's direct representative. The expenses of preparing and filing such returns
shall be borne by the Trustee.

                           (e) The Trustee or its designee 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 shall provide, upon receipt of
additional reasonable compensation, 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 pursuant to Treasury Regulation 1.860E-2(a)(5) and any person
designated in Section 860E(e)(3) of the Code.

                           (f) The Trustee and the Holders of Certificates shall
take any action or cause any REMIC to take any action necessary to create or
maintain the status of any REMIC as a REMIC under the REMIC Provisions and shall
assist each other as necessary to create or maintain such status. Neither the
Trustee nor the Holder of any Residual Certificate shall knowingly take any
action, cause any REMIC 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 any REMIC as a REMIC or (ii)
result in the imposition of a tax upon any 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 has 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 or the assets therein, or causing any 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, 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 has advised it in writing
that an Adverse REMIC Event could occur; provided, however, that if no Adverse
REMIC Event would occur but such action could result in the imposition of
additional taxes on the Residual Certificateholders, no such Person shall take
any such action, or cause any REMIC to take any such action without the written
consent of the Residual Certificateholders.

                           (g) Each Holder of a Residual Certificate shall pay
when due any and all taxes imposed on the related REMIC by federal or state
governmental authorities. To the extent that such taxes are not paid by a
Residual Certificateholder, the Trustee or the Paying Agent shall pay any
remaining REMIC taxes out of current or future amounts otherwise distributable
to the Holder of the Residual Certificate in any such REMIC 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
any such REMIC, as the case may be.

                           (h) The Trustee shall, for federal income tax
purposes, maintain books and records with respect to each REMIC on a calendar
year and on an accrual basis.

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<PAGE>

                           (i) No additional contributions of assets shall be
made to any REMIC, except as expressly provided in this Agreement.

                           (j) The Trustee shall not enter into any arrangement
by which any REMIC will receive a fee or other compensation for services.

         Section 10.02. PROHIBITED TRANSACTIONS AND ACTIVITIES.

         Neither the Depositor 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 each REMIC pursuant to Article VII 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 any 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 such REMIC as a REMIC or of the interests therein other than the
Residual Certificate 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 such REMIC to be
subject to any tax including a tax on prohibited transactions or prohibited
contributions pursuant to the REMIC Provisions.

         Section 10.03. INDEMNIFICATION WITH RESPECT TO PROHIBITED TRANSACTIONS
OR LOSS OF REMIC STATUS.

         In the event that a 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 Certificateholders of the related
Residual Certificate against any and all losses, claims, damages, liabilities or
expenses ("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 Depositor or the Holder of the Residual Certificate, nor for any
such Losses resulting from misinformation provided by any of the foregoing
parties on which the Trustee has relied. 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 or the Mortgage
Loan Purchase Agreement, (2) for any Losses other than arising out of
malfeasance, willful misconduct or negligent performance by the Trustee with
respect to its duties and obligations set forth herein, and (3) for any special
or consequential damages to Certificateholders of the related Residual
Certificate (in addition to payment of principal and interest on the
Certificates).

         Section 10.04. REO PROPERTY.

                           (a) Notwithstanding any other provision of this
Agreement, the Trustee shall not, except to the extent provided in this
Agreement, knowingly permit any Servicer to rent, lease, or otherwise earn
income on behalf of any REMIC with respect to any REO Property which might 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 REMIC
of any "income from non-permitted assets" within the meaning of section
860F(a)(2) of the Code or any

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"net income from foreclosure property" which is subject to tax under the REMIC
Provisions unless the Servicer has provided to the Trustee an Opinion of Counsel
concluding that, under the REMIC Provisions, such action would not adversely
affect the status of any REMIC as a REMIC and any income generated for any REMIC
by the REO Property would not result in the imposition of a tax upon such REMIC.

                           (b) The Depositor shall cause the Servicer (to the
extent provided in this Agreement) to make reasonable efforts to sell any REO
Property for its fair market value. In any event, however, the Depositor shall,
or shall cause the Servicer (to the extent provided in this Agreement) to,
dispose of any REO Property within three years of its acquisition by the Trust
Fund unless the Depositor or the Servicer (on behalf of the Trust Fund) has
received a grant of extension from the Internal Revenue Service to the effect
that, under the REMIC Provisions and any relevant proposed legislation and under
applicable state law, the REMIC may hold REO Property for a longer period
without adversely affecting the REMIC status of such REMIC or causing the
imposition of a Federal or state tax upon such REMIC. If such an extension has
been received, then the Depositor, acting on behalf of the Trustee hereunder,
shall, or shall cause the Servicer to, continue to attempt to sell the REO
Property for its fair market value for such period longer than three years as
such extension permits (the "Extended Period"). If such an extension has not
been received and the Depositor or the Servicer, acting on behalf of the Trust
Fund hereunder, is unable to sell the REO Property within 33 months after its
acquisition by the Trust Fund or if such an extension, has been received and the
Depositor or the Servicer is unable to sell the REO Property within the period
ending three months before the close of the Extended Period, the Depositor shall
cause the Servicer, before the end of the three year period or the Extended
Period, as applicable, to (i) purchase such REO Property at a price equal to the
REO Property's fair market value or (ii) auction the REO Property to the highest
bidder (which may be the Servicer) in an auction reasonably designed to produce
a fair price prior to the expiration of the three-year period or the Extended
Period, as the case may be.

                                  ARTICLE XI.

                            MISCELLANEOUS PROVISIONS

         Section 11.01. BINDING NATURE OF AGREEMENT; ASSIGNMENT.

         This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.

         Section 11.02. ENTIRE AGREEMENT.

         This Agreement contains the entire agreement and understanding among
the parties hereto with respect to the subject matter hereof, and supersedes all
prior and contemporaneous agreements, understandings, inducements and
conditions, express or implied, oral or written, of any nature whatsoever with
respect to the subject matter hereof. The express terms hereof control and
supersede any course of performance and/or usage of the trade inconsistent with
any of the terms hereof.

         Section 11.03. AMENDMENT.

                           (a) This Agreement may be amended from time to time
by the Depositor, the Servicer and the Trustee, without notice to or the consent
of any of the Holders, (i) to cure any ambiguity or mistake, (ii) to cause the
provisions herein to conform to or be consistent

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with or in furtherance of the statements made with respect to the Certificates,
the Trust Fund or this Agreement in any Offering Document, or to correct or
supplement any provision herein which may be inconsistent with any other
provisions herein or with the provisions of this Agreement, (iii) to add any
other provisions with respect to matters or questions arising under this
Agreement, (iv) to modify alter, amend, add to or rescind any of the terms or
provisions contained in this Agreement or (v) to add, delete, or amend any
provisions to the extent necessary or desirable to comply with any requirements
imposed by the Code and the REMIC Provisions. No such amendment effected
pursuant to the preceding sentence shall, as evidenced by an Opinion of Counsel,
adversely affect the status of any REMIC created pursuant to this Agreement, nor
shall such amendment effected pursuant to clauses (iii) or (iv) of such sentence
adversely affect in any material respect the interests of any Holder unless such
Holder has consented thereto. Prior to entering into any amendment without the
consent of Holders pursuant to this paragraph, the Trustee shall be provided
with an Opinion of Counsel (at the expense of the party requesting such
amendment) to the effect that such amendment is permitted under this Section.
Any such amendment shall be deemed not to adversely affect in any material
respect any Holder, if the Trustee receives written confirmation from each
Rating Agency that such amendment will not cause such Rating Agency to reduce
the then current rating assigned to the Certificates.

                           (b) This Agreement may also be amended from time to
time by the Depositor, the Servicer and the Trustee, with the consent of the
Holders of not less than 66-2/3% of the Class Principal Amount (or Percentage
Interest) of each Class of Certificates affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Holders; provided, however, that no such amendment shall be made unless the
Trustee receives an Opinion of Counsel, at the expense of the party requesting
the change, that such change will not adversely affect the status of any REMIC
as a REMIC or cause a tax to be imposed on such REMIC; and provided further,
that no such amendment may (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 or (ii) reduce the aforesaid percentages of Class Principal Amount
(or Percentage Interest) of Certificates of each Class, the Holders of which are
required to consent to any such amendment without the consent of the Holders of
100% of the Class Principal Amount (or Percentage Interest) of each Class of
Certificates affected thereby. For purposes of this paragraph, references to
"Holder" or "Holders" shall be deemed to include, in the case of any Class of
Book-Entry Certificates, the related Certificate Owners.

                           (c) Promptly after the execution of any such
amendment, the Trustee shall furnish written notification of the substance of
such amendment to each Holder, the Depositor, the Servicer and the Rating
Agencies.

                           (d) It shall not be necessary for the consent of
Holders under this Section 11.03 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Holders shall be subject to such
reasonable regulations as the Trustee may prescribe.

                           (e) Notwithstanding anything to the contrary in this
Agreement, the Trustee shall not consent to any amendment of this Agreement
except pursuant to the standards provided in this Section with respect to
amendment of this Agreement.

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<PAGE>

                           (f) Neither the Seller nor the Trustee shall consent
to the assignment by the Servicer of the Servicer's rights and obligations under
this Agreement without the prior written consent of the Depositor, which consent
shall not be unreasonably withheld.

         Section 11.04. VOTING RIGHTS.

         Except to the extent that the consent of all affected
Certificateholders is required pursuant to this Agreement, with respect to any
provision of this Agreement requiring the consent of Certificateholders
representing specified percentages of aggregate outstanding Certificate
Principal Amount (or Percentage Interest), Certificates owned by the Depositor,
the Trustee, the Servicer or any Affiliates thereof are not to be counted so
long as such Certificates are owned by the Depositor, the Trustee, the Servicer
or any Affiliate thereof.

         Section 11.05. PROVISION OF INFORMATION.

                           (a) For so long as any of the Certificates of any
Series or Class are "restricted securities" within the meaning of Rule 144(a)(3)
under the Act, each of the Depositor, the Servicer and the Trustee agree to
cooperate with each other to provide to any Certificateholders and to any
prospective purchaser of Certificates designated by such holder, upon the
request of such holder or prospective purchaser, any information required to be
provided to such holder or prospective purchaser to satisfy the condition set
forth in Rule 144A(d)(4) under the Act. Any reasonable, out-of-pocket expenses
incurred by the Trustee or the Servicer in providing such information shall be
reimbursed by the Depositor.

                           (b) The Trustee shall provide to any person to whom a
Prospectus was delivered, upon the request of such person specifying the
document or documents requested, (i) a copy (excluding exhibits) of any report
on Form 8-K or Form 10-K filed with the Securities and Exchange Commission and
(ii) a copy of any other document incorporated by reference in the Prospectus.
Any reasonable out-of-pocket expenses incurred by the Trustee in providing
copies of such documents shall be reimbursed by the Depositor.

                           (c) On each Distribution Date, the Trustee shall
deliver or cause to be delivered by first class mail or make available on its
website to the Depositor, a copy of the report delivered to Certificateholders
pursuant to Section 4.02.

         Section 11.06. GOVERNING LAW.

         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
CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.

         Section 11.07. NOTICES.

         All requests, demands, notices, authorizations, directions, consents,
waivers and communications hereunder shall be in writing and shall be deemed to
have been duly given when received by (a) in the case of the Depositor, Merrill
Lynch Mortgage Investors, Inc., 250 Vesey Street, 4 World Financial Center, 10th
Floor, New York, New York, 10080, telecopy number (212) 449-9015, Attention:
Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1, (b) in the case of
the Servicer, Cendant Mortgage Corporation, 3000 Leadenhall Road, Mt. Laurel New

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Jersey 08054, telecopy number (856) 917-6910, Attention: Robert E. Groody, Chief
Operating Officer, (c) in the case of the Seller, Merrill Lynch Mortgage
Lending, Inc., 4 World Financial Center, 10th Floor, New York, New York 10281,
telecopy number (212) 738-1110, Attention: Merrill Lynch Mortgage Investors
Trust Series MLCC 2004-1, and (d) with respect to the Trustee or the Certificate
Registrar, P.O. Box 98, Columbia, Maryland 21046, Attention: Client Manager -
MLMI Trust Series MLCC 2004-1, with a copy to it at its respective Corporate
Trust Office, or as to each party such other address as may hereafter be
furnished by such party to the other parties in writing. All demands, notices
and communications to a party hereunder shall be in writing and shall be deemed
to have been duly given when delivered to such party at the relevant address,
facsimile number or electronic mail address set forth above or at such other
address, facsimile number or electronic mail address as such party may designate
from time to time by written notice in accordance with this Section 11.07.

         Section 11.08. SEVERABILITY OF PROVISIONS.

         If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.

         Section 11.09. INDULGENCES; NO WAIVERS.

         Neither the failure nor any delay on the part of a party to exercise
any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege preclude any other or further exercise of the same or of any
other right, remedy, power or privilege, nor shall any waiver of any right,
remedy, power or privilege with respect to any occurrence be construed as a
waiver of such right, remedy, power or privilege with respect to any other
occurrence. No waiver shall be effective unless it is in writing and is signed
by the party asserted to have granted such waiver.

         Section 11.10. HEADINGS NOT TO AFFECT INTERPRETATION.

         The headings contained in this Agreement are for convenience of
reference only, and they shall not be used in the interpretation hereof.

         Section 11.11. BENEFITS OF AGREEMENT.

         Nothing in this Agreement or in the Certificates, express or implied,
shall give to any Person, other than the parties to this Agreement and their
successors hereunder and the Holders of the Certificates, any benefit or any
legal or equitable right, power, remedy or claim under this Agreement, except to
the extent specified in Section 11.15.

         Section 11.12. SPECIAL NOTICES TO THE RATING AGENCIES.

                           (a) The Depositor shall give prompt notice to the
Rating Agencies of the occurrence of any of the following events of which it has
notice:

                           (i) any amendment to this Agreement pursuant to
                  Section 11.03;

                           (ii) the occurrence of any Event of Default;

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                           (iii) any notice of termination given to the Servicer
                  pursuant to Section 6.14 or any resignation of the Servicer
                  pursuant to this Agreement;

                           (iv) the appointment of any successor to the Servicer
                  pursuant to Section 6.14; and

                           (v) the making of a final payment pursuant to Section
                  7.02.

                           (b) All notices to the Rating Agencies provided for
this Section shall be in writing and sent by first class mail, telecopy or
overnight courier, as follows:

If to Moody's, to:

                  Moody's Investors Service, Inc.
                  99 Church Street
                  New York, New York 10007
                  Attention:  ABS Monitoring

                  If to Fitch Ratings, to:

                  Fitch, Inc.
                  One State Street Plaza
                  30th Floor
                  New York, New York 10004
                  Attention:  Surveillance Group

                           (c) The Trustee shall provide or make available to
the Rating Agencies reports prepared pursuant to Section 4.02. In addition, the
Trustee shall, at the expense of the Trust Fund, make available to each Rating
Agency such information as such Rating Agency may reasonably request regarding
the Certificates or the Trust Fund, to the extent that such information is
reasonably available to the Trustee.

         Section 11.13. [RESERVED].

         Section 11.14. COUNTERPARTS.

         This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, and all of which together shall
constitute one and the same instrument.

         Section 11.15. NO PETITIONS.

         The Trustee and the Servicer, by entering into this Agreement, hereby
covenants and agrees that it shall not at any time institute against the
Depositor, or join in any institution against the Depositor of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to this Agreement or any of the
documents entered into by the Depositor in connection with the transactions
contemplated by this Agreement.

                                       92
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers hereunto duly authorized as of the
day and year first above written.

                                         MERRILL LYNCH MORTGAGE INVESTORS, INC.,
                                         as Depositor

                                         By:     /s/ Matthew Whalen
                                               ---------------------------------
                                         Name:   Matthew Whalen
                                         Title:  Authorized Signatory

                                         CENDANT MORTGAGE CORPORATION,
                                         as Servicer

                                         By:     /s/ Richard Bradfield
                                               ---------------------------------
                                         Name:   Richard Bradfield
                                         Title:  Vice President

                                         WELLS FARGO BANK, N.A.,
                                         as Trustee

                                         By:     /s/ Sandra Whalen
                                               ---------------------------------
                                         Name:   Sandra Whalen
                                         Title:  Vice President

Solely for purposes of Section 2.04,

accepted and agreed to by:

MERRILL LYNCH MORTGAGE LENDING, INC.

By:      /s/ Brian E. Brennan
    ---------------------------------
Name:    Brian E. Brennan
Title:   Authorized Signatory

<PAGE>

                                    EXHIBIT A

                              FORMS OF CERTIFICATES

                             [INTENTIONALLY OMITTED]

                                      A-1

<PAGE>

                                    EXHIBIT B

          FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)

STATE OF                   )
                           )       ss.:
COUNTY OF                  )

         [NAME OF OFFICER], _________________ being first duly sworn, deposes
and says:

         1.       That he [she] is [title of officer] ________________________
                  of [name of Purchaser]
                  _________________________________________ (the "Purchaser"), a
                  _______________________ [description of type of entity] duly
                  organized and existing under the laws of the [State of
                  __________] [United States], on behalf of which he [she] makes
                  this affidavit.

         2.       That the Purchaser's Taxpayer Identification Number is [ ].

         3.       That the Purchaser is not a "disqualified organization" within
                  the meaning of Section 860E(e)(5) of the Internal Revenue Code
                  of 1986, as amended (the "Code") and will not be a
                  "disqualified organization" as of [date of transfer], and that
                  the Purchaser is not acquiring a Residual Certificate (as
                  defined in the Agreement) for the account of, or as agent
                  (including a broker, nominee, or other middleman) for, any
                  person or entity from which it has not received an affidavit
                  substantially in the form of this affidavit. For these
                  purposes, a "disqualified organization" means the United
                  States, any state or political subdivision thereof, any
                  foreign government, any international organization, any agency
                  or instrumentality of any of the foregoing (other than an
                  instrumentality if all of its activities are subject to tax
                  and a majority of its board of directors is not selected by
                  such governmental entity), any cooperative organization
                  furnishing electric energy or providing telephone service to
                  persons in rural areas as described in Code Section
                  1381(a)(2)(C), any "electing large partnership" within the
                  meaning of Section 775 of the Code, or any organization (other
                  than a farmers' cooperative described in Code Section 521)
                  that is exempt from federal income tax unless such
                  organization is subject to the tax on unrelated business
                  income imposed by Code Section 511.

         4.       That the Purchaser is not, and on __________________ [date of
                  transfer] will not be, an employee benefit plan subject to
                  Title I of the Employee Retirement Income Security Act of
                  1974, as amended ("ERISA"), a plan subject to any provisions
                  under any federal, state, local, non-U.S. or other laws or
                  regulations that are substantively similar to foregoing
                  provisions of ERISA or the Code (collectively, a "PLAN"), and
                  is not directly or indirectly acquiring a Residual Certificate
                  for, on behalf of or with any assets of any such Plan.

         5.       That the Purchaser hereby acknowledges that under the terms of
                  the Pooling and Servicing Agreement dated as of November 1,
                  2004 (the "Agreement"), among Merrill Lynch Mortgage
                  Investors, Inc., as Depositor, Cendant Mortgage

                                      B-1
<PAGE>

                  Corporation, as Servicer and Wells Fargo Bank, N.A., as
                  Trustee with respect to Merrill Lynch Mortgage Investors Trust
                  Series MLCC 2004-1 Mortgage Pass-Through Certificates, no
                  transfer of the Residual Certificates shall be permitted to be
                  made to any person unless the Certificate Registrar and
                  Trustee have received a certificate from such transferee
                  containing the representations in paragraphs 3 and 4 hereof.

         6.       That the Purchaser does not hold REMIC residual securities as
                  nominee to facilitate the clearance and settlement of such
                  securities through electronic book-entry changes in accounts
                  of participating organizations (such entity, a "Book-Entry
                  Nominee").

         7.       That the Purchaser does not have the intention to impede the
                  assessment or collection of any federal, state or local taxes
                  legally required to be paid with respect to such Residual
                  Certificate.

         8.       That the Purchaser will not transfer a Residual Certificate to
                  any person or entity (i) as to which the Purchaser has actual
                  knowledge that the requirements set forth in paragraph 3,
                  paragraph 6 or paragraph 10 hereof are not satisfied or that
                  the Purchaser has reason to believe does not satisfy the
                  requirements set forth in paragraph 7 hereof, and (ii) without
                  obtaining from the prospective Purchaser an affidavit
                  substantially in this form and providing to the Trustee and
                  the Certificate Registrar a written statement substantially in
                  the form of Exhibit C to the Agreement.

         9.       That the Purchaser understands that, as the holder of a
                  Residual Certificate, the Purchaser may incur tax liabilities
                  in excess of any cash flows generated by the interest and that
                  it intends to pay taxes associated with holding such Residual
                  Certificate as they become due.

         10.      That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
                  Non-U.S. Person that holds a Residual Certificate in
                  connection with the conduct of a trade or business within the
                  United States and has furnished the transferor, the Trustee
                  and the Certificate Registrar with an effective Internal
                  Revenue Service Form W-8ECI (Certificate of Foreign Person's
                  Claim for Exemption From Withholding on Income Effectively
                  Connected With the Conduct of a Trade or Business in the
                  United States) or successor form at the time and in the manner
                  required by the Code. "Non-U.S. Person" means an individual,
                  corporation, partnership or other person other than (i) a
                  citizen or resident of the United States; (ii) a corporation,
                  partnership or other entity created or organized in or under
                  the laws of the United States or any state thereof, including
                  for this purpose, the District of Columbia; (iii) an estate
                  that is subject to U.S. federal income tax regardless of the
                  source of its income; (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
                  trustees have authority to control all substantial decisions
                  of the trust; and, (v) to the extent provided in Treasury
                  regulations, certain trusts in existence on August 20, 1996
                  that are treated as United States persons prior to such date
                  and elect to continue to be treated as United States persons.

         11.      The Purchaser will not cause income from the Residual
                  Certificate to be attributable to a foreign permanent
                  establishment or fixed base (within the

                                      B-2
<PAGE>

                  meaning of an applicable income tax treaty) of the Purchaser
                  or another U.S. taxpayer.

         12.      That the Purchaser agrees to such amendments of the Agreement
                  as may be required to further effectuate the restrictions on
                  transfer of any Residual Certificate to such a "disqualified
                  organization," an agent thereof, a Book-Entry Nominee, or a
                  person that does not satisfy the requirements of paragraph 7
                  and paragraph 10 hereof.

         13.      That the Purchaser consents to the designation of the Trustee
                  to act as agent for the "tax matters person" of each REMIC
                  created by the Trust Fund pursuant to the Agreement.

         14.      That the Purchaser agrees to be bound by Section 3.03(f) of
                  the Agreement.

                                      B-3
<PAGE>

         IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[title of officer] this _____ day of __________, 20__.

                                              __________________________________
                                              [Name of Purchaser]

                                              By: ______________________________
                                                     Name:
                                                     Title:

         Personally appeared before me the above-named [name of officer]
________________, known or proved to me to be the same person who executed the
foregoing instrument and to be the [title of officer] _________________ of the
Purchaser, and acknowledged to me that he [she] executed the same as his [her]
free act and deed and the free act and deed of the Purchaser.

         Subscribed and sworn before me this _____ day of __________ 20__.

NOTARY PUBLIC

________________________________________

COUNTY OF ______________________________

STATE OF _______________________________

My commission expires the _____ day of __________ 20__.

                                      B-4
<PAGE>

                                    EXHIBIT C

              RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)

                                                    ____________________________
                                                                 Date

Re:      Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1
         Mortgage Pass-Through Certificates

         _______________________ (the "Transferor") has reviewed the attached
affidavit of _____________________________ (the "Transferee"), and has no actual
knowledge that such affidavit is not true and has no reason to believe that the
information contained in paragraph 7 thereof is not true, and has no reason to
believe that the Transferee has the intention to impede the assessment or
collection of any federal, state or local taxes legally required to be paid with
respect to a Residual Certificate. In addition, the Transferor has conducted a
reasonable investigation at the time of the transfer and found that the
Transferee had historically paid its debts as they came due and found no
significant evidence to indicate that the Transferee will not continue to pay
its debts as they become due.

                                             Very truly yours,

                                             _______________________
                                             Name:
                                             Title:

                                      C-1

<PAGE>

                                   EXHIBIT D-1

                  STANDARD LAYOUT FOR MONTHLY REMITTANCE ADVICE

                             [INTENTIONALLY OMITTED]

                                     D-1-1

<PAGE>

                                   EXHIBIT D-2

<TABLE>
<CAPTION>
                              STANDARD LAYOUT FOR MONTHLY DEFAULTED LOAN REPORT

------------------------------------------------------------------------------------------------------------------------------------
 OUR LOAN NO.     INVESTOR     INVESTOR     MORTGAGOR    DUE      PAYT      PRINCIPAL    PRIN-INT       --DELINQUENCIES--      LOAN
                 BK. CAT TP    LOAN NO.       NAME       DATE      NO.       BALANCE     CONSTANT                              DESC.
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                     PRINCIPAL     INTEREST
------------------------------------------------------------------------------------------------------------------------------------
<S>              <C>           <C>         <C>           <C>      <C>       <C>          <C>         <C>           <C>        <C>

</TABLE>

                                     D-2-1

<PAGE>

                                    EXHIBIT E

                        MORTGAGE LOAN PURCHASE AGREEMENT

                        See Exhibit 99.1, filed herewith

                                      E-1

<PAGE>

                                    EXHIBIT F

                      LIST OF LIMITED PURPOSE SURETY BONDS

         Ambac Assurance Corporation Surety Bond No. AB0039BE, issued February
26, 1996, for Merrill Lynch Credit Corporation.

                                      F-1

<PAGE>

                                    EXHIBIT G

                     FORM OF RULE 144A TRANSFER CERTIFICATE

Re:      Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1
         Mortgage Pass-Through Certificates

         Reference is hereby made to the Pooling and Servicing Agreement, dated
as of November 1, 2004 (the "Agreement"), among Merrill Lynch Mortgage
Investors, Inc., as Depositor, Cendant Mortgage Corporation, as Servicer and
Wells Fargo Bank, N.A., as Trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Agreement.

         This letter relates to $__________ initial Certificate Balance of Class
Certificates which are held in the form of Definitive Certificates registered in
the name of (the "Transferor"). The Transferor has requested a transfer of such
Definitive Certificates for Definitive Certificates of such Class registered in
the name of [insert name of transferee].

         In connection with such request, and in respect of such Certificates,
the Transferor hereby certifies that such Certificates are being transferred in
accordance with (i) the transfer restrictions set forth in the Agreement and the
Certificates and (ii) Rule 144A under the Securities Act to a purchaser that the
Transferor reasonably believes is a "qualified institutional buyer" within the
meaning of Rule 144A purchasing for its own account or for the account of a
"qualified institutional buyer," which purchaser is aware that the sale to it is
being made in reliance upon Rule 144A, in a transaction meeting the requirements
of Rule 144A and in accordance with any applicable securities laws of any state
of the United States or any other applicable jurisdiction.

         This certificate and the statements contained herein are made for your
benefit and the benefit of the Underwriter and the Depositor.

                                              __________________________________
                                              [Name of Transferor]

                                              By: ______________________________
                                                     Name:
                                                     Title:

Dated:  ____________________________

                                      G-1

<PAGE>

                                    EXHIBIT H

                         FORM OF PURCHASER'S LETTER FOR
                        INSTITUTIONAL ACCREDITED INVESTOR

                                      Date

Dear Sirs:

         In connection with our proposed purchase of $______________ principal
amount of Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1 Mortgage
Pass-Through Certificates (the "Privately Offered Certificates") of Merrill
Lynch Mortgage Investors, Inc. (the "Depositor"), we confirm that:

         (1) We understand that the Privately Offered Certificates have not
been, and will not be, registered under the Securities Act of 1933, as amended
(the "Securities Act"), and may not be sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell any Privately Offered
Certificates within two years of the later of the date of original issuance of
the Privately Offered Certificates or the last day on which such Privately
Offered Certificates are owned by the Depositor or any affiliate of the
Depositor we will do so only (A) to the Depositor, (B) to "qualified
institutional buyers" (within the meaning of Rule 144A under the Securities Act)
in accordance with Rule 144A under the Securities Act ("QIBs"), (C) pursuant to
the exemption from registration provided by Rule 144 under the Securities Act,
or (D) to an institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act that is not
a QIB (an "Institutional Accredited Investor") which, prior to such transfer,
delivers to the Certificate Registrar under the Pooling and Servicing Agreement,
dated as of November 1, 2004 (the "Agreement"), among Merrill Lynch Mortgage
Investors, Inc., as Depositor, Cendant Mortgage Corporation, as Servicer and
Wells Fargo Bank, N.A., as Trustee, a signed letter in the form of this letter;
and we further agree, in the capacities stated above, to provide to any person
purchasing any of the Privately Offered Certificates from us a notice advising
such purchaser that resales of the Privately Offered Certificates are restricted
as stated herein.

         (2) We understand that, in connection with any proposed resale of any
Privately Offered Certificates to an Institutional Accredited Investor, we will
be required to furnish to the Certificate Registrar a certification from such
transferee in the form hereof to confirm that the proposed sale is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. We further understand that the
Privately Offered Certificates purchased by us will bear a legend to the
foregoing effect.

         (3) We are acquiring the Privately Offered Certificates for investment
purposes and not with a view to, or for offer or sale in connection with, any
distribution in violation of the Securities Act. We have such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of our investment in the Privately Offered Certificates,

                                      H-1
<PAGE>

and we and any account for which we are acting are each able to bear the
economic risk of such investment.

         (4) We are an Institutional Accredited Investor and we are acquiring
the Privately Offered Certificates purchased by us for our own account or for
one or more accounts (each of which is an Institutional Accredited Investor) as
to each of which we exercise sole investment discretion.

         (5) We have received such information as we deem necessary in order to
make our investment decision.

         (6) If we are acquiring ERISA-Restricted Certificates, we are not a
Plan and we are not acquiring the ERISA-Restricted Certificates for, on behalf
of or with any assets of any such Plan except in accordance with Section 3.03(d)
of the Pooling and Servicing Agreement.

         Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Agreement.

                                      H-2
<PAGE>

         You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.

                                            Very truly yours,

                                            _______________________________
                                            [Purchaser]

                                            By: ___________________________
                                            Name:
                                            Title:

                                      H-3
<PAGE>

                                    EXHIBIT I

                        FORM OF ERISA TRANSFER AFFIDAVIT

STATE OF NEW YORK      )
                       ) ss.:
COUNTY OF NEW YORK     )

         The undersigned, being first duly sworn, deposes and says as follows:

         1. The undersigned is the ______________________ of ______________ (the
"Investor"), a [corporation duly organized] and existing under the laws of
__________, on behalf of which he makes this affidavit.

         2. With respect to a transfer of an ERISA-Restricted Certificate, the
Investor shall provide the Trustee and the Depositor with (A) a representation
to the effect that the Investor is not an employee benefit plan subject to Title
I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
a plan subject to Section 4975 of the Internal Revenue Code of 1986, as amended
(the "Code") or a plan or arrangement subject to any provisions under any
federal, state, local, non-U.S. or other laws or regulations that are
substantively similar to foregoing provisions of ERISA or the Code ("Similar
Law") (collectively, a "Plan"), and is not directly or indirectly acquiring the
Certificate for, on behalf of or with any assets of any such Plan, (B) a
representation or certification to the Trustee to the effect that the proposed
transfer and holding of the Certificate and the servicing, management and
operation of the Trust Fund will not result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code which is not covered under an
individual or class prohibited transaction exemption including but not limited
to Department of Labor Prohibited Transaction Class Exemption ("PTCE") 84-14
(Class Exemption for Plan Asset Transactions Determined by Independent Qualified
Professional Asset Managers); PTCE 91-38 (Class Exemption for Certain
Transactions Involving Bank Collective Investment Funds); 90-1 (Class Exemption
for Certain Transactions Involving Insurance Company Pooled Separate Accounts),
PTCE 95-60 (Class Exemption for Certain Transactions Involving Insurance Company
General Accounts), PTCE 96-23 (Class Exemption for Plan Asset Transactions
Determined by In-House Asset Managers) and will not subject the Depositor, the
Servicer or the Trustee to any obligation in addition to those undertaken in the
Agreement, or (C) solely in the case of a Definitive Certificate, an Opinion of
Counsel satisfactory to the Trustee to the effect that the acquisition or
holding of such Certificate 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 and the Code, will not result in such a prohibited
transaction, and will not subject the Trustee, the Servicer or the Depositor to
any obligation in addition to those expressly undertaken in the Agreement, which
Opinion of Counsel shall not be an expense of the Trustee, the Certificate
Registrar, the Servicer or the Depositor.

         3. The Investor hereby acknowledges that under the terms of the Pooling
and Servicing Agreement dated as of November 1, 2004 (the "Agreement"), among
Merrill Lynch Mortgage Investors, Inc., as Depositor, Cendant Mortgage
Corporation, as Servicer and Wells Fargo Bank, N.A., as Trustee, no transfer of
the ERISA-Restricted Certificates shall be permitted

                                      I-1
<PAGE>

to be made to any person unless the Certificate Registrar has received a
certificate from such transferee in the form hereof.

                                      I-2
<PAGE>

         IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this ____ day of _______________ 20___.

                                              __________________________________
                                              [Investor]

                                              By: ______________________________
                                                  Name:
                                                  Title:

ATTEST:

__________________________

STATE OF                  )
                          )     ss.:
COUNTY OF                 )

         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 Investor, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Investor.

         Subscribed and sworn before me this _____ day of _________ 20___.

                                              __________________________________
                                              NOTARY PUBLIC

                                              My commission expires the
                                              _____ day of __________, 20___.

                                      I-3
<PAGE>

                                    EXHIBIT J

                        FORM OF LETTER OF REPRESENTATIONS
                        WITH THE DEPOSITORY TRUST COMPANY

                             [INTENTIONALLY OMITTED]

                                      J-1

<PAGE>

                                    EXHIBIT K

                          FORM OF INITIAL CERTIFICATION
            MERRILL LYNCH MORTGAGE INVESTORS TRUST SERIES MLCC 2004-1

                                ___________, 2004

                  To:           Merrill Lynch Mortgage Investors, Inc.

                                250 Vesey Street

                                4 World Financial Center, 10th Floor

                                New York, New York 10080

                                Cendant Mortgage Corporation

                                3000 Leadenhall Road

                                Mt. Laurel, New Jersey 08054

                                Merrill Lynch Mortgage Lending, Inc.

                                250 Vesey Street

                                4 World Financial Center, 10th Floor

                                New York, New York 10080

         Reference is made to the Pooling and Servicing Agreement among Merrill
Lynch Mortgage Investors, Inc. (the "Depositor"), Cendant Mortgage Corporation
(the "Servicer") and Wells Fargo Bank, N.A., as trustee (the "Trustee"), dated
as of November 1, 2004 (the "Agreement"), pursuant to which the Depositor has
delivered to the Trustee, with respect to each Mortgage Loan set forth on
Schedule A hereto (the "Mortgage Loan Schedule"), the documents set forth in
Section 2.01 of the Agreement.

         With respect to each Mortgage Loan listed on the Mortgage Loan Schedule
and except as otherwise noted on the Schedule of Exceptions set forth on
Schedule B hereto, the Trustee confirms that (1) the Trustee has received all of
the documents required to be delivered to the Trustee pursuant to Section 2.01
of the Agreement, (2) the Trustee has reviewed each Trustee's Mortgage File in
accordance with Section 2.02(a) of the Agreement, and the documents contained

                                      K-1
<PAGE>

in each Trustee's Mortgage File conform to the requirements set forth in such
Section 2.02(a), and (3) the Trustee has physical possession of the documents in
each Trustee's Mortgage File. The Trustee has not independently verified the
validity, enforceability, sufficiency, recordability, due authorization or
genuineness or any document in any Trustee's Mortgage File or any related
Mortgage Loan, nor the collectibility, insurability, effectiveness or
suitability of any related Mortgage Loan.

                                      K-2
<PAGE>

         All terms used herein and not otherwise defined herein shall have the
respective meaning ascribed to such term in the Agreement.

                                  WELLS FARGO BANK, N.A.,
                                  as Trustee

                                  By: _______________________________
                                  Name: _____________________________
                                  Title: ____________________________

                                      K-3
<PAGE>

                                    EXHIBIT L

                           FORM OF FINAL CERTIFICATION
            MERRILL LYNCH MORTGAGE INVESTORS TRUST SERIES MLCC 2004-1

                               _____________, 2004

                  To:           Merrill Lynch Mortgage Investors, Inc.

                                250 Vesey Street

                                4 World Financial Center, 10th Floor

                                New York, New York 10080

                                Cendant Mortgage Corporation

                                        3000 Leadenhall Road

                                Mt. Laurel, New Jersey 08054

                                Merrill Lynch Mortgage Lending, Inc.

                                250 Vesey Street

                                4 World Financial Center, 10th Floor

                                New York, New York 10080

         Reference is made to the Pooling and Servicing Agreement among Merrill
Lynch Mortgage Investors, Inc. (the "Depositor"), Cendant Mortgage Corporation
(the "Servicer") and Wells Fargo Bank, N.A., as Trustee (the "Trustee"), dated
as of November 1, 2004 (the "Agreement"), pursuant to which the Depositor has
delivered to the Trustee, with respect to each Mortgage Loan set forth on
Schedule A hereto (the "Mortgage Loan Schedule"), the documents set forth in
Section 2.01 of the Agreement.

         With respect to each Mortgage Loan listed on the Mortgage Loan Schedule
and except as otherwise noted on the Schedule of Exceptions set forth on
Schedule B hereto, the Trustee confirms that (1) the Trustee has received all of
the documents required to be delivered to the Custodian pursuant to Section 2.01
of the Agreement, (2) the Trustee has reviewed each Trustee's Mortgage File in
accordance with Section 2 of Amendment No. 1 to the Custodial Agreement, and the
documents contained in each Trustee's Mortgage File conform to the requirements
set

                                      L-1
<PAGE>

forth in such Section 2, and (3) the Trustee has physical possession of the
documents in each Trustee's Mortgage File. The Trustee has not independently
verified the validity, enforceability, sufficiency, recordability, due
authorization or genuineness or any document in any Trustee's Mortgage File or
any related Mortgage Loan, nor the collectibility, insurability, effectiveness
or suitability of any related Mortgage Loan.

                                      L-2
<PAGE>

         All terms used herein and not otherwise defined herein shall have the
respective meaning ascribed to such term in the Agreement.

                                WELLS FARGO BANK, N.A.,
                                as Trustee

                                By: _______________________________________
                                Name:  ____________________________________
                                Title: ____________________________________

                                      L-3
<PAGE>

                                    EXHIBIT M

                           LIST OF SERVICING OFFICERS

                             [INTENTIONALLY OMITTED]

                                      M-1

<PAGE>

                                    EXHIBIT N

                               REQUEST FOR RELEASE

                  To:           Wells Fargo Bank, N.A.

                                1015 10th Avenue S.E.

                                Minneapolis, Minnesota 55414

                                (Attention:  Merrill Lynch Mortgage  Investors
                                Trust Series MLCC 2004-1)

                                Re:          Pooling and Servicing Agreement,
                                        dated as of November 1, 2004, among
                                        Merrill Lynch Mortgage Investors,
                                        Inc., as Depositor, Cendant
                                        Mortgage Corporation, as Servicer
                                        and Wells Fargo Bank, N.A., as
                                        Trustee

         In connection with the administration of the pool of Mortgage Loans
held by you as Trustee for the benefit of Certificateholders, we request the
release of the (Trustee's Mortgage File/[specify documents]) for the Mortgage
Loan described below, for the reason indicated.

File/document to be sent to:

                  [Company]
                  [Address]
                  [Attn:]
                  [Telephone Number ____]

MORTGAGOR'S NAME, ADDRESS & ZIP CODE:

MORTGAGE LOAN NUMBER:

REASON FOR REQUESTING DOCUMENTS (check one)

                  1.  ______                 Mortgage Loan Paid in Full

                                             ([Seller/Depositor] [Servicer],
                                        hereby certifies that all amounts
                                        received in connection therewith have
                                        been credited to the Custodial Account
                                        or the Distribution Account, as
                                        applicable.)

                                      N-1
<PAGE>

                  2. ______                  Mortgage Loan in Foreclosure

                  3. ______                  Mortgage Loan Repurchased or
                                             Substituted For

                                             ([Seller/Depositor] [Servicer],
                                        hereby certifies that any applicable
                                        repurchase price or substitution
                                        shortfall amount has been credited to
                                        the Custodial Account or the
                                        Distribution Account, as applicable.)

                  ______ 4.                  Mortgage Loan Liquidated

                                             ([Seller/Depositor] [Servicer],
                                        hereby certifies that all proceeds of
                                        foreclosure, insurance or other
                                        liquidation have been finally received
                                        and credited to the Custodial Account or
                                        the Distribution Account, as
                                        applicable.)

                  ______ 5.                  Other (explain)

                                             If box 1, 2 or 3 above is
                                        checked, and if all or part of the
                                        Trustee's Mortgage File was previously
                                        released to us, please release to us our
                                        previous receipt on file with you, as
                                        well as any additional documents in your
                                        possession relating to the above
                                        specified Mortgage Loan.

                                             If box 4 or 5 above is checked,
                                        upon our return of all of the above
                                        documents to you as Trustee, please
                                        acknowledge your receipt by signing in
                                        the space indicated below, and returning
                                        this form.

                                                 [SELLER/DEPOSITOR]
                                                 [SERVICER]

                                                 By: __________________________
                                                 Date: ________________________

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Documents returned to Trustee:

__________________________________,
as Trustee

By:   _____________________________
Date: _____________________________

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                                    EXHIBIT O

                               CUSTODIAL AGREEMENT

         THIS CUSTODIAL AGREEMENT dated as of November 30, 2004 (this
"Agreement"), between MERRILL LYNCH MORTGAGE LENDING, INC. ("MLML") having an
address at 4 World Financial Center, New York, New York 10281 and WELLS FARGO
BANK, N.A. ("Custodian"), having an address at Sixth and Marquette, Minneapolis,
Minnesota 55479- 0031.

                              PRELIMINARY STATEMENT

         MLML may, from time to time, purchase certain Mortgage Loans from third
party sellers pursuant to the terms and conditions of certain mortgage loan
purchase agreements entered into between MLML and such third parties (each, a
"Purchase Agreement"). MLML desires that the Custodian act as custodian with
respect to the documents for the Mortgage Loans delivered from time to time to
the Custodian hereunder, and the Custodian desires to act as custodian with
respect to the documents for the Mortgage Loans.

         NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and for other good and valuable consideration, the sufficiency and
receipt of which is hereby acknowledged, the parties hereto hereby agree as
follows:

         1. Definitions.

         "Additional Collateral Mortgage Loan": Each Mortgage Loan that is
either a Mortgage 100sm Loan or Parent Power(R) Mortgage Loan as to which the
Additional Collateral is provided. For purposes hereof, the term "Additional
Collateral" shall mean (i) with respect to any Mortgage 100sm Loan, the
marketable securities subject to a security interest pursuant to the related
Mortgage 100sm Pledge Agreement, or (ii) with respect to any Parent Power(R)
Mortgage Loan, the related Parent Power(R) Agreement.

         "Agreement": This Custodial Agreement and all amendments and
attachments hereto and supplements hereof.

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

         "Business Day": Any day other than (i) a Saturday or Sunday, or (ii) a
day on which banking or savings associations in the State of New Jersey or the
State of Minnesota are authorized or obligated by law or executive order to be
closed.

         "Closing Date": With respect to each Mortgage Loan, the date upon which
the MLML completes the purchase of such Mortgage Loan.

         "Custodian": Wells Fargo Bank, N.A., or its successor in interest or
assigns.

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         "Custodian's Mortgage File": As to each Mortgage Loan, all Mortgage
Loan documents delivered to the Custodian pursuant hereto and held by the
Custodian with respect to each Mortgage Loan.

         "Cut-off Date": With respect to each Mortgage Loan, the first day of
the month in which the related Delivery Date occurs or such other date specified
by the Registered Holder.

         "Delivery Date": The date on which MLML delivers or causes to be
delivered to the Custodian the Mortgage Loans listed on the related Mortgage
Loan Schedule.

         "Exception Report": The Exception Report prepared by the Custodian as
an annex to the Trust Receipt which lists all exceptions with respect to the
Mortgage Loan Schedule and attached thereto as Schedule B, as updated from time
to time in accordance with Section 4 hereof.

         "First Mortgage Loan": A Mortgage Loan that is secured by a first lien
on the Mortgaged Property securing the related Mortgage Note.

         "Gross Margin": With respect to each adjustable rate Mortgage Loan, the
fixed number of basis points set forth in the Mortgage Loan Schedule that is
added to the Index on each Interest Rate Adjustment Date in accordance with the
terms of the related Mortgage Note to determine the Mortgage Interest Rate for
such Mortgage Loan, subject to any applicable Periodic Rate Cap or Lifetime Rate
Cap.

         "Index": With respect to each adjustable rate Mortgage Loan, a rate per
annum to which the Gross Margin is added on each Interest Rate Adjustment Date
to determine the new Mortgage Interest Rate for such Mortgage Loan.

         "Interest Rate Adjustment Date": With respect to each adjustable rate
Mortgage Loan, the date on which the Mortgage Interest Rate is adjusted in
accordance with the terms of the related Mortgage Note.

         "Lifetime Rate Cap": With respect to each adjustable rate Mortgage
Loan, the maximum Mortgage Interest Rate that may be borne thereby, as set forth
in the related Mortgage Note.

         "Loan-to-Value Ratio": With respect to any First Mortgage Loan, as of
any date of determination, the ratio on such date of the outstanding principal
balance of such Mortgage Loan to the Appraised Value of the related Mortgaged
Property.

         "Mortgage": The mortgage, deed of trust or other instrument creating a
first or second lien on real property securing the Mortgage Note.

         "Mortgage Interest Rate": The annual rate at which interest accrues on
any Mortgage Loan and with respect to any adjustable rate Mortgage Loan, as such
annual rate may be adjusted on any Interest Rate Adjustment Date and subject to
the limitations on such interest rate imposed by any Lifetime Rate Cap or any
Periodic Rate Cap.

         "Mortgage Loan": An individual Mortgage Loan, including but not limited
to all documents included in the Custodian's Mortgage File, monthly payments,
principal prepayments, proceeds from REO Dispositions and any and all rights,
benefits, proceeds and obligations arising therefrom or in connection therewith,
and which is the subject of this Agreement.

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         "Mortgage Loan Schedule": The list of Mortgage Loans purchased by MLML
from a third party seller from time to time that are subject to this Agreement
which list shall set forth the following information with respect to each
Mortgage Loan:

                           (i) the loan number;

                           (ii) [Reserved]

                           (iii) the street address of the Mortgaged Property,
                  including city, state and zip code, if available;

                           (iv) the Mortgage Interest Rate at origination and,
                  in the case of an adjustable rate Mortgage Loan, the Mortgage
                  Interest Rate in effect as of the related Cut-off Date, which
                  rate may vary from that reflected in the Mortgage and Note;

                           (v) for each adjustable rate Mortgage Loan, the first
                  Interest Rate Adjustment Date;

                           (vi) for each adjustable rate Mortgage Loan, the
                  Gross Margin;

                           (vii) for each adjustable rate Mortgage Loan, the
                  Lifetime Rate Cap, if applicable;

                           (viii) for each adjustable rate Mortgage Loan, the
                  Periodic Rate Cap, if applicable;

                           (ix) the original term to maturity and remaining term
                  to maturity;

                           (x) the original principal balance;

                           (xi) the first payment due date;

                           (xii) the maturity date;

                           (xiii) the monthly payment in effect as of the
                  related Cut-off Date;

                           (xiv) the principal balance as of the related Cut-off
                  Date;

                           (xv) as to any First Mortgage Loan the Loan-to-Value
                  Ratio at origination;

                           (xvi) a code indicating whether the Mortgaged
                  Property is occupied by the Mortgagor;

                           (xvii) a code indicating the type of Residential
                  Dwelling;

                           (xviii) a code indicating the purpose of the Mortgage
                  Loan;

                           (xix) a code indicating the Mortgage Loan
                  documentation type (i.e. limited documentation, full
                  documentation, easy documentation, etc.); and

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<PAGE>

                           (xx) for each adjustable rate Mortgage Loan, a code
                  indicating the type of Index.

         "Mortgage Note": The note evidencing the indebtedness of a Mortgagor
secured by a Mortgage.

         "Mortgaged Property": The underlying real property securing repayment
of a Mortgage Note, consisting of a fee simple estate in a single parcel of real
property improved by a Residential Dwelling.

         "Mortgagor": The obligor on a Mortgage Note, the owner of the Mortgaged
Property and the grantor or mortgagor named in the related Mortgage and such
grantor's or mortgagor's successor in title to the Mortgaged Property.

         "Opinion of Counsel": A document signed by an attorney, explaining the
attorney's understanding of the law as applicable to a state of facts submitted
for the purpose of an opinion.

         "Periodic Rate Cap": With respect to each adjustable rate Mortgage Loan
as to which the related Mortgage Loan Schedule indicates the existence of a
Periodic Rate Cap, the provision of the related Mortgage Note that provides for
a maximum amount by which the Mortgage Interest Rate may increase (or, if so
indicated on such Mortgage Loan Schedule, decrease) on an Interest Rate
Adjustment Date above (or below) the Mortgage Interest Rate in effect
immediately prior to such Interest Rate Adjustment Date.

         "Pledge Agreement": Any Mortgage 100 Pledge Agreement, Parent Power
Guaranty and Security Agreement for Securities Account, or Parent Power Guaranty
Agreement for Real Estate related to an Additional Collateral Mortgage Loan.

         "Registered Holder": MLML, its successors in interest or assigns, in
whole or in part, as the case may be.

         "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, or (iv) a
detached one-family dwelling in a planned unit development, none of which is a
co-operative.

         "Second Mortgage Loan": A Mortgage Loan that is secured by a second
lien on the Mortgaged Property securing the related Mortgage Note.

         "Trust Receipt": A trust receipt in the form annexed hereto as EXHIBIT
ONE delivered to MLCC by the Custodian covering all of the Mortgage Loans
subject to this Custodial Agreement from time to time, as reflected in the
Mortgage Loan Schedule and Exception Report attached thereto in accordance with
SECTION 4(B).

         2. Delivery of Mortgage Loan Schedule and Custodian's Mortgage File.

         MLML may, from time to time, deliver or cause to be delivered to the
Custodian a Mortgage Loan Schedule and the following documents for each Mortgage
Loan listed on such Mortgage Loan Schedule, to be held by the Custodian for the
benefit of the Registered Holder, as the owner thereof:

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<PAGE>

                           (a) The original Mortgage Note endorsed, "Pay to the
order of ___________, without recourse" and signed in the name of the name of
last endorsee, by an authorized officer of the last endorsee. If the Mortgage
Loan was acquired by the last endorsee in a merger or other type of acquisition,
the endorsement must be by "[name of last endorsee], successor [by merger to or
in interest to, as applicable] [name of predecessor]"; and if the Mortgage Loan
was acquired or originated by the last endorsee while doing business under
another name, the endorsement must be by "[name of last endorsee], successor in
interest to [previous name]." The Mortgage Note shall include all intervening
endorsements showing a complete chain of title from the originator to the last
endorsee.

                           (b) The original recorded Mortgage, with evidence of
recording thereon, or, if the original Mortgage has not yet been returned from
the recording office, a copy of the original Mortgage certified by the previous
owner to be a true copy of the original of the Mortgage which has been delivered
for recording in the appropriate recording office of the jurisdiction in which
the Mortgaged Property is located.

                           (c) The original Assignment of each Mortgage,
executed in blank by either MLML or its Servicer. If the Mortgage Loan was
acquired by the last endorsee in a merger or other type of acquisition, the
assignment must be by "[name of last assignee], successor [by merger to or in
interest to, as applicable] [name of predecessor]"; and if the Mortgage Loan was
acquired or originated by the last endorsee while doing business under another
name, the assignment must be by "[name of last assignee], successor in interest
to [previous name]."

                           (d) The original policy of title insurance (or a
preliminary title report if the original title insurance policy has not been
received from the title insurance company).

                           (e) Originals of any intervening assignments of the
Mortgage, with evidence of recording thereon or, if the original intervening
assignment has not yet been returned from the recording office, a copy of such
assignment certified by the Seller to be a true copy of the original of the
assignment which has been delivered for recording in the appropriate recording
office of the jurisdiction in which the Mortgaged Property is located.

                           (f) With respect to a Mortgage Loan that, according
to the Mortgage Loan Schedule is covered by a primary mortgage insurance policy,
the original or a copy of primary mortgage insurance certificate, if any.

                           (g) If indicated on the Mortgage Loan Schedule,
originals of all assumption and modification agreements, if any, with originals
or copies of the underlying instruments being modified.

                           (h) With respect to each Additional Collateral
Mortgage Loan,

                                    1. Copy of the related Mortgage 100 Pledge
Agreement for Securities Account or the Parent Power Guaranty and Security
Agreement for Securities Account or the Parent Power Guaranty Agreement for Real
Estate, as the case may be;

                                    2. copy of the UCC-1 (applicable for South
Carolina and Rhode Island only);

                                    3. an original form UCC-3, if applicable;

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<PAGE>

                                    4. For loans originated by a correspondent
lender, an original assignment of security interest of the related Mortgage 100
Pledge Agreement or Parent Power Agreement, as the case may be.

                           (i) With respect to each Cooperative Loan:

                                    1. the original proprietary lease;

                                    2. the original recognition agreement;

                                    3. the original security agreement;

                                    4. the original or copy of the assignment of
proprietary lease;

                                    5. the original cooperative stock
certificate and stock power executed by borrower in blank;

                                    6. the original UCC-1 Financing Statements;
and

                                    7. the original UCC-3 Financing Statements.

                           (j) Power of Attorney, if applicable.

         From time to time, MLML shall forward or cause to be forwarded to the
Custodian additional documents, original or otherwise, evidencing an assumption
or modification of a Mortgage Loan which documents shall become part of the
Custodian's Mortgage File.

         3. OBLIGATIONS OF THE CUSTODIAN.

                           (k) With respect to each Custodian's Mortgage File,
the Custodian is exclusively the custodian for the Registered Holder from and
after the related Delivery Date. The Custodian shall hold all documents
constituting the Custodian's Mortgage File received by it for the exclusive use
and benefit of the Registered Holder, and shall make disposition thereof only in
accordance with this Agreement and the instructions furnished by the Registered
Holder. The Custodian shall segregate and maintain continuous custody of all
documents constituting the Custodian's Mortgage File received by it in secure
and fire-resistant facilities in accordance with customary standards for such
custody. The Custodian represents and warrants that it will verify the receipt
of required documents, the accuracy of certain information, and indicate
discrepancies pursuant to the custody receipt requirements herein. The Custodian
makes no representations or warranties as to, and shall not be responsible to,
verify: (i) the validity, legality, enforceability, sufficiency, recordability,
due authorization or genuineness of any of the documents contained in each
Custodian's Mortgage File or any of the Mortgage Loans or (ii) the
collectibility, insurability, effectiveness or suitability of any such Mortgage
Loan. No provision of this Agreement shall be construed to impose on the
Custodian any obligation of a third party seller under this Agreement or a
Purchase Agreement under any circumstances.

                           (l) The Custodian shall, at its own expense, maintain
at all times during the existence of this Agreement and keep in full force and
effect a fidelity bond, errors and omissions insurance, theft and documents
insurance and forgery insurance in amounts and with standard coverage as is
customary for insurance typically maintained by institutions that act as

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<PAGE>

custodians. The minimum coverage under any such bond and insurance policies
shall be at least equal to the corresponding amounts required by the Government
National Mortgage Association, Fannie Mae or Freddie Mac either of the Custodian
or in their respective Seller/Servicing Guides. A certificate of an authorized
officer for the Custodian shall be furnished to the Registered Holder upon
request as evidence of its compliance with any such requirement.

         4. TRUST RECEIPT.

                  (a) The Custodian shall review the documents delivered to it
on each Delivery Date and shall deliver to Registered Holder within the time
frames outlined in exhibit B to this amendment, but prior to Closing Date, a
Mortgage Loan Schedule and Exception Report with respect to the Mortgage Loans,
and the delivery of each Mortgage Loan Schedule and Exception Report by the
Custodian hereunder shall be the Custodian's certification that such Mortgage
Loans are held for MLCC (as Registered Holder) and that, as to each Mortgage
Loan listed in the related Mortgage Loan Schedule (other than any Mortgage Loan
paid in full or any Mortgage Loan specifically identified in such certification
as not covered by the Exception Report), (a) all documents described in
Paragraphs 2(a) through 2(e) and to the extent provided in the Custodian's
Mortgage Files Paragraphs 2(f) through 2(j), if applicable, of this Agreement
are in its possession, (b) such documents have reviewed by it and appear regular
on their face and relate to such Mortgage Loan, (c) based on its examination and
only as to the foregoing documents, the information set forth in terms (i),
(ii), (iii) excluding the zip code requirement, (iv), (vi), (vii), (viii) and
(x) of the definition of "Mortgage Loan Schedule" respecting such Mortgage Loan
is correct, and which as to items (iv) (vi), (viii) and (x) for adjustable rate
Mortgage Loan Documents and (d) each Mortgage Note has been endorsed and each
Assignment has been executed as provided in Paragraph 2 hereof. The Custodian
shall determine whether any discrepancy or deficiency exists with respect to a
Custodian's Mortgage File and shall note such discrepancy on the Exception
Report. The Custodian shall also note on such Exception Report, with respect to
each Mortgage Loan, whether a certified copy of the related Mortgage was
delivered to the Custodian in lieu of the original of such Mortgage, whether a
certified copy of an intervening assignment of the related Mortgage was
delivered to the Custodian in lieu of the original of such assignment, and
whether a preliminary title report with respect to such Mortgage Loan was
delivered to the Custodian in lieu of the original policy of title insurance.
Except as specifically provided above, the Custodian shall be under no duty to
review, inspect or examine such documents to determine that any of them are
enforceable or appropriate for their prescribed purpose.

                  (b) On the date of this Amendment, the Custodian shall deliver
to MLCC, a Trust Receipt with a Mortgage Loan Schedule and Exception Report
attached thereto reflecting all Mortgage Loans subject to the Custodial
Agreement as of such date.

                  (c) Each Mortgage Loan Schedule and Exception Report delivered
by the Custodian to MLCC shall supersede and cancel the Mortgage Loan Schedule
and Exception Report previously delivered by the Custodian to MLCC hereunder,
and shall replace the then existing Mortgage Loan Schedule and Exception Report
to be attached to the Trust Receipt. Notwithstanding anything to the contrary
set forth herein, in the event that the Mortgage Loan Schedule and Exception
Report attached to the Trust Receipt is different from the most recently
delivered Mortgage Loan Schedule and Exception Report, then the most recently
delivered Mortgage Loan Schedule and Exception Report shall control and be
binding upon the parties hereto.

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<PAGE>

                  (d) The Custodian shall deliver to MLCC, electronically a
Mortgage Loan Schedule and Exception Report reflecting any additional Mortgage
Loans received and reviewed in accordance with the procedures set forth in
Section 2(a) hereof.

                  (e) Within five (5) days of receipt of written directions, in
the form attached hereto as Exhibit Six, from the Registered Holder with respect
to all or a portion of the Mortgage Loans owned by such Registered Holder, the
Custodian shall deliver all or any portion of the Custodian's Mortgage Files
held by it to Registered Holder, or to such other party as the Registered Party
may direct, as provided in Paragraph 19, at the place indicated in any such
written direction from the Registered Holder and shall deliver to the Registered
Holder a new Mortgage Loan Schedule and Exception Report, with respect to the
Custodian's Mortgage Files retained by the Custodian. The Registered Holder may
require the Custodian to complete the endorsements on any Mortgage Notes in its
possession and to complete the Assignment of Mortgages prepared by the Servicer
in blank, within a reasonable period of time. The cost of this shall be
reimbursed by the Registered Holder. A list of authorized signatures for such
written directions has been furnished to the Custodian by the Registered Holder
pursuant to Paragraph 20 hereof. Upon the Custodian's receipt of such written
notification from the Registered Holder that the Registered Holder has sold any
or all of the Mortgage Loans, which notification shall be accompanied by a
Mortgage Loan Schedule identifying such Mortgage Loans, the Custodian shall
change its records to reflect that such purchaser is the owner of such Mortgage
Loans and shall immediately, upon the direction of such Registered Holder,
either deliver the related Custodian's Mortgage Files to such purchaser at the
expense of such purchaser or issue a Mortgage Loan Schedule and Exception Report
in the name of such purchaser. Such purchaser, as a Registered Holder, shall be
required to simultaneously furnish to the Custodian a list of authorized
signatures for written directions pursuant to Paragraph 20 hereof. The Custodian
shall then deliver to the Registered Holder a new Mortgage Loan Schedule and
Exception Report, reflecting all Mortgage Loans with respect to which the
Custodian still holds the related Custodian's Mortgage Files on behalf of the
Registered Holder. The Registered Holder and the Custodian agree herein that any
purchaser of any or all of the Mortgage Loans shall succeed to the rights and
obligations of the Registered Holder under this Agreement with respect to such
Mortgage Loans upon receipt of its own Trust Receipt and Mortgage Loan Schedule
and Exception Report, as further specified in Paragraph 15 hereof.

         5. FEES AND EXPENSES OF THE CUSTODIAN.

         It is understood that the Custodian will charge such fees for its
services under this Agreement as are set forth in a separate agreement between
the Custodian and MLML, the payment of which, together with the Custodian's
expenses in connection herewith, shall be solely the obligation of the
Registered Holder with respect to the related Mortgage Loans.

         6. REMOVAL OF THE CUSTODIAN.

         Any Registered Holder with respect to all or a portion of the Mortgage
Loans owned by such Registered Holder, with or without cause, may, upon thirty
(30) days' written notice to the Custodian, remove and discharge or any
successor Custodian thereafter appointed, as to such portion or all of the
Mortgage Loans the Custodian, from the performance of its duties under this
Agreement. In the event of any such removal, upon tender of the Custody Receipts
and satisfaction of any outstanding fees and expenses of the Custodian, the
Custodian shall promptly transfer to such Registered Holder or to a successor
Custodian appointed by such Registered Holder at the expense of such Registered
Holder, as directed by such Registered Holder in

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writing, all Custodian's Mortgage Files related to the Mortgage Loans as to
which the Custodian is being terminated.

         7. EXAMINATION OF THE CUSTODIAN'S MORTGAGE FILE.

         Upon reasonable prior written notice to the Custodian, but not less
than two (2) Business Day, any Registered Holder with respect to all or a
portion of the Mortgage Loans owned by such Registered Holder and its agents,
accountants, attorneys, auditors, prospective purchasers, and third-party
contractors authorized by such Registered Holder will be permitted, during
normal business hours, to examine the Custodian's Mortgage Files, documents,
records and other papers in the possession of or under the control of the
Custodian relating to any or all of the Mortgage Loans for which the Custodian
holds the related Custodian's Mortgage File for such Registered Holder at the
expense of the inspecting party.

         8. COUNTERPARTS.

         For the purpose of facilitating the execution 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 all of which together shall constitute and be
one and the same instrument.

         9.       PERIODIC STATEMENTS.

         Upon the request of any Registered Holder at any other time with at
least two (2) Business Days' notice to the Custodian, the Custodian shall
provide to the Registered Holder with respect to all or a portion of the
Mortgage Loans owned by such Registered Holder, a list of all of the Mortgage
Loans for which the Custodian holds a Custodian's Mortgage File pursuant to this
Agreement. Such list may be in the form of a copy of the Mortgage Loan Schedule
with manual deletions to denote specifically any Mortgage Loans paid off,
liquidated or repurchased or otherwise released by the Custodian since the date
of this Agreement.

         10. GOVERNING LAW.

         This Agreement shall be construed in accordance with the laws of the
State where MLML is headquartered, and the obligations, rights and remedies of
the parties hereunder shall be determined in accordance with such laws.

         11. COPIES OF MORTGAGE DOCUMENTS.

         Upon the request of the Registered Holder with respect to all or a
portion of the Mortgage Loans owned by such Registered Holder, and at the cost
and expense of such party, the Custodian shall provide such Registered Holder
with copies or originals as provided in Section 21 hereof, of the Mortgage
Notes, Mortgages, Assignments and other documents to the extent that such
documents are part of the Custodian's Mortgage File relating to one or more of
the Mortgage Loans.

         12. NO ADVERSE INTEREST OF CUSTODIAN.

         By execution of this Agreement, the Custodian represents, warrants and
covenants that it currently does not hold, and during the existence of this
Agreement shall not hold, any adverse interest, by way of security or otherwise,
in any Mortgage Loan.

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         13. TERMINATION BY CUSTODIAN.

         The Custodian may terminate its obligations under this Agreement upon
at least sixty (60) days' notice to the Registered Holder with respect to all or
a portion of the Mortgage Loans owned by such Registered Holder. The Custodian
shall then be responsible for all costs associated with such termination,
including costs associated with the transfer of the Custodial Files. If, in the
event of such termination, the Registered Holder shall appoint a successor
Custodian within such sixty day period, then upon such appointment and tender of
the related Custody Receipts, the Custodian shall promptly transfer to such
successor Custodian, as directed by the Registered Holder with respect to all or
a portion of the Mortgage Loans owned by such Registered Holder, all of the
Custodian's Mortgage Files being administered under this Agreement and shall
either complete the Assignments and endorse the Mortgage Notes as directed by
the Registered Holder or allow the Registered Holder or its agents or attorneys,
access to the Custodian's Mortgage Files for such purpose. Notwithstanding the
foregoing, if the Registered Holder fails to appoint a Custodian within such
sixty day period, the Custodian may petition any court of competent jurisdiction
for the appointment of a successor Custodian.

         14. TERMINATION OF AGREEMENT.

         This Agreement shall terminate upon the earlier of (a) the final
payment or other liquidation (or advance with respect thereto) of the last
Mortgage Loan, (b) the disposition of all property acquired upon foreclosure or
by deed in lieu of foreclosure of the last Mortgage Loan, or (c) the delivery by
the Custodian of the last Custodian's Mortgage File pursuant to the direction of
the Registered Holder hereunder. In such event the Registered Holder with
respect to all or a portion of the Mortgage Loans owned by such Registered
Holder shall so notify the Custodian and tender the Mortgage Loan Schedule and
Exception Report, and thereafter all documents remaining in the Custodian's
Mortgage Files shall be forwarded to the Registered Holder.

         15. ASSIGNMENT OF AGREEMENT.

         The Registered Holder with respect to all or a portion of the Mortgage
Loans owned by such Registered Holder shall have the right to assign, in whole
or in part, its interests under this Agreement with respect to some or all of
the Mortgage Loans, and to designate any person (such person, an "Assignee") or
exercise any rights of the Registered Holder hereunder, and such assignee or
designee shall accede to the rights and obligations hereunder of the Registered
Holder with respect to such Mortgage Loans. All references to the Registered
Holder shall be deemed to include its assignee or designee. In connection with
any such assignment, the Registered Holder with respect to all or a portion of
the Mortgage Loans owned by such Registered Holder, the Custodian shall issue
(a) a Trust Receipt in the form of Exhibit One hereto with a Mortgage Loan
Schedule and Exception Report with respect to the Mortgage Loans subject to such
assignment to the Assignee and (b) an updated Mortgage Loan Schedule and
Exception Report to the assigning Registered Holder with respect to the Mortgage
Loans which the Custodian holds for the Registered Holder. The Custodian may not
assign its interest or delegate its duties under this Agreement without the
prior written consent of the Registered Holder. In the event of any such
assignment or delegation, the Registered Holder shall not be responsible for any
fees of the successor Custodian in excess of the fees formerly paid by the
Registered Holder to the Custodian.

         16. NOTICE.

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<PAGE>

         All demands, notices and communications hereunder shall be in writing
and shall be sent to the other party at the address shown on the first page
hereof, or such other address as may hereafter be furnished to the other party
by written notice given to the other party hereto in a notice complying with the
terms and provisions of this Section 16 or on an Exhibit Six notice provided
pursuant to Section 4(c).

         Any such demand, notice or communication hereunder shall be deemed
conclusively to have been given if personally delivered at or mailed by
registered mail, postage prepaid, and return receipt requested or transmitted by
telex, telegraph or facsimile transmission and by a similar writing to the other
party at its address as described in Subclause (a).

         17.      INDEMNIFICATION.

                           (m) Neither the Custodian nor any of its directors,
officers, agents or employees, shall be liable for any action taken or omitted
to be taken by it or them hereunder or in connection herewith in good faith and
believed by it or them to be within the purview of this Agreement, except for
its or their own negligence, lack of good faith or willful misconduct.

                           (n) The Registered Holder and the Custodian agree to
indemnify and hold each other and their respective directors, officers, agents
and employees harmless against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever, including reasonable attorney's fees, that may
be imposed on, incurred by, or asserted against it or them in any action taken
or not taken by it or them hereunder. This indemnification shall include, but
not be limited to, the claims of third parties arising from or related to this
Agreement or the Mortgage Loans. This indemnification applies if such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses, disbursements, or claims were imposed on, incurred by or
asserted against the party seeking indemnification because of the breach of the
obligations, negligence, lack of good faith or willful misconduct of the other
party or any of its directors, officers, agents or employees. The foregoing
indemnification shall survive any termination of this Agreement and the
resignation or removal of the Custodian.

                           (o) In the event that the Custodian fails to produce
a Mortgage Note, Assignment of Mortgage or any other document related to a
Mortgage Loan that was in its possession pursuant to Section 2 within four (4)
Business Days after required or requested by the Registered Holder or its
Servicer (a "Custodial Delivery Failure"), and provided that (i) Custodian
previously delivered to the Registered Holder a Mortgage Loan Schedule and
Exception Report which did not list such document as an exception; (ii) such
document is not outstanding pursuant to a request for release in the form
annexed hereto as Exhibit Five; and (iii) such document was held by the
Custodian on behalf of the Registered Holder, then the Custodian shall: (a) with
respect to any missing Mortgage Note, promptly deliver to the Registered Holder
upon request, a Lost Note Affidavit in the form of Exhibit Seven hereto and (b)
with respect to any missing document related to such Mortgage Loan, including
but not limited to a missing Mortgage Note, (1) indemnify the Registered Holder,
and its successor in interest, in accordance with the succeeding paragraph and,
(2) obtain and maintain an insurance bond in the name of the Registered Holder,
and its successors in interest and assigns, insuring against any losses
associated with the loss of such document, in an amount equal to the then
outstanding principal balance of the related Mortgage Loan or such lesser amount
requested by the Registered Holder, at the Registered Holder's sole option, at
any time the long term obligations of the Custodian are rated below the second
highest rating category of Moody's Investors Service, Inc. or Standard and
Poor's Ratings Group, a division of McGraw-Hill, Inc.

                                      O-11
<PAGE>

                           (p) The Custodian agrees to indemnify and hold the
Registered Holder, and its designees, harmless against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever, including reasonable
attorney's fees, that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of a Custodial Delivery Failure, as
defined herein, or the Custodian's negligence, lack of good faith or willful
misconduct. The forgoing indemnification shall survive any termination or
assignment of this Agreement.

         18. RELIANCE OF CUSTODIAN.

         In the absence of bad faith on the part of the Custodian, the Custodian
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any request, instructions, certificate,
opinion or other document furnished to the Custodian, reasonably believed by
Custodian to be genuine and to have been signed or presented by the proper party
or parties and conforming to the requirements of this Agreement. No
representations, warranties, covenants or obligations of the Custodian shall be
implied with respect to this Agreement or the Custodian's services hereunder.

         19. TRANSMISSION OF CUSTODIAN'S MORTGAGE FILE.

         Written instructions as to the method of shipment and shipper(s)
Custodian is directed to utilize in connection with transmission of mortgage
files and loan documents in the performance of the Custodian's duties hereunder
shall be delivered by the Registered Holder (the "Requesting Party") with
respect to all or a portion of the Mortgage Loans owned by such Registered
Holder to the Custodian prior to any shipment of any mortgage files and loan
documents hereunder. The Registered Holder will arrange for the provision of
such services at its sole cost and expense (or, at Custodian's option, reimburse
Custodian for all costs and expenses incurred by Custodian consistent with such
instructions) and will maintain such insurance against loss or damage to
mortgage files and loan documents as the Requesting Party deems appropriate.
Without limiting the generality of the provisions of Paragraph 17 above, it is
expressly agreed that in no event shall the Custodian have any liability for any
losses or damages to any person, including, without limitation, the Requesting
Party, arising out of actions of the Custodian consistent with instructions of
the Requesting Party. In the absence of any written instructions with respect to
the transmission of the Custodian's Mortgage Files, the parties hereby agree
that the Custodian may utilize any nationally recognized overnight courier
service and shall be entitled to reimbursement from the Registered Holder.

         20. AUTHORIZED REPRESENTATIVE.

         Unless the Registered Holder shall have given the Custodian written
notice to the contrary, each individual designated as an authorized
representative of the Registered Holder with respect to all or a portion of the
Mortgage Loans owned by such Registered Holder, and the Custodian, respectively
(an "Authorized Representative"), is authorized to give and receive notices,
requests and instructions and to deliver certificates and documents in
connection with this Agreement on behalf of the Registered Holder with respect
to all or a portion of the Mortgage Loans owned by such Registered Holder, or
the Custodian, as the case may be, and the specimen signature for each such
Authorized Representative of MLML as the initial Registered Holder and each such
Authorized Representative of the Custodian initially authorized hereunder is set
forth on Exhibit Three and Exhibit Four hereof, respectively. Any subsequent
Registered Holder of the Mortgage Loans shall provide the Custodian specimen
signatures for each Authorized Representative of such Registered Holder. From
time to time, the Registered Holder and the

                                      O-12
<PAGE>

Custodian may, by delivering to the other party a revised exhibit, change the
information previously given pursuant to this Paragraph, but each of the parties
hereto shall be entitled to rely conclusively on the then current exhibit until
receipt of a superseding exhibit.

         21. RELEASE OF CUSTODIAN'S FILE FOR SERVICING.

         Upon written request by the Registered Holder or its Servicer with
respect to all or a portion of the Mortgage Loans owned by such Registered
Holder, pursuant to the form attached hereto as Exhibit Five, the Custodian
shall use its best efforts to promptly, and in no event no later than two (2)
Business Days after receipt of such written request completed in accordance with
this Agreement, release to the Registered Holder or its Servicer for the
servicing or foreclosure of any of the Mortgage Loans the related Custodian's
Mortgage File. All Custodian's Mortgage Files so released to the Registered
Holder's Servicer shall be held by such Servicer in trust for the benefit of the
Registered Holder in accordance with the provisions of a servicing agreement
entered into between the Registered Holder and such Servicer. The Registered
Holder or its Servicer shall return to the Custodian the Custodian's Mortgage
File that has been released to the Registered Holder or its Servicer, when the
Registered Holder's or its Servicer's need therefor in connection with such
servicing or foreclosure no longer exists, unless the Mortgage Loan shall be
liquidated, in which case, upon receipt of a certification to this effect from
the Registered Holder or its Servicer to the Custodian in the form annexed
hereto as Exhibit Five, and the Custodian shall thereupon reflect any such
liquidation on the list of Mortgage Loans maintained by it pursuant to Paragraph
9 of this Agreement.

         Custodian shall not release more than 5% of the number of Mortgage
Loans at any time without additional written consent from Registered Holder.
This limitation shall not apply to the release of Custodial Files upon payment
in full.

         22. RELEASE OF CUSTODIAN'S MORTGAGE FILE FOR PAYMENT.

         Upon the repurchase or substitution of any Mortgage Loan pursuant to a
Purchase Agreement or the payment in full of any Mortgage Loan, which shall be
evidenced by the Custodian's receipt of a request for release, receipt and
certification in the form annexed hereto as Exhibit Five (which certification
shall include a statement to the effect that all amounts received in connection
with such payment or repurchase have been credited to the account of the
Registered Holder), the Custodian shall use its best efforts promptly and in no
event later than two (2) Business Days after receipt of the written request
therefor completed in accordance with this Agreement, release the related
Custodian's Mortgage File to the Registered Holder or, at the request of the
Registered Holder, its Servicer, such repurchase thereupon to be noted on the
list maintained by the Custodian pursuant to Paragraph 9 of this Agreement.

         23. REPRODUCTION OF DOCUMENTS.

         This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, and (b) certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

                                      O-13
<PAGE>

         24.      SEVERABILITY.

         If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, the invalidity
of any such covenant, agreement, provision or term of this Agreement shall in no
way affect the validity or enforceability of the other provisions of this
Agreement; provided, however, that if the invalidity of any covenant, agreement
or provision shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate in good faith to
develop a structure the economic effect of which is as nearly as possible the
same as the economic effect of this Agreement.

         25.      AMENDMENT; EXHIBITS.

         This Agreement may be amended from time to time by the parties hereto
only by a written agreement signed by the parties hereto. The exhibits to this
Agreement are hereby incorporated and made a part hereof and are an integral
part of this Agreement.

         26. CAPTIONS.

         Section headings are used herein for convenience only and do not limit
or expand the scope of the provisions herein.

         28. REPRESENTATIONS AND WARRANTIES OF CUSTODIAN.

         Custodian represents and warrants to and covenants with MLML as
follows:

                           (a) Custodian is a corporation duly incorporated,
validly existing and in good standing under the laws of Minnesota.

                           (b) Custodian has full corporate power to execute,
deliver and perform the obligations under this Agreement. MLML may rely on the
actions of Custodian without further inquiry. No additional consent,
authorization, or regulatory filing is required in order for Custodian to
legally perform its obligations.

         This agreement constitutes a legal, valid and binding obligation of
Custodian, enforceable against Custodian in accordance with the terms herein
except as limited by bankruptcy, insolvency, liquidation or other similar laws
affecting generally the enforcement of creditor's rights.

         29. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

                                      O-14
<PAGE>

         IN WITNESS WHEREOF, the Custodian and MLML have caused this Agreement
to be executed as of the date and year first written above.

                                  WELLS FARGO BANK, N.A.,
                                  Custodian

                                  By: ___________________________________
                                  Name: ___________________________________
                                  Title: __________________________________

                                  MERRILL LYNCH  MORTGAGE LENDING, INC.
                                  ("MLML")

                                  By: ___________________________________
                                  Name: ___________________________________
                                  Title: __________________________________

                                      O-15

<PAGE>

                                   EXHIBIT ONE

                            THE FORM OF TRUST RECEIPT

                                  TRUST RECEIPT

                                     (date)

THIS TRUST RECEIPT MAY NOT BE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE TERMS OF
THE CUSTODIAL AGREEMENT REFERRED TO BELOW

Registered Holder:  MERRILL LYNCH CREDIT CORPORATION

Ladies and Gentlemen:

         Reference is made to the Custodial Agreement, dated as of November 30,
2004 (the "Custodial Agreement"), between Merrill Lynch Credit Corporation
("MLCC") and Wells Fargo Bank, NA. (the "Custodian"), pursuant to which MLCC has
caused to be delivered to the Custodian a Custodian's Mortgage File for the
Mortgage Loans, which are more fully described in the Mortgage Loan Schedule
attached hereto as Schedule A.

         In accordance with the provisions of Sections 4(a) and (b) of the
above-referenced Custodial Agreement (capitalized terms not defined herein
having the meanings ascribed to them in the Custodial Agreement), the
undersigned as the Custodian, hereby certifies to each Mortgage Loan described
in the Mortgage Loan and Exception Report attached hereto as Schedule A, and B,
respectively.

         The delivery of the attached Mortgage Loan Schedule and Exception
Report evidences that: (a) the Custodian has reviewed all documents described in
Paragraphs 2(a) through 2(e) and to the extent provided in the Custodian's
Mortgage Files, Paragraphs 2(f) through 2(j), if applicable, of the Custodial
Agreement are in its possession; such documents appear regular on their face and
relate to such mortgage Loan; (b) based on its examination and only as to the
foregoing documents, the information set forth in terms (i), (ii), (iii)
excluding the zip code requirement, (iv), (vi); (vii), (viii) and (x) of the
definition of "Mortgage Loan Schedule" respecting such Mortgage Loan is correct,
and which as to items (iv) (vi), (viii) and (x) for adjustable rate Mortgage
Loan Documents; (c) each Mortgage Note has been endorsed and each Assignment has
been executed as provided in Paragraph 2 of the Custodial Agreement; (d) the
Custodian is holding each Mortgage Loan' identified on the Mortgage Loan
Schedule and Exception Report, pursuant to the Custodial Agreement, as the
bailee of and custodian for the Registered Holder and (e) such documents have
been reviewed by the Custodian and appear on their face to be regular and to
relate to such Mort age Loan and satisfy the requirements set forth in Section 2
of the Custodial Agreement and the Review Procedures.

         The Custodian shall determine whether any discrepancy or deficiency
exists with respect to a Custodian's Mortgage File and shall note such
discrepancy on the Exception Report attached hereto as Schedule B. The Custodian
shall also note on such Exception

                                      O-16
<PAGE>

Report, with respect to each Mortgage Loan, whether a certified copy of the
related Mortgage was delivered to the Custodian in lieu of the original of such
Mortgage, whether a certified copy of an intervening assignment of the related
Mortgage was delivered to the Custodian in lieu of the original of such
assignment, and whether a preliminary title report with respect to such Mortgage
Loan was delivered to the Custodian in lieu of the original policy of title
insurance.

         The Custodian makes no representations as to, and shall not be
responsible to verify, (i) the validity, legality, enforceability, due
authorization, recordability, sufficiency, or genuineness of any of lithe
documents contained in each Mortgage File or (ii) the collectability,
insurability, effectiveness or suitability of any such Mortgage Loan.

         Each Mortgage Loan Schedule and Exception Report covering all Mortgage
Loans held by for the Registered Holder by the Custodian shall supersede and
cancel the previously delivered Mortgage Loan Schedule and Exception Report
attached to the Trust Receipt, and shall control and be binding upon the parties
hereto.

                                           WELLS FARGO BANK, N.A.
                                           ("Custodian")

                                           By: _______________________________
                                               Name:
                                               Title:

                                      O-17
<PAGE>

                                    EXHIBIT P

                                   [Reserved]

                                       P-1

<PAGE>

                                    EXHIBIT Q

                         OFFICER'S CERTIFICATE - TRUSTEE

Merrill Lynch Mortgage Investors, Inc.
250 Vesey Street
4 World Financial Center, 10th Floor
New York, New York 10080

Re:      Pooling and Servicing Agreement (the "Agreement") dated as of November
         1, 2004 among Merrill Lynch Mortgage Investors, Inc., as depositor (the
         "Depositor"), Cendant Mortgage Corporation, as servicer (the
         "Servicer") and Wells Fargo Bank, N.A., as trustee (the "Trustee") -
         Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1 Mortgage Loan
         Pass-Through Certificates

         I, [identify the certifying individual], a [title] of the Trustee
hereby certify to 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 Monthly Statements delivered pursuant to
                  Section 4.02 the Agreement since the last Officer's
                  Certificate executed pursuant to Section 6.20 of the Agreement
                  [or in the case of the first certification, since the Cut-off
                  Date] (the "Trustee Information").

         2.       Based on my knowledge, the information in the Monthly
                  Statements , 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 date hereof;

         3.       Based on my knowledge, the Monthly Statements required to be
                  prepared by the Trustee under the Agreement has been prepared
                  and provided in accordance with the Agreement; and

         4.       I am responsible for reviewing the activities performed by the
                  Trustee under the Agreement and the Trustee has, as of the
                  date hereof fulfilled its obligations under the Agreement and
                  there are no significant deficiencies relating to the
                  Trustee's compliance with this Agreement.

Date:                                      Wells Fargo Bank, N.A., as Trustee

                                           By: _________________________________
                                           Name: _______________________________
                                           Title: ______________________________

                                       Q-1

<PAGE>

                                    EXHIBIT R

                        OFFICER'S CERTIFICATE - SERVICER

Merrill Lynch Mortgage Investors, Inc.
250 Vesey Street
4 World Financial Center, 10th Floor
New York, New York  10080

Wells Fargo Bank, N.A.
Sixth Street and Marquette Avenue
Minneapolis, Minnesota  55479

Re:      Pooling and Servicing Agreement (the "Agreement") dated as of November
         1, 2004 among Merrill Lynch Mortgage Investors, Inc., as depositor (the
         "Depositor"), Cendant Mortgage Corporation, as servicer (the
         "Servicer") and Wells Fargo Bank, N.A., as trustee ( the "Trustee") -
         Merrill Lynch Mortgage Investors Trust Series MLCC 2004-1 Mortgage Loan
         Pass-Through Certificates

         cc. I, [identify the certifying individual], a [title] of the Servicer
hereby certify to the Trustee and the Depositor, and their respective officers,
directors and affiliates, and with the knowledge and intent that they will rely
upon this certification, that:

         1. I have reviewed the information required to be delivered to the
Trustee pursuant to the Agreement (the "Servicing Information").

         2. Based on my knowledge, the information in the Annual Statement of
Compliance, and all servicing reports, officer's certificates and other
information relating to the servicing of the Mortgage Loans submitted to the
Trustee by the Servicer 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 the Annual
Statement of Compliance;

         3. Based on my knowledge, the Servicing Information required to be
provided to the Trustee by the Servicer under the Agreement has been provided to
the Trustee;

         4. I am responsible for reviewing the activities performed by the
Servicer under the Agreement and based upon the review required under the
Agreement, and except as disclosed in the Annual Statement of Compliance, the
Annual Independent Certified Public Accountant's Servicing Report and all
servicing reports, officer's certificates and other information relating to the
servicing of the Mortgage Loans submitted to the Trustee by the Servicer, the
Servicer has, as of the last day of the period covered by the Annual Statement
of Compliance fulfilled its obligations under the Agreement; and

         5. I have disclosed to the Trustee and the Depositor all significant
deficiencies relating to the Servicer's compliance with the minimum servicing
standards in accordance with a review conducted in compliance with the Uniform
Single Attestation Program for Mortgage Bankers as set forth in the Agreement.

                                       R-1

<PAGE>

Date:                                Cendant Mortgage Corporation, as Servicer

                                     By: _________________________________
                                     Name: _______________________________
                                     Title: ______________________________

                                       R-2

<PAGE>

                                   SCHEDULE A

                             MORTGAGE LOAN SCHEDULE

                             [INTENTIONALLY OMITTED]

<PAGE>

                                   SCHEDULE B
                  MORTGAGE LOAN REPRESENTATIONS AND WARRANTIES
                                  OF THE SELLER

         The Seller hereby represents and warrants to the Depositor as to each
Mortgage Loan, as of the Closing Date as follows:

                  (a) The information set forth in the Mortgage Loan Schedule is
true and correct in all material respects as of the Cut-off Date;

                  (b) As of the related Closing Date, the Mortgage Loan is not
delinquent in payment more than 30 days and the Mortgage Loan has not been
dishonored; there are no material defaults under the terms of the Mortgage Loan;
the Seller has not advanced funds, or induced, solicited or knowingly received
any advance of funds from a party other than the owner of the Mortgaged Property
subject to the Mortgage, directly or indirectly, for the payment of any amount
required by the Mortgage Loan;

                  (c) To the best of the Seller's knowledge, with respect to
those Mortgage Loans as to which the Mortgagors are required to deposit funds
into an escrow account for payment of taxes, assessments, insurance premiums and
similar items as they become due, there are no delinquent taxes, ground rents,
water charges, sewer rents, assessments or other outstanding charges which
constitute a lien on the related Mortgaged Property, and all escrow deposits
have been collected, are under the control of the Servicer, and have been
applied to the payment of such items in a timely fashion, in accordance with
such Mortgage. No escrow deposits or escrow payments or other charges or
payments due the Servicer have been capitalized under the related Mortgage or
Mortgage Note. With respect to those Mortgage Loans for which escrow deposits
are not required, to the best of the Seller's knowledge, there are no delinquent
taxes or other outstanding charges affecting the related Mortgaged Property
which constitute a lien on the related Mortgaged Property;

                  (d) The terms of the Mortgage Note and the Mortgage have not
been impaired, waived, altered or modified in any respect, except by written
instruments contained in the Mortgage File, approved, if necessary, by the
insurer under any Primary Mortgage Insurance Policy and recorded in all places
necessary to maintain the first priority of the lien, the substance of which
waiver, alteration or modification is reflected on the Mortgage Loan Schedule.
No Mortgagor has been released, in whole or in part, except in connection with
an assumption agreement which assumption agreement is part of the Mortgage File
and the terms of which are reflected in the Mortgage Loan Schedule;

                  (e) Neither the Mortgage Note nor the Mortgage 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 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 to the best
of the Seller's knowledge, no such right of rescission, set-off, counterclaim or
defense has been asserted by any Person with respect thereto;

                  (f) All buildings upon the Mortgaged Property are required to
be insured by a generally acceptable insurer against loss by fire, hazards of
extended coverage and such other

                                      -1-
<PAGE>

hazards as are customarily included in extended coverage in the area where the
Mortgaged Property is located, pursuant to standard hazard insurance policies in
an amount which is equal to the lesser of (A) the replacement cost of the
improvements securing such Mortgage Loan or (B) the principal balance owing on
such Mortgage Loan. To the best knowledge of the Seller, all such standard
hazard policies are in effect. On the date of origination, such standard hazard
policies contained a standard mortgagee clause naming the Seller or the
originator of the Mortgage Loan and their respective successors in interest as
mortgagee and, to the best knowledge of the Seller, such clause is still in
effect and, to the best of the Seller's knowledge, all premiums due thereon have
been paid. If the Mortgaged Property is located in an area identified by the
Federal Emergency Management Agency as having special flood hazards under the
National Flood Insurance Act of 1994, as amended, such Mortgaged Property is
covered by flood insurance in the amount required under the National Flood
Insurance Act of 1994. The Mortgage obligates the Mortgagor thereunder to
maintain all such insurance at Mortgagor's cost and expense, and on the
Mortgagor's failure to do so, authorizes the holder of the Mortgage to maintain
such insurance at Mortgagor's cost and expense and to seek reimbursement
therefor from the Mortgagor;

                  (g) To the best of the Seller's knowledge, at the time of
origination of such Mortgage Loan and thereafter, 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 required to be complied with by the
Seller as the originator of the Mortgage Loan and applicable to the Mortgage
Loan have been complied with in all material respects;

                  (h) The Mortgage has not been satisfied as of the Closing
Date, canceled or subordinated, in whole, 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 for the Mortgage Loan as set forth in the Mortgage Loan Schedule), nor to
the best of the Seller's knowledge has any instrument been executed that would
effect any such release, cancellation, subordination or rescission;

                  (i) Ownership of the Mortgaged Property is held in fee simple
or a leasehold estate. With respect to Mortgage Loans that are secured by a
leasehold estate, (i) the lease is valid, in full force and effect, and conforms
to all of Fannie Mae's requirements for leasehold estates; (ii) all rents and
other payments due under the lease have been paid; (iii) the lessee is not in
default under any provision of the lease; (iv) the term of the lease exceeds the
maturity date of the related Mortgage Loan by at least five (5) years; and (v)
the terms of the lease provide a Mortgagee with an opportunity to cure any
defaults. Except as permitted by the fourth sentence of this paragraph (i), the
Mortgage is a valid, subsisting and enforceable first lien on the Mortgaged
Property, including all buildings on the Mortgaged Property and all
installations and mechanical, electrical, plumbing, heating and air conditioning
systems affixed to such buildings, and all additions, alterations and
replacements made at any time with respect to the foregoing securing the
Mortgage Note's original principal balance. The Mortgage and the Mortgage Note
do not contain any evidence on their face of any security interest or other
interest or right thereto. Such lien is free and clear of all adverse claims,
liens and encumbrances having priority over the first lien of the Mortgage
subject only to (1) the lien of non-delinquent 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 which are acceptable to mortgage lending institutions generally, or
which are specifically referred to in the lender's title insurance policy
delivered to the originator of the Mortgage Loan and either (A) which are

                                      -2-
<PAGE>

referred to or otherwise considered in the appraisal made for the originator of
the Mortgage Loan, or (B) which do not in the aggregate adversely affect the
appraised value of the Mortgaged Property as set forth in such appraisal, and
(3) other matters to which like properties are commonly subject which do not in
the aggregate 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. Any security agreement, chattel mortgage or
equivalent document related to and delivered in connection with the Mortgage
Loan establishes and creates a valid, subsisting and enforceable first lien and
first priority security interest on the property described therein. With respect
to each Co-op Loan, the security instruments create a valid, enforceable and
subsisting first priority security interest in the Co-op Lease and Co-op Stock
securing the related Mortgage Note subject to only to (a) the lien of the
related cooperative for unpaid assessments representing the Mortgagor's pro rata
share of payments for a blanket mortgage, if any, current and future real
property taxes, insurance premiums, maintenance fees and other assessments to
which like collateral is commonly subject, and (b) other matters to which the
collateral is commonly subject which do not materially interfere with the
benefits of the security intended to be provided; provided, however, that the
related Co-op Loan may be subordinated or otherwise subject to the lien of a
Mortgage on the cooperative building;

                  (j) The Mortgage Note is not subject to a third party's
security interest or other rights or interest therein;

                  (k) 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 subject to bankruptcy, insolvency and
other laws of general application affecting the rights of creditors. All parties
to the Mortgage Note and the Mortgage had the legal capacity to enter into the
Mortgage Loan and to execute and deliver the Mortgage Note and the Mortgage. The
Mortgage Note and the Mortgage have been duly and properly executed by such
parties. The proceeds of the Mortgage Loan have been fully disbursed and there
is no requirement for future advances thereunder, and any and all requirements
as to completion of any on-site or off-site improvements and as to disbursements
of any escrow funds therefor have been complied with;

                  (l) Seller has good title to, and the full right to transfer
and sell, the Mortgage Loan free and clear of any encumbrance, equity, lien,
pledge, charge, claim or security interest, including, to the best knowledge of
the Seller, any lien, claim or other interest arising by operation of law;

                  (m) To the best of the Seller's knowledge, each Mortgage Loan
is covered by an ALTA lender's title insurance policy or other generally
acceptable form of policy or insurance acceptable to Fannie Mae or FHLMC, issued
by a title insurer acceptable to Fannie Mae or FHLMC and qualified to do
business in the jurisdiction where the Mortgaged Property is located, insuring
(subject to the exceptions contained in paragraph (ix)(1) (2) and (3) above) the
Seller, its successors and assigns, as to the first priority lien of the
Mortgage in the original principal amount of the Mortgage Loan. To the best of
the Seller's knowledge, the Seller is the sole insured of such lender's title
insurance policy, such title insurance policy has been duly and validly endorsed
to the purchaser or the assignment to the purchaser of the Seller's interest
therein does not require the consent of or notification to the insurer 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. To the best of the Seller's knowledge, no claims have been made under
such lender's title insurance policy, and no prior holder of the related
Mortgage has done, by act or omission, anything which would impair the coverage
of such lender's title insurance policy;

                                      -3-
<PAGE>

                  (n) To the best of the Seller's knowledge, there is no
default, breach, violation or event of acceleration existing under the 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
default, breach, violation or event permitting acceleration, except for any
Mortgage Loan payment which is not late by more than 30 days, and the Seller has
not waived any default, breach, violation or event permitting acceleration;

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

                  (p) To the best of the Seller's knowledge, all improvements
subject to the Mortgage, lay wholly within the boundaries and building
restriction lines of the Mortgaged Property (and wholly within the project with
respect to a condominium unit) and no improvements on adjoining properties
encroach upon the Mortgaged Property except those which are insured against by
the title insurance policy referred to in paragraph (xiii) above and all
improvements on the property comply with all applicable zoning and subdivision
laws and ordinances;

                  (q) To the best of the Seller's knowledge, each Mortgage Loan
was originated by the Seller or by a savings association, a savings bank, a
commercial bank or similar banking institution that is supervised and examined
by a Federal or state banking authority, a mortgagee approved by the Secretary
of HUD pursuant to Section 203 and 211 of the National Housing Act, or a Fannie
Mae- or FHLMC-approved seller. To the best of the Seller's knowledge, each
Mortgage Loan was underwritten generally in accordance with the Underwriting
Standards as in effect at the time of origination. To the best of the Seller's
knowledge, the Mortgage contains the usual and customary provision of the Seller
at the time of origination for the acceleration of the payment of the unpaid
principal balance of the Mortgage Loan if the related Mortgaged Property is sold
without the prior consent of the mortgagee thereunder;

                  (r) The Mortgaged Property at origination or acquisition was
and, to the best of the Seller's knowledge, currently is free of material damage
and waste and at origination there was, and to the best of the Seller's
knowledge there currently is, no proceeding pending for the total or partial
condemnation thereof;

                  (s) The related 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, (1) in the case of a Mortgage
designated as a deed of trust, by trustee's sale or judicial foreclosure, and
(2) otherwise by judicial foreclosure. The Seller has no knowledge of any
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;

                  (t) To the best of the Seller's knowledge, if the Mortgage
constitutes a deed of trust, a trustee, duly qualified if required under
applicable law to act 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 to the trustee under the deed of trust, except in connection with a
trustee's sale or attempted sale after default by the Mortgagor;

                                      -4-
<PAGE>

                  (u) With respect to each Mortgage Loan, there is an appraisal
on a Fannie Mae-approved form (or a narrative residential appraisal) of the
related Mortgaged Property that conforms to the applicable requirements of the
Financial Institutions Reform Recovery and Enforcement Act and that was signed
prior to the approval of such Mortgage Loan application by a qualified
appraiser, appointed by the Seller or the originator of such Mortgage Loan, as
appropriate, who has no interest, direct or indirect, in the Mortgaged Property
or in any loan made on the security thereof, and whose compensation is not
affected by the approval or disapproval of such Mortgage Loan;

                  (v) No Mortgage Loan contains "subsidized buydown" or
"graduated payment" features;

                  (w) The Mortgaged Property is a single-family (one- to
four-unit) dwelling residence erected thereon, or an individual condominium unit
in a condominium, or a Co-operative Apartment or an individual unit in a planned
unit development or in a de minimis planned unit development as defined by
Fannie Mae. No such residence is a mobile home or a manufactured dwelling which
is not permanently attached to the land;

                  (x) No Mortgage Loan provides for negative amortization;

                  (y) No Mortgage Loan had an original term in excess of thirty
(30) years;

                  (z) [RESERVED]

                  (aa) As of the Closing Date, each Mortgage Loan is a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code
(without regard to Treasury Regulations Section 1.860G-2(f) or any similar rule
that provides that a defective obligation is a qualified mortgage for a
temporary period);

                  (bb) As of the Closing Date, no Mortgage Loan provides for
interest other than at either (x) a single fixed rate in effect throughout the
term of the Mortgage Loan or (y) a single "variable rate" (within the meaning of
Treasury Regulations Section 1.860G-1(a)(3)) in effect throughout the term of
the Mortgage Loan.

                  (cc) As of the Closing Date, no Mortgage Loan is the subject
of pending or final foreclosure proceedings.

                  (dd) Based on delinquencies in payment on the Mortgage Loans
as of the Closing Date, Seller would not initiate foreclosure proceedings with
respect to any of the Mortgage Loans prior to the next scheduled payment date on
such Mortgage Loan.

                  (ee) 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.

                  (ff) No Mortgage Loan is covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA") and no Mortgage Loan is "high cost" as
defined by any applicable federal, state or local predatory or abusive lending
law. Any breach of this representation shall be deemed to materially and
adversely affect the value of the Mortgage Loan and shall require a repurchase
of the affected Mortgage Loan.

                                      -5-
<PAGE>

                  (gg) 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 or abusive lending laws.

                  (hh) No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable (as such terms are defined in the then current Standard & Poor's
LEVELS(R) Glossary which is now Version 5.6 Revised, Appendix E, attached to the
Mortgage Loan Purchase Agreement as Exhibit A) and no Mortgage Loan originated
on or after October 1, 2002 through March 6, 2003 is governed by the Georgia
Fair Lending Act.

                                      -6-BEAR STEARNS ASSET BACKED SECURITIES I LLC,

                                   Depositor,

                            EMC MORTGAGE CORPORATION,

                           Seller and Master Servicer,

                                       and

                       LASALLE BANK NATIONAL ASSOCIATION,

                                     Trustee

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

                         POOLING AND SERVICING AGREEMENT

                          Dated as of November 1, 2004

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

             BEAR STEARNS ASSET BACKED SECURITIES I TRUST 2004-HE10

                   ASSET-BACKED CERTIFICATES, SERIES 2004-HE10

<PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS

                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
                                                     ARTICLE I

                                                    DEFINITIONS

Section 1.01          Defined Terms...............................................................................5

Section 1.02          Allocation of Certain Interest Shortfalls..................................................48

                                                     ARTICLE II

                              CONVEYANCE OF TRUST FUND REPRESENTATIONS AND WARRANTIES

Section 2.01          Conveyance of Trust Fund...................................................................50

Section 2.02          Acceptance of the Mortgage Loans...........................................................52

Section 2.03          Representations, Warranties and Covenants of the Master Servicer and the Seller............54

Section 2.04          Representations and Warranties of the Depositor............................................59

Section 2.05          Delivery of Opinion of Counsel in Connection with Substitutions and Repurchases............60

Section 2.06          Countersignature and Delivery of Certificates..............................................61

                                                    ARTICLE III

                                 ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS

Section 3.01          The Master Servicer to act as Master Servicer..............................................62

Section 3.02          Due-on-Sale Clauses; Assumption Agreements.................................................63

Section 3.03          Subservicers...............................................................................64

Section 3.04          Documents, Records and Funds in Possession of the Master Servicer To Be Held for Trustee...65

Section 3.05          Maintenance of Hazard Insurance............................................................65

Section 3.06          Presentment of Claims and Collection of Proceeds...........................................66

Section 3.07          Maintenance of the Primary Mortgage Insurance Policies.....................................66

Section 3.08          Fidelity Bond, Errors and Omissions Insurance..............................................67

Section 3.09          Realization Upon Defaulted Mortgage Loans; Determination of Excess Liquidation Proceeds
                      and Realized Losses; Repurchases of Certain Mortgage Loans.................................67

Section 3.10          Servicing Compensation.....................................................................70

Section 3.11          REO Property...............................................................................70

Section 3.12          Liquidation Reports........................................................................71

Section 3.13          Annual Certificate as to Compliance........................................................71

Section 3.14          Annual Independent Certified Public Accountants' Servicing Report..........................71

Section 3.15          Books and Records..........................................................................72

Section 3.16          Reports Filed with Securities and Exchange Commission......................................72

Section 3.17          UCC........................................................................................74

                                                         i

<PAGE>

Section 3.18          Optional Purchase of Certain Mortgage Loans................................................74

Section 3.19          Obligations of the Master Servicer in Respect of Mortgage Rates and Scheduled Payments.....75

Section 3.20          Reserve Fund...............................................................................75

Section 3.21          Advancing Facility.........................................................................76

                                                     ARTICLE IV

                                                      ACCOUNTS

Section 4.01          Collection of Mortgage Loan Payments; Protected Account....................................78

Section 4.02          Permitted Withdrawals From the Protected Account...........................................80

Section 4.03          Collection of Taxes; Assessments and Similar Items; Escrow Accounts........................81

Section 4.04          Distribution Account.......................................................................82

Section 4.05          Permitted Withdrawals and Transfers from the Distribution Account..........................83

Section 4.06          Class P Certificate Account................................................................83

                                                     ARTICLE V

                                             DISTRIBUTIONS AND ADVANCES

Section 5.01          Advances...................................................................................84

Section 5.02          Compensating Interest Payments.............................................................85

Section 5.03          REMIC Distributions........................................................................85

Section 5.04          Distributions..............................................................................85

Section 5.05          Allocation of Realized Losses..............................................................91

Section 5.06          Monthly Statements to Certificateholders...................................................93

Section 5.07          REMIC Designations and REMIC Distributions.................................................96

                                                     ARTICLE VI

                                                  THE CERTIFICATES

Section 6.01          The Certificates...........................................................................99

Section 6.02          Certificate Register; Registration of Transfer and Exchange of Certificates...............100

Section 6.03          Mutilated, Destroyed, Lost or Stolen Certificates.........................................104

Section 6.04          Persons Deemed Owners.....................................................................104

Section 6.05          Access to List of Certificateholders' Names and Addresses.................................104

Section 6.06          Book-Entry Certificates...................................................................104

Section 6.07          Notices to Depository.....................................................................105

Section 6.08          Definitive Certificates...................................................................106

Section 6.09          Maintenance of Office or Agency...........................................................106

                                                        ii

<PAGE>

                                                    ARTICLE VII

                                       THE DEPOSITOR AND THE MASTER SERVICER

Section 7.01          Liabilities of the Depositor and the Master Servicer......................................107

Section 7.02          Merger or Consolidation of the Depositor or the Master Servicer...........................107

Section 7.03          Indemnification of the Trustee and the Master Servicer....................................107

Section 7.04          Limitations on Liability of the Depositor, the Master Servicer and Others.................108

Section 7.05          Master Servicer Not to Resign.............................................................109

Section 7.06          Successor Master Servicer.................................................................109

Section 7.07          Sale and Assignment of Master Servicing...................................................109

                                                    ARTICLE VIII

                                      DEFAULT; TERMINATION OF MASTER SERVICER

Section 8.01          Events of Default.........................................................................111

Section 8.02          Trustee to Act; Appointment of Successor..................................................113

Section 8.03          Notification to Certificateholders........................................................114

Section 8.04          Waiver of Defaults........................................................................114

                                                     ARTICLE IX

                                               CONCERNING THE TRUSTEE

Section 9.01          Duties of Trustee.........................................................................115

Section 9.02          Certain Matters Affecting the Trustee.....................................................116

Section 9.03          Trustee Not Liable for Certificates or Mortgage Loans.....................................118

Section 9.04          Trustee May Own Certificates..............................................................119

Section 9.05          Trustee's Fees and Expenses...............................................................119

Section 9.06          Eligibility Requirements for Trustee......................................................119

Section 9.07          Insurance.................................................................................120

Section 9.08          Resignation and Removal of Trustee........................................................120

Section 9.09          Successor Trustee.........................................................................121

Section 9.10          Merger or Consolidation of Trustee........................................................121

Section 9.11          Appointment of Co-Trustee or Separate Trustee.............................................121

Section 9.12          Tax Matters...............................................................................123

                                                     ARTICLE X

                                                    TERMINATION

Section 10.01         Termination upon Liquidation or Repurchase of all Mortgage Loans..........................126

Section 10.02         Final Distribution on the Certificates....................................................126

Section 10.03         Additional Termination Requirements.......................................................128

                                                        iii

<PAGE>

                                                     ARTICLE XI

                                              MISCELLANEOUS PROVISIONS

Section 11.01         Amendment.................................................................................129

Section 11.02         Recordation of Agreement; Counterparts....................................................130

Section 11.03         Governing Law.............................................................................130

Section 11.04         Intention of Parties......................................................................131

Section 11.05         Notices...................................................................................131

Section 11.06         Severability of Provisions................................................................132

Section 11.07         Assignment................................................................................132

Section 11.08         Limitation on Rights of Certificateholders................................................132

Section 11.09         Inspection and Audit Rights...............................................................133

Section 11.10         Certificates Nonassessable and Fully Paid.................................................133
</TABLE>

EXHIBITS

Exhibit A-1                Form of Class A Certificates
Exhibit A-2                Form of Class M Certificates
Exhibit A-3                Form of Class P Certificates
Exhibit A-4                Form of Class CE Certificates
Exhibit A-5                Form of Class R Certificates
Exhibit B                  Mortgage Loan Schedule
Exhibit C                  Form of Transfer Affidavit
Exhibit D                  Form of Transferor Certificate
Exhibit E                  Form of Investment Letter (Non-Rule 144A)
Exhibit F                  Form of Rule 144A and Related Matters Certificate
Exhibit G                  Form of Request for Release
Exhibit H                  DTC Letter of Representations
Exhibit I                  Schedule of Mortgage Loans with Lost Notes
Exhibit J                  Form of Custodial Agreement
Exhibit K                  Form of Back-Up Certification
Exhibit L                  Form of Mortgage Loan Purchase Agreement
Exhibit M                  Notional Balance Schedule and Cap Rate Schedule

                                       iv

<PAGE>

         POOLING AND SERVICING AGREEMENT, dated as of November 1, 2004, among
BEAR STEARNS ASSET BACKED SECURITIES I LLC, a Delaware limited liability
company, as depositor (the "Depositor"), EMC MORTGAGE CORPORATION, a Delaware
corporation, as seller (in such capacity, the "Seller") and as master servicer
(in such capacity, the "Master Servicer") and LASALLE BANK NATIONAL ASSOCIATION,
a national banking association, not in its individual capacity, but solely as
trustee (the "Trustee").

                              PRELIMINARY STATEMENT

         The Depositor is the owner of the Trust Fund that is hereby conveyed to
the Trustee in return for the Certificates.

                                     REMIC I
                                     -------

         As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the Mortgage Loans and certain other related assets
subject to this Agreement (other than the Reserve Fund and the Yield Maintenance
Agreements) as a REMIC for federal income tax purposes, and such segregated pool
of assets will be designated as "REMIC I". The Class R-1 Certificates will be
the sole class of "residual interests" in REMIC I for purposes of the REMIC
Provisions (as defined herein). The following table irrevocably sets forth the
designation, the Uncertificated REMIC I 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 I Regular Interests (as defined herein). None of the REMIC I
Regular Interests will be certificated.

<PAGE>

<TABLE>
<CAPTION>
                               UNCERTIFICATED REMIC I       INITIAL UNCERTIFICATED       LATEST POSSIBLE MATURITY
         DESIGNATION             PASS-THROUGH RATE             PRINCIPAL BALANCE                 DATE (1)
<S>                                 <C>                      <C>                             <C>
             AA                     Variable(2)              $    300,169,207.94             December 25, 2034
            I-A-1                   Variable(2)              $        615,970.00             December 25, 2034
            I-A-2                   Variable(2)              $        339,440.00             December 25, 2034
            I-A-3                   Variable(2)              $        189,740.00             December 25, 2034
           II-A-1                   Variable(2)              $      1,022,115.00             December 25, 2034
           II-A-2                   Variable(2)              $        255,530.00             December 25, 2034
             M-1                    Variable(2)              $        206,750.00             December 25, 2034
             M-2                    Variable(2)              $        131,705.00             December 25, 2034
             M-3                    Variable(2)              $         81,170.00             December 25, 2034
             M-4                    Variable(2)              $         38,285.00             December 25, 2034
             M-5                    Variable(2)              $         35,225.00             December 25, 2034
             M-6                    Variable(2)              $         30,630.00             December 25, 2034
             M-7                    Variable(2)              $         45,945.00             December 25, 2034
             ZZ                     Variable(2)              $      3,133,397.20             December 25, 2034
              P                       0.00%(2)               $            100.00             December 25, 2034
             1A                     Variable(2)              $          6,051.53             December 25, 2034
             1B                     Variable(2)              $         28,954.53             December 25, 2034
             2A                     Variable(2)              $          6,751.59             December 25, 2034
             2B                     Variable(2)              $         32,304.49             December 25, 2034
             XX                     Variable(2)              $    306,221,048.00             December 25, 2034
</TABLE>
---------------------------
(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 I
         Regular Interest.
(2)      Calculated in accordance with the definition of "Uncertificated REMIC I
         Pass-Through Rate" herein.

                                    REMIC II
                                    --------

         As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the REMIC I Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC II". The Class R-2 Certificates will represent the sole
class of "residual interests" in REMIC II for purposes of the REMIC Provisions.

         The following table irrevocably sets forth the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for each Class of
Certificates that represents one or more of the "regular interests" in REMIC II
created hereunder.

                                       2

<PAGE>

<TABLE>
<CAPTION>
                                                             INITIAL CERTIFICATE         LATEST POSSIBLE MATURITY
        DESIGNATION             PASS-THROUGH RATE             PRINCIPAL BALANCE                   DATE(1)
        -----------             -----------------             -----------------                   -------
<S>                                <C>                       <C>                             <C>
           I-A-1                   Variable(2)               $     123,194,000.00            December 25, 2034
           I-A-2                   Variable(2)               $      67,888,000.00            December 25, 2034
           I-A-3                   Variable(2)               $      37,948,000.00            December 25, 2034
          II-A-1                   Variable(2)               $     204,423,000.00            December 25, 2034
          II-A-2                   Variable(2)               $      51,106,000.00            December 25, 2034
            M-1                    Variable(2)               $      41,350,000.00            December 25, 2034
            M-2                    Variable(2)               $      26,341,000.00            December 25, 2034
            M-3                    Variable(2)               $      16,234,000.00            December 25, 2034
            M-4                    Variable(2)               $       7,657,000.00            December 25, 2034
            M-5                    Variable(2)               $       7,045,000.00            December 25, 2034
            M-6                    Variable(2)               $       6,126,000.00            December 25, 2034
            M-7                    Variable(2)               $       9,189,000.00            December 25, 2034
     Class CE Interest            Variable(2)(3)             $      14,089,220.28            December 25, 2034
     Class P Interest              0.00%(2)(4)               $             100.00            December 25, 2034
</TABLE>
----------
(1)      Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
         regulations, the Distribution Date in the month 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 II
         Regular Interest.
(2)      Calculated in accordance with the definition of "Pass-Through Rate"
         herein.
(3)      The Class CE Interest will accrue interest at its variable Pass-Through
         Rate on the Uncertificated Notional Balance of the Class CE Interest
         outstanding from time to time which shall equal the Uncertificated
         Principal Balance of the REMIC I Regular Interests (other than REMIC I
         Regular Interest P). The Class CE Interest will not accrue interest on
         its Certificate Principal Balance.
(4)      The Class P Interest is not entitled to distributions in respect of
         interest.

                                    REMIC III
                                    ---------

         As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the Class CE Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC III." The Class R-3 Interest represents the sole class of
"residual interests" in REMIC III for purposes of the REMIC Provisions.

         The following table sets forth (or describes) the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for the indicated
Class of Certificates that represents a "regular interest" in REMIC III created
hereunder:

                                       3

<PAGE>

<TABLE>
<CAPTION>
                                                        INITIAL AGGREGATE CERTIFICATE         LATEST POSSIBLE
      CLASS DESIGNATION           PASS-THROUGH RATE           PRINCIPAL BALANCE              MATURITY DATE(1)
      -----------------           -----------------           -----------------              ----------------
<S>                                  <C>                        <C>                          <C>
    Class CE Certificates            Variable(2)                $14,089,220.28               December 25, 2034
</TABLE>
---------------
(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 the Class CE Certificates.
(2) The Class CE Certificates will receive 100% of amounts received in respect
of the Class CE Interest.

                                    REMIC IV
                                    --------

         As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the Class P Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC IV." The Class R-4 Interest represents the sole class of
"residual interests" in REMIC IV for purposes of the REMIC Provisions.

         The following table sets forth (or describes) the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for the indicated
Class of Certificates that represents a "regular interest" in REMIC IV created
hereunder:

<TABLE>
<CAPTION>
                                                                INITIAL AGGREGATE
                                                              CERTIFICATE PRINCIPAL           LATEST POSSIBLE
      CLASS DESIGNATION             PASS-THROUGH RATE                BALANCE                 MATURITY DATE(1)
      -----------------             -----------------                -------                 ----------------
<S>                                     <C>                          <C>                     <C>
    Class P Certificates                0.00%(2)                     $100.00                 December 25, 2034
</TABLE>
---------------
(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 the Class P
         Certificates.
(2)      The Class P Certificates will receive 100% of amounts received in
         respect of the Class P Interest.

         The Trust Fund shall be named, and may be referred to as, the "Bear
Stearns Asset Backed Securities I Trust 2004-HE10." The Certificates issued
hereunder may be referred to as "Asset-Backed Certificates, Series 2004-HE10"
(including for purposes of any endorsement or assignment of a Mortgage Note or
Mortgage).

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

                                       4
<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

         Section 1.01 DEFINED TERMS.

         In addition to those terms defined in Section 1.02, whenever used in
this Agreement, the following words and phrases, unless the context otherwise
requires, shall have the following meanings:

         ACCEPTED SERVICING PRACTICES: With respect to each Mortgage Loan, those
mortgage servicing practices (including collection procedures) that are in
accordance with all applicable statutes, regulations and prudent mortgage
banking practices for similar mortgage loans.

         ACCOUNT: The Distribution Account, the Reserve Account, the Class P
Certificate Account and the Protected Account.

         ACCRUAL PERIOD: With respect to the Certificates (other than the Class
CE, Class P and the Residual Certificates) and any Distribution Date, the period
from and including the immediately preceding Distribution Date (or with respect
to the first Accrual Period, the Closing Date) to and including the day prior to
such Distribution Date. With respect to the Class CE Certificates and any
Distribution Date, the calendar month immediately preceding such Distribution
Date. All calculations of interest on the Certificates (other than the Class CE,
Class P and the Residual Certificates) will be made on the basis of the actual
number of days elapsed in the related Accrual Period. All calculations of
interest on the Class CE Certificates will be made on the basis of a 360-day
year consisting of twelve 30-day months.

         ADVANCE: An advance of delinquent payments of principal or interest in
respect of a Mortgage Loan required to be made by the Master Servicer as
provided in Section 5.01 hereof.

         AGREEMENT: This Pooling and Servicing Agreement and any and all
amendments or supplements hereto made in accordance with the terms herein.

         ADJUSTABLE RATE MORTGAGE LOAN: Each of the Mortgage Loans identified in
the Mortgage Loan Schedule as having a Mortgage Rate that is subject to
adjustment.

         ADJUSTMENT DATE: With respect to each Adjustable Rate Mortgage Loan,
the first day of the month in which the Mortgage Rate of an Adjustable Rate
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.

         AMOUNT HELD FOR FUTURE DISTRIBUTION: As to any Distribution Date, the
aggregate amount held in the Protected Account at the close of business on the
immediately preceding Determination Date on account of (i) all Scheduled
Payments or portions thereof received in respect of the Mortgage Loans due after
the related Due Period and (ii) Principal Prepayments, Liquidation Proceeds,
Subsequent Recoveries and Insurance Proceeds received in respect of such
Mortgage Loans after the last day of the related Prepayment Period.

                                       5
<PAGE>

         APPLIED REALIZED LOSS AMOUNT: With respect to any Distribution Date and
a Class of Class A Certificates and Class M Certificates, the sum of the
Realized Losses with respect to the Mortgage Loans which have been applied in
reduction of the Certificate Principal Balance of a Class of Certificates
pursuant to Section 5.05 of this Agreement which have not previously been
reimbursed reduced by any Subsequent Recoveries applied to such Applied Realized
Loss Amount.

         APPRAISED VALUE: With respect to any Mortgage Loan originated in
connection with a refinancing, the appraised value of the Mortgaged Property
based upon the appraisal made at the time of such refinancing or, with respect
to any other Mortgage Loan, the lesser of (x) the appraised value of the
Mortgaged Property based upon the appraisal made by a fee appraiser at the time
of the origination of the related Mortgage Loan, and (y) the sales price of the
Mortgaged Property at the time of such origination.

         BASIS RISK SHORTFALL CARRY FORWARD AMOUNT: With respect to any
Distribution Date and any Class of Class A Certificates and Class M Certificates
and any Distribution Date for which the Pass-Through Rate for such Certificates
is equal to the related Net Rate Cap, an amount equal to the sum of (A) the
excess, if any, of (a) the amount of Current Interest that such Class would have
been entitled to receive on such Distribution Date had the Pass-Though Rate
applicable to such Class been calculated at a per annum rate equal to One-Month
LIBOR plus the related Certificate Margin, over (b) the amount of Current
Interest that such Class received on such Distribution Date at a per annum rate
equal to the related Net Rate Cap and (B) the amount in clause (A) for all
previous Distribution Dates not previously paid, together with interest thereon
at a rate equal to the related Pass-Through Rate for such Distribution Date.

         BANKRUPTCY CODE: Title 11 of the United States Code.

         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 6.06). As of the Closing
Date, each Class of Regular Certificates (other than the Class M-7, Class CE and
Class P Certificates) constitutes a Class of Book-Entry Certificates.

         BUSINESS DAY: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which banking institutions in The City of New York, New York, Chicago,
Illinois, Minneapolis, Minnesota or the city in which the Corporate Trust Office
of the Trustee or the principal office of the Master Servicer is located are
authorized or obligated by law or executive order to be closed.

         CALENDAR QUARTER: January 1 to March 31, April 1 to June 30, July 1 to
September 30, or October 1 to December 31, as applicable.

         CAP RATE: The rates as set forth in Exhibit M.

         CERTIFICATE: Any one of the certificates of any Class executed and
authenticated by the Trustee in substantially the forms attached hereto as
Exhibits A-1 through A-5.

                                       6
<PAGE>

         CERTIFICATE MARGIN: With respect to the Class I-A-1 Certificates and,
for purposes of the definition of "One-Month LIBOR Pass-Through Rate", REMIC I
Regular Interest I-A-1, 0.180%.

         With respect to the Class I-A-2 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest
I-A-2, 0.340% in the case of each Distribution Date through and including the
first possible Optional Termination Date and 0.680% in the case of each
Distribution Date thereafter.

         With respect to the Class I-A-3 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest
I-A-3, 0.520% in the case of each Distribution Date through and including the
first possible Optional Termination Date and 1.040% in the case of each
Distribution Date thereafter.

         With respect to the Class II-A-1 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest
II-A-1, 0.350% in the case of each Distribution Date through and including the
first possible Optional Termination Date and 0.700% in the case of each
Distribution Date thereafter.

         With respect to the Class II-A-2 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest
II-A-2, 0.400% in the case of each Distribution Date through and including the
first possible Optional Termination Date and 0.800% in the case of each
Distribution Date thereafter.

         With respect to the Class M-1 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-1,
0.650% in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.975% in the case of each Distribution
Date thereafter.

         With respect to the Class M-2 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-2,
1.150% in the case of each Distribution Date through and including the first
possible Optional Termination Date and 1.725% in the case of each Distribution
Date thereafter.

         With respect to the Class M-3 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-3,
1.350% in the case of each Distribution Date through and including the first
possible Optional Termination Date and 2.025% in the case of each Distribution
Date thereafter.

         With respect to the Class M-4 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-4,
1.700% in the case of each Distribution Date through and including the first
possible Optional Termination Date and 2.550% in the case of each Distribution
Date thereafter.

         With respect to the Class M-5 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-5,
1.800% in the case of each

                                       7
<PAGE>

Distribution Date through and including the first possible Optional Termination
Date and 2.700% in the case of each Distribution Date thereafter.

         With respect to the Class M-6 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-6,
3.100% in the case of each Distribution Date through and including the first
possible Optional Termination Date and 4.650% in the case of each Distribution
Date thereafter.

         With respect to the Class M-7 Certificates and, for purposes of the
definition of "One-Month LIBOR Pass-Through Rate", REMIC I Regular Interest M-7,
4.000% in the case of each Distribution Date through and including the first
possible Optional Termination Date and 6.000% in the case of each Distribution
Date thereafter.

         CERTIFICATE NOTIONAL BALANCE: With respect to the Class CE Certificates
and any Distribution Date, an amount equal to the Stated Principal Balance of
the Mortgage Loans at the beginning of the related Due Period. The initial
Certificate Notional Balance of the Class CE Certificates shall be
$612,590,220.28. For federal income tax purposes, the Certificate Notional
Balance for any Distribution Date shall be an amount equal to the Uncertificated
Principal Balance of the REMIC I Regular Interests (other than REMIC I Regular
Interest P) for such Distribution Date.

         CERTIFICATE OWNER: With respect to a Book-Entry Certificate, the Person
that is the beneficial owner of such Book-Entry Certificate.

         CERTIFICATE PRINCIPAL BALANCE: As to any Certificate (other than any
Class CE Certificate or Class R Certificate) and as of any Distribution Date,
the Initial Certificate Principal Balance of such Certificate plus, in the case
of a Class A Certificate and Class M Certificate, any Subsequent Recoveries
added to the Certificate Principal Balance of such Certificate pursuant to
Section 5.04(b), less the sum of (i) all amounts distributed with respect to
such Certificate in reduction of the Certificate Principal Balance thereof on
previous Distribution Dates pursuant to Section 5.04, and (ii) any Applied
Realized Loss Amounts allocated to such Certificate on previous Distribution
Dates.

         CERTIFICATE REGISTER: The register maintained pursuant to Section 6.02
hereof.

         CERTIFICATEHOLDER OR HOLDER: The person in whose name a Certificate is
registered in the Certificate Register (initially, Cede & Co., as nominee for
the Depository, in the case of any Book-Entry Certificates).

         CLASS: All Certificates bearing the same Class designation as set forth
in Section 6.01 hereof.

         CLASS A CERTIFICATES: Any of the Class I-A-1, Class I-A-2, Class I-A-3,
Class II-A-1 and Class II-A-2 Certificates.

         CLASS A PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the Principal Distribution Amount for such
Distribution Date and (y) the excess,

                                       8
<PAGE>

if any, of (i) the aggregate Certificate Principal Balance of the Class A
Certificates immediately prior to such Distribution Date, over (ii) the lesser
of (a) the product of (1) 58.20% and (2) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period, and (b) the
aggregate Stated Principal Balance of the Mortgage Loans as of the last day of
the related Due Period minus $3,062,951.

         CLASS I-A CERTIFICATES: Any of the Class I-A-1, Class I-A-2 and Class
I-A-3 Certificates.

         CLASS I-A-1 CERTIFICATE: Any Certificate designated as a "Class I-A-1
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to the Percentage Interest of distributions provided for
the Class I-A-1 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS I-A-2 CERTIFICATE: Any Certificate designated as a "Class I-A-2
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to the Percentage Interest of distributions provided for
the Class I-A-2 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS I-A-3 CERTIFICATE: Any Certificate designated as a "Class I-A-3
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to the Percentage Interest of distributions provided for
the Class I-A-3 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS I-A PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date,
with respect to the Class I-A Certificates and any Distribution Date, is the
product of the Class A Principal Distribution Amount and a fraction, the
numerator of which is the Principal Funds for Loan Group I for such Distribution
Date and the denominator of which is the Principal Funds for both Loan Groups
for such Distribution Date.

         CLASS II-A CERTIFICATES: Any of the Class II-A-1 Certificates and Class
II-A-2 Certificates.

         CLASS II-A-1 CERTIFICATE: Any Certificate designated as a "Class II-A-1
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to the Percentage Interest of distributions provided for
the Class II-A-1 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS II-A-2 CERTIFICATE: Any Certificate designated as a "Class II-A-2
Certificate" on the face thereof, in the form of Exhibit A-1 hereto,
representing the right to the Percentage Interest of distributions provided for
the Class II-A-2 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

                                       9
<PAGE>

         CLASS II-A PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date,
with respect to the Class II-A Certificates and any Distribution Date, is the
product of the Class A Principal Distribution Amount and a fraction, the
numerator of which is the Principal Funds for Loan Group II for such
Distribution Date and the denominator of which is the Principal Funds for both
Loan Groups for such Distribution Date.

         CLASS CE CERTIFICATE: Any Certificate designated as a "Class CE
Certificate" on the face thereof, in the form of Exhibit A-4 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class CE Certificates herein and evidencing a Regular Interest in REMIC III.

         CLASS CE DISTRIBUTION AMOUNT: With respect to any Distribution Date,
the sum of (i) the Current Interest for the Class CE Interest for such
Distribution Date, (ii) any Overcollateralization Release Amount for such
Distribution Date and (iii) without duplication, any Subsequent Recoveries not
distributed to the Class A Certificates and Class M Certificates on such
Distribution Date; provided, however that on any Distribution Date after the
Distribution Date on which the Certificate Principal Balances of the Class A
Certificates and Class M Certificates have been reduced to zero, the Class CE
Distribution Amount shall include the Overcollateralization Amount.

         CLASS CE INTEREST: An uncertificated interest in the Trust Fund held by
the Trustee on behalf of the Holders of the Class CE Certificates, evidencing a
Regular Interest in REMIC II for purposes of the REMIC Provisions.

         CLASS M CERTIFICATES: Any of the Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6 and Class M-7 Certificates.

         CLASS M-1 CERTIFICATE: Any Certificate designated as a "Class M-1
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class M-1 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS M-1 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount and (y) the excess, if any, of (a) the sum of (1) the
aggregate Certificate Principal Balance of the Class A Certificates (after
taking into account the distribution of the Class A Principal Distribution
Amount on such Distribution Date and (2) the Certificate Principal Balance of
the Class M-1 Certificates immediately prior to such Distribution Date, over (b)
the lesser of (1) the product of (x) 71.70% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period, and (2) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period minus $3,062,951.

         CLASS M-2 CERTIFICATE: Any Certificate designated as a "Class M-2
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of

                                       10
<PAGE>

distributions provided for the Class M-2 Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC II and (ii) the right to receive the
Basis Risk Shortfall Carry Forward Amount from the Reserve Fund.

         CLASS M-2 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount and the Class M-1 Principal Distribution Amount and (y) the
excess, if any, of (a) the sum of (1) the aggregate Certificate Principal
Balance of the Class A Certificates (after taking into account the distribution
of the Class A Principal Distribution Amount on such Distribution Date), (2) the
Certificate Principal Balance of the Class M-1 Certificates (after taking into
account the distribution of the Class M-1 Principal Distribution Amount on such
Distribution Date) and (3) the Certificate Principal Balance of the Class M-2
Certificates immediately prior to such Distribution Date, over (b) the lesser of
(1) the product of (x) 80.30% and (y) the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period, and (2) the
aggregate Stated Principal Balance of the Mortgage Loans as of the last day of
the related Due Period minus $3,062,951.

         CLASS M-3 CERTIFICATE: Any Certificate designated as a "Class M-3
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class M-3 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS M-3 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount and the Class
M-2 Principal Distribution Amount and (y) the excess, if any, of (a) the sum of
(1) the aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Class A Principal
Distribution Amount on such Distribution Date), (2) the Certificate Principal
Balance of the Class M-1 Certificates (after taking into account the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date) and (4) the Certificate Principal
Balance of the Class M-3 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 85.60% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period, and (2) the aggregate Stated Principal Balance of the Mortgage Loans
as of the last day of the related Due Period minus $3,062,951.

         CLASS M-4 CERTIFICATE: Any Certificate designated as a "Class M-4
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class M-4 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

                                       11
<PAGE>

         CLASS M-4 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount and the Class M-3 Principal Distribution Amount
and (y) the excess, if any, of (a) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (2) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (3) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (4) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date) and (5) the Certificate Principal
Balance of the Class M-4 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 88.10% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period, and (2) the aggregate Stated Principal Balance of the Mortgage Loans
as of the last day of the related Due Period minus $3,062,951.

         CLASS M-5 CERTIFICATE: Any Certificate designated as a "Class M-5
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class M-5 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS M-5 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount and
the Class M-4 Principal Distribution Amount and (y) the excess, if any, of (a)
the sum of (1) the aggregate Certificate Principal Balance of the Class A
Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date) and (6) the Certificate Principal
Balance of the Class M-5 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 90.40% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period, and (2) the aggregate Stated Principal Balance of the Mortgage Loans
as of the last day of the related Due Period minus $3,062,951.

                                       12
<PAGE>

         CLASS M-6 CERTIFICATE: Any Certificate designated as a "Class M-6
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class M-6 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS M-6 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount, the
Class M-4 Principal Distribution Amount and the Class M-5 Principal Distribution
Amount and (y) the excess, if any, of (a) the sum of (1) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the distribution of the Class A Principal Distribution Amount on such
Distribution Date), (2) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (3) the Certificate
Principal Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (4) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (5) the Certificate Principal
Balance of the Class M-4 Certificates (after taking into account the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date), (6) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the distribution of the Class M-5 Principal
Distribution Amount on such Distribution Date) and (7) the Certificate Principal
Balance of the Class M-6 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 92.40% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period, and (2) the aggregate Stated Principal Balance of the Mortgage Loans
as of the last day of the related Due Period minus $3,062,951.

         CLASS M-7 CERTIFICATE: Any Certificate designated as a "Class M-7
Certificate" on the face thereof, in the form of Exhibit A-2 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class M-7 Certificates as set forth herein and evidencing (i) a Regular
Interest in REMIC II and (ii) the right to receive the Basis Risk Shortfall
Carry Forward Amount from the Reserve Fund.

         CLASS M-7 PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date, an
amount equal to the lesser of (x) the remaining Principal Distribution Amount
for such Distribution Date after distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution Amount, the
Class M-4 Principal Distribution Amount, the Class M-5 Principal Distribution
Amount and the Class M-6 Principal Distribution Amount and (y) the excess, if
any, of (a) the sum of (1) the aggregate Certificate Principal Balance of the
Class A Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
distribution of the Class M-1 Principal Distribution Amount on such Distribution

                                       13
<PAGE>

Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date) (7) the Certificate Principal Balance of the Class M-6 Certificates (after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date) and (8) the Certificate Principal Balance of
the Class M-7 Certificates immediately prior to such Distribution Date, over (b)
the lesser of (1) the product of (x) 95.40% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period, and (2) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period minus $3,062,951.

         CLASS P CERTIFICATE: Any Certificate designated as a "Class P
Certificate" on the face thereof, in the form of Exhibit A-3 hereto,
representing the right to its Percentage Interest of distributions provided for
the Class P Certificates as set forth herein and evidencing a Regular Interest
in REMIC IV.

         CLASS P INTEREST: An uncertificated interest in the Trust Fund held by
the Trustee on behalf of the Holders of the Class P Certificates, evidencing a
Regular Interest in REMIC II for purposes of the REMIC Provisions.

         CLASS P CERTIFICATE ACCOUNT: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 4.05 in the name of the Trustee
for the benefit of the Class P Certificateholders.

         CLASS R-1 CERTIFICATE: Any Certificate designated a "Class R-1
Certificate" on the face thereof, in substantially the form set forth in Exhibit
A-5 hereto, evidencing the Residual Interest in REMIC I and representing the
right to the Percentage Interest of distributions provided for the Class R-1
Certificates as set forth herein.

         CLASS R-2 CERTIFICATE: Any Certificate designated a "Class R-2
Certificate" on the face thereof, in substantially the form set forth in Exhibit
A-5 hereto, evidencing the Residual Interest in REMIC II and representing the
right to the Percentage Interest of distributions provided for the Class R-2
Certificates as set forth herein.

         CLASS RX CERTIFICATE: Any Certificate designated a "Class RX
Certificate" on the face thereof, in substantially the form set forth in Exhibit
A-5 hereto, evidencing the ownership of the Class R-3 Interest and the Class R-4
Interest and representing the right to the Percentage Interest of distributions
provided for the Class RX Certificates as set forth herein.

         CLASS R-3 INTEREST: The uncertificated Residual Interest in REMIC III.

         CLASS R-4 INTEREST: The uncertificated Residual Interest in REMIC IV.

                                       14
<PAGE>

         CLOSING DATE: November 30, 2004.

         CODE: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.

         COMPENSATING INTEREST: An amount, not to exceed the Servicing Fee, to
be deposited in the Protected Account by the Master Servicer to the payment of a
Prepayment Interest Shortfall on a Mortgage Loan subject to this Agreement.

         CORPORATE TRUST OFFICE: The designated office of the Trustee where at
any particular time its corporate trust business with respect to this Agreement
shall be administered, which office at the date of the execution of this
Agreement is located at 135 South LaSalle Street, Suite 1625, Chicago, Illinois,
Attention: Global Securitization Trust Services Group - Bear Stearns Asset
Backed Securities I LLC, Series 2004-HE10, or at such other address as the
Trustee may designate from time to time.

         CORRESPONDING CERTIFICATE: With respect to each Uncertificated REMIC I
Regular Interest (other than REMIC I Regular Interests AA, ZZ, 1A, 1B, ZA, ZB
and XX), the Certificate with the corresponding designation.

         CURRENT INTEREST: As of any Distribution Date, with respect to the
Certificates of each Class (other than the Class P Certificates and the Residual
Certificates), (i) the interest accrued on the Certificate Principal Balance or
Certificate Notional Balance or Uncertificated Notional Balance, as applicable,
during the related Accrual Period at the applicable Pass-Through Rate plus any
amount previously distributed with respect to interest for such Certificate that
has been recovered as a voidable preference by a trustee in bankruptcy minus
(ii) the sum of (a) any Prepayment Interest Shortfall for such Distribution
Date, to the extent not covered by Compensating Interest and (b) any Relief Act
Interest Shortfalls during the related Due Period, provided, however, that for
purposes of calculating Current Interest for any such Class, amounts specified
in clause (ii) hereof for any such Distribution Date shall be allocated first to
the Class CE Certificates and Residual Certificates in reduction of amounts
otherwise distributable to such Certificates on such Distribution Date and then
any excess shall be allocated to each Class of Class A Certificates and Class M
Certificates pro rata based on the respective amounts of interest accrued
pursuant to clause (i) hereof for each such Class on such Distribution Date.

         CURRENT SPECIFIED ENHANCEMENT PERCENTAGE: With respect to any
Distribution Date, the percentage obtained by dividing (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class M Certificates and (ii) the
Overcollateralization Amount, in each case prior to the distribution of the
Principal Distribution Amount on such Distribution Date, by (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the end of the related Due
Period.

         CUSTODIAL AGREEMENT: Any of the LaSalle Custodial Agreement or Wells
Fargo Custodial Agreement.

         CUSTODIANS: (i) Wells Fargo Bank, National Association, or any
successor custodian appointed pursuant to the provisions hereof and the Wells
Fargo Custodial Agreement ("Wells

                                       15
<PAGE>

Fargo") and (ii) LaSalle Bank National Association, or any successor custodian
appointed pursuant to the provisions hereof and the LaSalle Custodial Agreement
("LaSalle").

         CUT-OFF DATE: The close of business on November 1, 2004.

         CUT-OFF DATE PRINCIPAL BALANCE: As to any Mortgage Loan, the unpaid
principal balance thereof as of the close of business on the Cut-off Date after
application of all Principal Prepayments received prior to the Cut-off Date and
scheduled payments of principal due on or before the Cut-off Date, whether or
not received, but without giving effect to any installments of principal
received in respect of Due Dates after the Cut-off Date. The aggregate Cut-off
Date Principal Balance of the Mortgage Loans is $612,590,220.28.

         DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan that became final and
non-appealable, except such a reduction resulting from a Deficient Valuation or
any other reduction that results in a permanent forgiveness of principal.

         DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation by
a court of competent jurisdiction of the Mortgaged Property in an amount less
than the then outstanding indebtedness under such Mortgage Loan, or any
reduction in the amount of principal to be paid in connection with any Scheduled
Payment that results in a permanent forgiveness of principal, which valuation or
reduction results from an order of such court that is final and non-appealable
in a proceeding under the Bankruptcy Code.

         DEFINITIVE CERTIFICATES: As defined in Section 6.06.

         DELETED MORTGAGE LOAN: A Mortgage Loan replaced or to be replaced by a
Replacement Mortgage Loan.

         DELINQUENCY EVENT: A Delinquency Event shall have occurred and be
continuing if at any time, (x) the percent equivalent of a fraction, the
numerator of which is the aggregate Stated Principal Balance of the Mortgage
Loans that are 60 days or more Delinquent (including for this purpose any such
Mortgage Loans in bankruptcy or foreclosure and Mortgage Loans with respect to
which the related Mortgaged Property is REO Property), and the denominator of
which is the aggregate Stated Principal Balance of all of the Mortgage Loans as
of the last day of the related Due Period exceeds (y) 37% of the Current
Specified Enhancement Percentage.

         DELINQUENT: A Mortgage Loan is "delinquent" if any payment due thereon
is not made pursuant to the terms of such Mortgage Loan by the close of business
on the day such payment is scheduled to be due. A Mortgage Loan is "30 days
delinquent" if such payment has not been received by the close of business on
the corresponding day of the month immediately succeeding the month in which
such payment was due, or, if there is no such corresponding day (e.g., as when a
30-day month follows a 31-day month in which a payment was due on the 31st day
of such month), then on the last day of such immediately succeeding month.
Similarly for "60 days delinquent," "90 days delinquent" and so on.

                                       16
<PAGE>

         DENOMINATION: With respect to each Certificate, the amount set forth on
the face thereof as the "Initial Principal Balance of this Certificate".

         DEPOSITOR: Bear Stearns Asset Backed Securities I LLC, a Delaware
limited liability company, or its successor in interest.

         DEPOSITORY: The initial Depository shall be The Depository Trust
Company ("DTC"), the nominee of which 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(a)(5) of the
Uniform Commercial Code of the State of New York.

         DEPOSITORY AGREEMENT: With respect to the Class of Book-Entry
Certificates, the agreement among the Depositor, the Trustee and the initial
Depository, dated as of the Closing Date, substantially in the form of Exhibit
H.

         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 month of such Distribution Date or, if such 15th day is not a Business
Day, the immediately preceding Business Day.

         DISTRIBUTION ACCOUNT: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 4.04 in the name of the Trustee
for the benefit of the Certificateholders designated "LaSalle Bank National
Association, in trust for registered holders of Bear Stearns Asset Backed
Securities I LLC, Asset-Backed Certificates, Series 2004-HE10". Funds in the
Distribution Account shall be held in trust for the Certificateholders for the
uses and purposes set forth in this Agreement.

         DISTRIBUTION ACCOUNT DEPOSIT DATE: The Business Day prior to each
Distribution Date.

         DISTRIBUTION DATE: The 25th day of each calendar month after the
initial issuance of the Certificates, or if such 25th day is not a Business Day,
the next succeeding Business Day, commencing in December 2004.

         DUE DATE: As to any Mortgage Loan, the date in each month on which the
related Scheduled Payment is due, as set forth in the related Mortgage Note.

         DUE PERIOD: With respect to any Distribution Date, the period from the
second day of the calendar month preceding the calendar month in which such
Distribution Date occurs through close of business on the first day of the
calendar 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
long-term unsecured debt obligations and

                                       17
<PAGE>

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 debt obligations of such holding company, so long as Moody's is not
a Rating Agency) are rated by each Rating Agency in one of its two highest
long-term and its highest short-term rating categories, respectively, at the
time any amounts are held on deposit therein, or (ii) an account or accounts in
a depository institution or trust company in which such accounts are insured by
the FDIC (to the limits established by the FDIC) and the uninsured deposits in
which accounts are otherwise secured such that, as evidenced by an Opinion of
Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders have a claim with respect to the funds in such account or a
perfected first priority security interest against any collateral (which shall
be limited to Permitted Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution or
trust company in which such account is maintained, or (iii) a trust account or
accounts maintained with the corporate trust department of a federal or state
chartered depository institution or trust company having capital and surplus of
not less than $50,000,000, acting in its fiduciary capacity or (iv) any other
account acceptable to the Rating Agencies, as evidenced in writing. Eligible
Accounts may bear interest, and may include, if otherwise qualified under this
definition, accounts maintained with the Trustee.

         EMC: EMC Mortgage Corporation, a Delaware corporation, and its
successors and assigns.

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

         ERISA RESTRICTED CERTIFICATES: Any of the Class CE, Class P and
Residual Certificates.

         EVENT OF DEFAULT: As defined in Section 8.01 hereof.

         EXCESS CASHFLOW: With respect to any Distribution Date, an amount, if
any, equal to the sum of (a) the Remaining Excess Spread for such Distribution
Date and (b) the Overcollateralization Release Amount for such Distribution
Date.

         EXCESS LIQUIDATION PROCEEDS: To the extent not required by law to be
paid to the related Mortgagor, the excess, if any, of any Liquidation Proceeds
with respect to a Mortgage Loan over the Stated Principal Balance of such
Mortgage Loan and accrued and unpaid interest at the related Mortgage Rate
through the last day of the month in which the Mortgage Loan has been
liquidated.

         EXCESS SPREAD: With respect to any Distribution Date, the excess, if
any, of (i) the Interest Funds for such Distribution Date over (ii) the sum of
the Current Interest on the Class A Certificates and Class M Certificates and
Interest Carry Forward Amounts on the Class A Certificates (other than Interest
Carry Forward Amounts paid pursuant to Section 5.04(a)(4)(A)), in each case for
such Distribution Date.

         EXEMPTION: Prohibited Transaction Exemption 90-30, as amended from time
to time.

         EXTRA PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Distribution
Date, the lesser of (i) the excess, if any, of the Overcollateralization Target
Amount for such Distribution Date over

                                       18
<PAGE>

the Overcollateralization Amount for such Distribution Date (after giving effect
to distributions of principal on the Certificates other than any Extra Principal
Distribution Amount) and (ii) the Excess Spread for such Distribution Date.

         FANNIE MAE: Fannie Mae (formerly, Federal National Mortgage
Association), or any successor thereto.

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

         FINAL CERTIFICATION: The certification substantially in the form of
Exhibit Three to the related Custodial Agreement.

         FIRREA: The Financial Institutions Reform, Recovery, and Enforcement
Act of 1989.

         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 pursuant to or as contemplated by Section 2.03(c) or Section
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 Trustee shall maintain records,
based solely on information provided by the Master Servicer, of each Final
Recovery Determination made thereby.

         FREDDIE MAC: Federal Home Loan Mortgage Corporation, or any successor
thereto.

         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 LOANS: The Mortgage Loans identified as such on the Mortgage
Loan Schedule.

         GROUP I PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Distribution
Date, the product of the Principal Distribution Amount for such Distribution
Date and a fraction, the numerator of which is the Principal Funds for the Loan
Group I for such Distribution Date and the denominator of which is the Principal
Funds for both Loan Groups for such Distribution Date.

         GROUP II LOANS: The Mortgage Loans identified as such on the Mortgage
Loan Schedule.

         GROUP II PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the product of the Principal Distribution Amount for such
Distribution Date and a fraction, the numerator of which is the Principal Funds
for the Loan Group II for such Distribution Date and the denominator of which is
the Principal Funds for both Loan Groups for such Distribution Date.

                                       19
<PAGE>

         GROUP II SEQUENTIAL TRIGGER EVENT: A trigger event exists if, on any
Distribution Date before the 37th Distribution Date, the aggregate amount of
Realized Losses incurred since the Cut-off Date through the last day of the
related Prepayment Period divided by the aggregate Stated Principal Balance of
the Mortgage Loans as of the Cut-off Date exceeds 3.25% or if, on or after the
37th Distribution Date, a Trigger Event is in effect.

         INDEMNIFIED PERSONS: The Trustee, the Master Servicer, the Trust Fund
and their officers, directors, agents and employees and, with respect to the
Trustee, any separate co-trustee and its officers, directors, agents and
employees.

         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 CERTIFICATION: The certification substantially in the form of
Exhibit One to the related Custodial Agreement.

         INITIAL CERTIFICATE PRINCIPAL BALANCE: With respect to any Certificate,
the Certificate Principal Balance of such Certificate or any predecessor
Certificate on the Closing Date.

         INSTITUTIONAL ACCREDITED INVESTOR: Any Person meeting the requirements
of Rule 501(a)(l), (2), (3) or (7) of Regulation D under the Securities Act or
any entity all of the equity holders in which come within such paragraphs.

         INSURANCE PROCEEDS: Proceeds paid in respect of the Mortgage Loans
pursuant to any Insurance Policy and any other insurance policy covering a
Mortgage Loan, to the extent such proceeds are payable to the mortgagee under
the Mortgage, the Master Servicer or the trustee under the deed of trust and are
not applied to the restoration of the related Mortgaged Property or released to
the Mortgagor in accordance with the procedures that the Master Servicer would
follow in servicing mortgage loans held for its own account, in each case other
than any amount included in such Insurance Proceeds in respect of Insured
Expenses.

         INSURED EXPENSES: Expenses covered by any insurance policy with respect
to the Mortgage Loans.

         INTEREST CARRY FORWARD AMOUNT: As of any Distribution Date and with
respect to each Class of Certificates (other than the Class CE, Class P and the
Residual Certificates), the sum of (i) the excess of (a) the Current Interest
for such Class with respect to such Distribution Date and any prior Distribution
Dates over (b) the amount actually distributed to such Class of Certificates
with respect to interest on such Distribution Dates and (ii) interest thereon
(to the extent permitted by applicable law) at the applicable Pass-Through Rate
for such Class for the related Accrual Period including the Accrual Period
relating to such Distribution Date.

         INTEREST DETERMINATION DATE: Shall mean the second LIBOR Business Day
preceding the commencement of each Accrual Period.

         INTEREST FUNDS: With respect to each Loan Group and any Distribution
Date (i) the sum, without duplication, of (a) all scheduled interest during the
related Due Period with respect to the

                                       20
<PAGE>

related Mortgage Loans less the Servicing Fee, the Trustee Fee and the LPMI Fee,
if any, (b) all Advances relating to interest with respect to the related
Mortgage Loans made on or prior to the related Distribution Account Deposit
Date, (c) all Compensating Interest with respect to the related Mortgage Loans
and required to be remitted by the Master Servicer pursuant to this Agreement
with respect to such Distribution Date, (d) Liquidation Proceeds and Subsequent
Recoveries with respect to the related Mortgage Loans collected during the
related Prepayment Period (to the extent such Liquidation Proceeds and
Subsequent Recoveries relate to interest), and (e) all amounts relating to
interest with respect to each Mortgage Loan in such Loan Group repurchased by
the Seller pursuant to Sections 2.02 and 2.03 and by EMC pursuant to Section
3.18, in each case to the extent remitted by the Master Servicer to the
Distribution Account pursuant to this Agreement minus (ii) all amounts relating
to interest required to be reimbursed pursuant to Sections 4.02 and 4.05 or as
otherwise set forth in this Agreement.

         INTERIM CERTIFICATION: The certification substantially in the form of
Exhibit Two to the related Custodial Agreement.

         LASALLE: LaSalle Bank National Association, and any successor thereto.

         LASALLE CUSTODIAL AGREEMENT: The Custodial Agreement, dated as November
30, 2004, among the Depositor, the Seller, the Master Servicer, the Trustee and
LaSalle Bank National Association as Custodian relating to the Mortgage Loans
identified in such Custodial Agreement.

         LAST SCHEDULED DISTRIBUTION DATE: Solely for purposes of the face of
the Certificates as follows: with respect to the Certificates, other than the
Class I-A-1 Certificates and Class I-A-2 Certificates, the Distribution Date in
December 2034; with respect to the Class I-A-1 Certificates and Class I-A-2
Certificates, the Distribution Date in November 2024 and May 2031, respectively.

         LATEST POSSIBLE MATURITY DATE: The Distribution Date in the month
following the final scheduled maturity date of the Mortgage Loan in the Trust
Fund having the latest scheduled maturity date as of the Cut-off Date. For
purposes of the Treasury Regulations under Code section 860A through 860G, the
latest possible maturity date of each regular interest issued by REMIC I, REMIC
II, REMIC III and REMIC IV shall be the Latest Possible Maturity Date.

         LIBOR BUSINESS DAY: Shall mean a day on which banks are open for
dealing in foreign currency and exchange in London and New York City.

         LIQUIDATED LOAN: With respect to any Distribution Date, a defaulted
Mortgage Loan that has been liquidated through deed-in-lieu of foreclosure,
foreclosure sale, trustee's sale or other realization as provided by applicable
law governing the real property subject to the related Mortgage and any security
agreements and as to which the Master Servicer has made a Final Recovery
Determination with respect thereto.

         LIQUIDATION PROCEEDS: Amounts, other than Insurance Proceeds, received
in connection with the partial or complete liquidation of a Mortgage Loan,
whether through trustee's sale, foreclosure sale or otherwise, or in connection
with any condemnation or partial release of a Mortgaged Property and any other
proceeds received with respect to an REO Property, less the

                                       21
<PAGE>

sum of related unreimbursed Advances, Servicing Fees and Servicing Advances and
all expenses of liquidation, including property protection expenses and
foreclosure and sale costs, including court and reasonable attorneys fees.

         LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage, the
numerator of which is the original principal balance of the related Mortgage
Loan and the denominator of which is the Appraised Value of the related
Mortgaged Property.

         LOAN GROUP: Any of Loan Group I or Loan Group II.

         LOAN GROUP I: The Mortgage Loans included as such on the Mortgage Loan
Schedule.

         LOAN GROUP II: The Mortgage Loans included as such on the Mortgage Loan
Schedule.

         LPMI FEE: The fee payable to the insurer for each Mortgage Loan subject
to an LPMI Policy as set forth in such LPMI Policy.

         LPMI POLICY: A policy of mortgage guaranty insurance issued by an
insurer meeting the requirements of Fannie Mae and Freddie Mac in which the
Master Servicer or the related subservicer of the related Mortgage Loan is
responsible for the payment of the LPMI Fee thereunder from collections on the
related Mortgage Loan.

         MAJORITY CLASS CE CERTIFICATEHOLDER: The Holder of a 50.01% or greater
Percentage Interest in the Class CE Certificates.

         MARKER RATE: With respect to the Class CE Interest and any Distribution
Date, a per annum rate equal to two (2) times the weighted average of the
Uncertificated REMIC I Pass-Through Rates for the REMIC I Regular Interests
(other than REMIC I Regular Interests AA, 1A, 1B, 2A, 2B, XX and P), with the
rate on each such REMIC I Regular Interest (other than REMIC I Regular Interest
ZZ) subject to a cap equal to the lesser of (i) the related One-Month LIBOR
Pass-Through Rate for the Corresponding Certificate and (ii) the Net Rate Cap
for the Corresponding Certificate for the purpose of this calculation for such
Distribution Date and with the rate on REMIC I Regular Interest ZZ subject to a
cap of zero for the purpose of this calculation.

         MASTER SERVICER: EMC Mortgage Corporation, in its capacity as master
servicer, and its successors and assigns.

         MASTER SERVICER CERTIFICATION: A written certification covering
servicing of the Mortgage Loans by the Master Servicer and signed by an officer
of the Master Servicer that complies with (i) the Sarbanes-Oxley Act of 2002, as
amended from time to time, and (ii) the February 21, 2003 Statement by the Staff
of the Division of Corporation Finance of the Securities and Exchange Commission
Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and
15d-14, as in effect from time to time; provided that if, after the Closing Date
(a) the Sarbanes-Oxley Act of 2002 is amended, (b) the Statement referred to in
clause (ii) is modified or superceded by any subsequent statement, rule or
regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (c) any future releases, rules and regulations are
published by the Securities and Exchange Commission from time to time

                                       22
<PAGE>

pursuant to the Sarbanes-Oxley Act of 2002, which in any such case affects the
form or substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer,
materially more onerous than the form of the required certification as of the
Closing Date, the Master Servicer Certification shall be as agreed to by the
Master Servicer, the Depositor and the Seller following a negotiation in good
faith to determine how to comply with any such new requirements.

         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.

         MAXIMUM UNCERTIFICATED ACCRUED INTEREST DEFERRAL AMOUNT: With respect
to any Distribution Date, the excess of (i) accrued interest at the
Uncertificated REMIC I Pass-Through Rate applicable to REMIC I Regular Interest
ZZ for such Distribution Date on a balance equal to the Uncertificated Principal
Balance of REMIC I Regular Interest ZZ minus the REMIC I Overcollateralized
Amount, in each case for such Distribution Date, over (ii) the aggregate amount
of Uncertificated Accrued Interest for such Distribution Date on the REMIC I
Regular Interests (other than REMIC I Regular Interests AA, ZZ, 1A, 1B, 2A, 2B,
XX and P), with the rate on each such REMIC I Regular Interest subject to a cap
equal to the lesser of (x) the One-Month LIBOR Pass-Through Rate for the
Corresponding Certificate and (y) the Net Rate Cap for the Corresponding
Certificate for the purpose of this calculation for such Distribution Date.

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

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

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

         MINIMUM MORTGAGE RATE: With respect to each Adjustable Rate Mortgage
Loan, the percentage set forth in the related Mortgage Note as the minimum
Mortgage Rate thereunder.

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

         MONTHLY STATEMENT: The statement delivered to the Certificateholders
pursuant to Section 5.06.

         MOODY'S: Moody's Investors Service, Inc., and any successor thereto.

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

                                       23
<PAGE>

         MORTGAGE FILE: The mortgage documents listed in Section 2.01 hereof
pertaining to a particular Mortgage Loan and any additional documents delivered
to the related Custodian to be added to the Mortgage File pursuant to this
Agreement and the related Custodial Agreement.

         MORTGAGE LOANS: Such of the Mortgage Loans transferred and assigned to
the Trustee pursuant to the provisions hereof, as from time to time are held as
a part of the Trust Fund (including any REO Property), the mortgage loans so
held being identified in the Mortgage Loan Schedule, notwithstanding foreclosure
or other acquisition of title of the related Mortgaged Property.

         MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement,
dated as of November 30, 2004, between the Seller, as seller and the Depositor,
as purchaser, in the form attached hereto as Exhibit L.

         MORTGAGE LOAN PURCHASE PRICE: The price, calculated as set forth in
Section 10.01, to be paid in connection with the repurchase of the Mortgage
Loans pursuant to Section 10.01.

         MORTGAGE LOAN SCHEDULE: The list of Mortgage Loans (as from time to
time amended by the Seller or the Master Servicer to reflect the deletion of
Deleted Mortgage Loans and the addition of Replacement Mortgage Loans pursuant
to the provisions of this Agreement) transferred to the Trustee as part of the
Trust Fund and from time to time subject to this Agreement, the initial Mortgage
Loan Schedule being attached hereto as Exhibit B, setting forth the following
information with respect to each Mortgage Loan:

                  (i) the loan number;

                  (ii) the Mortgage Rate in effect as of the Cut-off Date;

                  (iii) the Servicing Fee Rate;

                  (iv) the Trustee Fee Rate;

                  (v) the LPMI Fee, if applicable;

                  (vi) the Net Mortgage Rate in effect as of the Cut-off Date;

                  (vii) the maturity date;

                  (viii) the original principal balance;

                  (ix) the Cut-off Date Principal Balance;

                  (x) the original term;

                  (xi) the remaining term;

                  (xii) the property type;

                                       24
<PAGE>

                  (xiii) the MIN with respect to each MOM Loan;

                  (xiv) with respect to each Adjustable Rate Mortgage Loan, the
         Minimum Mortgage Rate;

                  (xv) with respect to each Adjustable Rate Mortgage Loan, the
         Maximum Mortgage Rate;

                  (xvi) with respect to each Adjustable Rate Mortgage Loan, the
         Gross Margin;

                  (xvii) with respect to each Adjustable Rate Mortgage Loan, the
         next Adjustment Date;

                  (xviii) with respect to each Adjustable Rate Mortgage Loan,
         the Periodic Rate Cap;

                  (xix) the Loan Group; and

                  (xx) a code indicating whether such Mortgage Loan is a first
         lien Mortgage Loan or a second lien Mortgage Loan.

Such schedule shall also set forth the aggregate Cut-off Date Principal Balance
for all of the Mortgage Loans.

         MORTGAGE NOTE: The original executed note or other evidence of
indebtedness of a Mortgagor under a Mortgage Loan.

         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 shall be the rate set forth in the Mortgage Loan
Schedule as the Mortgage 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 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.

         MORTGAGOR: The obligors on a Mortgage Note.

                                       25
<PAGE>

         NET MORTGAGE RATE: As to each Mortgage Loan, and at any time, the per
annum rate equal to the Mortgage Rate less the sum of (i) the Servicing Fee
Rate, (ii) the Trustee Fee Rate and (iii) the rate at which the LPMI Fee is
calculated, if any.

         NET RATE CAP: With respect to the Class I-A-1, Class I-A-2 and Class
I-A-3 Certificates and any Distribution Date, a rate per annum equal to the
product of (x) the weighted average of the Net Mortgage Rates on the then
outstanding Mortgage Loans in Loan Group I, weighted based on their Stated
Principal Balances as of the first day of the calendar month preceding the month
in which the Distribution Date occurs and (y) 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, however, such rate
shall be the equivalent of the foregoing, expressed as the weighted average of
(adjusted for the actual number of days elapsed in the related Accrual Period)
the Uncertificated REMIC I Pass-Through Rate on REMIC I Regular Interest 1B,
weighted on the basis of the Uncertificated Principal Balance of such REMIC I
Regular Interest.

         With respect to the Class II-A-1 Certificates and Class II-A-2
Certificates and any Distribution Date, a rate per annum equal to the product of
(x) the weighted average of the Net Mortgage Rates on the then outstanding
Mortgage Loans in Loan Group II, weighted based on their Stated Principal
Balances as of the first day of the calendar month preceding the month in which
the Distribution Date occurs and (y) 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, however, such rate shall be the
equivalent of the foregoing, expressed as the weighted average of (adjusted for
the actual number of days elapsed in the related Accrual Period) the
Uncertificated REMIC I Pass-Through Rate on REMIC I Regular Interest 2B,
weighted on the basis of the Uncertificated Principal Balance of such REMIC I
Regular Interest.

         With respect to the Class M Certificates and any Distribution Date, a
rate per annum equal to the product of (x) the weighted average of the weighted
average of the Net Mortgage Rates on the then outstanding Mortgage Loans in each
Loan Group, weighted in proportion to the results of subtracting from the
aggregate Stated Principal Balance of each such Loan Group as of the first day
of the calendar month preceding the month in which the Distribution Date, the
aggregate Certificate Principal Balance of the related Class or Classes of
Senior Certificates and (y) 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, however, such rate shall be the
equivalent of the foregoing, expressed as the weighted average (adjusted for the
actual number of days elapsed in the related Accrual Period) of the
Uncertificated REMIC I Pass-Through Rates on (a) REMIC I Regular Interest 1A,
subject to a cap and a floor equal to the Uncertificated REMIC I Pass-Through
Rate on REMIC I Regular Interest 1B, and (b) REMIC I Regular Interest 2A,
subject to a cap and a floor equal to the Uncertificated REMIC I Pass-Through
Rate on REMIC I Regular Interest 2B, weighted on the basis of the Uncertificated
Balance of each such REMIC I Regular Interest.

         NON-BOOK-ENTRY CERTIFICATE: Any Certificate other than a Book-Entry
Certificate.

                                       26
<PAGE>

         NONRECOVERABLE ADVANCE: Any portion of an Advance previously made or
proposed to be made by the Master Servicer pursuant to this Agreement, that, in
the good faith judgment of the Master Servicer, will not or, in the case of a
proposed advance, would not, be ultimately recoverable by it from the related
Mortgagor, related Liquidation Proceeds, Insurance Proceeds or otherwise.

         NOTIONAL BALANCE: With respect to each Distribution Date and the Yield
Maintenance Agreements relating to the Class I-A, Class II-A and Class M
Certificates, the lesser of (i) the aggregate Certificate Principal Balance of
the Class I-A, Class II-A or the Class M Certificates, respectively, at the
beginning of the related calculation period, and (ii) the notional balance for
the related calculation period as set forth in the related confirmation set
forth in Exhibit M.

         OFFERED CERTIFICATES: Any of the Class I-A-1, Class I-A-2, Class I-A-3,
Class II-A-1, Class II-A-2, Class M-1, Class M-2, Class M-3, Class M-4, Class
M-5 and Class M-6 Certificates.

         OFFICER'S CERTIFICATE: A certificate (i) signed by the Chairman of the
Board, the Vice Chairman of the Board, the President, a Vice President (however
denominated), an Assistant Vice President, the Treasurer, the Secretary, or one
of the assistant treasurers or assistant secretaries of the Depositor or the
Master Servicer (or any other officer customarily performing functions similar
to those performed by any of the above designated officers and also to whom,
with respect to a particular matter, such matter is referred because of such
officer's knowledge of and familiarity with a particular subject) or (ii), if
provided for in this Agreement, signed by a Servicing Officer, as the case may
be, and delivered to the Depositor, the Seller and/or the Trustee, as the case
may be, as required by this Agreement.

         ONE-MONTH LIBOR: With respect to any Accrual Period, the rate
determined by the Trustee on the related Interest Determination Date on the
basis of the rate for U.S. dollar deposits for one month that appears on
Telerate Screen Page 3750 as of 11:00 a.m. (London time) on such Interest
Determination Date; provided that the parties hereto acknowledge that One-Month
LIBOR for the first Accrual Period shall equal 2.18% per annum. If such rate
does not appear on such page (or such other page as may replace that page on
that service, or if such service is no longer offered, such other service for
displaying One-Month LIBOR or comparable rates as may be reasonably selected by
the Trustee), One-Month LIBOR for the applicable Accrual Period will be the
Reference Bank Rate. If no such quotations can be obtained by the Trustee and no
Reference Bank Rate is available, One-Month LIBOR will be One-Month LIBOR
applicable to the preceding Accrual Period. The establishment of One-Month LIBOR
on each Interest Determination Date by the Trustee and the Trustee's calculation
of the rate of interest applicable to the Class A Certificates and Class M
Certificates for the related Accrual Period shall, in the absence of manifest
error, be final and binding.

         ONE-MONTH LIBOR PASS-THROUGH RATE: With respect to the Class I-A-1
Certificates and, for purposes of the definition of "Marker Rate" and "Maximum
Uncertificated Accrued Interest Deferral Amount", REMIC I Regular Interest
I-A-1, a per annum rate equal to One-Month LIBOR plus the related Certificate
Margin.

                                       27
<PAGE>

         With respect to the Class I-A-2 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest I-A-2, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class I-A-3 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest I-A-3, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class II-A-1 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest II-A-1, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class II-A-2 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest II-A-2, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-1 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-1, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-2 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-2, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-3 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-3, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-4 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-4, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-5 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-5, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-6 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-6, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

         With respect to the Class M-7 Certificates and, for purposes of the
definition of "Marker Rate" and "Maximum Uncertificated Accrued Interest
Deferral Amount", REMIC I Regular Interest M-7, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.

                                       28
<PAGE>

         OPINION OF COUNSEL: A written opinion of counsel, who may be counsel
for the Seller, the Depositor or the Master Servicer, reasonably acceptable to
each addressee of such opinion; provided that with respect to Section 2.05,
7.05, 7.07 or 11.01, or the interpretation or application of the REMIC
Provisions, such counsel must (i) in fact be independent of the Seller,
Depositor and the Master Servicer, (ii) not have any direct financial interest
in the Seller, the Depositor or the Master Servicer or in any affiliate of
either, and (iii) not be connected with the Seller, the Depositor or the Master
Servicer as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.

         OPTIONAL TERMINATION: The termination of the Trust Fund created
hereunder as a result of the purchase of all of the Mortgage Loans and any REO
Property pursuant to the last sentence of Section 10.01 hereof.

         OPTIONAL TERMINATION DATE: The Distribution Date on which the Stated
Principal Balance of all of the Mortgage Loans is equal to or less than 10% of
the Stated Principal Balance of all of the Mortgage Loans as of the Cut-off
Date.

         OPTIONAL TERMINATION DATE: The Distribution Date on which the Stated
Principal Balance of all of the Mortgage Loans is equal to or less than 10% of
the Stated Principal Balance of all of the Mortgage Loans as of the Cut-off
Date.

         ORIGINAL VALUE: The value of the property underlying a Mortgage Loan
based, in the case of the purchase of the underlying Mortgaged Property, on the
lower of an appraisal or the sales price of such property or, in the case of a
refinancing, on an appraisal.

         OTS: The Office of Thrift Supervision.

         OUTSTANDING: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:

         (a) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and

         (b) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant to this
Agreement.

         OUTSTANDING MORTGAGE LOAN: As of any date of determination, a Mortgage
Loan with a Stated Principal Balance greater than zero that was not the subject
of a Principal Prepayment in full, and that did not become a Liquidated Loan,
prior to the end of the related Prepayment Period.

         OVERCOLLATERALIZATION AMOUNT: With respect to any Distribution Date,
the excess, if any, of the aggregate Stated Principal Balances of the Mortgage
Loans as of the last day of the related Due Period (including any reduction due
to Realized Losses) over the Certificate Principal Balances of the Certificates
on such Distribution Date (after taking into account the payment of principal
other than any Extra Principal Distribution Amount on such Certificates).

         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, if any, of (i) the Overcollateralization Amount for
such Distribution Date (assuming that 100% of the Principal Remittance Amount is
applied as a principal payment on such Distribution Date) over

                                       29
<PAGE>

(ii) the Overcollateralization Target Amount for such Distribution Date (with
the amount pursuant to clause (y) deemed to be $0 if the Overcollateralization
Amount is less than or equal to the Overcollateralization Target Amount on that
Distribution Date).

         OVERCOLLATERALIZATION TARGET AMOUNT: With respect to any Distribution
Date (a) prior to the Stepdown Date, 2.30% of the aggregate Stated Principal
Balance of the Mortgage Loans as of the Cut-off Date, (b) on or after the
Stepdown Date and if a Trigger Event is not in effect, the greater of (i) the
lesser of (1) 2.30% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date and (2) 4.60% of the then current aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period and (ii) $3,062,951 or (c) on or after the Stepdown Date and if a Trigger
Event is in effect, the Overcollateralization Target Amount for the immediately
preceding Distribution Date.

         OWNERSHIP INTEREST: As to any Certificate, any ownership 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.

         PASS-THROUGH RATE: With respect to the Class A Certificates and Class M
Certificates and any Distribution Date, a rate per annum equal to the lesser of
(i) the related One-Month LIBOR Pass-Through Rate for such Distribution Date and
(ii) the related Net Rate Cap for such Distribution Date. The initial
Pass-Through Rates for the Class I-A-1, Class I-A-2, Class I-A-3, Class II-A-1,
Class II-A-2, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6
and Class M-7 Certificates will be 2.36%, 2.52%, 2.70%, 2.53%, 2.58%, 2.83%,
3.33%, 3.53%, 3.88%, 3.98%, 5.28% and 6.18%, respectively.

         With respect to the Class CE Interest and any Distribution Date, a rate
per annum equal to the percentage equivalent of a fraction, the numerator of
which is the sum of the amount determined for each REMIC I Regular Interest
(other than REMIC I Regular Interests 1A, 1B, 2A, 2B, XX and P) of the excess of
the Uncertificated REMIC I Pass-Through Rate for such REMIC I Regular Interest
over the Marker Rate, applied to a notional amount equal to the Uncertificated
Principal Balance of such REMIC I Regular Interest and the denominator of which
is the aggregate Uncertificated Principal Balances of such REMIC I Regular
Interests.

         With respect to the Class CE Certificates: the Class CE Certificates
shall not have a Pass-Through Rate, but Current Interest for such Certificates
and each Distribution Date shall be an amount equal to 100% of the amounts
distributable to the Class CE Interest for such Distribution Date.

         With respect to the Class P Certificates, 0.00% per annum.

         PERCENTAGE INTEREST: With respect to any Certificate of a specified
Class, the Percentage Interest set forth on the face thereof or the percentage
obtained by dividing the Denomination of such Certificate by the aggregate of
the Denominations of all Certificates of the such Class.

         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

                                       30
<PAGE>

such Adjustment Date from the Mortgage Rate in effect immediately prior to such
Adjustment Date.

         PERMITTED INVESTMENTS: At any time, any one or more of the following
obligations and securities:

                  (i) obligations of the United States or any agency thereof,
         provided such obligations are backed by the full faith and credit of
         the United States;

                  (ii) general obligations of or obligations guaranteed by any
         state of the United States or the District of Columbia receiving the
         highest long-term debt rating of each Rating Agency, or such lower
         rating as will not result in the downgrading or withdrawal of the
         ratings then assigned to the Certificates by each Rating Agency, as
         evidenced in writing;

                  (iii) commercial or finance company paper which is then
         receiving the highest commercial or finance company paper rating of
         each Rating Agency, or such lower rating as will not result in the
         downgrading or withdrawal of the ratings then assigned to the
         Certificates by each Rating Agency, as evidenced in writing;

                  (iv) certificates of deposit, demand or time deposits, or
         bankers' acceptances issued by any depository institution or trust
         company incorporated under the laws of the United States or of any
         state thereof and subject to supervision and examination by federal
         and/or state banking authorities (including the Trustee in its
         commercial banking capacity), provided that the commercial paper and/or
         long term unsecured debt obligations of such depository institution or
         trust company are then rated one of the two highest long-term and the
         highest short-term ratings of each such Rating Agency for such
         securities, or such lower ratings as will not result in the downgrading
         or withdrawal of the rating then assigned to the Certificates by any
         Rating Agency, as evidenced in writing;

                  (v) guaranteed reinvestment agreements issued by any bank,
         insurance company or other corporation containing, at the time of the
         issuance of such agreements, such terms and conditions as will not
         result in the downgrading or withdrawal of the rating then assigned to
         the Certificates by any such Rating Agency, as evidenced in writing;

                  (vi) repurchase obligations with respect to any security
         described in clauses (i) and (ii) above, in either case entered into
         with a depository institution or trust company (acting as principal)
         described in clause (v) above;

                  (vii) securities (other than stripped bonds, stripped coupons
         or instruments sold at a purchase price in excess of 115% of the face
         amount thereof) bearing interest or sold at a discount issued by any
         corporation incorporated under the laws of the United States or any
         state thereof which, at the time of such investment, have one of the
         two highest short term ratings of each Rating Agency (except if the
         Rating Agency is Moody's, such rating shall be the highest commercial
         paper rating of Moody's for any such securities), or such lower rating
         as will not result in the downgrading or withdrawal of the rating then
         assigned to the Certificates by any Rating Agency, as evidenced by a
         signed writing delivered by each Rating Agency;

                  (viii) interests in any money market fund (including any such
         fund managed or advised by the Trustee or any affiliate thereof) which
         at the date of acquisition of the interests in such fund and throughout
         the time such interests are held in such fund has the highest
         applicable short term rating by each Rating Agency or such lower rating
         as will not result in the downgrading or withdrawal of the ratings then

                                       31
<PAGE>

         assigned to the Certificates by each Rating Agency, as evidenced in
         writing;

                  (ix) short term investment funds sponsored by any trust
         company or banking association incorporated under the laws of the
         United States or any state thereof (including any such fund managed or
         advised by the Trustee or the Master Servicer or any affiliate thereof)
         which on the date of acquisition has been rated by each Rating Agency
         in their respective highest applicable rating category or such lower
         rating as will not result in the downgrading or withdrawal of the
         ratings then assigned to the Certificates by each Rating Agency, as
         evidenced in writing; and

                  (x) such other investments having a specified stated maturity
         and bearing interest or sold at a discount acceptable to each Rating
         Agency and as will not result in the downgrading or withdrawal of the
         rating then assigned to the Certificates by any Rating Agency, as
         evidenced by a signed writing delivered by each Rating Agency;

provided, that no such instrument shall be a Permitted Investment if such
instrument (i) evidences the right to receive interest only payments with
respect to the obligations underlying such instrument, (ii) is purchased at a
premium or (iii) is purchased at a deep discount; provided further that no such
instrument shall be a Permitted Investment (A) if such instrument evidences
principal and interest payments derived from obligations underlying such
instrument and the interest payments with respect to such instrument provide a
yield to maturity of greater than 120% of the yield to maturity at par of such
underlying obligations, or (B) if it may be redeemed at a price below the
purchase price (the foregoing clause (B) not to apply to investments in units of
money market funds pursuant to clause (viii) above); provided further that no
amount beneficially owned by any REMIC may be invested in investments (other
than money market funds) treated as equity interests for federal income tax
purposes, unless the Master Servicer shall receive an Opinion of Counsel, at the
expense of the Master Servicer, to the effect that such investment will not
adversely affect the status of any such REMIC as a REMIC under the Code or
result in imposition of a tax on any such REMIC. Permitted Investments that are
subject to prepayment or call may not be purchased at a price in excess of par.

         PERMITTED TRANSFEREE: Any person other than (i) the United States, any
State or political subdivision thereof, any possession of the United States or
any agency or instrumentality of any of the foregoing, (ii) a foreign
government, International Organization or any agency or instrumentality of
either of the foregoing, (iii) an organization (except certain farmers'
cooperatives described in section 521 of the Code) that is exempt from tax
imposed by Chapter 1 of the Code (including the tax imposed by section 511 of
the Code on unrelated business taxable income) on any excess inclusions (as
defined in section 860E(c)(1) of the Code) with respect to

                                       32
<PAGE>

any Residual Certificate, (iv) rural electric and telephone cooperatives
described in section 1381(a)(2)(C) of the Code, (v) a Person that is not a
citizen or resident of the United States, a corporation, partnership (other than
a partnership that has any direct or indirect foreign partners) or other entity
(treated as a corporation or a partnership for federal income tax purposes),
created or organized in or under the laws of the United States, any state
thereof or the District of Columbia, an estate whose income from sources without
the United States is includible in gross income for United States federal income
tax purposes regardless of its connection with the conduct of a trade or
business within the United States, or 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 trustor and (vi) any other Person so designated by
the Trustee based upon an Opinion of Counsel addressed to the Trustee (which
shall not be an expense of the Trustee) that states that the Transfer of an
Ownership Interest in a Residual Certificate to such Person may cause REMIC I,
REMIC II, REMIC III or REMIC IV to fail to qualify as a REMIC at any time that
any Certificates are Outstanding. The terms "United States," "State" and
"International Organization" shall have the meanings set forth in section 7701
of the Code or successor provisions. A corporation will not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof for these purposes if all of its activities are subject to tax and, with
the exception of Freddie Mac, a majority of its board of directors is not
selected by such government unit.

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

         PREPAYMENT ASSUMPTION: The applicable rate of prepayment as described
in the Prospectus Supplement relating to each Class of Offered Certificates.

         PREPAYMENT CHARGE: Any prepayment premium, penalty or charge payable by
a Mortgagor in connection with any Principal Prepayment on a Mortgage Loan
pursuant to the terms of the related Mortgage Note.

         PREPAYMENT INTEREST SHORTFALL: With respect to any Distribution Date,
for each Mortgage Loan that was the subject of a partial Principal Prepayment, a
Principal Prepayment in full, or that became a Liquidated Loan during the
related Prepayment Period, (other than a Principal Prepayment in full resulting
from the purchase of a Mortgage Loan pursuant to Section 2.02, 2.03, 3.18 or
10.01 hereof), the amount, if any, by which (i) one month's interest at the
applicable Net Mortgage Rate on the Stated Principal Balance of such Mortgage
Loan immediately prior to such prepayment (or liquidation) or in the case of a
partial Principal Prepayment on the amount of such prepayment (or liquidation
proceeds) exceeds (ii) the amount of interest paid or collected in connection
with such Principal Prepayment or such liquidation proceeds less the sum of (a)
the Trustee Fee, (b) the Servicing Fee and (c) the LPMI Fee, if any.

         PREPAYMENT PERIOD: As to any Distribution Date, the period commencing
on the 16th day of the month prior to the month in which the related
Distribution Date occurs and ending on the 15th day of the month in which such
Distribution Date occurs.

                                       33
<PAGE>

         PRIMARY MORTGAGE INSURANCE POLICY: Any primary mortgage guaranty
insurance policy issued in connection with a Mortgage Loan which provides
compensation to a Mortgage Note holder in the event of default by the obligor
under such Mortgage Note or the related security instrument, if any or any
replacement policy therefor through the related Accrual Period for such Class
relating to a Distribution Date.

         PRINCIPAL DISTRIBUTION AMOUNT: With respect to each Distribution Date,
an amount equal to (x) the Principal Funds for such Distribution Date plus (y)
any Extra Principal Distribution Amount for such Distribution Date, less (z) any
Overcollateralization Release Amount.

         PRINCIPAL FUNDS: With respect to each Loan Group and any Distribution
Date, (i) the sum, without duplication, of (a) all scheduled principal collected
during the related Due Period, (b) all Advances relating to principal made on or
before the Distribution Account Deposit Date, (c) Principal Prepayments
exclusive of prepayment charges or penalties collected during the related
Prepayment Period, (d) the Stated Principal Balance of each Mortgage Loan in the
related Loan Group that was repurchased by the Seller pursuant to Sections 2.02
and 2.03 or by EMC pursuant to Section 3.18, (e) the aggregate of all
Substitution Adjustment Amounts for the related Determination Date in connection
with the substitution of Mortgage Loans pursuant to Section 2.03(c), (f) all
Liquidation Proceeds and Subsequent Recoveries collected during the related
Prepayment Period (to the extent such Liquidation Proceeds and Subsequent
Recoveries relate to principal), in each case to the extent remitted by the
Master Servicer to the Distribution Account pursuant to this Agreement and (g)
amounts in respect of principal paid by the Majority Class CE Certificateholder
or the Master Servicer, as applicable, pursuant to Section 10.01, minus (ii) all
amounts required to be reimbursed pursuant to Sections 4.02 and 4.05 or as
otherwise set forth in this Agreement.

         PRINCIPAL PREPAYMENT: Any Mortgagor payment or other recovery of (or
proceeds with respect to) principal on a Mortgage Loan (including loans
purchased or repurchased under Sections 2.02, 2.03, 3.18 and 10.01 hereof) that
is received in advance of its scheduled Due Date and is not accompanied by an
amount as to interest representing scheduled interest due on any date or dates
in any month or months subsequent to the month of prepayment. Partial Principal
Prepayments shall be applied by the Master Servicer, as appropriate, in
accordance with the terms of the related Mortgage Note.

         PRINCIPAL REMITTANCE AMOUNT: With respect to each Distribution Date,
the sum of the amounts listed in clauses (a) through (f) of the definition of
Principal Funds.

         PRIVATE CERTIFICATES: Any of the Class M-7, Class P, Class CE and
Residual Certificates.

         PROSPECTUS SUPPLEMENT: The Prospectus Supplement dated November 23,
2004 relating to the public offering of the Class I-A-1, Class I-A-2, Class
I-A-3, Class II-A-1, Class II-A-2, Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5 and Class M-6 Certificates.

         PROTECTED ACCOUNT: The separate Eligible Account established and
maintained by the Master Servicer with respect to the Mortgage Loans and REO
Property in accordance with Section 4.01 hereof.

                                       34
<PAGE>

         PUD: A Planned Unit Development.

         PURCHASE PRICE: With respect to any Mortgage Loan (x) required to be
repurchased by the Seller pursuant to Section 2.02 or 2.03 hereof or (y) that
EMC has a right to purchase pursuant to Section 3.18 hereof, an amount equal to
the sum of (i) 100% of the outstanding principal balance of the Mortgage Loan as
of the date of such purchase (or if the related Mortgaged Property was acquired
with respect thereto, 100% of the Outstanding Principal Balance at the date of
the acquisition), plus (ii) accrued interest thereon at the applicable Mortgage
Rate through the first day of the month in which the Purchase Price is to be
distributed to Certificateholders, reduced by any portion of the Servicing Fee,
Servicing Advances and Advances payable to the purchaser of the Mortgage Loan
plus (iii) any costs and damages (if any) incurred by the Trust in connection
with any violation of such Mortgage Loan of any anti-predatory lending laws.

         QIB: A Qualified Institutional Buyer as defined in Rule 144A
promulgated under the Securities Act.

         RATING AGENCY: Each of Moody's and S&P. If any such organization or its
successor is no longer in existence, "Rating Agency" shall be a nationally
recognized statistical rating organization, or other comparable Person,
designated by the Depositor, notice of which designation shall be given to the
Trustee. References herein to a given rating category of a Rating Agency shall
mean such rating category without giving effect to any modifiers.

         REALIZED LOSS: With respect to each Mortgage Loan as to which a Final
Recovery Determination has been made, an amount (not less than zero) equal to
(i) the unpaid principal balance of such Mortgage Loan as of the commencement of
the calendar month in which the Final Recovery Determination was made, plus (ii)
accrued interest from the Due Date as to which interest was last paid by the
Mortgagor through the end of the calendar month in which such Final Recovery
Determination was made, calculated in the case of each calendar month during
such period (A) at an annual rate equal to the annual rate at which interest was
then accruing on such Mortgage Loan and (B) on a principal amount equal to the
Stated Principal Balance of such Mortgage Loan as of the close of business on
the Distribution Date during such calendar month, minus (iii) the proceeds, if
any, received in respect of such Mortgage Loan during the calendar month in
which such Final Recovery Determination was made, net of amounts that are
payable therefrom to the Master Servicer pursuant to this Agreement. In
addition, to the extent the Master Servicer receives Subsequent Recoveries with
respect to any Mortgage Loan, the amount of the Realized Loss with respect to
that Mortgage Loan will be reduced to the extent such recoveries are distributed
to any Class of Certificates or applied to increase Excess Spread on any
Distribution Date.

         With respect to any REO Property as to which a Final Recovery
Determination has been made, an amount (not less than zero) equal to (i) the
unpaid principal balance of the related Mortgage Loan as of the date of
acquisition of such REO Property on behalf of REMIC I, plus (ii) accrued
interest from the Due Date as to which interest was last paid by the Mortgagor
in respect of the related Mortgage Loan through the end of the calendar month
immediately preceding the calendar month in which such REO Property was
acquired, calculated in the case of each calendar month during such period (A)
at an annual rate equal to the annual rate at which

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<PAGE>

interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as of
the close of business on the Distribution Date during such calendar month, plus
(iii) 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 Final Recovery Determination was
made, minus (iv) the aggregate of all unreimbursed Advances and Servicing
Advances.

         With respect to each Mortgage Loan which has become the subject of a
Deficient Valuation, the difference between the principal balance of the
Mortgage Loan outstanding immediately prior to such Deficient Valuation and the
principal balance of the Mortgage Loan as reduced by the Deficient Valuation.

         With respect to each Mortgage Loan which has become the subject of a
Debt Service Reduction, the portion, if any, of the reduction in each affected
Monthly Payment attributable to a reduction in the Mortgage Rate imposed by a
court of competent jurisdiction. Each such Realized Loss shall be deemed to have
been incurred on the Due Date for each affected Monthly Payment.

         RECORD DATE: With respect to any Distribution Date and the Offered
Certificates, so long as such Classes of Certificates are Book-Entry
Certificates, the Business Day preceding such Distribution Date, and otherwise,
the close of business on the last Business Day of the month preceding the month
in which such Distribution Date occurs. With respect to the Class M-7, Class CE,
Class P and Residual Certificates and (a) the first Distribution Date, the
Closing Date and (b) with respect to any other Distribution Date, the close of
business on the last Business Day of the month preceding the month in which such
Distribution Date occurs.

         REFERENCE BANKS: Shall mean leading banks selected by the Trustee and
engaged in transactions in Eurodollar deposits in the international Eurocurrency
market (i) with an established place of business in London, (ii) which have been
designated as such by the Trustee and (iii) which are not controlling,
controlled by, or under common control with, the Depositor, the Seller or the
Master Servicer.

         REFERENCE BANK RATE: With respect to any Accrual Period shall mean the
arithmetic mean, rounded upwards, if necessary, to the nearest whole multiple of
0.03125%, of the offered rates for United States dollar deposits for one month
that are quoted by the Reference Banks as of 11:00 a.m., New York City time, on
the related Interest Determination Date to prime banks in the London interbank
market for a period of one month in an amount approximately equal to the
aggregate Certificate Principal Balance of the Class A Certificates and Class M
Certificates for such Accrual Period, provided that at least two such Reference
Banks provide such rate. If fewer than two offered rates appear, the Reference
Bank Rate will be the arithmetic mean, rounded upwards, if necessary, to the
nearest whole multiple of 0.03125%, of the rates quoted by one or more major
banks in New York City, selected by the Trustee, as of 11:00 a.m., New York City
time, on such date for loans in United States dollars to leading European banks
for a period of one month in amounts approximately equal to the aggregate
Certificate Principal Balance of the Class A Certificates and Class M
Certificates for such Accrual Period.

                                       36
<PAGE>

         REGULAR CERTIFICATE: Any Certificate other than a Residual Certificate.

         REGULAR INTEREST: A "regular interest" in a REMIC within the meaning of
Section 860G(a)(1) of the Code.

         RELIEF ACT: The Servicemembers Civil Relief Act, as amended, or similar
state law.

         RELIEF ACT INTEREST SHORTFALL: With respect to any Distribution Date
and any Mortgage Loan, any reduction in the amount of interest collectible on
such Mortgage Loan for the most recently ended Due Period as a result of the
application of the Relief Act.

         REMAINING EXCESS SPREAD: With respect to any Distribution Date, the
Excess Spread less any Extra Principal Distribution Amount, in each case for
such Distribution Date.

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

         REMIC I: The segregated pool of assets described in Section 5.07(a).

         REMIC I INTEREST LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount (subject to adjustment based on the actual number
of days elapsed in the respective Accrual Period) equal to (a) the product of
(i) 50% of the aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) the Uncertificated REMIC I Pass-Through
Rate for REMIC I Regular Interest AA minus the Marker Rate, divided by (b) 12.

         REMIC I MARKER ALLOCATION PERCENTAGE: 50% of any amount payable or loss
attributable from the Mortgage Loans, which shall be allocated to REMIC I
Regular Interest AA, REMIC I Regular Interest I-A-1, REMIC I Regular Interest
I-A-2, REMIC I Regular Interest I-A-3, REMIC I Regular Interest II-A-1, REMIC I
Regular Interest II-A-2, REMIC I Regular Interest M-1, REMIC I Regular Interest
M-2, REMIC I Regular Interest M-3, REMIC I Regular Interest M-4, REMIC I Regular
Interest M-5, REMIC I Regular Interest M-6, REMIC I Regular Interest M-7 and
REMIC I Regular Interest ZZ.

         REMIC I OVERCOLLATERALIZATION AMOUNT: With respect to any date of
determination, (i) 0.50% of the aggregate Uncertificated Principal Balances of
the REMIC I Regular Interests (other than REMIC I Regular Interest P) minus (ii)
the aggregate of the Uncertificated Principal Balances of REMIC I Regular
Interest I-A-1, REMIC I Regular Interest I-A-2, REMIC I Regular Interest I-A-3,
REMIC I Regular Interest II-A-1, REMIC I Regular Interest II-A-2, REMIC I
Regular Interest M-1, REMIC I Regular Interest M-2, REMIC I Regular Interest
M-3, REMIC I Regular Interest M-4, REMIC I Regular Interest M-5 and REMIC I
Regular Interest M-6 and REMIC I Regular Interest M-7, in each case as of such
date of determination.

         REMIC I PRINCIPAL LOSS ALLOCATION AMOUNT: With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Stated Principal Balance of the Mortgage Loans and 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 I Regular Interest
I-A-1, REMIC I Regular Interest I-A-2, REMIC I Regular Interest I-A-3, REMIC I

                                       37
<PAGE>

Regular Interest II-A-1, REMIC I Regular Interest II-A-2, REMIC I Regular
Interest M-1, REMIC I Regular Interest M-2, REMIC I Regular Interest M-3, REMIC
I Regular Interest M-4, REMIC I Regular Interest M-5, REMIC I Regular Interest
M-6, REMIC I Regular Interest M-7 and the denominator of which is the aggregate
of the Uncertificated Principal Balances of REMIC I Regular Interest I-A-1,
REMIC I Regular Interest I-A-2, REMIC I Regular Interest I-A-3, REMIC I Regular
Interest II-A-1, REMIC I Regular Interest II-A-2, REMIC I Regular Interest M-1,
REMIC I Regular Interest M-2, REMIC I Regular Interest M-3, REMIC I Regular
Interest M-4, REMIC I Regular Interest M-5, REMIC I Regular Interest M-6, REMIC
I Regular Interest M-7 and REMIC I Regular Interest ZZ.

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

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

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

         REMIC I REGULAR INTEREST I-A-2: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest I-A-2 shall accrue
interest at the related Uncertificated REMIC I Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST I-A-3: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest I-A-3 shall accrue
interest at the related Uncertificated REMIC I Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

                                       38
<PAGE>

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

         REMIC I REGULAR INTEREST II-A-2: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest II-A-2 shall accrue
interest at the related Uncertificated REMIC I Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

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

         REMIC I REGULAR INTEREST M-2: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest M-2 shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST M-3: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest M-3 shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST M-4: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest M-4 shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST M-5: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest M-5 shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the

                                       39
<PAGE>

terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST M-6: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest M-6 shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST M-7: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest M-7 shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

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

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

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

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

                                       40
<PAGE>

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

         REMIC I REGULAR INTEREST 2A: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest 2A shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I REGULAR INTEREST 2B: One of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
Regular Interest in REMIC I. REMIC I Regular Interest 2B shall accrue interest
at the related Uncertificated REMIC I Pass-Through Rate in effect from time to
time, and shall be entitled to distributions of principal, subject to the terms
and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

         REMIC I SUB WAC ALLOCATION PERCENTAGE: 50% of any amount payable or
loss attributable from the Mortgage Loans, which shall be allocated to REMIC I
Regular Interest 1A, REMIC I Regular Interest 1B, REMIC I Regular Interest 2A,
REMIC I Regular Interest 2B and REMIC I Regular Interest XX.

         REMIC I SUBORDINATED BALANCE RATIO: The ratio among the Uncertificated
Principal Balances of each REMIC I Regular Interest ending with the designation
"A", equal to the ratio among, with respect to each such REMIC I Regular
Interest, the excess of (x) the aggregate Stated Principal Balance of the
Mortgage Loans in Loan Group I or the Mortgage Loans in Loan Group II, as
applicable over (y) the current Certificate Principal Balance of related Class A
Certificates.

         REMIC I REQUIRED OVERCOLLATERALIZATION AMOUNT: 0.50% of the
Overcollateralization Target Amount.

         REMIC II: The segregated pool of assets described in Section 5.07(a).

         REMIC II CERTIFICATE: Any Regular Certificate (other than the Class CE
Certificate and Class P Certificate).

         REMIC II CERTIFICATEHOLDER: The Holder of any REMIC II Certificate.

         REMIC II REGULAR INTEREST: Any Class A Certificate, Class M
Certificate, the Class CE Interest or Class P Interest.

                                       41
<PAGE>

         REMIC III: The segregated pool of assets consisting of the Class CE
Interest conveyed in trust to the Trustee, for the benefit of the Holders of the
Class CE Certificates and the Class RX Certificate (in respect of the Class R-3
Interest), with respect to which a separate REMIC election is to be made.

         REMIC III CERTIFICATE: Any Class CE Certificate or Class RX Certificate
(in respect of the Class R-3 Interest).

         REMIC IV: The segregated pool of assets consisting of the Class P
Interest conveyed in trust to the Trustee, for the benefit of the Holders of the
Class P Certificates and the Class RX Certificate (in respect of the Class R-4
Interest), with respect to which a separate REMIC election is to be made.

         REMIC IV CERTIFICATE: Any Class P Certificate or Class RX Certificate
(in respect of the Class R-4 Interest).

         REMIC OPINION: Shall mean an Opinion of Counsel to the effect that the
proposed action will not cause any of REMIC I, REMIC II, REMIC III or REMIC IV
to fail to qualify as a REMIC at any time that any Certificates are outstanding.

         REMIC PROVISIONS: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at sections 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
proposed, temporary and final regulations and published rulings, notices and
announcements promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.

         REMITTANCE DATE: Shall mean the Business Day immediately preceding the
Distribution Account Deposit Date.

         REO IMPUTED INTEREST: As to any REO Property, for any calendar month
during which such REO Property was at any time part of REMIC I, 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 PROPERTY: A Mortgaged Property acquired by the Master Servicer
through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan.

         REPLACEMENT MORTGAGE LOAN: A Mortgage Loan or Mortgage Loans in the
aggregate substituted by the Seller for a Deleted Mortgage Loan, which must, on
the date of such substitution, as confirmed in a Request for Release, (i) have a
Stated Principal Balance, after deduction of the principal portion of the
Scheduled Payment due in the month of substitution, not in excess of, and not
less than 90% of, the Stated Principal Balance of the Deleted Mortgage Loan;
(ii) if the Replacement Mortgage Loan is a fixed rate Mortgage Loan, have a
fixed Mortgage Rate not less than or more than 1% per annum higher than the
Mortgage Rate of the Deleted Mortgage Loan; (iii) have the same or higher credit
quality characteristics than that of the Deleted Mortgage Loan; (iv) have a
Loan-to-Value Ratio no higher than that of the Deleted

                                       42
<PAGE>

Mortgage Loan; (v) have a remaining term to maturity no greater than (and not
more than one year less than) that of the Deleted Mortgage Loan; (vi) not permit
conversion of the Mortgage Rate from a fixed rate to a variable rate; (vii) have
the same lien priority as the Deleted Mortgage Loan; (viii) constitute the same
occupancy type as the Deleted Mortgage Loan or be owner occupied; (ix) if the
Replacement 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, (x) if the Replacement 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, (xi) if the Replacement 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, (xii) if the Replacement 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, (xiii)
comply with each representation and warranty set forth in Section 7 of the
Mortgage Loan Purchase Agreement and (xiv) the related Custodian has delivered a
Final Certification noting no defects or exceptions.

         REQUEST FOR RELEASE: The Request for Release to be submitted by the
Seller or the Master Servicer to the related Custodian substantially in the form
of Exhibit G. Each Request for Release furnished to the related Custodian by the
Seller or the Master Servicer shall be in duplicate and shall be executed by an
officer of such Person or a Servicing Officer (or, if furnished electronically
to the related Custodian, shall be deemed to have been sent and executed by an
officer of such Person or a Servicing Officer) of the Master Servicer.

         REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to time under this
Agreement.

         RESERVE FUND: Shall mean the separate trust account created and
maintained by the Trustee pursuant to Section 3.20 hereof.

         RESIDUAL CERTIFICATES: The Class R-1, Class R-2 and Class RX
Certificates (representing ownership of the Class R-3 Interest and Class R-4
Interest) each evidencing the sole class of "residual interests" (within the
meaning of Section 860G(a)(2) of the Code) in the related REMIC.

         RESIDUAL INTEREST: The sole class of "residual interests" in a REMIC
within the meaning of Section 860G(a)(2) of the Code.

         RESPONSIBLE OFFICER: With respect to the Trustee, any Vice President,
any Assistant Vice President, the Secretary, any Assistant Secretary, or any
Trust Officer with specific responsibility for the transactions contemplated
hereby, any other officer customarily performing functions similar to those
performed by any of the above designated officers or other officers of the
Trustee specified by the Trustee, as to whom, with respect to a particular
matter, such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.

         S&P: Standard & Poor's, a division of The McGraw-Hill Companies, Inc.,
and any successor thereto.

                                       43
<PAGE>

         SCHEDULED PAYMENT: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan.

         SECURITIES ACT: The Securities Act of 1933, as amended.

         SELLER: EMC Mortgage Corporation, a Delaware corporation, and its
successors and assigns, in its capacity as seller of the Mortgage Loans to the
Depositor.

         SENIOR CERTIFICATES: Any of the Class I-A-1, Class I-A-2, Class I-A-3,
Class II-A-1 and Class II-A-2 Certificates.

         SERVICING ADVANCES: All customary, reasonable and necessary "out of
pocket" costs and expenses (including reasonable legal fees) incurred in the
performance by the Master Servicer of its servicing obligations hereunder,
including, but not limited to, the cost of (i) the preservation, restoration and
protection of a Mortgaged Property, (ii) any enforcement or judicial
proceedings, including foreclosures, and including any expenses incurred in
relation to any such proceedings that result from the Mortgage Loan being
registered in the MERS(R) System, (iii) the management and liquidation of any
REO Property (including, without limitation, realtor's commissions) and (iv)
compliance with any obligations under Section 3.07 hereof to cause insurance to
be maintained.

         SERVICING FEE: As to each Mortgage Loan and any Distribution Date, an
amount equal to 1/12th of the Servicing Fee Rate multiplied by the Stated
Principal Balance of such Mortgage Loan as of the last day of the related Due
Period or, in the event of any payment of interest that accompanies a Principal
Prepayment in full during the related Due Period made by the Mortgagor
immediately prior to such prepayment, interest at the Servicing Fee Rate on the
Stated Principal Balance of such Mortgage Loan for the period covered by such
payment of interest.

         SERVICING FEE RATE: 0.500% per annum.

         SERVICING MODIFICATION: With respect to any Mortgage Loan that is in
default or, in the reasonable judgment of the Master Servicer, as to which
default is reasonably foreseeable, any modification which is effected by the
Master Servicer in accordance with the terms of this Agreement which results in
any change in the outstanding Stated Principal Balance, any change in the
Mortgage Rate or any extension of the term of such Mortgage Loan.

         SERVICING OFFICER: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished to
the Trustee by the Master Servicer on the Closing Date pursuant to this
Agreement, as such list may from time to time be amended.

         STARTUP DAY: The Startup Day for each REMIC formed hereunder shall be
the Closing Date.

         STATED PRINCIPAL BALANCE: With respect to any Mortgage Loan or related
REO Property and any Distribution Date, the Cut-off Date Principal Balance
thereof minus the sum of (i) the

                                       44
<PAGE>

principal portion of the Scheduled Payments due with respect to such Mortgage
Loan during each Due Period ending prior to such Distribution Date (and
irrespective of any delinquency in their payment), (ii) all Principal
Prepayments with respect to such Mortgage Loan received prior to or during the
related Prepayment Period, and all Liquidation Proceeds to the extent applied by
the Master Servicer as recoveries of principal in accordance with Section 3.09
with respect to such Mortgage Loan, that were received by the Master Servicer as
of the close of business on the last day of the Prepayment Period related to
such Distribution Date and (iii) any Realized Losses on such Mortgage Loan
incurred during the related Prepayment Period. The Stated Principal Balance of a
Liquidated Loan equals zero.

         STEPDOWN DATE: The later to occur of (a) the Distribution Date in
December 2007 and (b) the first Distribution Date on which the Current Specified
Enhancement Percentage (calculated for this purpose only, prior to distributions
on the Certificates but following distributions on the Mortgage Loans for the
related Due Period) is greater than or equal to 41.80%.

         SUBORDINATED CERTIFICATES: The Class M Certificates, Class CE
Certificates and Residual Certificates.

         SUBSEQUENT RECOVERIES: As of any Distribution Date, amounts received by
the Master Servicer (net of any related expenses permitted to be reimbursed
pursuant to Section 4.02) or surplus amounts held by the Master Servicer to
cover estimated expenses (including, but not limited to, recoveries in respect
of the representations and warranties made by the Seller pursuant to the
Mortgage Loan Purchase Agreement) specifically related to a Mortgage Loan that
was the subject of a liquidation or final disposition of any REO Property prior
to the related Prepayment Period that resulted in a Realized Loss.

         SUBSERVICING AGREEMENT: Any agreement entered into between the Master
Servicer and a subservicer with respect to the subservicing of any Mortgage Loan
hereunder by such subservicer.

         SUBSTITUTION ADJUSTMENT AMOUNT: The meaning ascribed to such term
pursuant to Section 2.03(c).

         SUCCESSOR MASTER SERVICER: The meaning ascribed to such term pursuant
to Section 8.02.

         TAX MATTERS PERSON: The person designated as "tax matters person" in
the manner provided under Treasury regulation ss. 1.860F-4(d) and temporary
Treasury regulation ss. 301.6231(a)(7)-1T. The holder of the greatest Percentage
Interest in a Class of Residual Certificates shall be the Tax Matters Person for
the related REMIC. The Trustee, or any successor thereto or assignee thereof
shall serve as tax administrator hereunder and as agent for the related Tax
Matters Person.

         TRANSFER: Any direct or indirect transfer or sale of any Ownership
Interest in a Certificate.

         TRANSFER AFFIDAVIT: As defined in Section 6.02(c).

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<PAGE>

         TRIGGER EVENT: With respect to any Distribution Date after the Stepdown
Date, a Trigger Event exists if (i) a Delinquency Event shall have occurred and
be continuing or (ii) the aggregate amount of Realized Losses on the Mortgage
Loans since the Cut-off Date as a percentage of the initial aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date exceeds the
applicable percentages set forth below with respect to such Distribution Date:

                       DISTRIBUTION DATE               PERCENTAGE
                ------------------------------         ----------
                December 2007 to November 2008           3.25%
                December 2008 to November 2009           5.00%
                December 2009 to November 2010           6.50%
                December 2010 and thereafter             7.25%

         TRUST FUND: The corpus of the trust created hereunder consisting of (i)
the Mortgage Loans and all interest accruing and principal due with respect
thereto after the Cut-off Date to the extent not applied in computing the
Cut-off Date Principal Balance thereof; (ii) the Distribution Account, the Class
P Certificate Account, the Reserve Fund and the Protected Account and all
amounts deposited therein pursuant to the applicable provisions of this
Agreement; (iii) property that secured a Mortgage Loan and has been acquired by
foreclosure, deed in lieu of foreclosure or otherwise; (iv) the mortgagee's
rights under the Insurance Policies with respect to the Mortgage Loans; (v) the
rights under the Yield Maintenance Agreements; (vi) the rights under the
Mortgage Loan Purchase Agreement; and (vii) all proceeds of the foregoing,
including proceeds of conversion, voluntary or involuntary, of any of the
foregoing into cash or other liquid property.

         TRUSTEE: LaSalle Bank National Association, a national banking
association, not in its individual capacity, but solely in its capacity as
trustee for the benefit of the Certificateholders under this Agreement, and any
successor thereto, and any corporation or national banking association resulting
from or surviving any consolidation or merger to which it or its successors may
be a party and any successor trustee as may from time to time be serving as
successor trustee hereunder.

         TRUSTEE FEE: As to each Mortgage Loan and any Distribution Date, a fee
per annum equal to 0.0029% multiplied by the Stated Principal Balance of such
Mortgage Loan as of the last day of the related Due Period.

         UNCERTIFICATED ACCRUED INTEREST: With respect to each REMIC I Regular
Interest on each Distribution Date, an amount equal to one month's interest at
the Uncertificated REMIC I Pass-Through Rate on the Uncertificated Principal
Balance of such REMIC I 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 I Regular Interests as set forth in
Section 5.07).

                                       46
<PAGE>

         UNCERTIFICATED NOTIONAL BALANCE: With respect to the Class CE Interest
and any Distribution Date, the Uncertificated Principal Balance of the REMIC I
Regular Interests (other than REMIC I Regular Interest P) for such Distribution
Date.

         UNCERTIFICATED PRINCIPAL BALANCE: The amount of the REMIC I Regular
Interests outstanding as of any date of determination. As of the Closing Date,
the Uncertificated Principal Balance of each REMIC I Regular Interest shall
equal the amount set forth in the Preliminary Statement hereto as its initial
uncertificated principal balance. On each Distribution Date, the Uncertificated
Principal Balance of the REMIC I Regular Interest shall be reduced by all
distributions of principal made on such REMIC I Regular Interest on such
Distribution Date pursuant to Section 5.07 and, if and to the extent necessary
and appropriate, shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 5.05 and the Uncertificated Principal Balance of
REMIC I Regular Interest ZZ shall be increased by interest deferrals as provided
in Section 5.07(b)(1)(i). The Uncertificated Principal Balance of each REMIC I
Regular Interest shall never be less than zero. With respect to the Class CE
Interest 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 I
Regular Interests over (B) the then aggregate Certificate Principal Balances of
the Class A Certificates, the Class M Certificates and the Class P Interest then
outstanding.

         UNCERTIFICATED REMIC I PASS-THROUGH RATE: With respect to REMIC I
Regular Interest AA, REMIC I Regular Interest I-A-1, REMIC I Regular Interest
I-A-2, REMIC I Regular Interest I-A-3, REMIC I Regular Interest II-A-1, REMIC I
Regular Interest II-A-2, REMIC I Regular Interest M-1, REMIC I Regular Interest
M-2, REMIC I Regular Interest M-3, REMIC I Regular Interest M-4, REMIC I Regular
Interest M-5, REMIC I Regular Interest M-6, REMIC I Regular Interest M-7, REMIC
I Regular Interest ZZ, REMIC I Regular Interest 1A, REMIC I Regular Interest 2A
and REMIC I Regular Interest XX, the weighted average of the Net Mortgage Rates
of the Mortgage Loans. With respect to REMIC I Regular Interest 1B, the weighted
average of the Net Mortgage Rates of the Mortgage Loans in Loan Group I. With
respect to REMIC I Regular Interest 2B, the weighted average of the Net Mortgage
Rates of the Mortgage Loans in Loan Group II. With respect to REMIC I Regular
Interest P, 0.00%.

         UNDERWRITING AGREEMENT: The Underwriting Agreement, dated as of April
28, 2004, and the related Terms Agreement (together, the "Underwriting
Agreement"), dated as of November 23, 2004 among the Depositor, Bear, Stearns &
Co. Inc. ("Bear Stearns") and WaMu Capital Corp. ("WaMu"; and together with Bear
Stearns, the "Underwriters").

         UNPAID REALIZED LOSS AMOUNT: With respect to any Class A Certificates
and as to any Distribution Date, is the excess of Applied Realized Loss Amounts
with respect to such Class over the sum of all distributions in reduction of the
Applied Realized Loss Amounts on all previous Distribution Dates. Any amounts
distributed to the Class A Certificates in respect of any Unpaid Realized Loss
Amount shall not be applied to reduce the Certificate Principal Balance of such
Class.

         VOTING RIGHTS: The portion of the voting rights of all the Certificates
that is allocated to any Certificate for purposes of the voting provisions
hereunder. Voting Rights shall be allocated

                                       47
<PAGE>

(i) 93% to the Class A Certificates and Class M Certificates, (ii) 3% to the
Class CE Certificates until paid in full, and (iii) 1% to each Class of Residual
Certificates and Class P Certificates, with the allocation among the
Certificates (other than the Class CE, Class P and the Residual Certificates) to
be in proportion to the Certificate Principal Balance of each Class relative to
the Certificate Principal Balance of all other such Classes. Voting Rights will
be allocated among the Certificates of each such Class in accordance with their
respective Percentage Interests.

         WELLS FARGO: Wells Fargo Bank, National Association, and any successor
thereto.

         WELLS FARGO CUSTODIAL AGREEMENT: The Custodial Agreement, dated as
November 30, 2004, among the Depositor, the Seller, the Master Servicer, the
Trustee and Wells Fargo Bank, National Association as Custodian relating to the
Mortgage Loans identified in such Custodial Agreement.

         YIELD MAINTENANCE AGREEMENTS: The three Yield Maintenance Agreements,
each dated November 30, 2004 between the Trust (on behalf of the Class I-A,
Class II-A and Class M Certificateholders) and Bear Stearns Financial Products
Inc.

         Section 1.02 ALLOCATION OF CERTAIN INTEREST SHORTFALLS.

         For purposes of calculating the amount of Current Interest for the
Class A Certificates, the Class M Certificates and the Class CE Certificates for
any Distribution Date, the aggregate amount of any Prepayment Interest
Shortfalls (to the extent not covered by payments by the Master Servicer
pursuant to Section 5.02) and any Relief Act Interest Shortfalls incurred in
respect of the Mortgage Loans for any Distribution Date shall be allocated
first, to the Class CE Certificates based on, and to the extent of, one month's
interest at the then applicable respective Pass-Through Rate on the Certificate
Notional Amount thereof and, thereafter, among the Class A Certificates and
Class M Certificates, in each case 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.

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

         (a) The REMIC I Marker Allocation Percentage of the aggregate amount of
any Prepayment Interest Shortfalls (to the extent not covered by payments by the
Master Servicer pursuant to Section 5.02) and the REMIC I Marker Allocation
Percentage of any Relief Act Interest Shortfalls incurred in respect of the
Mortgage Loans for any Distribution Date shall be allocated among REMIC I
Regular Interest I-A-1, REMIC I Regular Interest I-A-2, REMIC I Regular Interest
I-A-3, REMIC I Regular Interest II-A-1, REMIC I Regular Interest II-A-2, REMIC I
Regular Interest M-1, REMIC I Regular Interest M-2, REMIC I Regular Interest
M-3, REMIC I Regular Interest M-4, REMIC I Regular Interest M-5, REMIC I Regular
Interest M-6, REMIC I Regular Interest M-7 and REMIC I Regular Interest ZZ, PRO
RATA, based on, and to the extent of, one month's interest at the then
applicable respective Uncertificated REMIC I Pass-Through Rate on the respective
Uncertificated Principal Balance of each such REMIC I Regular Interest;

                                       48
<PAGE>

         (b) The REMIC I Sub WAC Allocation Percentage of the aggregate amount
of any Prepayment Interest Shortfalls (to the extent not covered by payments by
the Master Servicer pursuant to Section 5.02) and the REMIC I Sub WAC Allocation
Percentage of any Relief Act Interest Shortfalls incurred in respect of the
Mortgage Loans for any Distribution Date shall be allocated to Uncertificated
Accrued Interest payable to REMIC I Regular Interest 1A, REMIC I Regular
Interest 1B, REMIC I Regular Interest 2A, REMIC I Regular Interest 2B and REMIC
I Regular Interest XX, PRO RATA, based on, and to the extent of, one month's
interest at the then applicable respective Uncertificated REMIC I Pass-Through
Rate on the respective Uncertificated Principal Balance of each such REMIC I
Regular Interest; and

         (c) The aggregate amount of any Prepayment Interest Shortfalls (to the
extent not covered by payments by the Master Servicer pursuant to Section 5.02)
and any Relief Act Interest Shortfalls allocated to the Class CE Certificates
shall be deemed allocated to the Class CE Interest.

                                       49
<PAGE>

                                   ARTICLE II

                            CONVEYANCE OF TRUST FUND
                         REPRESENTATIONS AND WARRANTIES

         Section 2.01 CONVEYANCE OF TRUST FUND.

         Pursuant to the Mortgage Loan Purchase Agreement, the Seller sold,
transferred, assigned, set over and otherwise conveyed to the Depositor, without
recourse, all the right, title and interest of the Seller in and to the assets
in the Trust Fund.

         The Seller has entered into this Agreement in consideration for the
purchase of the Mortgage Loans by the Depositor pursuant to the Mortgage Loan
Purchase Agreement and has agreed to take the actions specified herein.

         The Depositor, concurrently with the execution and delivery hereof,
hereby sells, transfers, assigns, sets over and otherwise conveys to the Trustee
for the use and benefit of the Certificateholders, without recourse, all the
right, title and interest of the Depositor in and to the Trust Fund.

         In connection with such sale, the Depositor has delivered to, and
deposited with, the Trustee or the related Custodian, as its agent, the
following documents or instruments with respect to each Mortgage Loan so
assigned: (i) the original Mortgage Note, including any riders thereto, endorsed
without recourse to the order of "LaSalle Bank National Association, as Trustee
for certificateholders of Bear Stearns Asset Backed Securities I LLC Asset
Backed Certificates, Series 2004-HE10," and showing an unbroken chain of
endorsements from the original payee thereof to the Person endorsing it to the
Trustee, (ii) the original Mortgage and, if the related Mortgage Loan is a MOM
Loan, noting the presence of the MIN and language indicating that such Mortgage
Loan is a MOM Loan, which shall have been recorded (or if the original is not
available, a copy), with evidence of such recording indicated thereon (or if
clause (x) in the proviso below applies, shall be in recordable form), (iii)
unless the Mortgage Loan is a MOM Loan, the assignment (either an original or a
copy, which may be in the form of a blanket assignment if permitted in the
jurisdiction in which the Mortgaged Property is located) to the Trustee of the
Mortgage with respect to each Mortgage Loan in the name of "LaSalle Bank
National Association, as Trustee for certificateholders of Bear Stearns Asset
Backed Securities I LLC Asset Backed Certificates, Series 2004-HE10," which
shall have been recorded (or if clause (x) in the proviso below applies, shall
be in recordable form) (iv) an original or a copy of all intervening assignments
of the Mortgage, if any, with evidence of recording thereon, (v) the original
policy of title insurance or mortgagee's certificate of title insurance or
commitment or binder for title insurance, if available, or a copy thereof, or,
in the event that such original title insurance policy is unavailable, a
photocopy thereof, or in lieu thereof, a current lien search on the related
Mortgaged Property and (vi) originals or copies of all available assumption,
modification or substitution agreements, if any; provided, however, that in lieu
of the foregoing, the Seller may deliver the following documents, under the
circumstances set forth below: (x) if any Mortgage, assignment thereof to the
Trustee or intervening assignments thereof have been

                                       50
<PAGE>

delivered or are being delivered to recording offices for recording and have not
been returned in time to permit their delivery as specified above, the Depositor
may deliver a true copy thereof with a certification by the Seller or the title
company issuing the commitment for title insurance, on the face of such copy,
substantially as follows: "Certified to be a true and correct copy of the
original, which has been transmitted for recording"; and (y) in lieu of the
Mortgage Notes relating to the Mortgage Loans identified in the list set forth
in Exhibit I, the Depositor may deliver a lost note affidavit and indemnity and
a copy of the original note, if available; and provided, further, however, that
in the case of Mortgage Loans which have been prepaid in full after the Cut-Off
Date and prior to the Closing Date, the Depositor, in lieu of delivering the
above documents, may deliver to the Trustee and the related Custodian a
certification of a Servicing Officer to such effect and in such case shall
deposit all amounts paid in respect of such Mortgage Loans, in the Protected
Account or in the Distribution Account on the Closing Date. In the case of the
documents referred to in clause (x) above, the Depositor shall deliver such
documents to the Trustee or the related Custodian promptly after they are
received. The Seller shall cause, at its expense, the Mortgage and intervening
assignments, if any, and to the extent required in accordance with the
foregoing, the assignment of the Mortgage to the Trustee to be submitted for
recording promptly after the Closing Date; provided that the Seller need not
cause to be recorded (a) any assignment in any jurisdiction under the laws of
which, as evidenced by an Opinion of Counsel addressed to the Trustee delivered
by the Seller to the Trustee and the Rating Agencies, the recordation of such
assignment is not necessary to protect the Trustee's interest in the related
Mortgage Loan or (b) if MERS is identified on the Mortgage or on a properly
recorded assignment of the Mortgage as the mortgagee of record solely as nominee
for Seller and its successors and assigns. In the event that the Seller, the
Depositor or the Master Servicer gives written notice to the Trustee that a
court has recharacterized the sale of the Mortgage Loans as a financing, the
Seller shall submit or cause to be submitted for recording as specified above
each such previously unrecorded assignment to be submitted for recording as
specified above at the expense of the Trust. In the event a Mortgage File is
released to the Master Servicer as a result of such Person having completed a
Request for Release, the related Custodian shall, if not so completed, complete
the assignment of the related Mortgage in the manner specified in clause (iii)
above.

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

                                       51
<PAGE>

         Section 2.02 ACCEPTANCE OF THE MORTGAGE LOANS.

         (a) Based on the Initial Certification received by it from the related
Custodian, the Trustee acknowledges receipt of, subject to the further review
and exceptions reported by the related Custodian pursuant to the procedures
described below, the documents (or certified copies thereof) delivered to the
Trustee or the related Custodian on its behalf pursuant to Section 2.01 and
declares that it holds and will continue to hold directly or through a custodian
those documents and any amendments, replacements or supplements thereto and all
other assets of the Trust Fund delivered to it in trust for the use and benefit
of all present and future Holders of the Certificates. On the Closing Date, the
Trustee or the related Custodian on its behalf will deliver one or more Initial
Certifications, each in the form of Exhibit One to the related Custodial
Agreement, confirming whether or not it has received the Mortgage File for each
Mortgage Loan, but without review of such Mortgage File, except to the extent
necessary to confirm whether such Mortgage File contains the original Mortgage
Note or a lost note affidavit and indemnity in lieu thereof. No later than 90
days after the Closing Date, the Trustee or the related Custodian on its behalf
shall, for the benefit of the Certificateholders, review each Mortgage File
delivered to it and execute and deliver to the Seller and the Master Servicer
and, if reviewed by the related Custodian or the Trustee, one or more Interim
Certifications, each substantially in the form of Exhibit Two to the related
Custodial Agreement. In conducting such review, the Trustee or the related
Custodian on its behalf will ascertain whether all required documents have been
executed and received and whether those documents relate, determined on the
basis of the Mortgagor name, original principal balance and loan number, to the
Mortgage Loans identified in Exhibit B to this Agreement, as supplemented
(provided, however, that with respect to those documents described in subclauses
(iv) and (vi) of Section 2.01, such obligations shall extend only to documents
actually delivered pursuant to such subclauses). In performing any such review,
the Trustee and the related Custodian may conclusively rely on the purported due
execution and genuineness of any such document and on the purported genuineness
of any signature thereon. If the Trustee or the related Custodian on its behalf
finds any document constituting part of the Mortgage File not to have been
executed or received, or to be unrelated to the Mortgage Loans identified in
Exhibit B or to appear to be defective on its face, the Trustee or the related
Custodian on its behalf shall include such information in the exception report
attached to the Interim Certification. The Seller shall correct or cure any such
defect or, if prior to the end of the second anniversary of the Closing Date,
the Seller may substitute for the related Mortgage Loan a Replacement Mortgage
Loan, which substitution shall be accomplished in the manner and subject to the
conditions set forth in Section 2.03 or shall deliver to the Trustee an Opinion
of Counsel addressed to the Trustee to the effect that such defect does not
materially or adversely affect the interests of the Certificateholders in such
Mortgage Loan within 60 days from the date of notice from the Trustee of the
defect and if the Seller fails to correct or cure the defect or deliver such
opinion within such period, the Seller will, subject to Section 2.03, within 90
days from the notification of the Trustee purchase such Mortgage Loan at the
Purchase Price; provided, however, that if such defect relates solely to the
inability of the Seller to deliver the Mortgage, assignment thereof to the
Trustee, or intervening assignments thereof with evidence of recording thereon
because such documents have been submitted for recording and have not been
returned by the applicable jurisdiction, the Seller shall not be required to
purchase such Mortgage Loan if the Seller delivers such documents promptly upon
receipt, but in no event later than 360 days after the Closing Date.

                                       52
<PAGE>

         (b) No later than 180 days after the Closing Date, the Trustee or the
related Custodian on its behalf will review, for the benefit of the
Certificateholders, the Mortgage Files and will execute and deliver or cause to
be executed and delivered to the Seller and the Master Servicer and, if reviewed
by the related Custodian or the Trustee, one or more Final Certifications, each
substantially in the form of Exhibit Three to the related Custodial Agreement.
In conducting such review, the Trustee or the related Custodian on its behalf
will ascertain whether each document required to be recorded has been returned
from the recording office with evidence of recording thereon and the Trustee or
the related Custodian on its behalf has received either an original or a copy
thereof, as required in Section 2.01 (provided, however, that with respect to
those documents described in subclauses (iv) and (vi) of Section 2.01, such
obligations shall extend only to documents actually delivered pursuant to such
subclauses). If the Trustee or the related Custodian on its behalf finds any
document with respect to a Mortgage Loan has not been received, or to be
unrelated, determined on the basis of the Mortgagor name, original principal
balance and loan number, to the Mortgage Loans identified in Exhibit B or to
appear defective on its face, the Trustee or the related Custodian on its behalf
shall note such defect in the exception report attached to the Final
Certification and shall promptly notify the Seller. The Seller shall correct or
cure any such defect or, if prior to the end of the second anniversary of the
Closing Date, the Seller may substitute for the related Mortgage Loan a
Replacement Mortgage Loan, which substitution shall be accomplished in the
manner and subject to the conditions set forth in Section 2.03 or shall deliver
to the Trustee an Opinion of Counsel addressed to the Trustee to the effect that
such defect does not materially or adversely affect the interests of
Certificateholders in such Mortgage Loan within 60 days from the date of notice
from the Trustee of the defect and if the Seller is unable within such period to
correct or cure such defect, or to substitute the related Mortgage Loan with a
Replacement Mortgage Loan or to deliver such opinion, the Seller shall, subject
to Section 2.03, within 90 days from the notification of the Trustee, purchase
such Mortgage Loan at the Purchase Price; provided, however, that if such defect
relates solely to the inability of the Seller to deliver the Mortgage,
assignment thereof to the Trustee or intervening assignments thereof with
evidence of recording thereon, because such documents have not been returned by
the applicable jurisdiction, the Seller shall not be required to purchase such
Mortgage Loan, if the Seller delivers such documents promptly upon receipt, but
in no event later than 360 days after the Closing Date. Notwithstanding anything
to the contrary, the Trustee shall have no responsibility with respect to the
custody or review of Mortgage Files held by the related Custodian pursuant to
the related Custodial Agreement. The Trustee shall have no liability for the
failure of the Custodians to perform their respective obligations under the
related Custodial Agreement.

         (c) In the event that a Mortgage Loan is purchased by the Seller in
accordance with subsections 2.02(a) or (b) above or Section 2.03, the Seller
shall remit the applicable Purchase Price to the Master Servicer for deposit in
the Protected Account and shall provide written notice to the Trustee detailing
the components of the Purchase Price, signed by a Servicing Officer. Upon
deposit of the Purchase Price in the Protected Account and upon receipt of a
Request for Release with respect to such Mortgage Loan, the Trustee or the
related Custodian will release to the Seller the related Mortgage File and the
Trustee shall execute and deliver all instruments of transfer or assignment,
without recourse, representation or warranty furnished to it by the Seller, as
are necessary to vest in the Seller title to and rights under the Mortgage Loan.
Such purchase shall be deemed to have occurred on the date on which the deposit
into the Protected Account

                                       53
<PAGE>

was made. The Trustee shall promptly notify the Rating Agencies of such
repurchase. The obligation of the Seller to cure, repurchase or substitute for
any Mortgage Loan as to which a defect in a constituent document exists shall be
the sole remedies respecting such defect available to the Certificateholders or
to the Trustee on their behalf.

         (d) The Seller shall deliver to the Trustee or the related Custodian on
its behalf, and Trustee agrees to accept the Mortgage Note and other documents
constituting the Mortgage File with respect to any Replacement Mortgage Loan,
which the Trustee or the related Custodian will review as provided in
subsections 2.02(a) and 2.02(b), provided, that the Closing Date referred to
therein shall instead be the date of delivery of the Mortgage File with respect
to each Replacement Mortgage Loan.

         Section 2.03 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MASTER
SERVICER AND THE SELLER.

         (a) The Master Servicer hereby represents and warrants to the Depositor
and the Trustee as follows, as of the Closing Date:

                  (i) It is duly organized and is validly existing and in good
         standing under the laws of the State of Delaware and is duly authorized
         and qualified to transact any and all business contemplated by this
         Agreement to be conducted by it in any state in which a Mortgaged
         Property is located or is otherwise not required under applicable law
         to effect such qualification and, in any event, is in compliance with
         the doing business laws of any such state, to the extent necessary to
         ensure its ability to enforce each Mortgage Loan, to service the
         Mortgage Loans in accordance with the terms of the Mortgage Loan
         Purchase Agreement and to perform any of its other obligations under
         this Agreement in accordance with the terms hereof or thereof.

                  (ii) It has the full corporate power and authority to service
         each Mortgage Loan, and to execute, deliver and perform, and to enter
         into and consummate the transactions contemplated by this Agreement and
         has duly authorized by all necessary corporate action on its part the
         execution, delivery and performance of this Agreement; and this
         Agreement, assuming the due authorization, execution and delivery
         hereof by the other parties hereto or thereto, as applicable,
         constitutes its legal, valid and binding obligation, enforceable
         against it in accordance with its terms, except that (a) the
         enforceability hereof may be limited by bankruptcy, insolvency,
         moratorium, receivership and other similar laws relating to creditors'
         rights generally and (b) the remedy of specific performance and
         injunctive and other forms of equitable relief may be subject to
         equitable defenses and to the discretion of the court before which any
         proceeding therefor may be brought.

                  (iii) The execution and delivery of this Agreement, the
         servicing of the Mortgage Loans by it under this Agreement, the
         consummation of any other of the transactions contemplated by this
         Agreement, and the fulfillment of or compliance with the terms hereof
         and thereof are in its ordinary course of business and will not (A)
         result in a breach of any term or provision of its charter or by-laws
         or (B) conflict with, result in

                                       54
<PAGE>

         a breach, violation or acceleration of, or result in a default under,
         the terms of any other material agreement or instrument to which it is
         a party or by which it may be bound, or (C) constitute a violation of
         any statute, order or regulation applicable to it of any court,
         regulatory body, administrative agency or governmental body having
         jurisdiction over it; and it is not in breach or violation of any
         material indenture or other material agreement or instrument, or in
         violation of any statute, order or regulation of any court, regulatory
         body, administrative agency or governmental body having jurisdiction
         over it which breach or violation may materially impair its ability to
         perform or meet any of its obligations under this Agreement.

                  (iv) It is an approved servicer of conventional mortgage loans
         for Fannie Mae or Freddie Mac and is a mortgagee approved by the
         Secretary of Housing and Urban Development pursuant to sections 203 and
         211 of the National Housing Act.

                  (v) No litigation is pending or, to the best of its knowledge,
         threatened, against it that would materially and adversely affect the
         execution, delivery or enforceability of this Agreement or its ability
         to service the Mortgage Loans or to perform any of its other
         obligations under this Agreement in accordance with the terms hereof.

                  (vi) No consent, approval, authorization or order of any court
         or governmental agency or body is required for its execution, delivery
         and performance of, or compliance with, this Agreement or the
         consummation of the transactions contemplated hereby or thereby, or if
         any such consent, approval, authorization or order is required, it has
         obtained the same.

                  (vii) The Master Servicer has and will fully furnish for each
         Group II Loan, in accordance with the Fair Credit Reporting Act and its
         implementing regulations, accurate and complete information (i.e.,
         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.

         (b) The Seller hereby represents and warrants to the Depositor and the
Trustee as follows, as of the Closing Date:

                  (i) The Seller is duly organized as a Delaware corporation and
         is validly existing and in good standing under the laws of the State of
         Delaware and is duly authorized and qualified to transact any and all
         business contemplated by this Agreement to be conducted by the Seller
         in any state in which a Mortgaged Property is located or is otherwise
         not required under applicable law to effect such qualification and, in
         any event, is in compliance with the doing business laws of any such
         state, to the extent necessary to ensure its ability to enforce each
         Mortgage Loan, to sell the Mortgage Loans in accordance with the terms
         of the Mortgage Loan Purchase Agreement and to perform any of its other
         obligations under this Agreement in accordance with the terms hereof.

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<PAGE>

                  (ii) The Seller has the full corporate power and authority to
         sell each Mortgage Loan, and to execute, deliver and perform, and to
         enter into and consummate the transactions contemplated by this
         Agreement and has duly authorized by all necessary corporate action on
         the part of the Seller the execution, delivery and performance of this
         Agreement, assuming the due authorization, execution and delivery
         hereof by the other parties hereto or thereto, as applicable,
         constitutes a legal, valid and binding obligation of the Seller,
         enforceable against the Seller in accordance with its terms, except
         that (a) the enforceability hereof may be limited by bankruptcy,
         insolvency, moratorium, receivership and other similar laws relating to
         creditors' rights generally and (b) the remedy of specific performance
         and injunctive and other forms of equitable relief may be subject to
         equitable defenses and to the discretion of the court before which any
         proceeding therefor may be brought.

                  (iii) The execution and delivery of this Agreement by the
         Seller, the sale of the Mortgage Loans by the Seller under the Mortgage
         Loan Purchase Agreement, the consummation of any other of the
         transactions contemplated by this Agreement, and the fulfillment of or
         compliance with the terms hereof and thereof are in the ordinary course
         of business of the Seller and will not (A) result in a material breach
         of any term or provision of the charter or by-laws of the Seller or (B)
         conflict with, result in a breach, violation or acceleration of, or
         result in a default under, the terms of any other material agreement or
         instrument to which the Seller is a party or by which it may be bound,
         or (C) constitute a violation of any statute, order or regulation
         applicable to the Seller of any court, regulatory body, administrative
         agency or governmental body having jurisdiction over the Seller; and
         the Seller is not in breach or violation of any material indenture or
         other material agreement or instrument, or in violation of any statute,
         order or regulation of any court, regulatory body, administrative
         agency or governmental body having jurisdiction over it which breach or
         violation may materially impair the Seller's ability to perform or meet
         any of its obligations under this Agreement.

                  (iv) The Seller is an approved seller of conventional mortgage
         loans for Fannie Mae or Freddie Mac and is a mortgagee approved by the
         Secretary of Housing and Urban Development pursuant to sections 203 and
         211 of the National Housing Act.

                  (v) No litigation is pending or, to the best of the Seller's
         knowledge, threatened, against the Seller that would materially and
         adversely affect the execution, delivery or enforceability of this
         Agreement or the ability of the Seller to sell the Mortgage Loans or to
         perform any of its other obligations under this Agreement in accordance
         with the terms hereof or thereof.

                  (vi) No consent, approval, authorization or order of any court
         or governmental agency or body is required for the execution, delivery
         and performance by the Seller of, or compliance by the Seller with,
         this Agreement or the consummation of the transactions contemplated
         hereby, or if any such consent, approval, authorization or order is
         required, the Seller has obtained the same.

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<PAGE>

                  (vii) With respect to each Mortgage Loan as of the Closing
         Date (or such other date as may be specified in Section 7 of the
         Mortgage Loan Purchase Agreement), the Seller hereby remakes and
         restates each of the representations and warranties set forth in
         Section 7 of the Mortgage Loan Purchase Agreement to the Depositor and
         the Trustee to the same extent as if fully set forth herein.

         (c) Upon discovery by any of the parties hereto of a breach of a
representation or warranty set forth in the Mortgage Loan Purchase Agreement
with respect to the Mortgage Loans that materially and adversely affects the
interests of the Certificateholders in any Mortgage Loan, the party discovering
such breach shall give prompt written notice thereof to the other parties. Any
breach of a representation or warranty contained in clauses (gg), (hh) and (nn)
through (qq) of Section 7 of the Mortgage Loan Purchase Agreement in respect of
a Group II Loan, shall be deemed to materially adversely affect the interests of
the related Certificateholders. The Seller hereby covenants with respect to the
representations and warranties set forth in the Mortgage Loan Purchase Agreement
with respect to the Mortgage Loans, that within 90 days of the discovery of a
breach of any representation or warranty set forth therein that materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
it shall cure such breach in all material respects and, if such breach is not so
cured, (i) if such 90 day period expires prior to the second anniversary of the
Closing Date, remove such Mortgage Loan (a "Deleted Mortgage Loan") from the
Trust Fund and substitute in its place a Replacement Mortgage Loan, in the
manner and subject to the conditions set forth in this Section; or (ii)
repurchase the affected Mortgage Loan or Mortgage Loans from the Trustee at the
Purchase Price in the manner set forth below; provided that any such
substitution pursuant to (i) above or repurchase pursuant to (ii) above shall
not be effected prior to the delivery to the Trustee of an Opinion of Counsel if
required by Section 2.05 hereof and any such substitution pursuant to (i) above
shall not be effected prior to the additional delivery to the Trustee of a
Request for Release. The Trustee shall give prompt written notice to the parties
hereto of the Seller's failure to cure such breach as set forth in the preceding
sentence. The Seller shall promptly reimburse the Master Servicer and the
Trustee for any expenses reasonably incurred by the Master Servicer or the
Trustee in respect of enforcing the remedies for such breach. To enable the
Master Servicer to amend the Mortgage Loan Schedule, the Seller shall, unless it
cures such breach in a timely fashion pursuant to this Section 2.03, promptly
notify the Master Servicer whether it intends either to repurchase, or to
substitute for, the Mortgage Loan affected by such breach. With respect to the
representations and warranties with respect to the Mortgage Loans that are made
to the best of the Seller's knowledge, if it is discovered by any of the
Depositor, the Master Servicer, the Seller, the Trustee or the related 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, notwithstanding the Seller's lack of knowledge with respect to the
substance of such representation or warranty, the Seller shall nevertheless be
required to cure, substitute for or repurchase the affected Mortgage Loan in
accordance with the foregoing.

         With respect to any Replacement Mortgage Loan or Loans, the Seller
shall deliver to the Trustee or the related Custodian on its behalf for the
benefit of the Certificateholders such documents and agreements as are required
by Section 2.01. No substitution will be made in any calendar month after the
Determination Date for such month. Scheduled Payments due with

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respect to Replacement Mortgage Loans in the Due Period related to the
Distribution Date on which such proceeds are to be distributed shall not be part
of the Trust Fund and will be retained by the Seller. For the month of
substitution, distributions to Certificateholders will include the Scheduled
Payment due on any Deleted Mortgage Loan for the related Due Period and
thereafter the Seller shall be entitled to retain all amounts received in
respect of such Deleted Mortgage Loan. The Master Servicer shall amend the
Mortgage Loan Schedule for the benefit of the Certificateholders to reflect the
removal of such Deleted Mortgage Loan and the substitution of the Replacement
Mortgage Loan or Loans and the Master Servicer shall deliver the amended
Mortgage Loan Schedule to the Trustee and the related Custodian. Upon such
substitution, the Replacement Mortgage Loan or 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 Replacement Mortgage Loan or Loans, as of the date of
substitution, the representations and warranties set forth in Section 7 of the
Mortgage Loan Purchase Agreement with respect to such Mortgage Loan. Upon any
such substitution and the deposit into the Protected Account of the amount
required to be deposited therein in connection with such substitution as
described in the following paragraph and receipt by the Trustee of a Request for
Release for such Mortgage Loan, the Trustee or the related Custodian shall
release to the Seller the Mortgage File relating to such Deleted Mortgage Loan
and held for the benefit of the Certificateholders and the Trustee shall execute
and deliver at the Seller's direction such instruments of transfer or assignment
as have been prepared by the Seller, in each case without recourse,
representation or warranty as shall be necessary to vest in the Seller, or its
respective designee, title to the Trustee's interest in any Deleted Mortgage
Loan substituted for pursuant to this Section 2.03.

         For any month in which the Seller substitutes one or more Replacement
Mortgage Loans for a Deleted Mortgage Loan, the Master Servicer will determine
the amount (if any) by which the aggregate principal balance of all the
Replacement Mortgage Loans as of the date of substitution is less than the
Stated Principal Balance (after application of the principal portion of the
Scheduled Payment due in the month of substitution) of such Deleted Mortgage
Loan. An amount equal to the aggregate of such deficiencies, described in the
preceding sentence for any Distribution Date (such amount, the "Substitution
Adjustment Amount") shall be deposited into the Protected Account, by the Seller
delivering such Replacement Mortgage Loan on the Determination Date for the
Distribution Date relating to the Prepayment Period during which the related
Mortgage Loan became required to be purchased or replaced hereunder.

         In the event that the Seller shall have repurchased a Mortgage Loan,
the Purchase Price therefor shall be deposited into the Protected Account, on
the Determination Date for the Distribution Date in the month following the
month during which the Seller became obligated to repurchase or replace such
Mortgage Loan and upon such deposit of the Purchase Price, the delivery of an
Opinion of Counsel if required by Section 2.05 and the receipt of a Request for
Release, the Trustee or the related Custodian shall release the related Mortgage
File held for the benefit of the Certificateholders to the Seller, and the
Trustee shall execute and deliver at such Person's direction the related
instruments of transfer or assignment prepared by the Seller, in each case
without recourse, as shall be necessary to transfer title from the Trustee for
the benefit of the Certificateholders and transfer the Trustee's interest to the
Seller to any Mortgage Loan purchased pursuant to this Section 2.03. It is
understood and agreed that the obligation under this Agreement of the Seller to
cure, repurchase or replace any Mortgage Loan as to which a breach

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has occurred and is continuing shall constitute the sole remedies against the
Seller respecting such breach available to the Certificateholders, the Depositor
or the Trustee.

         (d) The representations and warranties set forth in this Section 2.03
hereof shall survive delivery of the respective Mortgage Loans and Mortgage
Files to the Trustee or the related Custodian for the benefit of the
Certificateholders.

         Section 2.04 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR.

         The Depositor hereby represents and warrants to the Master Servicer and
the Trustee as follows, as of the date hereof and as of the Closing Date:

                  (i) The Depositor is duly organized and is validly existing as
         a limited liability company in good standing under the laws of the
         State of Delaware and has full power and authority necessary to own or
         hold its properties and to conduct its business as now conducted by it
         and to enter into and perform its obligations under this Agreement.

                  (ii) The Depositor has the full power and authority to
         execute, deliver and perform, and to enter into and consummate the
         transactions contemplated by, this Agreement and has duly authorized,
         by all necessary corporate action on its part, the execution, delivery
         and performance of this Agreement, assuming the due authorization,
         execution and delivery hereof by the other parties hereto, constitutes
         a legal, valid and binding obligation of the Depositor, enforceable
         against the Depositor in accordance with its terms, subject, as to
         enforceability, to (i) bankruptcy, insolvency, reorganization,
         moratorium and other similar laws affecting creditors' rights generally
         and (ii) general principles of equity, regardless of whether
         enforcement is sought in a proceeding in equity or at law.

                  (iii) The execution and delivery of this Agreement by the
         Depositor, the consummation of the transactions contemplated by this
         Agreement, and the fulfillment of or compliance with the terms hereof
         and thereof are in the ordinary course of business of the Depositor and
         will not (A) result in a material breach of any term or provision of
         the certificate of formation or limited liability company agreement of
         the Depositor or (B) conflict with, result in a breach, violation or
         acceleration of, or result in a default under, the terms of any other
         material agreement or instrument to which the Depositor is a party or
         by which it may be bound or (C) constitute a violation of any statute,
         order or regulation applicable to the Depositor of any court,
         regulatory body, administrative agency or governmental body having
         jurisdiction over the Depositor; and the Depositor is not in breach or
         violation of any material indenture or other material agreement or
         instrument, or in violation of any statute, order or regulation of any
         court, regulatory body, administrative agency or governmental body
         having jurisdiction over it which breach or violation may materially
         impair the Depositor's ability to perform or meet any of its
         obligations under this Agreement.

                  (iv) No litigation is pending, or, to the best of the
         Depositor's knowledge, threatened, against the Depositor that would
         materially and adversely affect the

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<PAGE>

         execution, delivery or enforceability of this Agreement or the ability
         of the Depositor to perform its obligations under this Agreement in
         accordance with the terms hereof or thereof.

                  (v) No consent, approval, authorization or order of any court
         or governmental agency or body is required for the execution, delivery
         and performance by the Depositor of, or compliance by the Depositor
         with this Agreement or the consummation of the transactions
         contemplated hereby or thereby, or if any such consent, approval,
         authorization or order is required, the Depositor has obtained the
         same.

         The Depositor hereby represents and warrants to the Trustee as of the
Closing Date, following the transfer of the Mortgage Loans to it by the Seller,
the Depositor had good title to the Mortgage Loans and the related Mortgage
Notes were subject to no offsets, claims, defenses or counterclaims.

         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 or the related Custodian for the benefit of the Certificateholders. Upon
discovery by the Depositor or the Trustee of a breach of such representations
and warranties, the party discovering such breach shall give prompt written
notice to the others, to each Rating Agency.

         Section 2.05 DELIVERY OF OPINION OF COUNSEL IN CONNECTION WITH
SUBSTITUTIONS AND REPURCHASES.

         (a) Notwithstanding any contrary provision of this Agreement, with
respect to any Mortgage Loan that is not in default or as to which default is
not imminent, no repurchase or substitution pursuant to Sections 2.02 or 2.03
shall be made unless the Seller delivers to the Trustee an Opinion of Counsel,
addressed to the Trustee, to the effect that such repurchase or substitution
would not (i) result in the imposition of the tax on "prohibited transactions"
of REMIC I, REMIC II, REMIC III or REMIC IV or contributions after the Closing
Date, as defined in sections 860F(a)(2) and 860G(d) of the Code, respectively or
(ii) cause any of REMIC I, REMIC II, REMIC III or REMIC IV to fail to qualify as
a REMIC at any time that any Certificates are outstanding. Any Mortgage Loan as
to which repurchase or substitution was delayed pursuant to this paragraph shall
be repurchased or the substitution therefor shall occur (subject to compliance
with Sections 2.02 or 2.03) upon the earlier of (a) the occurrence of a default
or imminent default with respect to such Mortgage Loan and (b) receipt by the
Trustee of an Opinion of Counsel addressed to the Trustee to the effect that
such repurchase or substitution, as applicable, will not result in the events
described in clause (i) or clause (ii) of the preceding sentence.

         (b) Upon discovery by the Depositor, the Seller or the Master Servicer
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
promptly (and in any event within 5 Business Days of discovery) give written
notice thereof to the other parties and the Trustee. In connection therewith,
the Trustee shall require the Seller, at the Seller's option, to either (i)
substitute, if the conditions in Section 2.03 with respect to substitutions are
satisfied, a

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<PAGE>

Replacement Mortgage Loan for the affected Mortgage Loan, or (ii)
repurchase the affected Mortgage Loan within 90 days of such discovery in the
same manner as it would a Mortgage Loan for a breach of representation or
warranty in accordance with Section 2.03. The Trustee shall reconvey to the
Seller the Mortgage Loan to be released pursuant hereto (and the related
Custodian shall deliver the related Mortgage File) 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 in accordance with Section 2.03.

         Section 2.06 COUNTERSIGNATURE AND DELIVERY OF CERTIFICATES.

         (a) The Trustee acknowledges the sale, transfer and assignment to it of
the Trust Fund and, concurrently with such transfer and assignment, has
executed, countersigned and delivered, to or upon the order of the Depositor,
the Certificates in authorized denominations evidencing the entire ownership of
the Trust Fund. The Trustee agrees to hold the Trust Fund and exercise the
rights referred to above for the benefit of all present and future Holders of
the Certificates and to perform the duties set forth in this Agreement in
accordance with its terms.

         (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 I Regular Interests, and the other assets of REMIC II for the
benefit of the holders of the REMIC II Regular Interests and the Class R-2
Certificates. The Trustee acknowledges receipt of the REMIC I Regular Interests
(which are uncertificated) and the other assets of REMIC II and declares that it
holds and will hold the same in trust for the exclusive use and benefit of the
holders of the REMIC II Regular Interests and the Class R-2 Certificates.

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

         (d) 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 P Interest for the benefit of the holders of the REMIC IV
Certificates. The Trustee acknowledges receipt of the Class P Interest (which
are uncertificated) and declares that it holds and will hold the same in trust
for the exclusive use and benefit of the holders of the REMIC IV Certificates.

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                                  ARTICLE III

               ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS

         Section 3.01 THE MASTER SERVICER TO ACT AS MASTER SERVICER.

                  The Master Servicer shall service and administer the Mortgage
Loans in accordance with customary and usual standards of practice of prudent
mortgage loan servicers in the respective states in which the related Mortgaged
Properties are located. In connection with such servicing and administration,
the Master Servicer shall have full power and authority, acting alone and/or
through subservicers as provided in Section 3.03, to do or cause to be done any
and all things that it may deem necessary or desirable in connection with such
servicing and administration, including but not limited to, the power and
authority, subject to the terms hereof (i) to execute and deliver, on behalf of
the Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any related Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages (but only
in the manner provided herein), (iii) to collect any Insurance Proceeds and
other Liquidation Proceeds or Subsequent Recoveries, and (iv) subject to Section
3.09, to effectuate foreclosure or other conversion of the ownership of the
Mortgaged Property securing any Mortgage Loan; provided that the Master Servicer
shall take no action that is inconsistent with or prejudices the interests of
the Trust Fund or the Certificateholders in any Mortgage Loan or the rights and
interests of the Depositor or the Trustee under this Agreement.

         Without limiting the generality of the foregoing, the Master Servicer,
in its own name or in the name of the Trust, the Depositor or the Trustee, is
hereby authorized and empowered by the Trust, the Depositor and the Trustee,
when the Master Servicer believes it appropriate in its reasonable judgment, to
execute and deliver, on behalf of the Trustee, the Depositor, the
Certificateholders or any of them, 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 with respect to
the Mortgaged Properties held for the benefit of the Certificateholders. The
Master Servicer shall prepare and deliver to the Depositor and/or the Trustee
such documents requiring execution and delivery by any or all of them as are
necessary or appropriate to enable the Master Servicer to service and administer
the Mortgage Loans. Upon receipt of such documents, the Depositor and/or the
Trustee shall execute such documents and deliver them to the Master Servicer.

         In accordance with the standards of the first paragraph of this Section
3.01, 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 reimbursable in the first
instance from related collections from the Mortgagors pursuant to Section 5.03,
and further as provided in Section 5.02. All costs incurred by the Master
Servicer, if any, in effecting the timely payments of taxes and assessments on
the Mortgaged Properties and related insurance premiums shall not, for the
purpose of calculating monthly distributions to the Certificateholders, be added
to the Stated Principal Balance under the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit.

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         Section 3.02 DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS.

         (a) Except as otherwise provided in this Section 3.02, when any
property subject to a Mortgage has been or is about to be conveyed by the
Mortgagor, the Master Servicer shall to the extent that it has knowledge of such
conveyance, enforce any due-on-sale clause contained in any Mortgage Note or
Mortgage, to the extent permitted under applicable law and governmental
regulations, but only to the extent that such enforcement will not adversely
affect or jeopardize coverage under any Required Insurance Policy.
Notwithstanding the foregoing, the Master Servicer is not required to exercise
such rights with respect to a Mortgage Loan if the Person to whom the related
Mortgaged Property has been conveyed or is proposed to be conveyed satisfies the
terms and conditions contained in the Mortgage Note and Mortgage related thereto
and the consent of the mortgagee under such Mortgage Note or Mortgage is not
otherwise so required under such Mortgage Note or Mortgage as a condition to
such transfer. In the event that the Master Servicer is prohibited by law from
enforcing any such due-on-sale clause, or if coverage under any Required
Insurance Policy would be adversely affected, or if nonenforcement is otherwise
permitted hereunder, the Master Servicer is authorized, subject to Section
3.02(b), to take or enter into an assumption and modification agreement from or
with the person to whom such property has been or is about to be conveyed,
pursuant to which such person becomes liable under the Mortgage Note and, unless
prohibited by applicable state law, the Mortgagor remains liable thereon,
provided that the Mortgage Loan shall continue to be covered (if so covered
before the Master Servicer enters such agreement) by the applicable Required
Insurance Policies. The Master Servicer, subject to Section 3.02(b), is also
authorized with the prior approval of the insurers under any Required Insurance
Policies 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 Mortgage Note.
Notwithstanding the foregoing, the Master Servicer shall not be deemed to be in
default under this Section 3.02(a) by reason of any transfer or assumption that
the Master Servicer reasonably believes it is restricted by law from preventing.

         (b) Subject to the Master Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section 3.02(a), in any case in which a
Mortgaged Property has been conveyed to a Person by a Mortgagor, and such Person
is to enter into an assumption agreement or modification agreement or supplement
to the Mortgage Note or Mortgage that requires the signature of the Trustee, or
if an instrument of release signed by the Trustee is required releasing the
Mortgagor from liability on the related Mortgage Loan, the Master Servicer shall
prepare and deliver or cause to be prepared and delivered to the Trustee for
signature and shall direct, in writing, the Trustee to execute the assumption
agreement with the Person to whom the Mortgaged Property is to be conveyed and
such modification agreement or supplement to the Mortgage Note or Mortgage or
other instruments as are reasonable or necessary to carry out the terms of the
Mortgage Note or Mortgage or otherwise to comply with any applicable laws
regarding assumptions or the transfer of the Mortgaged Property to such Person.
In connection with any such assumption, no material term of the Mortgage Note
(including, but not limited to, the Mortgage Rate, the amount of the Scheduled
Payment and any other term affecting the amount or timing of payment on the
Mortgage Loan) may be changed. In addition, the substitute Mortgagor and the
Mortgaged Property must be acceptable to the Master Servicer in accordance with
its servicing standards as then in effect. The Master Servicer shall notify the
Trustee that

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<PAGE>

any such substitution or assumption agreement has been completed by forwarding
to the Trustee the original of such substitution or assumption agreement, which
in the case of the original 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. Any
fee collected by the Master Servicer for entering into an assumption or
substitution of liability agreement will be retained by the Master Servicer as
additional servicing compensation.

         Section 3.03 SUBSERVICERS.

         The Master Servicer shall perform all of its servicing responsibilities
hereunder or may cause a subservicer to perform any such servicing
responsibilities on its behalf, but the use by the Master Servicer of a
subservicer shall not release the Master Servicer from any of its obligations
hereunder and the Master Servicer shall remain responsible hereunder for all
acts and omissions of each subservicer as fully as if such acts and omissions
were those of the Master Servicer. The Master Servicer shall pay all fees of
each subservicer from its own funds, and a subservicer's fee shall not exceed
the Servicing Fee payable to the Master Servicer hereunder.

         At the cost and expense of the Master Servicer, without any right of
reimbursement from its Protected Account, the Master Servicer shall be entitled
to terminate the rights and responsibilities of a subservicer and arrange for
any servicing responsibilities to be performed by a successor subservicer;
provided, however, that nothing contained herein shall be deemed to prevent or
prohibit the Master Servicer, at the Master Servicer's option, from electing to
service the related Mortgage Loans itself. In the event that the Master
Servicer's responsibilities and duties under this Agreement are terminated
pursuant to Section 8.03, the Master Servicer shall at its own cost and expense
terminate the rights and responsibilities of each subservicer effective as of
the date of termination of the Master Servicer. The Master Servicer shall pay
all fees, expenses or penalties necessary in order to terminate the rights and
responsibilities of each subservicer from the Master Servicer's own funds
without reimbursement from the Trust Fund.

         Notwithstanding the foregoing, the Master Servicer shall not be
relieved of its obligations hereunder and shall be obligated to the same extent
and under the same terms and conditions as if it alone were servicing and
administering the Mortgage Loans. The Master Servicer shall be entitled to enter
into an agreement with a subservicer for indemnification of the Master Servicer
by the subservicer and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification.

         Any subservicing agreement and any other transactions or services
relating to the Mortgage Loans involving a subservicer shall be deemed to be
between such subservicer and the Master Servicer alone, and the Trustee shall
not have any obligations, duties or liabilities with respect to such subservicer
including any obligation, duty or liability of the Trustee to pay such
subservicer's fees and expenses. Each subservicing agreement shall provide that
such agreement may be assumed or terminated without cause or penalty by the
Trustee or other Successor Master Servicer in the event the Master Servicer is
terminated in accordance with this Agreement. For purposes of remittances to the
Trustee pursuant to this Agreement, the Master Servicer shall be

                                       64
<PAGE>

deemed to have received a payment on a Mortgage Loan when a subservicer has
received such payment.

         Section 3.04 DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF THE MASTER
SERVICER TO BE HELD FOR TRUSTEE.

         Notwithstanding any other provisions of this Agreement, the Master
Servicer shall transmit to the Trustee or the related Custodian on behalf of the
Trustee as required by this Agreement all documents and instruments in respect
of a Mortgage Loan coming into the possession of the Master Servicer from time
to time and shall account fully to the Trustee for any funds received by the
Master Servicer or that otherwise are collected by the Master Servicer as
Liquidation Proceeds, Insurance Proceeds or Subsequent Recoveries in respect of
any such Mortgage Loan. All Mortgage Files and funds collected or held by, or
under the control of, the Master Servicer in respect of any Mortgage Loans,
whether from the collection of principal and interest payments or from
Liquidation Proceeds or Subsequent Recoveries, including but not limited to, any
funds on deposit in the Protected Account, shall be held by the Master Servicer
for and on behalf of the Trustee and shall be and remain the sole and exclusive
property of the Trustee, subject to the applicable provisions of this Agreement.
The Master Servicer also agrees that it shall not create, incur or subject any
Mortgage File or any funds that are deposited in the Protected Account or in any
Escrow Account, or any funds that otherwise are or may become due or payable to
the Trustee for the benefit of the Certificateholders, to any claim, lien,
security interest, judgment, levy, writ of attachment or other encumbrance, or
assert by legal action or otherwise any claim or right of set off against any
Mortgage File or any funds collected on, or in connection with, a Mortgage Loan,
except, however, that the Master Servicer shall be entitled to set off against
and deduct from any such funds any amounts that are properly due and payable to
the Master Servicer under this Agreement.

         Section 3.05 MAINTENANCE OF HAZARD INSURANCE.

         The Master Servicer shall cause to be maintained, for each Mortgage
Loan, hazard insurance on buildings upon, or comprising part of, the Mortgaged
Property against loss by fire, hazards of extended coverage and such other
hazards as are customary in the area where the related Mortgaged Property is
located with an insurer which is licensed to do business in the state where the
related Mortgaged Property is located. Each such policy of standard hazard
insurance shall contain, or have an accompanying endorsement that contains, a
standard mortgagee clause. The Master Servicer shall also cause flood insurance
to be maintained on property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan, to the extent described below. Pursuant to
Section 4.01, any amounts collected by the Master Servicer under any such
policies (other than the amounts to be applied to the restoration or repair of
the related Mortgaged Property or property thus acquired or amounts released to
the Mortgagor in accordance with the Master Servicer's normal servicing
procedures) shall be deposited in the Protected Account. Any cost incurred by
the Master Servicer in maintaining any such insurance shall not, for the purpose
of calculating monthly distributions to the Certificateholders or remittances to
the Trustee for their benefit, be added to the principal balance of the Mortgage
Loan, notwithstanding that the terms of the Mortgage Loan so permit. Such costs
shall be recoverable by the Master Servicer out of late payments by the related
Mortgagor or out of Liquidation Proceeds to the extent

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permitted by Section 4.02. It is understood and agreed that no earthquake or
other additional insurance is to be required of any Mortgagor or maintained on
property acquired in respect of a Mortgage 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 is located at the
time of origination of the Mortgage Loan in a federally designated special flood
hazard area and such area is participating in the national flood insurance
program, the Master Servicer shall cause flood insurance to be maintained with
respect to such Mortgage Loan. Such flood insurance shall be in an amount equal
to the least of (i) the Stated Principal Balance of the related Mortgage Loan,
(ii) minimum amount required to compensate for damage or loss on a replacement
cost basis or (iii) the maximum amount of such insurance available for the
related Mortgaged Property under the Flood Disaster Protection Act of 1973, as
amended.

         In the event that the Master Servicer shall obtain and maintain a
blanket policy insuring against hazard losses on all of the Mortgage Loans, it
shall conclusively be deemed to have satisfied its obligations as set forth in
the first sentence of this Section 3.05, it being understood and agreed that
such policy may contain a deductible clause on terms substantially equivalent to
those commercially available and maintained by comparable servicers. If such
policy contains a deductible clause, the Master Servicer shall, in the event
that there shall not have been maintained on the related Mortgaged Property a
policy complying with the first sentence of this Section 3.05, and there shall
have been a loss that would have been covered by such policy, deposit in the
Protected Account the amount not otherwise payable under the blanket policy
because of such deductible clause. Such deposit shall be from the Master
Servicer's own funds without reimbursement therefor. In connection with its
activities as administrator and servicer of the Mortgage Loans, the Master
Servicer agrees to present, on behalf of itself, the Depositor and the Trustee
for the benefit of the Certificateholders claims under any such blanket policy.

         Section 3.06 PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS.

         The Master Servicer shall prepare and present on behalf of the Trustee
and the Certificateholders all claims under the Insurance Policies and take such
actions (including the negotiation, settlement, compromise or enforcement of the
insured's claim) as shall be necessary to realize recovery under such Insurance
Policies. Any proceeds disbursed to the Master Servicer in respect of such
Insurance Policies shall be promptly deposited in the Protected Account upon
receipt, except that any amounts realized that are to be applied to the repair
or restoration of the related Mortgaged Property as a condition precedent to the
presentation of claims on the related Mortgage Loan to the insurer under any
applicable Insurance Policy need not be so deposited (or remitted).

         Section 3.07 MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES.

         (a) The Master Servicer shall not take any action that would result in
noncoverage under any applicable Primary Mortgage Insurance Policy of any loss
which, but for the actions of the Master Servicer would have been covered
thereunder. The Master Servicer shall use its best efforts to keep in force and
effect (to the extent that the Mortgage Loan requires the Mortgagor to maintain
such insurance), Primary Mortgage Insurance applicable to each Mortgage Loan.
The Master Servicer shall not cancel or refuse to renew any such Primary
Mortgage Insurance Policy

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that is in effect at the date of the initial issuance of the Mortgage Note and
is required to be kept in force hereunder.

         (b) The Master Servicer agrees to present on behalf of the Trustee, the
Certificateholders claims to the insurer under any Primary Mortgage Insurance
Policies and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Primary Mortgage Insurance Policies
respecting defaulted Mortgage Loans. Pursuant to Section 4.01, any amounts
collected by the Master Servicer under any Primary Mortgage Insurance Policies
shall be deposited in the Protected Account, subject to withdrawal pursuant to
Section 4.02 hereof.

         Section 3.08 FIDELITY BOND, ERRORS AND OMISSIONS INSURANCE.

         The Master Servicer shall maintain, at its own expense, a blanket
fidelity bond and an errors and omissions insurance policy, with broad coverage
with responsible companies on all officers, employees or other persons acting in
any capacity with regard to the Mortgage Loans and who 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 Master 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 Master 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 which is not in accordance with Accepted
Servicing Practices. No provision of this Section 3.08 requiring the fidelity
bond and errors and omissions insurance shall diminish or relieve the Master
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 Accepted Servicing Practices. The
Master Servicer shall deliver to the Trustee a certificate from the surety and
the insurer as to the existence of the fidelity bond and errors and omissions
insurance policy and shall obtain a statement from the surety and the insurer
that such fidelity bond or insurance policy shall in no event be terminated or
materially modified without thirty days prior written notice to the Trustee. The
Master Servicer shall notify the Trustee within five business days of receipt of
notice that such fidelity bond or insurance policy will be, or has been,
materially modified or terminated. The Trustee for the benefit of the
Certificateholders must be named as loss payees on the fidelity bond and as
additional insured on the errors and omissions policy.

         Section 3.09 REALIZATION UPON DEFAULTED MORTGAGE LOANS; DETERMINATION
OF EXCESS LIQUIDATION PROCEEDS AND REALIZED LOSSES; REPURCHASES OF CERTAIN
MORTGAGE LOANS.

         (a) The Master Servicer shall use reasonable efforts 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. In
connection with such foreclosure or other conversion, the Master Servicer shall
follow such practices and procedures as it shall deem necessary or advisable and
as shall be normal and usual in its general mortgage servicing activities and
the requirements of the insurer under any Required Insurance Policy; provided
that the Master

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Servicer shall not be required to expend its own funds in connection with any
foreclosure or towards the restoration of any property unless it shall determine
(i) that such restoration and/or foreclosure will increase the proceeds of
liquidation of the Mortgage Loan after reimbursement to itself of such expenses
and (ii) that such expenses will be recoverable to it through Insurance
Proceeds, Liquidation Proceeds (respecting which it shall have priority for
purposes of withdrawals from the Protected Account pursuant to Section 4.02). If
the Master Servicer reasonably believes that Liquidation Proceeds with respect
to any such Mortgage Loan would not be increased as a result of such foreclosure
or other action, such Mortgage Loan will be charged-off and will become a
Liquidated Loan. The Master Servicer will give notice of any such charge-off to
the Trustee. The Master Servicer shall be responsible for all other costs and
expenses incurred by it in any such proceedings; provided that such costs and
expenses shall be Servicing Advances and that it shall be entitled to
reimbursement thereof from the proceeds of liquidation of the related Mortgaged
Property, as contemplated in Section 4.02. If the Master Servicer has knowledge
that a Mortgaged Property that the Master Servicer is contemplating acquiring in
foreclosure or by deed- in-lieu of foreclosure is located within a one-mile
radius of any site with environmental or hazardous waste risks known to the
Master Servicer, the Master Servicer will, prior to acquiring the Mortgaged
Property, consider such risks and only take action in accordance with its
established environmental review procedures.

         With respect to any REO Property, the deed or certificate of sale shall
be taken in the name of the Trustee for the benefit of the Certificateholders
(or the Trustee's nominee on behalf of the Certificateholders). The Trustee's
name shall be placed on the title to such REO Property solely as the Trustee
hereunder and not in its individual capacity. The Master Servicer shall ensure
that the title to such REO Property references this Agreement and the Trustee's
capacity hereunder. Pursuant to its efforts to sell such REO Property, the
Master Servicer shall either itself or through an agent selected by the Master
Servicer protect and conserve such REO Property in the same manner and to such
extent as is customary in the locality where such REO Property is located and
may, incident to its conservation and protection of the interests of the
Certificateholders, rent the same, or any part thereof, as the Master Servicer
deems to be in the best interest of the Master Servicer and the
Certificateholders for the period prior to the sale of such REO Property. The
Master Servicer shall prepare for and deliver to the Trustee a statement with
respect to each REO Property that has been rented showing the aggregate rental
income received and all expenses incurred in connection with the management and
maintenance of such REO Property at such times as is necessary to enable the
Trustee to comply with the reporting requirements of the REMIC Provisions. The
net monthly rental income, if any, from such REO Property shall be deposited in
the Protected Account no later than the close of business on each Determination
Date. The Master Servicer shall perform the tax reporting and withholding
related to foreclosures, abandonments and cancellation of indebtedness income as
specified by Sections 1445, 6050J and 6050P of the Code by preparing and filing
such tax and information returns, as may be required.

         In the event that the Trust Fund acquires any Mortgaged Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Master Servicer shall dispose of such Mortgaged Property
prior to three years after its acquisition by the Trust Fund or, at the expense
of the Trust Fund, request more than 60 days prior to the day on which such
three-year period would otherwise expire, an extension of the three-year grace
period

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unless the Trustee shall have been supplied with an Opinion of Counsel addressed
to the Trustee (such opinion not to be an expense of the Trustee) to the effect
that the holding by the Trust Fund of such Mortgaged Property subsequent to such
three-year period will not result in the imposition of taxes on "prohibited
transactions" of REMIC I, REMIC II, REMIC III or REMIC IV as defined in section
860F of the Code or cause any of REMIC I, REMIC II, REMIC III or REMIC IV 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 Mortgaged Property (subject
to any conditions contained in such Opinion of Counsel). Notwithstanding any
other provision of this Agreement, no Mortgaged Property acquired by the Trust
Fund shall be rented (or allowed to continue to be rented) or otherwise used for
the production of income by or on behalf of the Trust Fund in such a manner or
pursuant to any terms that would (i) cause such Mortgaged Property to fail to
qualify as "foreclosure property" within the meaning of section 860G(a)(8) of
the Code or (ii) subject any of REMIC I, REMIC II, REMIC III or REMIC IV to the
imposition of any federal, state or local income taxes on the income earned from
such Mortgaged Property under section 860G(c) of the Code or otherwise, unless
the Master Servicer has agreed to indemnify and hold harmless the Trust Fund
with respect to the imposition of any such taxes.

         The decision of the Master Servicer to foreclose on a defaulted
Mortgage Loan shall be subject to a determination by the Master Servicer that
the proceeds of such foreclosure would exceed the costs and expenses of bringing
such a proceeding. The income earned from the management of any Mortgaged
Properties acquired through foreclosure or other judicial proceeding, net of
reimbursement to the Master Servicer for expenses incurred (including any
property or other taxes) in connection with such management and net of
unreimbursed Servicing Fees, Advances, Servicing Advances and any management fee
paid or to be paid with respect to the management of such Mortgaged Property,
shall be applied to the payment of principal of, and interest on, the related
defaulted Mortgage Loans (with interest accruing as though such Mortgage Loans
were still current) and all such income shall be deemed, for all purposes in the
Agreement, to be payments on account of principal and interest on the related
Mortgage Notes and shall be deposited into the Protected Account. To the extent
the income received during a Prepayment Period is in excess of the amount
attributable to amortizing principal and accrued interest at the related
Mortgage Rate on the related Mortgage Loan, such excess shall be considered to
be a partial Principal Prepayment for all purposes hereof.

         The Liquidation Proceeds from any liquidation of a Mortgage Loan, net
of any payment to the Master Servicer as provided above, shall be deposited in
the Protected Account on the next succeeding Determination Date following
receipt thereof for distribution on the related Distribution Date, except that
any Excess Liquidation Proceeds shall be retained by the Master Servicer as
additional servicing compensation.

         The proceeds of any Liquidated Loan, as well as any recovery resulting
from a partial collection of Liquidation Proceeds or any income from an REO
Property, will be applied in the following order of priority: first, to
reimburse the Master Servicer for any related unreimbursed Servicing Advances
and Servicing Fees, pursuant to Section 4.02 or this Section 3.09; second, to
reimburse the Master Servicer for any unreimbursed Advances, pursuant to Section
4.02 or this Section 3.09; third, to accrued and unpaid interest (to the extent
no Advance has been made for such amount) on the Mortgage Loan or related REO
Property, at the Net Mortgage Rate to the

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<PAGE>

first day of the month in which such amounts are required to be distributed; and
fourth, as a recovery of principal of the Mortgage Loan.

         (b) On each Determination Date, the Master Servicer shall determine the
respective aggregate amounts of Excess Liquidation Proceeds and Realized Losses,
if any, for the related Prepayment Period.

         (c) The Master Servicer has no intent to foreclose on any Mortgage Loan
based on the delinquency characteristics as of the Closing Date; provided, that
the foregoing does not prevent the Master Servicer from initiating foreclosure
proceedings on any date hereafter if the facts and circumstances of such
Mortgage Loans including delinquency characteristics in the Master Servicer's
discretion so warrant such action.

         Section 3.10 SERVICING COMPENSATION.

         As compensation for its activities hereunder, the Master Servicer shall
be entitled to retain or withdraw from the Protected Account out of each payment
of interest on a Mortgage Loan included in the Trust Fund an amount equal to the
Servicing Fee.

         Additional servicing compensation in the form of any Excess Liquidation
Proceeds, assumption fees, late payment charges, all income and gain net of any
losses realized from Permitted Investments with respect to funds in or credited
to the Protected Account shall be retained by the Master Servicer to the extent
not required to be deposited in the Protected Account pursuant to Section 4.02.
The Master Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder (including payment of any
premiums for hazard insurance, as required by Section 3.05 and maintenance of
the other forms of insurance coverage required by Section 3.07) and shall not be
entitled to reimbursement therefor except as specifically provided in Section
4.02.

         Section 3.11 REO PROPERTY.

         (a) In the event the Trust Fund acquires ownership of any REO Property
in respect of any related Mortgage Loan, the deed or certificate of sale shall
be issued to the Trustee, or to its nominee, on behalf of the related
Certificateholders. The Master Servicer shall sell any REO Property as
expeditiously as possible and in accordance with the provisions of this
Agreement. Pursuant to its efforts to sell such REO Property, the Master
Servicer shall protect and conserve such REO Property in the manner and to the
extent required herein, in accordance with the REMIC Provisions.

         (b) The Master Servicer shall deposit all funds collected and received
in connection with the operation of any REO Property into the Protected Account.

         (c) The Master Servicer, upon the final disposition of any REO
Property, shall be entitled to reimbursement for any related unreimbursed
Advances, unreimbursed Servicing Advances or Servicing Fees from Liquidation
Proceeds received in connection with the final disposition of such REO Property;
provided, that any such unreimbursed Advances or Servicing Fees as well as any
unpaid Servicing Fees may be reimbursed or paid, as the case may be, prior

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to final disposition, out of any net rental income or other net amounts derived
from such REO Property.

         Section 3.12 LIQUIDATION REPORTS.

         Upon the foreclosure of any Mortgaged Property or the acquisition
thereof by the Trust Fund pursuant to a deed-in-lieu of foreclosure, the Master
Servicer shall submit a liquidation report to the Trustee containing such
information as shall be mutually acceptable to the Master Servicer and the
Trustee with respect to such Mortgaged Property.

         Section 3.13 ANNUAL CERTIFICATE AS TO COMPLIANCE.

         (a) The Master Servicer will deliver to the Trustee and the Rating
Agencies not later than March 1, 2005 and not later than March 1 of each year
thereafter, a certificate of a Servicing Officer stating, as to each signatory
thereof, that (i) a review of the activities of the Master Servicer during the
preceding calendar year or portion thereof and of its performance under this
Agreement has been made under such officer's supervision, and (ii) to the best
of such officer's knowledge, based on such review, the Master Servicer has
fulfilled all of its obligations under this Agreement in all material respects
throughout such year or portion thereof, 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 except for such defaults as such
officer in its good faith judgment believe to be immaterial.

         (b) Copies of such statements shall be provided to any
Certificateholder upon request by the Master Servicer or by the Trustee at the
Master Servicer's expense if the Master Servicer failed to provide such copies
(unless (i) the Master Servicer shall have failed to provide the Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement).

         Section 3.14 ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' SERVICING
REPORT.

         Not later than March 1, 2005 and not later than March 1 of each year
thereafter, the Master Servicer at its expense shall cause a firm of independent
public accountants which is a member of the American Institute of Certified
Public Accountants to furnish a statement to the Trustee and the Rating Agencies
to the effect that, with respect to the preceding calendar year, such firm has
examined certain documents and records relating to the Master Servicer's
servicing of mortgage loans of the same type as the Mortgage Loans pursuant to
servicing agreements substantially similar to this Agreement, which agreements
may include this Agreement, and that, on the basis of such an examination,
conducted substantially in compliance with the Uniform Single Attestation
Program for Mortgage Bankers, such firm is of the opinion that the Master
Servicer's servicing has been conducted in compliance with the agreements
examined pursuant to this Section 3.14, except for (i) such exceptions as such
firm shall believe to be immaterial,(ii) such other exceptions as shall be set
forth in such statement and (iii) such exceptions that the Uniform Single
Attestation Program for Mortgage Bankers requires it to report. Copies of such
statements shall be provided to any Certificateholder upon request by the Master
Servicer or by the Trustee at the Master Servicer's expense if the Master
Servicer failed

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to provide such copies (unless (i) the Master Servicer shall have failed to
provide the Trustee with such statement or (ii) the Trustee shall be unaware of
the Master Servicer's failure to provide such statement).

         Section 3.15 BOOKS AND RECORDS.

         The Master Servicer shall be responsible for maintaining, and shall
maintain, a complete set of books and records for the Mortgage Loans which shall
be appropriately identified in the Master Servicer's computer system to clearly
reflect the ownership of the Mortgage Loans by the Trust. In particular, the
Master Servicer shall maintain in its possession, available for inspection by
the Trustee and shall deliver to the Trustee upon demand, evidence of compliance
with all federal, state and local laws, rules and regulations. To the extent
that original documents are not required for purposes of realization of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the Master
Servicer may be in the form of microfilm or microfiche or such other reliable
means of recreating original documents, including, but not limited to, optical
imagery techniques so long as the Master Servicer complies with the requirements
of Accepted Servicing Practices.

         The Master Servicer shall maintain with respect to each Mortgage Loan
and shall make available for inspection by the Trustee the related servicing
file during the time such Mortgage Loan is subject to this Agreement and
thereafter in accordance with applicable law.

         Section 3.16 REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION.

         (a) The Depositor shall prepare or cause to be prepared the initial
current report on Form 8-K. Within 15 days after each Distribution Date, the
Trustee shall, in accordance with industry standards, file with the Commission
via the Electronic Data Gathering and Retrieval System ("EDGAR"), a Form 8-K
with a copy of the monthly statement to be furnished by the Trustee to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
January 30 in each year commencing in 2005, the Trustee shall, in accordance
with industry standards, file a Form 15 Suspension Notice with respect to the
Trust Fund, if applicable. Prior to (i) March 15, 2005 and (ii) unless and until
a Form 15 Suspension Notice shall have been filed, prior to March 15 of each
year thereafter, the Master Servicer shall provide the Trustee with a Master
Servicer Certification, together with a copy of the annual independent
accountant's servicing report and annual statement of compliance to be delivered
by the Master Servicer pursuant to Sections 3.13 and 3.14. Prior to (i) March
31, 2005 and (ii) unless and until a Form 15 Suspension Notice shall have been
filed, March 31 of each year thereafter, the Trustee shall, subject to
subsection (d) below, file a Form 10-K, in substance conforming to industry
standards, with respect to the Trust Fund. Such Form 10-K shall include the
Master Servicer Certification and other documentation provided by the Master
Servicer pursuant to the second preceding sentence and the Form 10-K
certification signed by the Depositor. The Depositor hereby grants to the
Trustee a limited power of attorney to execute and file each such document on
behalf of the Depositor. Such power of attorney shall continue until either the
earlier of (i) receipt by the Trustee from the Depositor of written termination
of such power of attorney and (ii) the termination of the Trust Fund. The
Depositor agrees to promptly furnish to the Trustee, from time to time upon
request, such further information, reports and financial statements within its

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control related to this Agreement, the Mortgage Loans as the Trustee reasonably
deems appropriate to prepare and file all necessary reports with the Commission.
The Trustee shall have no responsibility to file any items other than those
specified in this Section 3.16; provided, however, the Trustee will cooperate
with the Depositor in connection with any additional filings with respect to the
Trust Fund as the Depositor deems necessary under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). Copies of all reports filed by the
Trustee under the Exchange Act shall be sent to: the Depositor c/o Bear, Stearns
& Co. Inc., Attn: Managing Director-Analysis and Control, One Metrotech Center
North, Brooklyn, New York 11202-3859. Fees and expenses incurred by the Trustee
in connection with this Section 3.16 shall not be reimbursable from the Trust
Fund.

         (b) In connection with the filing of any 10-K hereunder, the Trustee
shall sign a certification (in the form attached hereto as Exhibit K) for the
Depositor regarding certain aspects of the Form 10-K certification signed by the
Depositor, provided, however, that the Trustee shall not be required to
undertake an analysis of any accountant's report attached as an exhibit to the
Form 10-K.

         (c)      (i) 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 3.16 or the
Trustee's negligence, bad faith or willful misconduct in connection therewith.

                  (ii) The Depositor shall indemnify and hold harmless the
         Trustee 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 obligations of
         the Depositor under this Section 3.16 or the Depositor's negligence,
         bad faith or willful misconduct in connection therewith.

                  (iii) The Master Servicer shall indemnify and hold harmless
         the Trustee and the Depositor and their respective 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 obligations of the Master Servicer under this Section
         3.16 or the Master Servicer's negligence, bad faith or willful
         misconduct in connection therewith.

                  (iv) If the indemnification provided for herein is unavailable
         or insufficient to hold harmless the Depositor or the Trustee, as
         applicable, then the defaulting party, in connection with a breach of
         its respective obligations under this Section 3.16 or its respective
         negligence, bad faith or willful misconduct in connection therewith,
         agrees that it shall contribute to the amount paid or payable by the
         other parties as a result of the losses, claims, damages or liabilities
         of the other party in such proportion as is appropriate to reflect the
         relative fault and the relative benefit of the Depositor on the one
         hand and the Trustee on the other.

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         (d) Nothing shall be construed from the foregoing subsections (a), (b)
and (c) to require the Trustee or any officer, director or Affiliate thereof to
sign any Form 10-K or any certification contained therein. Furthermore, the
inability of the Trustee to file a Form 10-K as a result of the lack of required
information as set forth in Section 3.16(a) or required signatures on such Form
10-K or any certification contained therein shall not be regarded as a breach by
the Trustee of any obligation under this Agreement.

         (e) Notwithstanding the provisions of Section 11.01, this Section 3.16
may be amended without the consent of the Certificateholders.

         Section 3.17 UCC.

         The Trustee agrees to file continuation statements for any Uniform
Commercial Code financing statements which the Seller has informed the Trustee
were filed on the Closing Date in connection with the Trust. The Seller shall
file any financing statements or amendments thereto required by any change in
the Uniform Commercial Code.

         Section 3.18 OPTIONAL PURCHASE OF CERTAIN MORTGAGE LOANS.

         With respect to any Mortgage Loans which as of the first day of a
Calendar Quarter is delinquent in payment by 90 days or more or is an REO
Property, EMC shall have the right to purchase any Mortgage Loan from the Trust
which becomes 90 days or more delinquent or becomes an REO Property at a price
equal to the Purchase Price; provided however (i) that such Mortgage Loan is
still 90 days or more delinquent or is an REO Property as of the date of such
purchase and (ii) this purchase option, if not theretofore exercised, shall
terminate on the date prior to the last day of the related Calendar Quarter.
This purchase option, if not exercised, shall not be thereafter reinstated
unless the delinquency is cured and the Mortgage Loan thereafter again becomes
90 days or more delinquent or becomes an REO Property, in which case the option
shall again become exercisable as of the first day of the related Calendar
Quarter.

         In addition, EMC shall, at its option, purchase any Mortgage Loan from
the Trust if the first Due Date for such Mortgage Loan is subsequent to the
Cut-off Date and the initial Scheduled Payment is not made within thirty (30)
days of such Due Date. Such purchase shall be made at a price equal to the
Purchase Price.

         If at any time EMC remits to the Master Servicer a payment for deposit
in the Protected Account covering the amount of the Purchase Price for such a
Mortgage Loan, and EMC provides to the Trustee a certification signed by a
Servicing Officer stating that the amount of such payment has been deposited in
the Protected Account, then the Trustee shall execute the assignment of such
Mortgage Loan prepared and delivered to the Trustee, at the request of EMC,
without recourse, representation or warranty, to EMC which shall succeed to all
the Trustee's right, title and interest in and to such Mortgage Loan, and all
security and documents relative thereto. Such assignment shall be an assignment
outright and not for security. EMC will thereupon own such Mortgage, and all
such security and documents, free of any further obligation to the Trustee or
the Certificateholders with respect thereto.

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         Section 3.19 OBLIGATIONS OF THE MASTER SERVICER IN RESPECT OF MORTGAGE
RATES AND SCHEDULED 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 Rates, Scheduled 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 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 Master Servicer in respect of any such liability. Such indemnities
shall survive the termination or discharge of this Agreement. Notwithstanding
the foregoing, this Section 3.19 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 and Mortgage, to the extent permitted by
applicable law.

         Section 3.20 RESERVE FUND.

         (a) On or before the Closing Date, the Trustee shall establish a
Reserve Fund on behalf of the Holders of the Certificates. The Reserve Fund must
be an Eligible Account. The Reserve Fund shall be entitled "Reserve Fund,
LaSalle Bank National Association as Trustee for the benefit of holders of Bear
Stearns Asset Backed Securities I LLC, Asset-Backed Certificates, Series
2004-HE10". The Trustee shall demand payment of all money payable by Bear
Stearns Financial Products Inc. (the "Counterparty") under the Yield Maintenance
Agreements. The Trustee shall deposit in the Reserve Fund all payments received
from the Counterparty pursuant to the Yield Maintenance Agreements. On each
Distribution Date the Trustee shall remit amounts received from the Counterparty
to the Holders of the Class A Certificates, Class M Certificates and Class CE
Certificates in the manner provided in clause (b) below. In addition, on each
Distribution Date as to which there is a Basis Risk Shortfall Carry Forward
Amount payable to any Class of Class A Certificates and/or Class M Certificates,
the Trustee shall deposit the amounts distributable pursuant to clauses (C) and
(D) of Section 5.04(a)(4) into the Reserve Fund and the Trustee has been
directed by the Class CE Certificateholder to distribute such amounts to the
Holders of the Class A and/or Class M Certificates in the amounts and priorities
set forth in clauses (C) and (D) of Section 5.04(a)(4). Any amount paid to the
Holders of Class A Certificates and/or Class M Certificates pursuant to the
preceding sentence in respect of Basis Risk Shortfall Carry Forward Amount shall
be treated as distributed to the Class CE Certificateholder in respect of the
Class CE Certificates and paid by the Class CE Certificateholder to the Holders
of the Class A Certificates and/or Class M Certificates. Any payments to the
Holders of the Class A Certificates and/or Class M Certificates in respect of
Basis Risk Shortfall Carry Forward Amount, whether pursuant to the second
preceding sentence or pursuant to subsection (b) below, shall not be payments
with respect to a "regular interest" in a REMIC within the meaning of Code
Section 860(G)(a)(1).

         (b) Amounts received from the Counterparty under the Yield Maintenance
Agreements shall be distributed in the following manner and order of priority:

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                  (i) FIRST, (A) from amounts received under the Yield
         Maintenance Agreement related to the Class I-A Certificates, to the
         Class I-A Certificates, pro rata based on the amount of Basis Risk
         Shortfall Carry Forward Amount for such Classes of Certificates for the
         related Distribution Date, (B) from amounts received under the Yield
         Maintenance Agreement related to the Class II-A Certificates, to the
         Class II-A Certificates, pro rata based on the amount of Basis Risk
         Shortfall Carry Forward Amount for such Classes of Certificates for the
         related Distribution Date and (C) from amounts received under the Yield
         Maintenance Agreement related to the Class M Certificates, sequentially
         to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6
         and Class M-7 Certificates, in that order, the amount of any Basis Risk
         Shortfall Carry Forward Amount for such Classes of Certificates for the
         related Distribution Date;

                  (ii) SECOND, from any remaining amounts received under the
         non-related Yield Maintenance Agreements, to the Class A Certificates
         and Class M Certificates, as applicable, pro rata, based on the
         aggregate amount of Basis Risk Shortfall Carry Forward Amounts for the
         Class A Certificates and Class M Certificates, as applicable, for such
         Distribution Date to the extent not covered in clause (i) above, which
         amounts shall be paid in the case of the Class I-A, Class II-A and
         Class M Certificates in the order of priority in clauses (i) first (A),
         (B) and (C) above; and

                  (iii) THIRD, any remaining amounts received under the Yield
         Maintenance Agreements, to the Class CE Certificates.

         (c) The Reserve Fund is an "outside reserve fund" within the meaning of
Treasury Regulation ss.1.860G-2(h) and shall be an asset of the Trust Fund but
not an asset of any REMIC. The Trustee on behalf of the Trust shall be the
nominal owner of the Reserve Fund. The Class CE Certificateholder shall be the
beneficial owner of the Reserve Fund, subject to the power of the Trustee to
transfer amounts under Section 5.04. Amounts in the Reserve Fund shall, at the
direction of the Class CE Certificateholder, be invested in Permitted
Investments that mature no later than the Business Day prior to the next
succeeding Distribution Date. All net income and gain from such investments
shall be distributed to the Class CE Certificateholder, not as a distribution in
respect of any interest in any REMIC, on such Distribution Date. All amounts
earned on amounts on deposit in the Reserve Fund shall be taxable to the Class
CE Certificateholder. Any losses on such investments shall be deposited in the
Reserve Fund by the Class CE Certificateholder out of its own funds immediately
as realized.

         Section 3.21 ADVANCING FACILITY.

         (a) The Master Servicer and/or the Trustee on behalf of the Trust Fund,
in either case, with the consent of the Master Servicer in the case of the
Trustee and, in each case, with notice to the Rating Agencies, 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 3.21, upon reasonable
request of the Advancing Person, the Trustee shall execute a

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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
3.21(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 3.21. An Advancing Person whose
obligations hereunder are limited to the funding of Advances and/or Servicing
Advances shall not be required to meet the qualifications of a Master Servicer
or a subservicer pursuant to Section 8.02 hereof and will not be deemed to be a
subservicer under this Agreement.

         (b) If an Advancing Facility is entered into, then the Master Servicer
shall not be permitted to reimburse itself therefor under Section 4.02(a)(ii),
Section 4.02(a)(iii) and Section 4.02(a)(v) 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 4.02. 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 4.02(a)(ii), Section
4.02(a)(iii) or Section 4.02(a)(v), 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 3.21 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 3.21, 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, notwithstanding anything to the contrary in this Agreement.

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                                   ARTICLE IV

                                    ACCOUNTS

         Section 4.01 COLLECTION OF MORTGAGE LOAN PAYMENTS; PROTECTED ACCOUNT.

         (a) The Master Servicer shall make reasonable efforts in accordance
with customary and usual standards of practice of prudent mortgage lenders in
the respective states in which the Mortgaged Properties are located to collect
all payments called for under the terms and provisions of the Mortgage Loans to
the extent such procedures shall be consistent with this Agreement and the terms
and provisions of any related Required Insurance Policy. Consistent with the
foregoing, the Master Servicer may in its discretion (i) waive any late payment
charge and (ii) extend the due dates for payments due on a Mortgage Note for a
period not greater than 125 days. In the event of any such arrangement, the
Master Servicer shall make Advances on the related Mortgage Loan during the
scheduled period in accordance with the amortization schedule of such Mortgage
Loan without modification thereof by reason of such arrangements, and shall be
entitled to reimbursement therefor in accordance with Section 5.01. The Master
Servicer shall not be required to institute or join in litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage Note or
otherwise or against any public or governmental authority with respect to a
taking or condemnation) if it reasonably believes that enforcing the provision
of the Mortgage or other instrument pursuant to which such payment is required
is prohibited by applicable law. In addition, if (x) a Mortgage Loan is in
default or default is imminent or (y) the Master Servicer delivers to the
Trustee a certification addressed to the Trustee, based on the advice of counsel
or certified public accountants, in either case, that have a national reputation
with respect to taxation of REMICs, that a modification of such Mortgage Loan
will not result in the imposition of taxes on or disqualify any of REMIC I,
REMIC II, REMIC III or REMIC IV, the Master Servicer may, (A) amend the related
Mortgage Note to reduce the Mortgage Rate applicable thereto, provided that such
reduced Mortgage Rate shall in no event be lower than 5.00% with respect to any
Mortgage Loan and (B) amend any Mortgage Note to extend to the maturity thereof.

         The Master Servicer shall not waive (or permit a sub-servicer to waive)
any Prepayment Charge unless: (i) the enforceability thereof shall have been
limited by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors' rights generally, (ii) the enforcement thereof is
illegal, or any local, state or federal agency has threatened legal action if
the prepayment penalty is enforced, (iii) the collectability thereof shall have
been limited due to acceleration in connection with a foreclosure or other
involuntary payment or (iv) such waiver is standard and customary in servicing
similar Mortgage Loans and relates to a default or a reasonably foreseeable
default and would, in the reasonable judgment of the Master Servicer, maximize
recovery of total proceeds taking into account the value of such Prepayment
Charge and the related Mortgage Loan. If a Prepayment Charge is waived, but does
not meet the standards described above, then the Master Servicer is required to
pay the amount of such waived Prepayment Charge, for the benefit of the Class P
Certificates, by remitting such amount to the Trustee by the Distribution
Account Deposit Date.

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         (b) The Master Servicer shall establish and maintain a Protected
Account (which shall at all times be an Eligible Account) with a depository
institution in the name of the Master Servicer for the benefit of the Trustee on
behalf of the Certificateholders and designated "EMC Mortgage Corporation, as
Master Servicer, for the benefit of LaSalle Bank National Association, in trust
for registered holders of Bear Stearns Asset Backed Securities I LLC,
Asset-Backed Certificates Series 2004-HE10". The Master Servicer shall deposit
or cause to be deposited into the Protected Account on a daily basis within one
Business Day of receipt, except as otherwise specifically provided herein, the
following payments and collections remitted by subservicers or received by it in
respect of the Mortgage Loans subsequent to the Cut-off Date (other than in
respect of principal and interest due on the Mortgage Loans on or before the
Cut-off Date) and the following amounts required to be deposited hereunder:

                  (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
         net of the Servicing Fee permitted under Section 3.10 and LPMI Fees, if
         any;

                  (iii) all Liquidation Proceeds, Subsequent Recoveries and
         Insurance Proceeds, other than proceeds to be applied to the
         restoration or repair of the Mortgaged Property or released to the
         Mortgagor in accordance with the Master Servicer's normal servicing
         procedures;

                  (iv) any amount required to be deposited by the Master
         Servicer pursuant to Section 4.01(c) in connection with any losses on
         Permitted Investments;

                  (v) any amounts required to be deposited by the Master
         Servicer pursuant to Section 3.05;

                  (vi) any Prepayment Charges collected on the Mortgage Loans;
         and

                  (vii) any other amounts required to be deposited hereunder.

         The foregoing requirements for remittance by the Master Servicer into
the Protected 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 or assumption fees, if collected, need not be remitted by the
Master Servicer. In the event that the Master Servicer shall remit any amount
not required to be remitted and not otherwise subject to withdrawal pursuant to
Section 4.02, it may at any time withdraw or direct the institution maintaining
the Protected Account, to withdraw such amount from the Protected Account, any
provision herein to the contrary notwithstanding. Such withdrawal or direction
may be accomplished by delivering written notice thereof to the institution
maintaining the Protected Account, that describes the amounts deposited in error
in the Protected Account. The Master Servicer shall maintain adequate records
with respect to all withdrawals made pursuant to this Section. All funds
deposited in the Protected Account shall be held in trust for the
Certificateholders until withdrawn in accordance with Section 4.02.

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         (c) The institution that maintains the Protected Account shall invest
the funds in the Protected Account, in the manner directed by the Master
Servicer, in Permitted Investments which shall mature not later than the
Remittance Date and shall not be sold or disposed of prior to its maturity. All
such Permitted Investments shall be made in the name of the Trustee, for the
benefit of the Certificateholders. All income and gain net of any losses
realized from any such investment shall be for the benefit of the Master
Servicer as servicing compensation and shall be remitted to it monthly as
provided herein. The amount of any losses incurred in the Protected Account in
respect of any such investments shall be deposited by the Master Servicer into
the Protected Account, out of the Master Servicer's own funds.

         (d) The Master Servicer shall give at least 30 days advance notice to
the Trustee, the Seller, each Rating Agency and the Depositor of any proposed
change of location of the Protected Account prior to any change thereof.

         Section 4.02 PERMITTED WITHDRAWALS FROM THE PROTECTED ACCOUNT.

         (a) The Master Servicer may from time to time make withdrawals from the
Protected Account for the following purposes:

                  (i) to pay itself (to the extent not previously paid to or
         withheld by the Master Servicer), as servicing compensation in
         accordance with Section 3.10, that portion of any payment of interest
         that equals the Servicing Fee for the period with respect to which such
         interest payment was made, and, as additional servicing compensation,
         those other amounts set forth in Section 3.10;

                  (ii) to reimburse the Master Servicer for Advances made by it
         with respect to the Mortgage Loans, provided, however, that the Master
         Servicer's right of reimbursement pursuant to this subclause (ii) shall
         be limited to amounts received on particular Mortgage Loan(s)
         (including, for this purpose, Liquidation Proceeds, Insurance Proceeds
         and Subsequent Recoveries) that represent late recoveries of payments
         of principal and/or interest on such particular Mortgage Loan(s) in
         respect of which any such Advance was made;

                  (iii) to reimburse the Master Servicer for any previously made
         portion of a Servicing Advance or an Advance made by the Master
         Servicer that, in the good faith judgment of the Master Servicer, will
         not be ultimately recoverable by it from the related Mortgagor, any
         related Liquidation Proceeds, Insurance Proceeds or otherwise (a
         "Nonrecoverable Advance"), to the extent not reimbursed pursuant to
         clause (ii) or clause (v);

                  (iv) to reimburse the Master Servicer from Insurance Proceeds
         for Insured Expenses covered by the related Insurance Policy;

                  (v) to pay the Master Servicer any unpaid Servicing Fees and
         to reimburse it for any unreimbursed Servicing Advances, provided,
         however, that the Master Servicer's right to reimbursement for
         Servicing Advances pursuant to this subclause (v) with respect to any
         Mortgage Loan shall be limited to amounts received on particular
         Mortgage

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         Loan(s) (including, for this purpose, Liquidation Proceeds, Insurance
         Proceeds, Subsequent Recoveries and purchase and repurchase proceeds)
         that represent late recoveries of the payments for which such Servicing
         Advances were made;

                  (vi) to pay to the Seller, the Depositor or itself, as
         applicable, with respect to each Mortgage Loan or property acquired in
         respect thereof that has been purchased pursuant to Section 2.02, 2.03
         or 3.18 of this Agreement, all amounts received thereon and not taken
         into account in determining the related Stated Principal Balance of
         such repurchased Mortgage Loan;

                  (vii) to pay any expenses recoverable by the Master Servicer
         pursuant to Section 7.04 of this Agreement;

                  (viii) to withdraw pursuant to Section 4.01 any amount
         deposited in the Protected Account and not required to be deposited
         therein; and

                  (ix) to clear and terminate the Protected Account upon
         termination of this Agreement pursuant to Section 10.01 hereof.

         In addition, no later than 1:00 p.m. Eastern time on the Distribution
Account Deposit Date, the Master Servicer shall withdraw from the Protected
Account and remit to the Trustee the amount of Interest Funds for each Loan
Group (without taking into account any reduction in the amount of Interest Funds
attributable to the application of clause (c) of the definition thereof
contained in Article I of this Agreement) and Principal Funds for each Loan
Group collected, to the extent on deposit, and the Trustee shall deposit such
amount in the Distribution Account. In addition, on or before the Distribution
Account Deposit Date, the Master Servicer shall remit to the Trustee for deposit
in the Distribution Account any Advances or any payments of Compensating
Interest required to be made by the Master Servicer with respect to the Mortgage
Loans. Furthermore, on each Distribution Account Deposit Date, the Master
Servicer shall remit to the Trustee all Prepayment Charges collected by the
Master Servicer with respect to the Mortgage Loans during the related Prepayment
Period.

         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 Protected Account pursuant to subclauses (i), (ii), (iv),
(v), (vi) and (vii) above. Prior to making any withdrawal from the Protected
Account pursuant to subclause (iii), the Master Servicer shall deliver to the
Trustee an Officer's Certificate of a Servicing Officer indicating the amount of
any previous Advance or Servicing Advance determined by the Master Servicer to
be a Nonrecoverable Advance and identifying the related Mortgage Loan(s), and
their respective portions of such Nonrecoverable Advance.

         Section 4.03 COLLECTION OF TAXES; ASSESSMENTS AND SIMILAR ITEMS; ESCROW
ACCOUNTS.

         With respect to each Mortgage Loan, to the extent required by the
related Mortgage Note, the Master Servicer shall establish and maintain one or
more accounts (each, an "Escrow Account") and deposit and retain therein all
collections from the Mortgagors (or advances by the Master Servicer) for the
payment of taxes, assessments, hazard insurance premiums or

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comparable items for the account of the Mortgagors. Nothing herein shall require
the Master Servicer to compel a Mortgagor to establish an Escrow Account in
violation of applicable law.

         Withdrawals of amounts so collected from the Escrow Accounts may be
made only to effect timely payment of taxes, assessments, hazard insurance
premiums, condominium or PUD association dues, or comparable items, to reimburse
the Master Servicer out of related collections for any payments made with
respect to each Mortgage Loan pursuant to Section 3.01 (with respect to taxes
and assessments and insurance premiums) and Section 3.05 (with respect to hazard
insurance), to refund to any Mortgagors for any Mortgage Loans any sums as may
be determined to be overages, to pay interest, if required by law or the terms
of the related Mortgage or Mortgage Note, to such Mortgagors on balances in the
Escrow Account or to clear and terminate the Escrow Account at the termination
of this Agreement in accordance with Section 10.01 thereof. The Escrow Account
shall not be a part of the Trust Fund.

         Section 4.04 DISTRIBUTION ACCOUNT.

         (a) The Trustee shall establish and maintain in the name of the
Trustee, for the benefit of the Certificateholders, the Distribution Account as
a segregated trust account or accounts.

         (b) All amounts deposited to the Distribution Account shall be held by
the Trustee in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement.

         (c) The Distribution Account shall constitute an Eligible Account of
the Trust Fund segregated on the books of the Trustee and held by the Trustee
and the Distribution Account and the funds deposited therein shall not be
subject to, and shall be protected from, all claims, liens, and encumbrances of
any creditors or depositors of the Trustee (whether made directly, or indirectly
through a liquidator or receiver of the Trustee). The amount at any time
credited to the Distribution Account may be invested in the name of the Trustee,
in such Permitted Investments, or deposited in demand deposits with such
depository institutions, as determined by the Trustee. All Permitted Investments
shall mature or be subject to redemption or withdrawal on or before, and shall
be held until, the next succeeding Distribution Date if the obligor for such
Permitted Investment is the Trustee or, if such obligor is any other Person, the
Business Day preceding such Distribution Date. All investment earnings on
amounts on deposit in the Distribution Account or benefit from funds uninvested
therein from time to time shall be for the account of the Trustee. The Trustee
shall be permitted to withdraw or receive distribution of any and all investment
earnings from the Distribution Account on each Distribution Date. If there is
any loss on a Permitted Investment or demand deposit, the Trustee shall deposit
the amount of the loss in the Distribution Account not later than the applicable
Distribution Date on which the moneys so invested are required to be distributed
to the Certificateholders. With respect to the Distribution Account and the
funds deposited therein, the Trustee shall take such action as may be necessary
to ensure that the Certificateholders shall be entitled to the priorities
afforded to such a trust account (in addition to a claim against the estate of
the Trustee) as provided by 12 U.S.C. ss. 92a(e), and applicable regulations
pursuant thereto, if applicable, or any applicable comparable state statute
applicable to state chartered banking corporations.

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         Section 4.05 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE DISTRIBUTION
ACCOUNT.

         (a) The Trustee will make or cause to be made such withdrawals or
transfers from the Distribution Account for the following purposes:

                  (i) to pay to itself the Trustee Fee;

                  (ii) to reimburse the Trustee for expenses, costs and
         liabilities incurred by or reimbursable to it pursuant to this
         Agreement;

                  (iii) to pay investment income to the Trustee;

                  (iv) to remove amounts deposited in error; and

                  (v) to clear and terminate the Distribution Account pursuant
         to Section 10.01.

                  (b) On each Distribution Date, the Trustee shall distribute
         Interest Funds and Principal Funds in the Distribution Account for each
         Loan Group to the holders of the Certificates in accordance with
         Section 5.04.

         Section 4.06 CLASS P CERTIFICATE ACCOUNT.

         (a) The Trustee shall establish and maintain in the name of the
Trustee, for the benefit of the Class P Certificateholders, the Class P
Certificate Account as a segregated trust account or accounts.

         (b) On the Closing Date, the Depositor will deposit, or cause to be
deposited in the Class P Certificate Account, an amount equal to $100. All
amounts deposited to the Class P Certificate Account shall be held by the
Trustee in the name of the Trustee in trust for the benefit of the Class P
Certificateholders in accordance with the terms and provisions of this
Agreement. The amount on deposit in the Class P Certificate Account shall be
held uninvested.

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                                   ARTICLE V

                           DISTRIBUTIONS AND ADVANCES

         Section 5.01 ADVANCES.

         The Master Servicer shall, or shall cause the related subservicer
pursuant to the Subservicing Agreement to, make an Advance and deposit such
Advance in the Protected Account. Each such Advance shall be remitted to the
Distribution Account no later than 1:00 p.m. Eastern time on the Distribution
Account Deposit Date in immediately available funds. The Master Servicer shall
be obligated to make any such Advance only to the extent that such advance would
not be a Nonrecoverable Advance. If the Master Servicer shall have determined
that it has made a Nonrecoverable Advance or that a proposed Advance or a lesser
portion of such Advance would constitute a Nonrecoverable Advance, the Master
Servicer shall deliver (i) to the Trustee for the benefit of the
Certificateholders funds constituting the remaining portion of such Advance, if
applicable, and (ii) to the Depositor, each Rating Agency and the Trustee an
Officer's Certificate setting forth the basis for such determination. Subject to
the Master Servicer's recoverability determination, in the event that a
subservicer fails to make a required Advance, the Master Servicer shall be
required to remit the amount of such Advance to the Distribution Account.

         In lieu of making all or a portion of such Advance from its own funds,
the Master Servicer may (i) cause to be made an appropriate entry in its records
relating to the Protected Account that any Amount Held for Future Distributions
has been used by the Master Servicer in discharge of its obligation to make any
such Advance and (ii) transfer such funds from the Protected Account to the
Distribution Account. Any funds so applied and transferred shall be replaced by
the Master Servicer by deposit in the Distribution Account, no later than the
close of business on the Business Day immediately preceding the Distribution
Date on which such funds are required to be distributed pursuant to this
Agreement.

         The Master Servicer shall be entitled to be reimbursed from the
Protected Account for all Advances of its own funds made pursuant to this
Section as provided in Section 4.02. The obligation to make Advances with
respect to any Mortgage Loan shall continue until such Mortgage Loan is paid in
full or the related Mortgaged Property or related REO Property has been
liquidated or until the purchase or repurchase thereof (or substitution
therefor) from the Trust Fund pursuant to any applicable provision of this
Agreement, except as otherwise provided in this Section 5.01.

         Subject to and in accordance with the provisions of Article VIII
hereof, in the event the Master Servicer fails to make such Advance, then the
Trustee, as Successor Master Servicer, shall be obligated to make such Advance,
subject to the provisions of this Section 5.01.

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         Section 5.02 COMPENSATING INTEREST PAYMENTS.

         In the event that there is a Prepayment Interest Shortfall arising from
a voluntary Principal Prepayment in part or in full by the Mortgagor with
respect to any Mortgage Loan, the Master Servicer shall, to the extent of the
Servicing Fee for such Distribution Date, deposit into the Distribution Account,
as a reduction of the Servicing Fee for such Distribution Date, no later than
the close of business on the Business Day immediately preceding such
Distribution Date, an amount equal to the Prepayment Interest Shortfall; and in
case of such deposit, the Master Servicer shall not be entitled to any recovery
or reimbursement from the Depositor, the Trustee, the Seller, the Trust Fund or
the Certificateholders.

         Section 5.03 REMIC DISTRIBUTIONS.

         On each Distribution Date the Trustee shall be deemed to have allocated
distributions to the REMIC I Regular Interests in accordance with Section 5.07
hereof.

         Section 5.04 DISTRIBUTIONS.

         (a) On each Distribution Date, an amount equal to the Interest Funds
and Principal Funds for each Loan Group for such Distribution Date shall be
withdrawn by the Trustee from the Distribution Account and distributed in the
following order of priority:

         (1) Interest Funds shall be distributed in the following manner and
order of priority:

                  (A) From Interest Funds in respect of:

                  (i) Loan Group I, to the Class I-A-1, Class I-A-2 and Class
                  I-A-3 Certificates, the Current Interest and any Interest
                  Carry Forward Amount for each such Class, on a pro rata basis
                  based on the entitlement of each such Class; and

                  (ii) Loan Group II, to the Class II-A-1 Certificates and Class
                  II-A-2 Certificates, the Current Interest and any Interest
                  Carry Forward Amount for each such Class, on a pro rata basis
                  based on the entitlement of each such Class;

                  (B) From remaining Interest Funds in respect of the
         non-related Loan Group, to the Class I-A Certificates and Class II-A
         Certificates, the remaining Current Interest, if any, and the remaining
         Interest Carry Forward Amount, if any, for such Classes, pro rata based
         on the entitlement of each such Class;; and

                  (C) From remaining Interest Funds in respect of both Loan
         Groups, sequentially, to the Class M-1, Class M-2, Class M-3, Class
         M-4, Class M-5, Class M-6 and Class M-7 Certificates, in that order,
         the Current Interest for each such Class.

         Any Excess Spread to the extent necessary to meet a level of
overcollateralization equal to the Overcollateralization Target Amount will be
the Extra Principal Distribution Amount and will be included as part of the
Principal Distribution Amount. Any Remaining Excess Spread

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together with any Overcollateralization Release Amount will be applied as Excess
Cashflow and distributed pursuant to clauses (4)(A) through (G) below.

         On any Distribution Date, any Relief Act Interest Shortfalls and any
Prepayment Interest Shortfalls to the extent not covered by Compensating
Interest will be allocated as set forth in the definition of "Current Interest"
herein.

         (2) Principal Funds, including any Extra Principal Distribution Amount,
shall be distributed in the following manner and order of priority:

                  (A) For each Distribution Date (i) prior to the Stepdown Date
         or (ii) on which a Trigger Event is in effect:

                  (i) To the Class A Certificates, the Principal Distribution
                  Amount for such Distribution Date to be distributed as
                  follows:

                           (1) from the Group I Principal Distribution Amount
                           for such Distribution Date, sequentially, to the
                           Class I-A-1, Class I-A-2 and Class I-A-3
                           Certificates, in that order, in each case until the
                           Certificate Principal Balance thereof is reduced to
                           zero; and

                           (2) from the Group II Principal Distribution Amount
                           for such Distribution Date, pro rata to the Class
                           II-A-1 Certificates and Class II-A-2 Certificates,
                           until the Certificate Principal Balances thereof are
                           reduced to zero; provided, however, that if a Group
                           II Sequential Trigger Event is in effect, the Group
                           II Principal Distribution Amount for such
                           Distribution Date shall be distributed sequentially
                           to the Class II-A-1 Certificates and Class II-A-2
                           Certificates, in that order, in each case until the
                           Certificate Principal Balance thereof is reduced to
                           zero;

                  (ii) To the Class M-1 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining Principal Distribution
                  Amount, until the Certificate Principal Balance thereof is
                  reduced to zero;

                  (iii) To the Class M-2 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining Principal Distribution
                  Amount, until the Certificate Principal Balance thereof is
                  reduced to zero;

                  (iv) To the Class M-3 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining Principal Distribution
                  Amount, until the Certificate Principal Balance thereof is
                  reduced to zero;

                  (v) To the Class M-4 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining

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<PAGE>

                  Principal Distribution Amount, until the Certificate Principal
                  Balance thereof is reduced to zero;

                  (vi) To the Class M-5 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining Principal Distribution
                  Amount, until the Certificate Principal Balance thereof is
                  reduced to zero;

                  (vii) To the Class M-6 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining Principal Distribution
                  Amount, until the Certificate Principal Balance thereof is
                  reduced to zero; and

                  (viii) To the Class M-7 Certificates, from any remaining
                  Principal Funds in respect of both Loan Groups for such
                  Distribution Date, the remaining Principal Distribution
                  Amount, until the Certificate Principal Balance thereof is
                  reduced to zero.

                  (B) For each Distribution Date on or after the Stepdown Date,
         so long as a Trigger Event is not in effect:

                  (i) To the Class A Certificates, the Principal Distribution
                  Amount for such Distribution Date to be distributed as
                  follows:

                           (1) from the Group I Principal Distribution Amount
                           for such Distribution Date, sequentially, to the
                           Class I-A-1, Class I-A-2 and Class I-A-3
                           Certificates, in that order, the Class I-A Principal
                           Distribution Amount for such Distribution Date, in
                           each case until the Certificate Principal Balance
                           thereof is reduced to zero; and

                           (2) from the Group II Principal Distribution Amount
                           for such Distribution Date, pro rata to the Class
                           II-A-1 Certificates and Class II-A-2 Certificates,
                           the Class II-A Principal Distribution Amount for such
                           Distribution Date, until the Certificate Principal
                           Balances thereof are reduced to zero;

                  (ii) To the Class M-1 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-1 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero;

                  (iii) To the Class M-2 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-2 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero;

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<PAGE>

                  (iv) To the Class M-3 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-3 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero;

                  (v) To the Class M-4 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-4 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero;

                  (vi) To the Class M-5 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-5 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero;

                  (vii) To the Class M-6 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-6 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero; and

                  (viii) To the Class M-7 Certificates, from any remaining
                  Principal Distribution Amount in respect of both Loan Groups
                  for such Distribution Date, the Class M-7 Principal
                  Distribution Amount, until the Certificate Principal Balance
                  thereof is reduced to zero.

         (3) Notwithstanding the provisions of clauses (2)(A) and (B) above, if
on any Distribution Date the Class A Certificates related to a Loan Group are no
longer outstanding, the pro rata portion of the Principal Distribution Amount or
the applicable Class A Principal Distribution Amount, as applicable, otherwise
allocable to such Class A Certificates will be allocated among the remaining
group or groups of Class A Certificates pro rata and among the Classes of each
such certificate group in the same manner and order of priority described above;
and

         (4) Any Excess Cashflow shall be distributed in the following manner
and order of priority:

                  (A) from any remaining Excess Cashflow, to the Class A
         Certificates, (a) first, any remaining Interest Carry Forward Amount
         for such Classes, pro rata, in accordance with the Interest Carry
         Forward Amount due with respect to each such Class, to the extent not
         fully paid pursuant to clauses (1) (A) and (B) above and (b) second,
         any Unpaid Realized Loss Amount for such Classes for such Distribution
         Date, pro rata, in accordance with the Applied Realized Loss Amount
         allocated to each such Class;

                  (B) from any remaining Excess Cashflow, sequentially, to the
         Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, and
         Class M-7 Certificates, in that order, an amount equal to the Interest
         Carry Forward Amount for each such Class for such Distribution Date;

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<PAGE>

                  (C) from any remaining Excess Cashflow otherwise distributable
         to the Class CE Certificates, to the Reserve Fund to pay to the Class
         I-A Certificates and Class II-A Certificates, any Basis Risk Shortfall
         Carry Forward Amount for each such Class for such Distribution Date, on
         a pro rata basis, based on the amount of the Basis Risk Shortfall Carry
         Forward Amount for each such Class, and to the extent not covered by
         the Yield Maintenance Agreements;

                  (D) from any remaining Excess Cashflow otherwise distributable
         to the Class CE Certificates, to the Reserve Fund to pay to the Class
         M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6 and Class
         M-7 Certificates, sequentially in that order, any Basis Risk Shortfall
         Carry Forward Amount for each such Class for such Distribution Date, if
         any, in each case to the extent not covered by the Yield Maintenance
         Agreements;

                  (E) from any remaining Excess Cashflow, to the Class A
         Certificates, on a pro rata basis, based on the entitlement of each
         such Class, and then sequentially to the Class M-1, Class M-2, Class
         M-3, Class M-4, Class M-5, Class M-6 and Class M-7 Certificates, in
         that order, the amount of Relief Act Shortfalls and any Prepayment
         Interest Shortfalls allocated to such Classes of Certificates, to the
         extent not previously reimbursed;

                  (F) from any remaining Excess Cashflow, to the Class CE
         Certificates, an amount equal to the Class CE Distribution Amount
         reduced by amounts distributed in clauses (C) and (D) above; and

                  (G) any remaining amounts to each of the Class R-1, Class R-2
         and Class RX Certificates, based on the related REMIC in which such
         amounts remain.

         On each Distribution Date, all amounts in respect of Prepayment Charges
shall be distributed to the Holders of the Class P Certificates, provided that
such distributions shall not be in reduction of the principal balance thereof.
On the Distribution Date immediately following the expiration of the latest
Prepayment Charge term as identified on the Mortgage Loan Schedule, any amount
on deposit in the Class P Certificate Account will be distributed to the Holders
of the Class P Certificates in reduction of the Certificate Principal Balance
thereof.

         In addition, notwithstanding the foregoing, on any Distribution Date
after the Distribution Date on which the Certificate Principal Balance of a
Class of Class A Certificates or Class M Certifcates has been reduced to zero,
that Class of Certificates will be retired and will no longer be entitled to
distributions, including distributions in respect of Prepayment Interest
Shortfalls or Basis Risk Shortfall Carry Forward Amounts.

         (b) In addition to the foregoing distributions, with respect to any
Subsequent Recoveries, the Master Servicer shall deposit such funds into the
Protected Account pursuant to Section 4.01(b)(iii). If, after taking into
account such Subsequent Recoveries, the amount of a Realized Loss is reduced,
the amount of such Subsequent Recoveries will be applied to increase the
Certificate Principal Balance of the Class of Certificates with the highest
payment priority to

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which Realized Losses have been allocated, but not by more than the amount of
Realized Losses previously allocated to that Class of Certificates pursuant to
Section 5.05; provided, however, to the extent that no reductions to a
Certificate Principal Balance of any Class of Certificates currently exists as
the result of a prior allocation of a Realized Loss, such Subsequent Recoveries
will be applied as Excess Spread. 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 payment priority, up to the amount
of such Realized Losses previously allocated to that Class of Certificates
pursuant to Section 5.05, and so on. Holders of such Certificates will not be
entitled to any payment in respect of Current 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.

         (c) Subject to Section 10.02 hereof respecting the final distribution,
on each Distribution Date the Trustee shall make distributions to each
Certificateholder of record on the preceding Record Date either by wire transfer
in immediately available funds to the account of such holder at a bank or other
entity having appropriate facilities therefor, if such Holder has so notified
the Trustee at least 5 Business Days prior to the related Record Date, or, if
not, by check mailed by first class mail to such Certificateholder at the
address of such holder appearing in the Certificate Register. Notwithstanding
the foregoing, but subject to Section 10.02 hereof respecting the final
distribution, distributions with respect to Certificates registered in the name
of a Depository shall be made to such Depository in immediately available funds.

         (d) On or before 5:00 p.m. Eastern time on the fifth Business Day
immediately preceding each Distribution Date, the Master Servicer shall deliver
a report to the Trustee in electronic form (or by such other means as the Master
Servicer and the Trustee may agree from time to time) containing such data and
information, as agreed to by the Master Servicer and the Trustee such as to
permit the Trustee to prepare the Monthly Statement to Certificateholders and to
make the required distributions for the related Distribution Date.

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         Section 5.05 ALLOCATION OF REALIZED LOSSES.

         (a) All Realized Losses on the Mortgage Loans allocated to any REMIC I
Regular Interest pursuant to Section 5.05(b) on the Mortgage Loans shall be
allocated by the Trustee on each Distribution Date as follows: first, to Excess
Spread; second, to the Class CE Certificates, 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; ninth, to the Class M-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; tenth, to related Class or
Classes of Class A Certificates, on a pro rata basis, until the Certificate
Principal Balances thereof have been reduced to zero; and eleventh, to the
unrelated Class or Classes of Class A Certificates, on a pro rata basis, until
the Certificate Principal Balances thereof have been reduced to zero; provided,
however, any such Realized Losses otherwise allocable to the Class II-A-1
Certificates shall be allocated first to the Class II-A-2 Certificates, until
the Certificate Principal Balance thereof has been reduced to zero, and then to
the Class II-A-1 Certificates. 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.

         (b) Any allocation of Realized Losses to a Class of Certificates 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
CE Certificates shall be made by reducing the amount otherwise payable in
respect thereof pursuant to clause (F) of Section 5.04(a)(4). No allocations of
any Realized Losses shall be made to the Certificate Principal Balance of the
Class P Certificates.

         As used herein, an allocation of a Realized Loss on a "pro rata basis"
among two or more specified Classes of Certificates means an allocation on a pro
rata basis, among the various Classes so specified, to each such Class of
Certificates on the basis of their then outstanding Certificate Principal
Balances prior to giving effect to distributions to be made on such Distribution
Date. All Realized Losses and all other losses allocated to a Class of
Certificates hereunder will be allocated among the Certificates of such Class in
proportion to the Percentage Interests evidenced thereby.

         (c) (i) The REMIC I Marker Percentage of all Realized Losses on the
Mortgage Loans (without duplication of losses allocated pursuant to Section
1.02) shall be allocated by the Trustee on each Distribution Date to the
following REMIC I Regular Interests in the specified percentages, as follows:
first, to Uncertificated Accrued Interest payable to the REMIC I Regular

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<PAGE>

Interest AA and REMIC I Regular Interest ZZ up to an aggregate amount equal to
the REMIC I Interest Loss Allocation Amount, 98.00% and 2.00%, respectively;
second, to the Uncertificated Principal Balances of the REMIC I Regular Interest
AA and REMIC I Regular Interest ZZ up to an aggregate amount equal to the REMIC
I Principal Loss Allocation Amount, 98.00% and 2.00%, respectively; third, to
the Uncertificated Principal Balances of REMIC I Regular Interest AA, REMIC I
Regular Interest M-7 and REMIC I Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC I Regular
Interest M-7 has been reduced to zero; fourth, to the Uncertificated Principal
Balances of REMIC I Regular Interest AA, REMIC I Regular Interest M-6 and REMIC
I Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until the
Uncertificated Principal Balance of REMIC I Regular Interest M-6 has been
reduced to zero; fifth to the Uncertificated Principal Balances of REMIC I
Regular Interest AA, REMIC I Regular Interest M-5 and REMIC I Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Principal
Balance of REMIC I Regular Interest M-5 has been reduced to zero; sixth, to the
Uncertificated Principal Balances of REMIC I Regular Interest AA, REMIC I
Regular Interest M-4 and REMIC I Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC I Regular
Interest M-4 has been reduced to zero; seventh to the Uncertificated Principal
Balances of REMIC I Regular Interest AA, REMIC I Regular Interest M-3 and REMIC
I Regular Interest ZZ, 98.00%, 1.00%, and 1.00%, respectively, until the
Uncertificated Principal Balance of REMIC I Regular Interest M-3 has been
reduced to zero; eighth to the Uncertificated Principal Balances of REMIC I
Regular Interest AA, REMIC I Regular Interest M-2 and REMIC I Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Principal
Balance of REMIC I Regular Interest M-2 has been reduced to zero; ninth to the
Uncertificated Principal Balances of REMIC I Regular Interest AA, REMIC I
Regular Interest M-1 and REMIC I Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Principal Balance of REMIC I Regular
Interest M-1 has been reduced to zero; tenth with respect to any Realized Losses
on the Mortgage Loans, to the Uncertificated Principal Balance of REMIC I
Regular Interest AA, 98.00%, to the Uncertificated Principal Balances of the
related REMIC I Regular Interests I-A-1, I-A-2, I-A-3, II-A-1 and II-A-2, 1.00%
pro rata, and to the Uncertificated Principal Balance of REMIC I Regular
Interest ZZ, 1.00%, until the Uncertificated Principal Balances of such REMIC I
Regular Interests I-A-1, I-A-2, I-A-3, II-A-1 and II-A-2 have been reduced to
zero; and eleventh with respect to any Realized Losses on the Mortgage Loans, to
the Uncertificated Principal Balance of REMIC I Regular Interest AA, 98.00%, to
the Uncertificated Principal Balances of the unrelated REMIC I Regular Interests
I-A-1, I-A-2, I-A-3, II-A-1 and II-A-2, 1.00% pro rata, and to the
Uncertificated Principal Balance of REMIC I Regular Interest ZZ, 1.00%, until
the Uncertificated Principal Balances of such REMIC I Regular Interests I-A-1,
I-A-2, I-A-3, II-A-1 and II-A-2 have been reduced to zero; provided, however,
any such Realized Losses otherwise allocable to the REMIC I Regular Interest
II-A-1 shall be allocated first to the REMIC I Regular Interest II-A-2, until
the Uncertificated Principal Balance thereof has been reduced to zero, and then
to the REMIC I Regular Interest II-A-1.

                  (ii) The REMIC I 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 I Regular Interest ending with the designation
         "B" equal to 0.01% of the aggregate Stated Principal Balance of the

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<PAGE>

         Mortgage Loans in the related Loan Group; second, to each REMIC I
         Regular Interest ending with the designation "A" so that the
         Uncertificated Principal Balance of each such REMIC I 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 Certificates
         related to such 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 I Regular
         Interests such that the REMIC I Subordinated Balance Ratio is
         maintained); and third, any remaining Realized Losses shall be
         allocated to REMIC I Regular Interest XX.

         Section 5.06 MONTHLY STATEMENTS TO CERTIFICATEHOLDERS.

         (a) Not later than each Distribution Date, the Trustee shall prepare
and make available to each Holder of Certificates, the Master Servicer and the
Depositor a statement setting forth for the Certificates:

                  (i) the amount of the related distribution to Holders of each
         Class allocable to principal, separately identifying (A) the aggregate
         amount of any Principal Prepayments included therein, (B) the aggregate
         of all scheduled payments of principal included therein and (C) the
         Extra Principal Distribution Amount (if any);

                  (ii) the amount of such distribution to Holders of each Class
         allocable to interest and the portion thereof, if any, provided by the
         Yield Maintenance Agreements;

                  (iii) the Interest Carry Forward Amount and any Basis Risk
         Shortfall Carry Forward Amount for each Class of Certificates;

                  (iv) the Certificate Principal Balance or Certificate Notional
         Balance of each Class after giving effect (i) to all distributions
         allocable to principal on such Distribution Date and (ii) the
         allocation of any Applied Realized Loss Amounts for such Distribution
         Date;

                  (v) for each Loan Group, the aggregate of the Stated Principal
         Balances of (A) all of the Mortgage Loans in such Loan Group, (B) the
         first lien Mortgage Loans in such Loan Group, (C) the second lien
         Mortgage Loans in such Loan Group, and (D) the Adjustable Rate Mortgage
         Loans in such Loan Group, for the following Distribution Date;

                  (vi) the related amount of the Servicing Fees paid to or
         retained by the Master Servicer for the related Due Period;

                  (vii) the Pass-Through Rate for each Class of Class A
         Certificates and Class M Certificates with respect to the current
         Accrual Period, and, if applicable, whether such Pass-Through Rate was
         limited by the applicable Net Rate Cap;

                  (viii) the amount of Advances included in the distribution on
         such Distribution Date;

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<PAGE>

                  (ix) the cumulative amount of Applied Realized Loss Amounts to
         date;

                  (x) the number and aggregate Stated Principal Balances of the
         Mortgage Loans in each Loan Group (A) Delinquent (exclusive of Mortgage
         Loans in foreclosure and bankruptcy) (1) 31 to 60 days, (2) 61 to 90
         days and (3) 91 or more days, (B) in foreclosure and delinquent (1) 31
         to 60 days, (2) 61 to 90 days and (3) 91 or more days and (C) in
         bankruptcy and delinquent (1) 31 to 60 days, (2) 61 to 90 days and (3)
         91 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
         separately identifying such information for the (1) first lien Mortgage
         Loans, (2) second lien Mortgage Loans, and (3) Adjustable Rate Mortgage
         Loans, in each such Loan Group;

                  (xi) with respect to any Mortgage Loan that was liquidated
         during the preceding calendar month, the loan number and Stated
         Principal Balance of, and Realized Loss on, such Mortgage Loan as of
         the close of business on the Determination Date preceding such
         Distribution Date;

                  (xii) the total number and principal balance of any real
         estate owned or REO Properties as of the close of business on the
         Determination Date preceding such Distribution Date;

                  (xiii) the three month rolling average of the percent
         equivalent of a fraction, the numerator of which is the aggregate
         stated Principal Balance of the Mortgage Loans in each Loan Group that
         are 60 days or more delinquent or are in bankruptcy or foreclosure or
         are REO Properties, and the denominator of which is the aggregate
         Stated Principal Balance of all of the Mortgage Loans in such Loan
         Group as of the last day of such Distribution Date and separately
         identifying such information for the (1) first lien Mortgage Loans, (2)
         second lien Mortgage Loans, and (3) Adjustable Rate Mortgage Loans, in
         each such Loan Group;

                  (xiv) the Realized Losses during the related Prepayment Period
         and the cumulative Realized Losses through the end of the preceding
         month;

                  (xv) whether a Trigger Event exists; and

                  (xvi) the amount of the distribution made on such Distribution
         Date to the Holders of the Class P Certificates allocable to Prepayment
         Charges.

         The Trustee may make the foregoing Monthly Statement (and, at its
option, any additional files containing the same information in an alternative
format) available each month to Certificateholders via the Trustee's internet
website. The Trustee's internet website shall initially be located at
"www.etrustee.net". Assistance in using the website can be obtained by calling
the Trustee's customer service desk at (312) 904-6709. Parties that are unable
to use the above distribution options are entitled to have a paper copy mailed
to them via first class mail by calling the customer service desk and indicating
such. The Trustee may change the way Monthly Statements are distributed in order
to make such distributions more convenient or more accessible to the above
parties.

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<PAGE>

         (b) The Trustee's responsibility for making the above information
available to the Certificateholders is limited to the availability, timeliness
and accuracy of the information derived from the Master Servicer. The Trustee
will make available a copy of each statement provided pursuant to this Section
5.06 to each Rating Agency.

         (c) Within a reasonable period of time after the end of each calendar
year, the Trustee shall cause to be furnished upon request to each Person who at
any time during the calendar year was a Certificateholder, a statement
containing the information set forth in clauses (a)(i) and (a)(ii) of this
Section 5.06 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 provided by the Trustee pursuant to any
requirements of the Code as from time to time in effect.

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

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

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

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

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

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

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

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

         The information pursuant to clauses (i), (ii), (iii) and (iv) above
shall be provided by the Depositor pursuant to Section 9.12.

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<PAGE>

         Section 5.07 REMIC DESIGNATIONS AND REMIC DISTRIBUTIONS.

         (a) The Trustee shall elect that each of REMIC I, REMIC II, REMIC III
and REMIC IV shall be treated as a REMIC under Section 860D of the Code. Any
inconsistencies or ambiguities in this Agreement or in the administration of
this Agreement shall be resolved in a manner that preserves the validity of such
REMIC elections. The assets of REMIC I shall include the Mortgage Loans and all
interest owing in respect of and principal due thereon, the Distribution
Account, the Protected Account, any REO Property, any proceeds of the foregoing
and any other assets subject to this Agreement (other than the Reserve Fund).
The REMIC I Regular Interests shall constitute the assets of REMIC II. The Class
CE Interest shall constitute the assets of REMIC III and the Class P Interest
shall constitute the assets of REMIC IV.

         (b) (1) On each Distribution Date, the following amounts, in the
following order of priority, shall be distributed by REMIC I to REMIC II on
account of the REMIC I Regular Interests or withdrawn from the Distribution
Account and distributed to the holders of the Class R-1 Certificates, as the
case may be:

                  (i) to Holders of each REMIC I Regular Interest (other than
         REMIC I Regular Interests 1A, 1B, 2A, 2B, XX and P) PRO RATA, in an
         amount equal to (A) Uncertificated Accrued Interest for such REMIC I
         Regular Interest for such Distribution Date, plus (B) any amounts in
         respect thereof remaining unpaid from previous Distribution Dates.
         Amounts payable as Uncertificated Accrued Interest in respect of REMIC
         I Regular Interest ZZ shall be reduced when the REMIC I
         Overcollateralization Amount is less than the REMIC I Required
         Overcollateralization Amount, by the lesser of (x) the amount of such
         difference and (y) the Maximum Uncertificated Accrued Interest Deferral
         Amount and such amount will be payable to the Holders of REMIC I
         Regular Interest I-A-1, REMIC I Regular Interest I-A-2, REMIC I Regular
         Interest I-A-3, REMIC I Regular Interest II-A-1, REMIC I Regular
         Interest II-A-2, REMIC I Regular Interest M-1, REMIC I Regular Interest
         M-2, REMIC I Regular Interest M-3, REMIC I Regular Interest M-4, REMIC
         I Regular Interest M-5, REMIC I Regular Interest M-6 and REMIC I
         Regular Interest M-7 in the same proportion as the Extra Principal
         Distribution Amount is allocated to the Corresponding Certificates and
         the Uncertificated Principal Balance of REMIC I Regular Interest ZZ
         shall be increased by such amount;

                  (ii) to Holders of REMIC I Regular Interest 1A, REMIC I
         Regular Interest 1B, REMIC I Regular Interest 2A, REMIC I Regular
         Interest 2B and REMIC I Regular Interest XX, pro rata, 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;

                  (iii) to the Holders of REMIC I Regular Interests (other than
         REMIC I Regular Interests 1A, 1B, 2A, 2B, XX and P) in an amount equal
         to the remainder of the REMIC I Marker Allocation Percentage of the
         Interest Funds and Principal Funds for both Loan Groups for such
         Distribution Date after the distributions made pursuant to clause (i)
         above, allocated as follows:

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<PAGE>

                  (A) 98% of such remainder to the Holders of REMIC I Regular
         Interest AA, until the Uncertificated Principal Balance of such REMIC I
         Regular Interest is reduced to zero;

                  (B) 2% of such remainder, first, to the Holders of REMIC I
         Regular Interest I-A-1, REMIC I Regular Interest I-A-2, REMIC I Regular
         Interest I-A-3, REMIC I Regular Interest II-A-1, REMIC I Regular
         Interest II-A-2, REMIC I Regular Interest M-1, REMIC I Regular Interest
         M-2, REMIC I Regular Interest M-3, REMIC I Regular Interest M-4, REMIC
         I Regular Interest M-5, REMIC I Regular Interest M-6 and REMIC I
         Regular Interest M-7, in an aggregate amount equal to 1% of and in the
         same proportion as principal payments are allocated to the
         Corresponding Certificates, until the Uncertificated Principal Balances
         of such REMIC I Regular Interests are reduced to zero; and second, to
         the Holders of REMIC I Regular Interest ZZ, until the Uncertificated
         Principal Balance of such REMIC I Regular Interest is reduced to zero;
         then

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

                  (iv) to the Holders of REMIC I Regular Interest 1A, REMIC I
         Regular Interest 1B, REMIC I Regular Interest 2A, REMIC I Regular
         Interest 2B and REMIC I Regular Interest XX, in an amount equal to the
         remainder of the REMIC I Sub WAC Allocation Percentage of the Interest
         Funds and Principal Funds for both Loan Groups for such Distribution
         Date after the distributions made pursuant to clause (ii) above, first,
         so as to keep the Uncertificated Principal Balance of each REMIC I
         Regular Interest ending with the designation "B" equal to 0.01% of the
         aggregate Stated Principal Balance of the Mortgage Loans in the related
         Loan Group; second, to each REMIC I Regular Interest ending with the
         designation "A," so that the Uncertificated Principal Balance of each
         such REMIC I 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 related to such 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 I Regular Interests such that the REMIC I Subordinated Balance
         Ratio is maintained); and third, any remaining principal to REMIC I
         Regular Interest XX.

         (c) On each Distribution Date, all amounts representing Prepayment
Charges deemed distributed in respect of the Class P Interest shall be deemed
distributed in respect of REMIC I Regular Interest P, provided that such amounts
shall not reduce the Uncertificated Principal Balance of REMIC I Regular
Interest P. On the Distribution Date immediately following the expiration of the
latest Prepayment Charge term as identified on the Mortgage Loan Schedule, $100
shall be deemed distributed in respect of REMIC I Regular Interest P in
reduction of the Uncertificated Principal Balance thereof.

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<PAGE>

         (d) On each Distribution Date, an amount equal to the amounts
distributed pursuant to Sections 5.04(a)(4)(C), (D) and (F) on such date shall
be deemed distributed from REMIC II to REMIC III in respect of the Class CE
Distribution Amount distributable to the Class CE Interest.

         (e) On each Distribution Date, 100% of the amounts deemed distributed
on REMIC I Regular Interest P shall be deemed distributed by REMIC II to REMIC
IV in respect of the Class P Interest.

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                                   ARTICLE VI

                                THE CERTIFICATES

Section 6.01      THE CERTIFICATES.

         The Certificates shall be substantially in the forms attached hereto as
Exhibits A-1 through A-5. The Certificates shall be issuable in registered form,
in the minimum dollar denominations, integral dollar multiples in excess thereof
(except that one Certificate of each Class may be issued in a different amount
which must be in excess of the applicable minimum dollar denomination) and
aggregate dollar denominations as set forth in the following table:

                    MINIMUM        INTEGRAL MULTIPLE IN     ORIGINAL CERTIFICATE
     CLASS        DENOMINATION      EXCESS OF MINIMUM        PRINCIPAL BALANCE
     -----        ------------      -----------------        -----------------
     I-A-1           $25,000              $1.00               $123,194,000.00
     I-A-2           $25,000              $1.00               $ 67,888,000.00
     I-A-3           $25,000              $1.00               $ 37,948,000.00
    II-A-1           $25,000              $1.00               $204,423,000.00
    II-A-2           $25,000              $1.00               $ 51,106,000.00
      M-1            $25,000              $1.00               $ 41,350,000.00
      M-2            $25,000              $1.00               $ 26,341,000.00
      M-3            $25,000              $1.00               $ 16,234,000.00
      M-4            $25,000              $1.00               $  7,657,000.00
      M-5            $25,000              $1.00               $  7,045,000.00
      M-6            $25,000              $1.00               $  6,126,000.00
      M-7            $25,000              $1.00               $  9,189,000.00
      CE              10%                   1%                $ 14,089,220.28
       P             $   100               N/A                $        100.00
      R-1            100%                  N/A                      N/A
      R-2            100%                  N/A                      N/A
      RX             100%                  N/A                      N/A

         The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by an authorized 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 Trustee, 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 authentication and delivery. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless there appears on such Certificate the countersignature
of the Trustee by manual signature, and such countersignature upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly countersigned and delivered hereunder. All
Certificates shall be dated the date of their countersignature. On the Closing
Date, the Trustee shall authenticate the Certificates to be issued at the
written direction of the Depositor, or any affiliate thereof.

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         The Depositor shall provide, or cause to be provided, to the Trustee on
a continuous basis, an adequate inventory of Certificates to facilitate
transfers.

         Section 6.02 CERTIFICATE REGISTER; REGISTRATION OF TRANSFER AND
EXCHANGE OF CERTIFICATES.

         (a) The Trustee shall maintain, or cause to be maintained in accordance
with the provisions of Section 6.09 hereof, a Certificate Register for the Trust
Fund in which, subject to the provisions of subsections (b) and (c) below and to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of Transfers and exchanges of Certificates
as herein provided. Upon surrender for registration of Transfer of any
Certificate, the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the same
Class and of like aggregate Percentage Interest.

         At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of the same Class in authorized denominations and evidencing
the same aggregate Percentage Interest upon surrender of the Certificates to be
exchanged at the office or agency of the Trustee. Whenever any Certificates are
so surrendered for exchange, the Trustee shall execute, authenticate, and
deliver the Certificates that the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for registration
of Transfer or exchange shall be accompanied by a written instrument of Transfer
in form satisfactory to the Trustee duly executed by the holder thereof or his
attorney duly authorized in writing.

         No service charge to the Certificateholders shall be made for any
registration of Transfer or exchange of Certificates, but 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 may be required.

         All Certificates surrendered for registration of Transfer or exchange
shall be canceled and subsequently destroyed by the Trustee in accordance with
the Trustee's customary procedures.

         (b) No Transfer of a Private Certificate shall be made unless such
Transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under the Securities Act and such state securities
laws. In the event that a Transfer is to be made in reliance upon an exemption
from the Securities Act and such laws, in order to assure compliance with the
Securities Act and such laws, the Certificateholder desiring to effect such
Transfer and such Certificateholder's prospective transferee shall each certify
to the Trustee in writing the facts surrounding the Transfer by (x)(i) the
delivery to the Trustee by the Certificateholder desiring to effect such
transfer of a certificate substantially in the form set forth in Exhibit D (the
"Transferor Certificate") and (ii) the delivery by the Certificateholder's
prospective transferee of (A) a letter in substantially the form of Exhibit E
(the "Investment Letter") if the prospective transferee is an Institutional
Accredited Investor or (B) a letter in substantially the form of Exhibit F (the
"Rule 144A and Related Matters Certificate") if the prospective transferee is a
QIB or (y) there shall be delivered to the Trustee an Opinion of Counsel
addressed to the Trustee that such Transfer may

                                      100
<PAGE>

be made pursuant to an exemption from the Securities Act, which Opinion of
Counsel shall not be an expense of the Depositor, the Seller, the Master
Servicer or the Trustee. The Depositor shall provide to any Holder of a Private
Certificate and any prospective transferee designated by any such Holder,
information regarding the related Certificates and the Mortgage Loans and such
other information as shall be necessary to satisfy the condition to eligibility
set forth in Rule 144A(d)(4) for Transfer of any such Certificate without
registration thereof under the Securities Act pursuant to the registration
exemption provided by Rule 144A. The Trustee and the Master Servicer shall
cooperate with the Depositor in providing the Rule 144A information referenced
in the preceding sentence, including providing to the Depositor such information
regarding the Certificates, the Mortgage Loans and other matters regarding the
Trust Fund as the Depositor shall reasonably request to meet its obligation
under the preceding sentence. Each Holder of a Private Certificate desiring to
effect such Transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Seller and the Master 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 an ERISA Restricted Certificate or a Class M-7
Certificate shall be made unless either (i) the Trustee and the Master Servicer
shall have received a representation from the transferee of such Certificate
acceptable to and in form and substance satisfactory to the Trustee and the
Master Servicer, to the effect that such transferee is not an employee benefit
plan subject to Section 406 of ERISA or a plan subject to Section 4975 of the
Code (either a "plan"), or a Person acting on behalf of any such plan or using
the assets of any such plan, or (ii) 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 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, the Trustee shall have received
an Opinion of Counsel for the benefit of the Trustee and the Master Servicer and
on which they may rely, satisfactory to the Trustee, to the effect that the
purchase and holding of such ERISA Restricted Certificate will not constitute or
result in the assets of the Trust being deemed to be "plan assets" under ERISA
or the Code, will not result in any prohibited transactions under ERISA or
Section 4975 of the Code and will not subject the Trustee, the Master Servicer
or the Depositor to any obligation in addition to those expressly undertaken in
this Agreement, which Opinion of Counsel shall not be an expense of the Trustee,
the Master Servicer or the Depositor, or (iii) in the case of a Class M-7
Certificate, the transferee provides a representation, or is deemed to represent
in the case of the Global Certificate or an opinion of counsel to the effect
that the proposed transfer or holding of such Class M-7 Certificate and the
servicing, management and operation of the Trust and its assets: (I) will not
result in any prohibited transaction which is not covered under an individual or
class prohibited transaction exemption, including, but not limited to,
Prohibited Transaction Exemption ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60
or PTE 96-23 and (II) will not give rise to any obligation on the part of the
Depositor, the Master Servicer or the Trustee.. 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 Section 406 of ERISA or a
plan subject to Section 4975 of the Code without the delivery of the Opinion of
Counsel as described above shall be void and of no effect; provided that the
restriction set forth in this sentence shall not be applicable if there has been
delivered to the Trustee an Opinion of Counsel meeting the requirements of
clause (ii) of the first sentence of this paragraph. Neither the Trustee nor the
Master Servicer shall be required to monitor, determine or inquire as to

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<PAGE>

compliance with the transfer restrictions with respect to any ERISA Restricted
Certificate that is a Book-Entry Certificate, and neither the Trustee nor the
Master Servicer shall have any liability for transfers of any such Book-Entry
Certificates made through the book-entry facilities of any Depository or between
or among participants of the Depository or Certificate Owners made in violation
of the transfer restrictions set forth herein. Neither the Trustee nor the
Master Servicer shall be under any liability to any Person for any registration
of transfer of any ERISA Restricted Certificate that is in fact not permitted by
this Section 6.02(b) or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder under the
provisions of this Agreement. The Trustee shall be entitled, but not obligated,
to recover from any Holder of any ERISA Restricted Certificate that was in fact
an employee benefit plan subject to Section 406 of ERISA or a plan subject to
Section 4975 of the Code or a Person acting on behalf of any such plan at the
time it became a Holder or, at such subsequent time as it became such a plan or
Person acting on behalf of such a plan, all payments made on such ERISA
Restricted Certificate at and after either such time. Any such payments so
recovered by the Trustee shall be paid and delivered by the Trustee to the last
preceding Holder of such Certificate that is not such a plan or Person acting on
behalf of a plan.

         (c) Each beneficial owner of a Class M Certificate (other than a Class
M-7 Certificate) or any interest therein shall be deemed to have represented, by
virtue of its acquisition or holding of that certificate or interest therein,
that either (i) it is not a Plan or investing with "Plan Assets", (ii) it has
acquired and is holding such certificate in reliance on the Exemption, and that
it understands that there are certain conditions to the availability of the
Exemption, including that the certificate must be rated, at the time of
purchase, not lower than "BBB-" (or its equivalent) by S&P, Fitch Ratings or
Moody's, and the certificate is so rated or (iii) (1) it is an insurance
company, (2) the source of funds used to acquire or hold the certificate or
interest therein is an "insurance company general account," as such term is
defined in PTE 95-60, and (3) the conditions in Sections I and III of PTCE 95-60
have been satisfied.

         (c) 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 the rights of each Person acquiring any Ownership
         Interest in a Residual Certificate are expressly subject to the
         following provisions:

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

                  (ii) No Ownership Interest in a Residual Certificate may be
         registered on the Closing Date or thereafter transferred, and the
         Trustee shall not register the Transfer of any Residual Certificate
         unless, in addition to the certificates required to be delivered to the
         Trustee under subparagraph (b) above, the Trustee shall have been
         furnished with an affidavit (a "Transfer Affidavit") of the initial
         owner or the proposed transferee in the form attached hereto as Exhibit
         C.

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<PAGE>

                  (iii) Each Person holding or acquiring any Ownership Interest
         in a Residual Certificate shall agree (A) to obtain a Transfer
         Affidavit from any other Person to whom such Person attempts to
         Transfer its Ownership Interest in a Residual Certificate, (B) to
         obtain a Transfer Affidavit from any Person for whom such Person is
         acting as nominee, trustee or agent in connection with any Transfer of
         a Residual Certificate and (C) not to Transfer its Ownership Interest
         in a Residual Certificate or to cause the Transfer of an Ownership
         Interest in a Residual Certificate to any other Person if it has actual
         knowledge that such Person is not a Permitted Transferee.

                  (iv) Any attempted or purported Transfer of any Ownership
         Interest in a Residual Certificate in violation of the provisions of
         this Section 6.02(c) shall be absolutely null and void and shall vest
         no rights in the purported Transferee. If any purported transferee
         shall become a Holder of a Residual Certificate in violation of the
         provisions of this Section 6.02(c), then the last preceding Permitted
         Transferee shall 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 Section 6.02(b) and this Section 6.02(c) or for making
         any payments due on such 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 Transfer was registered after receipt of
         the related Transfer Affidavit. The Trustee shall be entitled but not
         obligated to recover from any Holder of a Residual Certificate that was
         in fact not a Permitted Transferee at the time it became a Holder or,
         at such subsequent time as it became other than a Permitted Transferee,
         all payments made on such Residual Certificate at and after either such
         time. Any such payments so recovered by the Trustee shall be paid and
         delivered by the Trustee to the last preceding Permitted Transferee of
         such Certificate.

                  (v) The Master Servicer shall make available within 60 days of
         written request from the Trustee, all information necessary to compute
         any tax imposed under Section 860E(e) of the Code as a result of a
         Transfer of an Ownership Interest in a Residual Certificate to any
         Holder who is not a Permitted Transferee.

The restrictions on Transfers of a Residual Certificate set forth in this
Section 6.02(c) shall cease to apply (and the applicable portions of the legend
on a Residual Certificate may be deleted) with respect to Transfers occurring
after delivery to the Trustee of an Opinion of Counsel addressed to the Trustee,
which Opinion of Counsel shall not be an expense of the Trustee, the Seller or
the Master Servicer to the effect that the elimination of such restrictions will
not cause REMIC I, REMIC II, REMIC III or REMIC IV, as applicable, to fail to
qualify as a REMIC at any time that the Certificates are outstanding or result
in the imposition of any tax on the Trust Fund, a Certificateholder or another
Person. Each Person holding or acquiring any ownership Interest in a Residual
Certificate hereby consents to any amendment of this Agreement that, based on an
Opinion of Counsel addressed to the Trustee and furnished to the Trustee, is
reasonably necessary (a) to ensure that the record ownership of, or any
beneficial interest in, a Residual Certificate is not transferred, directly or
indirectly, to a Person that is not a Permitted Transferee and (b) to provide
for a means to compel the Transfer of a Residual Certificate that is held by a
Person that is not a Permitted Transferee to a Holder that is a Permitted
Transferee.

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         (d) The preparation and delivery of all certificates and opinions
referred to above in this Section 6.02 shall not be an expense of the Trust
Fund, the Trustee, the Depositor, the Seller or the Master Servicer.

         Section 6.03 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.

         If (a) any mutilated Certificate is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Certificate and of the ownership thereof and (b) there is delivered to
the Trustee 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 that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of any new
Certificate under this Section 6.03, the Trustee may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Trustee) connected therewith. Any replacement Certificate issued pursuant to
this Section 6.03 shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time. All Certificates
surrendered to the Trustee under the terms of this Section 6.03 shall be
canceled and destroyed by the Trustee in accordance with its standard procedures
without liability on its part.

         Section 6.04 PERSONS DEEMED OWNERS.

         The Trustee and any agent of the Trustee may treat the person in whose
name any Certificate is registered as the owner of such Certificate for the
purpose of receiving distributions as provided in this Agreement and for all
other purposes whatsoever, and neither the Trustee nor any agent of the Trustee
shall be affected by any notice to the contrary.

         Section 6.05 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES.

         If three or more Certificateholders (a) request such information in
writing from the Trustee, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication that such Certificateholders propose to transmit or if the
Depositor or the Master Servicer shall request such information in writing from
the Trustee, then the Trustee shall, within ten Business Days after the receipt
of such request, provide the Depositor, the Master Servicer or such
Certificateholders at such recipients' expense the most recent list of the
Certificateholders of the Trust Fund held by the Trustee, if any. The Depositor
and every Certificateholder, by receiving and holding a Certificate, agree that
the Trustee shall not be held accountable by reason of the disclosure of any
such information as to the list of the Certificateholders hereunder, regardless
of the source from which such information was derived.

         Section 6.06 BOOK-ENTRY CERTIFICATES.

         The Regular Certificates (other than the Class M-7, Class CE and Class
P Certificates), upon original issuance, shall be issued in the form of one or
more typewritten Certificates

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representing the Book-Entry Certificates, to be delivered to the Depository by
or on behalf of the Depositor. Such Certificates shall initially be registered
on the Certificate Register in the name of the Depository or its nominee, and no
Certificate Owner of such Certificates will receive a definitive certificate
representing such Certificate Owner's interest in such Certificates, except as
provided in Section 6.08. Unless and until definitive, fully registered
Certificates ("Definitive Certificates") have been issued to the Certificate
Owners of such Certificates pursuant to Section 6.08:

         (a) the provisions of this Section shall be in full force and effect;
(b) the Depositor and the Trustee may deal with the Depository and the
Depository Participants for all purposes (including the making of distributions)
as the authorized representative of the respective Certificate Owners of such
Certificates;

         (c) registration of the Book-Entry Certificates may not be transferred
by the Trustee except to another Depository;

         (d) the rights of the respective Certificate Owners of such
Certificates shall be exercised only through the Depository and the Depository
Participants and shall be limited to those established by law and agreements
between the Owners of such Certificates and the Depository and/or the Depository
Participants. Pursuant to the Depository Agreement, unless and until Definitive
Certificates are issued pursuant to Section 6.08, the Depository will make
book-entry transfers among the Depository Participants and receive and transmit
distributions of principal and interest on the related Certificates to such
Depository Participants;

         (e) the Depository may collect its usual and customary fees, charges
and expenses from its Depository Participants;

         (f) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants; and

         (g) to the extent that the provisions of this Section conflict with any
other provisions of this Agreement, the provisions of this Section shall
control.

         For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Certificateholders
evidencing a specified percentage of the aggregate unpaid principal amount of
any Class of Certificates, such direction or consent may be given by Certificate
Owners (acting through the Depository and the Depository Participants) owning
Book-Entry Certificates evidencing the requisite percentage of principal amount
of such Class of Certificates.

         Section 6.07 NOTICES TO DEPOSITORY.

         Whenever any notice or other communication is required to be given to
Certificateholders of a Class with respect to which Book-Entry Certificates have
been issued, unless and until Definitive Certificates shall have been issued to
the related Certificate Owners, the Trustee shall give all such notices and
communications to the Depository.

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         Section 6.08 DEFINITIVE CERTIFICATES.

         If, after Book-Entry Certificates have been issued with respect to any
Certificates, (a) the Depositor or the Depository advises the Trustee that the
Depository is no longer willing or able to discharge properly its
responsibilities under the Depository Agreement with respect to such
Certificates and the Depositor is unable to locate a qualified successor or (b)
the Depositor, at its sole option, advises the Trustee that it elects to
terminate the book-entry system with respect to such Certificates through the
Depository, then the Trustee shall notify all Certificate Owners of such
Certificates, through the Depository, of the occurrence of any such event and of
the availability of Definitive Certificates to applicable Certificate Owners
requesting the same. The Depositor shall provide the Trustee with an adequate
inventory of certificates to facilitate the issuance and transfer of Definitive
Certificates. Upon surrender to the Trustee of any such Certificates by the
Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall countersign and deliver such Definitive
Certificates. Neither the Depositor nor the Trustee shall be liable for any
delay in delivery of such instructions and each may conclusively rely on, and
shall be protected in relying on, such instructions.

         In addition, if an Event of Default has occurred and is continuing,
each Certificate Owner materially adversely affected thereby may at its option
request a Definitive Certificate evidencing such Certificate Owner's Voting
Rights in the related Class of Certificates. In order to make such request, such
Certificate Owner shall, subject to the rules and procedures of the Depository,
provide the Depository or the related Depository Participant with directions for
the Trustee to exchange or cause the exchange of the Certificate Owner's
interest in such Class of Certificates for an equivalent Voting Right in fully
registered definitive form. Upon receipt by the Trustee of instructions from the
Depository directing the Trustee to effect such exchange (such instructions to
contain information regarding the Class of Certificates and the Certificate
Principal Balance being exchanged, the Depository Participant account to be
debited with the decrease, the registered holder of and delivery instructions
for the definitive Certificate, and any other information reasonably required by
the Trustee), (i) the Trustee shall instruct the Depository to reduce the
related Depository Participant's account by the aggregate Certificate Principal
Balance of the definitive Certificate, (ii) the Trustee shall execute,
authenticate and deliver, in accordance with the registration and delivery
instructions provided by the Depository, a definitive Certificate evidencing
such Certificate Owner's Voting Rights in such Class of Certificates and (iii)
the Trustee shall execute and authenticate a new Book-Entry Certificate
reflecting the reduction in the Certificate Principal Balance of such Class of
Certificates by the amount of the definitive Certificates.

         Section 6.09 MAINTENANCE OF OFFICE OR AGENCY.

         The Trustee will maintain or cause to be maintained at its expense an
office or offices or agency or agencies at the Corporate Trust Office where
Certificates may be surrendered for registration of transfer or exchange. The
Trustee initially designates its Corporate Trust Office, as the office for such
purposes. The Trustee will give prompt written notice to the Certificateholders
of any change in such location of any such office or agency.

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                                  ARTICLE VII

                      THE DEPOSITOR AND THE MASTER SERVICER

         Section 7.01 LIABILITIES OF THE DEPOSITOR AND THE MASTER SERVICER.

         Each of the Depositor, and the Master Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by it herein.

         Section 7.02 MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE MASTER
SERVICER.

         (a) Each of the Depositor and the Master Servicer will keep in full
force and effect its existence, rights and franchises as a corporation under the
laws of the state of its incorporation, and will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement.

         (b) Any Person into which the Depositor or the Master Servicer may be
merged or consolidated, or any corporation resulting from any merger or
consolidation to which the Depositor or the Master Servicer shall be a party, or
any Person succeeding to the business of the Depositor or the Master Servicer,
shall be the successor of the Depositor or the Master Servicer hereunder,
without the execution or filing of any paper or further act on the part of any
of the parties hereto, anything herein to the contrary notwithstanding.

         Section 7.03 INDEMNIFICATION OF THE TRUSTEE AND THE MASTER SERVICER.

         (a) The Master Servicer agrees to indemnify the Indemnified Persons
for, and to hold them harmless against, any loss, liability or expense
(including reasonable legal fees and disbursements of counsel) incurred on their
part that may be sustained in connection with, arising out of, or relating to,
any claim or legal action (including any pending or threatened claim or legal
action) relating to this Agreement, including any powers of attorney delivered
pursuant to this Agreement, the Custodial Agreement or the Certificates (i)
related to the Master Servicer's failure to perform its duties in compliance
with this Agreement (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) or (ii) incurred by reason of
the Master Servicer's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder, provided, in each case, that with respect to
any such claim or legal action (or pending or threatened claim or legal action),
the Trustee shall have given the Master Servicer and the Seller written notice
thereof promptly after the Trustee shall have with respect to such claim or
legal action knowledge thereof; provided, however that the failure to give such
notice shall not relieve the Master Servicer of its indemnification obligations
hereunder. This indemnity shall survive the resignation or removal of the
Trustee or Master Servicer and the termination of this Agreement.

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         (b) The Seller will indemnify any Indemnified Person for any loss,
liability or expense of any Indemnified Person not otherwise paid or covered
pursuant to Subsection (a) above.

         Section 7.04 LIMITATIONS ON LIABILITY OF THE DEPOSITOR, THE MASTER
SERVICER AND OTHERS. Subject to the obligation of the Master Servicer to
indemnify the Indemnified Persons pursuant to Section 7.03:

         (a) Neither the Depositor, the Master Servicer nor any of the
directors, officers, employees or agents of the Depositor and the Master
Servicer shall be under any liability to the Indemnified Persons, the Trust Fund
or the Certificateholders for taking any action or for refraining from taking
any action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the
Master Servicer or any such Person against any breach of warranties or
representations made herein or any liability which would otherwise be imposed by
reason of such Person's willful misfeasance, bad faith or gross negligence in
the performance of duties or by reason of reckless disregard of obligations and
duties hereunder.

         (b) The Depositor, the Master Servicer and any director, officer,
employee or agent of the Depositor and the Master Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person respecting any matters arising hereunder.

         (c) The Depositor, the Master Servicer, the Trustee, each Custodian and
any director, officer, employee or agent of the Depositor, the Master Servicer,
the Trustee, each Custodian shall be indemnified by the Trust and held harmless
thereby against any loss, liability or expense (including reasonable legal fees
and disbursements of counsel) incurred on their part that may be sustained in
connection with, arising out of, or related to, any claim or legal action
(including any pending or threatened claim or legal action) relating to this
Agreement, the Custodial Agreement or the Certificates, other than (i) in the
case of the Master Servicer, (x) any such loss, liability or expense related to
the Master Servicer's failure to perform its duties in compliance with this
Agreement (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement) or (y) any such loss, liability or
expense incurred by reason of the Master Servicer's willful misfeasance, bad
faith or gross negligence in the performance of duties hereunder, or by reason
of reckless disregard of obligations and duties hereunder, (ii) in the case of
the Trustee, any such loss, liability or expense incurred by reason of the
Trustee's willful misfeasance, bad faith or negligence in the performance of its
duties hereunder, or by reason of its reckless disregard of obligations and
duties hereunder and (iii) in the case of either Custodian, any such loss,
liability or expense incurred by reason of such Custodian's willful misfeasance,
bad faith or negligence in the performance of its duties under the related
Custodial Agreement, or by reason of its reckless disregard of obligations and
duties thereunder.

         (d) Neither the Depositor nor the Master Servicer shall be under any
obligation to appear in, prosecute or defend any legal action that is not
incidental to its duties under this Agreement and that in its opinion may
involve it in any expense or liability; provided, however, the Master Servicer
may in its discretion, with the consent of the Trustee (which consent shall

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not be unreasonably withheld), undertake any such action 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. In
such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities of the Trust Fund,
and the Master Servicer shall be entitled to be reimbursed therefor out of the
Protected Account as provided by Section 4.02. Nothing in this Subsection
7.04(d) shall affect the Master Servicer's obligation to service and administer
the Mortgage Loans pursuant to Article III.

         (e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Trust might incur as a result of such
course of action by reason of the condition of the Mortgaged Properties but
shall give notice to the Trustee if it has notice of such potential liabilities.

         Section 7.05 MASTER SERVICER NOT TO RESIGN. Except as provided in
Section 7.07, the Master Servicer shall not resign from the obligations and
duties hereby imposed on it except (i) with the prior consent of the Trustee
(which consents shall not be unreasonably withheld) or (ii) upon a determination
that any such duties hereunder are no longer permissible under applicable law
and such impermissibility cannot be cured. Any such determination permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of Counsel,
addressed to and delivered to, the Trustee. No such resignation by the Master
Servicer shall become effective until the Trustee or a successor to the Master
Servicer reasonably satisfactory to the Trustee shall have assumed the
responsibilities and obligations of the Master Servicer in accordance with
Section 8.02 hereof. The Trustee shall notify the Rating Agencies of the
resignation of the Master Servicer.

         Section 7.06 SUCCESSOR MASTER SERVICER. In connection with the
appointment of any successor Master Servicer or the assumption of the duties of
the Master Servicer, the Trustee may make such arrangements for the compensation
of such successor master servicer out of payments on the Mortgage Loans as the
Trustee and such successor master servicer shall agree. If the successor master
servicer does not agree that such market value is a fair price, such successor
master servicer shall obtain two quotations of market value from third parties
actively engaged in the servicing of single-family mortgage loans. In no event
shall the compensation of any successor master servicer exceed that permitted
the Master Servicer hereunder without the consent of all of the
Certificateholders.

         Section 7.07 SALE AND ASSIGNMENT OF MASTER SERVICING. The Master
Servicer may sell and assign its rights and delegate its duties and obligations
in its entirety as Master Servicer under this Agreement; provided, however,
that: (i) the purchaser or transferee accepting such assignment and delegation
(a) shall be a Person which shall be qualified to service mortgage loans for
Fannie Mae or Freddie Mac; (b) shall have a net worth of not less than
$10,000,000 (unless otherwise approved by each Rating Agency pursuant to clause
(ii) below); (c) shall be reasonably satisfactory to the Trustee (as evidenced
in a writing signed by the Trustee); and (d) shall execute and deliver to the
Trustee an agreement, in form and substance reasonably satisfactory to the
Trustee, which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by it as

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master servicer under this Agreement, any custodial agreement from and after the
effective date of such agreement; (ii) each Rating Agency shall be given prior
written notice of the identity of the proposed successor to the Master Servicer
and each Rating Agency's rating of the Certificates in effect immediately prior
to such assignment, sale and delegation will not be downgraded, qualified or
withdrawn as a result of such assignment, sale and delegation, as evidenced by a
letter to such effect delivered to the Master Servicer, the Trustee; and (iii)
the Master Servicer assigning and selling the master servicing shall deliver to
the Trustee an Officer's Certificate and an Opinion of Counsel addressed to the
Trustee, each stating that all conditions precedent to such action under this
Agreement have been completed and such action is permitted by and complies with
the terms of this Agreement. No such assignment or delegation shall affect any
liability of the Master Servicer arising prior to the effective date thereof.

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                                  ARTICLE VIII

                     DEFAULT; TERMINATION OF MASTER SERVICER

         Section 8.01 EVENTS OF DEFAULT.

         "Event of Default," wherever used herein, means any one of the
following events:

                  (i) any failure by the Master Servicer to remit to the Trustee
         any amounts received or collected by the Master Servicer in respect of
         the Mortgage Loans and required to be remitted by it hereunder (other
         than any Advance), which failure shall continue unremedied for one
         Business Day after the date on which written notice of such failure
         shall have been given to the Master Servicer by the Trustee or the
         Depositor, or to the Trustee and the Master Servicer by the Holders of
         Certificates evidencing not less than 25% of the Voting Rights
         evidenced by the Certificates;

                  (ii) any failure by the Master Servicer to observe or perform
         in any material respect any other of the covenants or agreements on the
         part of the Master Servicer contained in this Agreement or any breach
         of a representation or warranty by the Master Servicer, which failure
         or breach shall continue unremedied for a period of 60 days after the
         date on which written notice of such failure shall have been given to
         Master Servicer by the Trustee or the Depositor, or to the Trustee and
         the Master Servicer by the Holders of Certificates evidencing not less
         than 25% of the Voting Rights evidenced by the Certificates;

                  (iii) a decree or order of a court or agency or supervisory
         authority having jurisdiction in the premises for the appointment of a
         receiver or liquidator in any insolvency, readjustment of debt,
         marshalling of assets and liabilities or similar proceedings, or for
         the winding-up or liquidation of its affairs, shall have been entered
         against the Master Servicer and such decree or order shall have
         remained in force undischarged or unstayed for a period of 60
         consecutive days;

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

                  (v) the Master Servicer shall admit in writing its inability
         to pay its debts generally as they become due, file a petition to take
         advantage of, or commence a voluntary case under, any applicable
         insolvency or reorganization statute, make an assignment for the
         benefit of its creditors, or voluntarily suspend payment of its
         obligations;

                  (vi) the Master Servicer assigns or delegates its duties or
         rights under this Agreement in contravention of the provisions
         permitting such assignment or delegation under Sections 7.05 or 7.07;
         or

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                  (vii) The Master Servicer fails to deposit, or cause to be
         deposited, in the Distribution Account any Advance (other than a
         Nonrecoverable Advance) by 5:00 p.m. New York City time on the
         Distribution Account Deposit Date.

         If an Event of Default shall occur, then, and in each and every such
case, so long as such Event of Default shall not have been remedied, the Trustee
may, and at the direction of the Holders of Certificates evidencing not less
than 25% of the Voting Rights evidenced by the Certificates, the Trustee shall
in the case of any Event of Default described in clauses (i) through (vii)
above, by notice in writing to the Master Servicer (with a copy to each Rating
Agency), terminate all of the rights and obligations of the Master Servicer
under this Agreement and in and to the Mortgage Loans and the proceeds thereof,
other than its rights as a Certificateholder hereunder. On or after the receipt
by the Master Servicer of such written notice, all authority and power of the
Master Servicer hereunder, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the Trustee, or any successor
appointed pursuant to Section 8.02 (a "Successor Master Servicer"). Such
Successor Master Servicer shall thereupon if such Successor Master Servicer is a
successor to the Master Servicer, make any Advance required by Article V,
subject, in the case of the Trustee, to Section 8.02. The Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the terminated
Master Servicer, as attorney- in-fact or otherwise, any and all documents and
other instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of any Mortgage Loans and
related documents, or otherwise. Unless expressly provided in such written
notice, no such termination shall affect any obligation of the Master Servicer
to pay amounts owed pursuant to Article VII or Article IX. The Master Servicer
agrees to cooperate with the Trustee in effecting the termination of the Master
Servicer's responsibilities and rights hereunder, including, without limitation,
the transfer to the applicable Successor Master Servicer of all cash amounts
which shall at the time be credited to the Protected Account maintained pursuant
to Section 4.02, or thereafter be received with respect to the applicable
Mortgage Loans. The Trustee shall promptly notify the Rating Agencies of the
occurrence of an Event of Default known to the Trustee.

         Notwithstanding any termination of the activities of the Master
Servicer hereunder, the Master Servicer shall be entitled to receive, out of any
late collection of a Scheduled Payment on a Mortgage Loan that was due prior to
the notice terminating the Master Servicer's rights and obligations as Master
Servicer hereunder and received after such notice, that portion thereof to which
the Master Servicer would have been entitled pursuant to Sections 4.02 and to
receive any other amounts payable to the Master Servicer hereunder the
entitlement to which arose prior to the termination of its activities hereunder.

         Notwithstanding the foregoing, if an Event of Default described in
clause (vii) of this Section 8.01 shall occur, the Trustee shall, by notice in
writing to the Master Servicer, which may be delivered by telecopy, immediately
terminate all of the rights and obligations of the Master Servicer thereafter
arising under this Agreement, but without prejudice to any rights it may have as
a Certificateholder or to reimbursement of Advances and other advances of its
own funds, and the Trustee shall act as provided in Section 8.02 to carry out
the duties of the Master Servicer, including the obligation to make any Advance
the nonpayment of which was an Event

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of Default described in clause (vii) of this Section 8.01. Any such action taken
by the Trustee must be prior to the distribution on the relevant Distribution
Date.

         Section 8.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.

         On and after the time the Master Servicer receives a notice of
termination pursuant to Section 8.01 hereof the Trustee shall automatically
become the successor to the Master Servicer with respect to the transactions set
forth or provided for herein and after a transition period (not to exceed 90
days), shall be subject to all the responsibilities, duties and liabilities
relating thereto placed on the Master Servicer by the terms and provisions
hereof; provided, however that, pursuant to Article V hereof, the Trustee in its
capacity as successor Master Servicer shall be responsible for making any
Advances required to be made by the Master Servicer immediately upon the
termination of the Master Servicer and any such Advance shall be made on the
Distribution Date on which such Advance was required to be made by the
predecessor Master Servicer. Effective on the date of such notice of
termination, as compensation therefor, the Trustee shall be entitled to all
compensation, reimbursement of expenses and indemnification that the Master
Servicer would have been entitled to if it had continued to act hereunder,
provided, however, that the Trustee shall not be (i) liable for any acts or
omissions of the Master Servicer, (ii) obligated to make Advances if it is
prohibited from doing so under applicable law, (iii) responsible for expenses of
the Master Servicer pursuant to Section 2.03 or (iv) obligated to deposit losses
on any Permitted Investment directed by the Master Servicer. Notwithstanding the
foregoing, the Trustee may, if it shall be unwilling to so act, or shall, if it
is prohibited by applicable law from making Advances pursuant to Article V or if
it is otherwise unable to so act, appoint, or petition a court of competent
jurisdiction to appoint, any established mortgage loan servicing institution the
appointment of which does not adversely affect the then current rating of the
Certificates by each Rating Agency 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. Any Successor Master Servicer
shall (i) be an institution that is a Fannie Mae and Freddie Mac approved
seller/servicer in good standing, that has a net worth of at least $15,000,000,
(ii) be acceptable to the Trustee (which consent shall not be unreasonably
withheld) and (iii) be willing to act as successor servicer of any Mortgage
Loans under this Agreement, and shall have executed and delivered to the
Depositor and the Trustee an agreement accepting such delegation and assignment,
that contains an assumption by such Person of the rights, powers, duties,
responsibilities, obligations and liabilities of the Master Servicer (other than
any liabilities of the Master Servicer hereof incurred prior to termination of
the Master Servicer under Section 8.01 or as otherwise set forth herein), with
like effect as if originally named as a party to this Agreement, provided that
each Rating Agency shall have acknowledged in writing that its rating of the
Certificates in effect immediately prior to such assignment and delegation will
not be qualified or reduced as a result of such assignment and delegation. If
the Trustee assumes the duties and responsibilities of the Master Servicer in
accordance with this Section 8.02, the Trustee shall not resign as Master
Servicer until a Successor Master Servicer has been appointed and has accepted
such appointment. Pending appointment of a successor to the Master Servicer
hereunder, the Trustee, unless the Trustee is prohibited by law from so acting,
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans or otherwise as
it and such successor shall agree; provided that no such

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compensation unless agreed to by the Certificateholders shall be in excess of
that permitted the Master Servicer hereunder. The Trustee and such successor
shall take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession. Neither the Trustee nor any other Successor
Master Servicer shall be deemed to be in default hereunder by reason of any
failure to make, or any delay in making, any distribution hereunder or any
portion thereof or any failure to perform, or any delay in performing, any
duties or responsibilities hereunder, in either case caused by the failure of
the Master Servicer to deliver or provide, or any delay in delivering or
providing, any cash, information, documents or records to it.

         The costs and expenses of the Trustee in connection with the
termination of the Master Servicer, appointment of a Successor Master Servicer
and, if applicable, any transfer of servicing, including, without limitation,
all costs and 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 or the Successor Master
Servicer to service the related Mortgage Loans properly and effectively, to the
extent not paid by the terminated Master Servicer, shall be payable to the
Trustee pursuant to Section 9.05. Any successor to the Master Servicer as
successor servicer under any Subservicing Agreement shall give notice to the
applicable Mortgagors of such change of servicer and shall, during the term of
its service as successor servicer maintain in force the policy or policies that
the Master Servicer is required to maintain pursuant to Section 3.08.

         Section 8.03 NOTIFICATION TO CERTIFICATEHOLDERS.

         (a) Upon any termination of or appointment of a successor to the Master
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.

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

         Section 8.04 WAIVER OF DEFAULTS.

         The Trustee shall transmit by mail to all Certificateholders, within 60
days after the occurrence of any Event of Default actually known to a
Responsible Officer of the Trustee, unless such Event of Default shall have been
cured, notice of each such Event of Default hereunder known to the Trustee. The
Holders of Certificates evidencing not less than 51% of the Voting Rights may,
on behalf of all Certificateholders, waive any default by the Master Servicer in
the performance of its obligations hereunder and the consequences thereof,
except a default in the making of or the causing to be made of any required
distribution on the Certificates. Upon any such waiver of a past default, such
default shall be deemed to cease to exist, and any Event of Default arising
therefrom shall be deemed to have been timely remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon except to the extent expressly so waived.
The Trustee shall give notice of any such waiver to the Rating Agencies.

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                                   ARTICLE IX

                             CONCERNING THE TRUSTEE

         Section 9.01 DUTIES OF TRUSTEE.

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

         (b) Upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments which are specifically
required to be furnished to the Trustee pursuant to any provision of this
Agreement, the Trustee shall examine them to determine whether they are in the
form required by 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
Master Servicer; provided, further, that the Trustee shall not be responsible
for the accuracy or verification of any calculation provided to it pursuant to
this Agreement.

         (c) On each Distribution Date, the Trustee shall make monthly
distributions and the final distribution to the Certificateholders from funds in
the Distribution Account as provided in Sections 5.04 and 10.01 herein.

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

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

                  (ii) The Trustee shall not be liable in its individual
         capacity for an error of judgment made in good faith by a Responsible
         Officer or Responsible Officers of the

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         Trustee unless it shall be proved that the Trustee was negligent in
         ascertaining the pertinent facts;

                  (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 directions of the Holders of Certificates
         evidencing not less than 25% of the aggregate Voting Rights of the
         Certificates (or such other percentage as specifically set forth
         herein), if such action or non-action relates to the time, method and
         place of conducting any proceeding for any remedy available to the
         Trustee or exercising any trust or other power conferred upon the
         Trustee under this Agreement;

                  (iv) The Trustee shall not be required to take notice or be
         deemed to have notice or knowledge of any default or Event of Default
         unless a Responsible Officer of the Trustee shall have actual knowledge
         thereof. In the absence of such knowledge, the Trustee may conclusively
         assume there is no such default or Event of Default;

                  (v) The Trustee shall not in any way be liable by reason of
         any insufficiency in any Account held by or in the name of Trustee
         unless it is determined by a court of competent jurisdiction in a
         non-appealable judgment that the Trustee's negligence or willful
         misconduct was the primary cause of such insufficiency (except to the
         extent that the Trustee is obligor and has defaulted thereon);

                  (vi) Anything in this Agreement to the contrary
         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; and

                  (vii) None of the Master Servicer, the Seller, the Depositor
         or the Trustee shall be responsible for the acts or omissions of the
         other, it being understood that this Agreement shall not be construed
         to render them partners, joint venturers or agents of one another.

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.

         (e) All funds received by the Trustee and required to be deposited in
the Distribution Account pursuant to this Agreement will be promptly so
deposited by the Trustee.

         Section 9.02 CERTAIN MATTERS AFFECTING THE TRUSTEE.

         (a) Except as otherwise provided in Section 10.01:

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

                  (ii) The Trustee may consult with counsel and any advice of
         such counsel or any Opinion of Counsel shall be full and complete
         authorization and protection with respect to 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 trusts or powers vested in it by this Agreement,
         other than its obligation to give notices pursuant to this Agreement,
         or to institute, conduct or defend any litigation hereunder or in
         relation hereto at the request, order or direction of any of the
         Certificateholders pursuant to the provisions of this Agreement, unless
         such Certificateholders shall have offered to the Trustee reasonable
         security or indemnity against the costs, expenses and liabilities which
         may be incurred therein or thereby. Nothing contained herein shall,
         however, relieve the Trustee of the obligation, upon the occurrence of
         an Event of Default of which a Responsible Officer of the Trustee has
         actual knowledge (which has not been cured or waived), to exercise such
         of the rights and powers vested in it by this Agreement, and to use the
         same degree of care and skill in their exercise, as a prudent person
         would exercise under the circumstances in the conduct of his own
         affairs;

                  (iv) The Trustee shall not be liable in its individual
         capacity 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) The Trustee shall not be bound to make any investigation
         into the facts or matters stated in any resolution, certificate,
         statement, instrument, opinion, report, notice, request, consent,
         order, approval, bond or other paper or document, unless requested in
         writing to do so by Holders of Certificates evidencing not less than
         25% of the aggregate Voting Rights of the Certificates and provided
         that 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 reasonably assured
         to the Trustee by the security afforded to it by the terms of this
         Agreement. The Trustee may require reasonable indemnity against such
         expense or liability as a condition to taking any such action. The
         reasonable expense of every such examination shall be paid by the
         Certificateholders requesting the investigation;

                  (vi) The Trustee may execute any of the trusts or powers
         hereunder or perform any duties hereunder either directly or through
         Affiliates, agents or attorneys; provided, however, that the Trustee
         may not appoint any paying agent to perform any paying agent functions
         under this Agreement without the express written consent of the Master
         Servicer, which consents will not be unreasonably withheld. The Trustee
         shall not be liable or responsible for the misconduct or negligence of
         any of the Trustee's agents or

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         attorneys or paying agent appointed hereunder by the Trustee with due
         care and, when required, with the consent of the Master Servicer;

                  (vii) Should the Trustee deem the nature of any action
         required on its part to be unclear, the Trustee may require prior to
         such action that it be provided by the Depositor with reasonable
         further instructions; 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 accountable for other than its
         negligence or willful misconduct in the performance of any such act;

                  (viii) The Trustee shall not be required to give any bond or
         surety with respect to the execution of the trust created hereby or the
         powers granted hereunder, except as provided in Subsection 9.07; and

                  (ix) The Trustee shall not have any duty to conduct any
         affirmative investigation as to the occurrence of any condition
         requiring the repurchase of any Mortgage Loan by any Person pursuant to
         this Agreement, or the eligibility of any Mortgage Loan for purposes of
         this Agreement.

         (b) The Trustee is hereby directed by the Depositor to execute and
deliver the Yield Maintenance Agreements. Amounts payable by the Trust on the
Closing Date pursuant to the Yield Maintenance Agreement shall be paid by the
Depositor or its designee. The Trustee in its individual capacity shall have no
responsibility for any of the undertakings, agreements or representations with
respect to the Yield Maintenance Agreement, including, without limitation, for
making any payments thereunder.

         Section 9.03 TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS.

         The recitals contained herein and in the Certificates (other than the
signature and countersignature of the Trustee on the Certificates) shall be
taken as the statements of the Depositor, and the Trustee shall not have any
responsibility for their correctness. The Trustee makes no representation as to
the validity or sufficiency of the Certificates (other than the signature and
countersignature of the Trustee on the Certificates) or of any Mortgage Loan
except as expressly provided in Sections 2.02 and 2.06 hereof; provided,
however, that the foregoing shall not relieve the Trustee, or the related
Custodian on its behalf, of the obligation to review the Mortgage Files pursuant
to Section 2.02 of this Agreement. The Trustee's signature and countersignature
(or countersignature of its agent) on the Certificates shall be solely in its
capacity as Trustee and shall not constitute the Certificates an obligation of
the Trustee in any other capacity. The Trustee shall not be accountable for the
use or application by the Depositor of any of the Certificates or of the
proceeds of such Certificates, or for the use or application of any funds paid
to the Depositor with respect to the Mortgage Loans. Subject to Section 2.06,
the Trustee shall not be responsible for the legality or validity of this
Agreement or any document or instrument relating to this Agreement, the validity
of the execution of this Agreement or of any supplement hereto or instrument of
further assurance, or the validity, priority, perfection or sufficiency of the
security for the Certificates issued hereunder or intended to be issued
hereunder. The Trustee shall not at any time have any responsibility or
liability for or with

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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 Fund or its ability to generate the payments to be distributed to
Certificateholders, under this Agreement. The Trustee shall not be responsible
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 or to record this Agreement.

         Section 9.04 TRUSTEE MAY OWN CERTIFICATES.

         The Trustee in its individual capacity or in any capacity other than as
Trustee hereunder may become the owner or pledgee of any Certificates with the
same rights it would have if it were not the Trustee and may otherwise deal with
the parties hereto.

         Section 9.05 TRUSTEE'S FEES AND EXPENSES.

         The Trustee will be entitled to recover from the Distribution Account
pursuant to Section 4.05, the Trustee Fee, all reasonable out-of-pocket
expenses, disbursements and advances and the expenses of the Trustee in
connection with any Event of Default (or anything related thereto, including any
determination that an Event of Default does or does not exist), any breach of
this Agreement or any claim or legal action (including any pending or threatened
claim or legal action) incurred or made by the Trustee in the administration of
the trusts hereunder (including the reasonable compensation, expenses and
disbursements of its counsel) except any such expense, disbursement or advance
as may arise from its negligence or intentional misconduct or which is the
responsibility of the Certificateholders hereunder. If funds in the Distribution
Account are insufficient therefor, the Trustee shall recover such expenses,
disbursements or advances from the Depositor and the Depositor hereby agrees to
pay such expenses, disbursements or advances. Such compensation and
reimbursement obligation shall not be limited by any provision of law in regard
to the compensation of a trustee of an express trust.

         Section 9.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE.

         The Trustee and any successor Trustee shall during the entire duration
of this Agreement be a state bank or trust company or a national banking
association organized and doing business under the laws of a state or the United
States of America, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus and undivided profits of at least
$50,000,000, subject to supervision or examination by federal or state authority
and rated "BBB" or higher by Fitch with respect to their long-term rating and
rated "BBB" or higher by S&P and "Baa2" or higher by Moody's with respect to any
outstanding long-term unsecured unsubordinated debt, and, in the case of a
successor Trustee other than pursuant to Section 9.10, rated in one of the two
highest long-term debt categories by each Rating Agency (at least "AA-" in the
case of S&P) or otherwise acceptable to, each of the Rating Agencies and have a
short-term debt rating of at least "A-1" from S&P, or otherwise acceptable to,
S&P. The Trustee shall not be an Affiliate of the Master Servicer. If the
Trustee publishes reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then for
the purposes of this Section 9.06 the combined capital and surplus of such

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corporation shall be deemed to be its total equity capital (combined capital and
surplus) as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 9.06, the Trustee shall resign immediately in the
manner and with the effect specified in Section 9.08.

         Section 9.07 INSURANCE.

         The Trustee, at its own expense, shall at all times maintain and keep
in full force and effect: (i) fidelity insurance, (ii) theft of documents
insurance and (iii) forgery insurance (which may be collectively satisfied by a
"Financial Institution Bond" and/or a "Bankers' Blanket Bond"); provided, that
such insurance may be provided through self-insurance so long as the Trustee is
rated "A" or better by S&P and "A1" or better by Moody's. All such insurance
shall be in amounts, with standard coverage and subject to deductibles, as are
customary for insurance typically maintained by banks or their affiliates which
act as custodians for investor-owned mortgage pools. A certificate of an officer
of the Trustee as to the Trustee's compliance with this Section 9.07 shall be
furnished to any Certificateholder upon reasonable written request.

         Section 9.08 RESIGNATION AND REMOVAL OF TRUSTEE.

         The Trustee may at any time resign and be discharged from the Trust
hereby created by giving written notice thereof to the Depositor, the Seller and
the Master Servicer, with a copy to the Rating Agencies. Upon receiving such
notice of resignation, the Depositor shall promptly appoint a successor trustee
by written instrument, in triplicate, one copy of which instrument shall be
delivered to each of the resigning Trustee and the successor trustee. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee.

         If at any time (i) the Trustee shall cease to be eligible in accordance
with the provisions of Section 9.06 hereof and shall fail to resign after
written request thereto by the Depositor, (ii) the Trustee shall become
incapable of acting, or shall be adjudged as 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, or
(iii)(A) a tax is imposed with respect to the Trust Fund by any state in which
the Trustee or the Trust Fund is located, (B) the imposition of such tax would
be avoided by the appointment of a different trustee and (C) the Trustee fails
to indemnify the Trust Fund against such tax, then the Depositor or the Master
Servicer may remove the Trustee and appoint a successor trustee by written
instrument, in multiple copies, a copy of which instrument shall be delivered to
the Trustee, the Master Servicer and the successor trustee.

         The Holders evidencing at least 51% of the Voting Rights of each Class
of Certificates may at any time remove the Trustee and appoint a successor
trustee by written instrument or instruments, in multiple copies, signed by such
Holders or their attorneys-in-fact duly authorized, one complete set of which
instruments shall be delivered by the successor trustee to the Master Servicer,
the Trustee so removed and the successor trustee so appointed. Notice of any
removal of the Trustee shall be given to each Rating Agency by the Trustee or
successor trustee.

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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 9.08 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 9.09 hereof.

         Section 9.09 SUCCESSOR TRUSTEE.

         Any successor trustee appointed as provided in Section 9.08 hereof
shall execute, acknowledge and deliver to the Depositor, to its predecessor
trustee, the Master Servicer 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 the like effect as if originally
named as trustee herein.

         No successor trustee shall accept appointment as provided in this
Section 9.09 unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 9.07 hereof and its appointment
shall not adversely affect the then current rating of the Certificates.

         Upon acceptance of appointment by a successor trustee as provided in
this Section 9.09, the successor trustee shall mail notice of the succession of
such trustee hereunder to all Holders of Certificates. If the successor trustee
fails to mail such notice within ten days after acceptance of appointment, the
Depositor shall cause such notice to be mailed at the expense of the Trust Fund.

         Section 9.10 MERGER OR CONSOLIDATION OF TRUSTEE.

         Any corporation, state bank or national banking association into which
the Trustee may be merged or converted or with which it may be consolidated or
any corporation, state bank or national banking association resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation, state bank or national banking association succeeding to
substantially all of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall be
eligible under the provisions of Section 9.06 hereof without the execution or
filing of any paper or further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.

         Section 9.11 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 Fund or property securing any Mortgage Note may at the
time be located, the Master Servicer and the Trustee acting jointly shall have
the power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees jointly with
the Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the
benefit of the Certificateholders, such title to the Trust Fund or any part
thereof, whichever is applicable, and, subject to the other provisions of this
Section 9.11, such powers, duties, obligations, rights and trusts as the Master
Servicer and the Trustee may consider necessary or desirable. If the Master
Servicer shall not

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have joined in such appointment within 15 days after the receipt by it of a
request to do so, or in the case an Event of Default shall have occurred and be
continuing, the Trustee alone shall have the power to make such appointment. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 9.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 9.09.

         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, except for the obligation of the Trustee
         under this Agreement to advance funds on behalf of the Master Servicer,
         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 a Trustee hereunder
         or as a Successor Master Servicer hereunder), the Trustee shall be
         incompetent or unqualified to perform such act or acts, in which event
         such rights, powers, duties and obligations (including the holding of
         title to the Trust Fund or any portion thereof in any such
         jurisdiction) shall be exercised and performed 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 Trustee may at any time accept the resignation of or
         remove any separate trustee or co-trustee.

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

         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.

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         Section 9.12 TAX MATTERS.

         It is intended that the Trust Fund shall constitute, and that the
affairs of the Trust Fund shall be conducted so that each REMIC formed hereunder
qualifies as, a "real estate mortgage investment conduit" as defined in and in
accordance with the REMIC Provisions. In furtherance of such intention, the
Trustee covenants and agrees that it shall act as agent (and the Trustee is
hereby appointed to act as agent) on behalf of the Trust Fund. The Trustee, as
agent on behalf of the Trust Fund, shall do or refrain from doing, as
applicable, the following: (a) the Trustee shall prepare and file, or cause to
be prepared and filed, in a timely manner, U.S. Real Estate Mortgage Investment
Conduit Income Tax Returns (Form 1066 or any successor form adopted by the
Internal Revenue Service) and prepare and file or cause to be prepared and filed
with the Internal Revenue Service and applicable state or local tax authorities
income tax or information returns for each taxable year with respect to each
such REMIC containing such information and at the times and in the manner as may
be required by the Code or state or local tax laws, regulations, or rules, and
furnish or cause to be furnished to Certificateholders the schedules, statements
or information at such times and in such manner as may be required thereby; (b)
the Trustee shall apply for an employer identification number with the Internal
Revenue Service via a Form SS-4 or other comparable method for each REMIC that
is or becomes a taxable entity, and within thirty days of the Closing Date,
furnish or cause to be furnished to the Internal Revenue Service, on Forms 8811
or as otherwise may be required by the Code, the name, title, address, and
telephone number of the person that the holders of the Certificates may contact
for tax information relating thereto, together with such additional information
as may be required by such Form, and update such information at the time or
times in the manner required by the Code for the Trust Fund; (c) the Trustee
shall make or cause to be made elections, on behalf of each REMIC formed
hereunder to be treated as a REMIC on the federal tax return of such REMIC for
its first taxable year (and, if necessary, under applicable state law); (d) the
Trustee shall prepare and forward, or cause to be prepared and forwarded, to the
Certificateholders and to the Internal Revenue Service and, if necessary, state
tax authorities, all information returns and reports as and when required to be
provided to them in accordance with the REMIC Provisions, including without
limitation, the calculation of any original issue discount using the Prepayment
Assumption; (e) the Trustee shall provide information necessary for the
computation of tax imposed on the transfer of a Residual Certificate to a Person
that is not a Permitted Transferee, or an agent (including a broker, nominee or
other middleman) of a Person that is not a Permitted Transferee, or a
pass-through entity in which a Person that is not a Permitted Transferee is the
record holder of an interest (the reasonable cost of computing and furnishing
such information may be charged to the Person liable for such tax); (f) the
Trustee shall, to the extent under its control, conduct the affairs of the Trust
Fund at all times that any Certificates are outstanding so as to maintain the
status of each REMIC formed hereunder as a REMIC under the REMIC Provisions; (g)
the Trustee shall not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of any REMIC
formed hereunder; (h) the Trustee shall pay, from the sources specified in the
penultimate paragraph of this Section 9.12, the amount of any federal, state and
local taxes, including prohibited transaction taxes as described below, imposed
on any REMIC formed hereunder prior to the termination of the Trust Fund when
and as the same shall be due and payable (but such obligation shall not prevent
the Trustee or any other appropriate Person from contesting any such tax in
appropriate proceedings and shall not prevent the Trustee from withholding
payment of

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such tax, if permitted by law, pending the outcome of such proceedings); (i) the
Trustee shall maintain records relating to each REMIC formed hereunder including
but not limited to the income, expenses, assets and liabilities of each such
REMIC and adjusted basis of the Trust Fund property determined at such intervals
as may be required by the Code, as may be necessary to prepare the foregoing
returns, schedules, statements or information; (j) the Trustee shall, for
federal income tax purposes, maintain books and records with respect to the
REMICs on a calendar year and on an accrual basis; (k) the Trustee shall not
enter into any arrangement not otherwise provided for in this Agreement by which
the REMICs will receive a fee or other compensation for services nor permit the
REMICs to receive any income from assets other than "qualified mortgages" as
defined in Section 860G(a)(3) of the Code or "permitted investments" as defined
in Section 860G(a)(5) of the Code; and (l) as and when necessary and
appropriate, the Trustee, at the expense of the Trust Fund, shall represent the
Trust Fund 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 formed hereunder,
enter into settlement agreements with any governmental taxing agency, extend any
statute of limitations relating to any tax item of the Trust Fund, and otherwise
act on behalf of each REMIC formed hereunder in relation to any tax matter
involving any such REMIC.

         In order to enable the Trustee to perform its duties as set forth
herein, the Depositor shall provide, or cause to be provided, to the Trustee
within 10 days after the Closing Date all information or data that the Trustee
requests in writing and determines to be relevant for tax purposes to the
valuations and offering prices of the Certificates, including, without
limitation, the price, yield, prepayment assumption and projected cash flows of
the Certificates and the Mortgage Loans. Thereafter, the Depositor shall provide
to the Trustee promptly upon written request therefor, any such additional
information or data that the Trustee may, from time to time, request in order to
enable the Trustee to perform its duties as set forth herein. The Depositor
hereby indemnifies the Trustee for any losses, liabilities, damages, claims or
expenses of the Trustee arising from any errors or miscalculations of the
Trustee that result from any failure of the Depositor to provide, or to cause to
be provided, accurate information or data to the Trustee on a timely basis.

         In the event that any tax is imposed on "prohibited transactions" of
any of REMIC I, REMIC II, REMIC III or REMIC IV as defined in Section 860F(a)(2)
of the Code, on the "net income from foreclosure property" of the Trust Fund as
defined in Section 860G(c) of the Code, on any contribution to any of REMIC I,
REMIC II, REMIC III or REMIC IV after the startup day pursuant to Section
860G(d) of the Code, or any other tax is imposed, including, without limitation,
any federal, state or local tax or minimum tax imposed upon any of REMIC I,
REMIC II, REMIC III or REMIC IV, and is not paid as otherwise provided for
herein, such tax shall be paid by (i) the Trustee, if any such other tax arises
out of or results from a breach by the Trustee of any of its obligations under
this Agreement, (ii) any party hereto (other than the Trustee) to the extent any
such other tax arises out of or results from a breach by such other party of any
of its obligations under this Agreement or (iii) in all other cases, or in the
event that any liable party hereto fails to honor its obligations under the
preceding clauses (i) or (ii), any such tax will be paid first with amounts
otherwise to be distributed to the Class R Certificateholders, and second with
amounts otherwise to be distributed to all other Certificateholders in the
following order of priority: first, to the Class M-7 Certificates, second, to
the Class M-6 Certificates, third, to the

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Class M-5 Certificates, fourth, to the Class M-4 Certificates, fifth, to the
Class M-3 Certificates, sixth, to the Class M-2 Certificates, seventh to the
Class M-1 Certificates, and eighth to the Class A Certificates (pro rata based
on the amounts to be distributed). Notwithstanding anything to the contrary
contained herein, to the extent that such tax is payable by the Holder of any
Certificates, the Trustee is hereby authorized to retain on any Distribution
Date, from the Holders of the Class R Certificates (and, if necessary, second,
from the Holders of the other Certificates in the priority specified in the
preceding sentence), funds otherwise distributable to such Holders in an amount
sufficient to pay such tax. The Trustee shall promptly notify in writing the
party liable for any such tax of the amount thereof and the due date for the
payment thereof.

         The Trustee agrees that, in the event it should obtain any information
necessary for the other party to perform its obligations pursuant to this
Section 9.12, it will promptly notify and provide such information to such other
party.

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                                   ARTICLE X

                                   TERMINATION

         Section 10.01 TERMINATION UPON LIQUIDATION OR REPURCHASE OF ALL
MORTGAGE LOANS.

         Subject to Section 10.03, the obligations and responsibilities of the
Depositor, the Master Servicer, the Seller and the Trustee created hereby with
respect to the Trust Fund shall terminate upon the earlier of (a) the purchase
by the Majority Class CE Certificateholder (or its designee) or the Master
Servicer, as applicable, of all of the Mortgage Loans (and REO Properties)
remaining in the Trust Fund at a price (the "Mortgage Loan Purchase Price")
equal to the sum of (i) 100% of the Stated Principal Balance of each Mortgage
Loan (other than in respect of REO Property), (ii) accrued interest thereon at
the applicable Mortgage Rate to, but not including, the first day of the month
of such purchase, (iii) the appraised value of any REO Property in the Trust
Fund (up to the Stated Principal Balance of the related Mortgage Loan), such
appraisal to be conducted by an appraiser mutually agreed upon by the Master
Servicer and the Trustee, (iv) unreimbursed out-of pocket costs of the Master
Servicer, including unreimbursed servicing advances and the principal portion of
any unreimbursed Advances, made on the Mortgage Loans prior to the exercise of
such repurchase right, (v) any unreimbursed costs and expenses of the Trustee
payable pursuant to Section 9.05 and (b) the later of (i) the maturity or other
liquidation (or any Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and the disposition of all REO Property and (ii) the
distribution to Certificateholders of all amounts required to be distributed to
them pursuant to this Agreement, as applicable. In no event shall the trusts
created hereby continue beyond the earlier of (i) the expiration of 21 years
from the death of the last survivor of the descendants of Joseph P. Kennedy, the
late Ambassador of the United States to the Court of St. James, living on the
date hereof and (ii) the Latest Possible Maturity Date.

         The right to repurchase all Mortgage Loans and REO Properties by the
Majority Class CE Certificateholder pursuant to clause (a) in the preceding
paragraph shall be conditioned upon the Stated Principal Balance of all of the
Mortgage Loans in the Trust Fund, at the time of any such repurchase,
aggregating 10% or less of the aggregate Cut-off Date Principal Balance of all
of the Mortgage Loans. If the Majority Class CE Certificateholder does not
exercise this option, the Master Servicer has the right to repurchase all
Mortgage Loans and REO Properties pursuant to clause (a) in the preceding
paragraph, conditioned upon the Stated Principal Balance of all of the Mortgage
Loans in the Trust Fund, at the time of any such repurchase, aggregating 5% or
less of the aggregate Cut-off Date Principal Balance of all of the Mortgage
Loans.

         Section 10.02 FINAL DISTRIBUTION ON THE CERTIFICATES.

         If on any Determination Date, (i) the Master Servicer determines that
there are no Outstanding Mortgage Loans and no other funds or assets in the
Trust Fund other than the funds in the Protected Account, the Master Servicer
shall direct the Trustee to send a final distribution notice promptly to each
Certificateholder or (ii) the Trustee determines that a Class of

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Certificates shall be retired after a final distribution on such Class, the
Trustee shall notify the Certificateholders within five (5) Business Days after
such Determination Date that the final distribution in retirement of such Class
of Certificates is scheduled to be made on the immediately following
Distribution Date. Any final distribution made pursuant to the immediately
preceding sentence will be made only upon presentation and surrender of the
related Certificates at the Corporate Trust Office of the Trustee. If the
Majority Class CE Certificateholder or the Master Servicer, as applicable,
elects to terminate the Trust Fund pursuant to Section 10.01, at least 20 days
prior to the date notice is to be mailed to the Certificateholders, the Majority
Class CE Certificateholder or the Master Servicer, as applicable, shall notify
the Depositor and the Trustee of the date the Majority Class CE
Certificateholder or the Master Servicer, as applicable, intends to terminate
the Trust Fund. The Master Servicer shall remit the Mortgage Loan Purchase Price
to the Trustee on the Business Day prior to the Distribution Date for such
Optional Termination by the Majority Class CE Certificateholder or the Master
Servicer, as applicable.

         Notice of any termination of the Trust Fund, specifying the
Distribution Date on which Certificateholders may surrender their Certificates
for payment of the final distribution and cancellation, shall be given promptly
by the Trustee by letter to Certificateholders mailed not later than two
Business Days after the Determination Date in the month of such final
distribution. Any such notice shall specify (a) the Distribution Date upon which
final distribution on the Certificates will be made upon presentation and
surrender of Certificates at the office therein designated, (b) the amount of
such final distribution, (c) the location of the office or agency at which such
presentation and surrender must be made and (d) 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 therein
specified. The Trustee will give such notice to each Rating Agency at the time
such notice is given to Certificateholders.

         In the event such notice is given, the Master Servicer shall cause all
funds in the Protected Account to be remitted to the Trustee for deposit in the
Distribution Account on the Business Day prior to the applicable Distribution
Date in an amount equal to the final distribution in respect of the
Certificates. Upon such final deposit with respect to the Trust Fund and the
receipt by the Trustee of a Request for Release therefor, the Trustee or the
related Custodian shall promptly release to EMC as applicable the Mortgage Files
for the Mortgage Loans and the Trustee shall execute and deliver any documents
prepared and delivered to it which are necessary to transfer any REO Property.

         Upon presentation and surrender of the Certificates, the Trustee shall
cause to be distributed to Certificateholders of each Class the amounts
allocable to such Certificates held in the Distribution Account in the order and
priority set forth in Section 5.04 hereof on the final Distribution Date and in
proportion to their respective Percentage Interests.

         In the event that any affected Certificateholders shall not surrender
Certificates for cancellation within six months after the date specified in the
above mentioned written notice, the Trustee shall give a second written notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice all the applicable Certificates shall not
have been surrendered for

                                      127
<PAGE>

cancellation, the Trustee may take appropriate steps, or may appoint an agent to
take appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets that remain a part of the Trust Fund. If within one year
after the second notice all Certificates shall not have been surrendered for
cancellation, the Class R Certificateholders shall be entitled to all unclaimed
funds and other assets of the Trust Fund that remain subject hereto.

         Section 10.03 ADDITIONAL TERMINATION REQUIREMENTS.

         (a) Upon exercise by the Majority Class CE Certificateholder or the
Master Servicer, as applicable, of its purchase option as provided in Section
10.01, the Trust Fund shall be terminated in accordance with the following
additional requirements, unless the Trustee has been supplied with an Opinion of
Counsel addressed to the Trustee, at the expense of the Upon exercise by the
Majority Class CE Certificateholder or the Master Servicer, as applicable, to
the effect that the failure of the Trust Fund to comply with the requirements of
this Section 10.03 will not (i) result in the imposition of taxes on "prohibited
transactions" of a REMIC, or (ii) cause a REMIC to fail to qualify as a REMIC at
any time that any Certificates are outstanding:

         (1) The Majority Class CE Certificateholder or the Master Servicer, as
applicable, shall establish a 90-day liquidation period and notify the Trustee
thereof, and the Trustee shall in turn specify the first day of such period in a
statement attached to the tax return for any of REMIC I, REMIC II, REMIC III and
REMIC IV pursuant to Treasury Regulation Section 1.860F-1. The Majority Class CE
Certificateholder or the Master Servicer, as applicable, shall satisfy all the
requirements of a qualified liquidation under Section 860F of the Code and any
regulations thereunder, as evidenced by an Opinion of Counsel obtained at the
expense of the Majority Class CE Certificateholder or the Master Servicer, as
applicable;

         (2) During such 90-day liquidation period, and at or prior to the time
of making the final payment on the Certificates, the Trustee shall sell all of
the assets of REMIC I, REMIC II, REMIC III and REMIC IV for cash; and

         (3) 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,
to the Holders of the Residual Certificates all cash on hand (other than cash
retained to meet claims), and REMIC I shall terminate at that time.

         (b) By their acceptance of the Certificates, the Holders thereof hereby
authorize the adoption of a 90-day liquidation period for REMIC I, REMIC II,
REMIC III and REMIC IV, which authorization shall be binding upon all successor
Certificateholders.

         (c) The Trustee as agent for each REMIC hereby agrees to adopt and sign
such a plan of complete liquidation upon the written request of the Majority
Class CE Certificateholder or the Master Servicer, as applicable, and the
receipt of the Opinion of Counsel referred to in Section 10.03(a)(1) and to take
such other action in connection therewith as may be reasonably requested by the
Majority Class CE Certificateholder or the Master Servicer, as applicable.

                                      128
<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

         Section 11.01 AMENDMENT.

         This Agreement may be amended from time to time by parties hereto
without the consent of any of the Certificateholders to cure any ambiguity, to
correct or supplement any provisions herein (including to give effect to the
expectations of investors), to change the manner in which the Protected Account
is maintained or to make such other provisions with respect to matters or
questions arising under this Agreement as shall not be inconsistent with any
other provisions herein if such action shall not, as evidenced by an Opinion of
Counsel addressed to the Trustee, adversely affect in any material respect the
interests of any Certificateholder; provided that any such amendment shall be
deemed not to adversely affect in any material respect the interests of the
Certificateholders and no such Opinion of Counsel shall be required if the
Person requesting such amendment obtains a letter from each Rating Agency
stating that such amendment would not result in the downgrading or withdrawal of
the respective ratings then assigned to the Certificates.

         Notwithstanding the foregoing, without the consent of the
Certificateholders, the parties hereto may at any time and from time to time
amend this Agreement to modify, eliminate or add to any of its provisions to
such extent as shall be necessary or appropriate to maintain the qualification
of any of REMIC I, REMIC II, REMIC III and REMIC IV as a REMIC under the Code or
to avoid or minimize the risk of the imposition of any tax on any of REMIC I,
REMIC II, REMIC III or REMIC IV pursuant to the Code that would be a claim
against any of REMIC I, REMIC II, REMIC III or REMIC IV at any time prior to the
final redemption of the Certificates, provided that the Trustee has been
provided an Opinion of Counsel addressed to the Trustee, which opinion shall be
an expense of the party requesting such opinion but in any case shall not be an
expense of the Trustee or the Trust Fund, to the effect that such action is
necessary or appropriate to maintain such qualification or to avoid or minimize
the risk of the imposition of such a tax.

         This Agreement may also be amended from time to time by the parties
hereto with the consent of the Holders of each Class of Certificates affected
thereby evidencing over 50% of the Voting Rights of such Class or Classes 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 that no such amendment shall (i) reduce
in any manner the amount of, or delay the timing of, payments required to be
distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) cause any of REMIC I, REMIC II, REMIC III or REMIC IV to cease
to qualify as a REMIC or (iii) reduce the aforesaid percentages of Certificates
of each Class the Holders of which are required to consent to any such amendment
without the consent of the Holders of all Certificates of such Class then
outstanding.

                                      129
<PAGE>

         Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel addressed to the Trustee, which opinion shall be
an expense of the party requesting such amendment but in any case shall not be
an expense of the Trustee, to the effect that such amendment will not (other
than an amendment pursuant to clause (ii) of, and in accordance with, the
preceding paragraph) cause the imposition of any tax on any of REMIC I, REMIC
II, REMIC III or REMIC IV or the Certificateholders or cause any of REMIC I,
REMIC II, REMIC III or REMIC IV to cease to qualify as a REMIC at any time that
any Certificates are outstanding. Further, nothing in this Agreement shall
require the Trustee to enter into an amendment without receiving an Opinion of
Counsel, satisfactory to the Trustee that (i) such amendment is permitted and is
not prohibited by this Agreement and that all requirements for amending this
Agreement (including any consent of the applicable Certificateholders) have been
complied with.

         Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written
notification of the substance of such amendment to each Certificateholder and
each Rating Agency.

         It shall not be necessary for the consent of Certificateholders under
this Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.

         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
of the counties or other comparable jurisdictions in which any or all of the
Mortgaged Properties are situated, and in any other appropriate public recording
office or elsewhere. The Master Servicer shall effect such recordation at the
Trust's expense upon the request in writing of a Certificateholder, but only if
such direction is accompanied by an Opinion of Counsel (provided at the expense
of the Certificateholder requesting recordation) to the effect that such
recordation would materially and beneficially affect the interests of the
Certificateholders or is required by law.

         For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.

         Section 11.03 GOVERNING LAW.

         THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED

                                      130
<PAGE>

IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES
THEREOF (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAWS).

         Section 11.04 INTENTION OF PARTIES.

         It is the express intent of the parties hereto that the conveyance of
the Mortgage Notes, Mortgages, assignments of Mortgages, title insurance
policies and any modifications, extensions and/or assumption agreements and
private mortgage insurance policies relating to the Mortgage Loans by the Seller
to the Depositor, and by the Depositor to the Trustee be, and be construed as,
an absolute sale thereof to the Depositor or the Trustee, as applicable. It is,
further, not the intention of the parties that such conveyance be deemed a
pledge thereof by the Seller to the Depositor, or by the Depositor to the
Trustee. However, in the event that, notwithstanding the intent of the parties,
such assets are held to be the property of the Seller or the Depositor, as
applicable, or if for any other reason the Mortgage Loan Purchase Agreement or
this Agreement is held or deemed to create a security interest in such assets,
then (i) the Mortgage Loan Purchase Agreement and this Agreement shall each be
deemed to be a security agreement within the meaning of the Uniform Commercial
Code of the State of New York and (ii) the conveyance provided for in the
Mortgage Loan Purchase Agreement from the Seller to the Depositor, and the
conveyance provided for in this Agreement from the Depositor to the Trustee,
shall be deemed to be an assignment and a grant by the Seller or the Depositor,
as applicable, for the benefit of the Certificateholders of a security interest
in all of the assets that constitute the Trust Fund, whether now owned or
hereafter acquired.

         The Depositor for the benefit of the Certificateholders 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
assets of the Trust Fund, such security interest would be deemed to be a
perfected security interest of first priority under applicable law and will be
maintained as such throughout the term of the Agreement.

         Section 11.05 NOTICES.

         (a) The Trustee shall use its best efforts to promptly provide notice
to each Rating Agency with respect to each of the following of which a
Responsible Officer of the Trustee has actual knowledge:

                  (i) Any material change or amendment to this Agreement;

                  (ii) The occurrence of any Event of Default that has not been
         cured;

                  (iii) The resignation or termination of the Master Servicer or
         the Trustee and the appointment of any successor;

                  (iv) The repurchase or substitution of Mortgage Loans pursuant
         to Sections 2.02, 2.03, 3.18 and 10.01; and

                  (v) The final payment to Certificateholders.

                                      131
<PAGE>

         (b) All directions, demands and notices hereunder shall be in writing
and shall be deemed to have been duly given when delivered at or mailed by
registered mail, return receipt requested, postage prepaid, or by recognized
overnight courier, or by facsimile transmission to a number provided by the
appropriate party if receipt of such transmission is confirmed to (i) in the
case of the Depositor, Bear Stearns Asset Backed Securities I LLC, 383 Madison
Avenue, New York, New York 10179, Attention: Chief Counsel; (ii) in the case of
the Seller or the Master Servicer, EMC Mortgage Corporation, 909 Hidden Ridge
Drive, Irving, Texas 75038, Attention: Ralene Ruyle or such other address as may
be hereafter furnished to the other parties hereto by the Master Servicer in
writing; (iii) in the case of the Trustee, at each Corporate Trust Office or
such other address as the Trustee may hereafter furnish to the other parties
hereto and (iv) in the case of the Rating Agencies, (x) Moody's Investors
Service, Inc., 99 Church Street, New York, New York 10007, Attention: Home
Equity Monitoring and (y) Standard & Poor's, 55 Water Street, 41st Floor, New
York, New York 10041, Attention: Mortgage Surveillance Group. Any notice
delivered to the Seller, the Master Servicer or the Trustee under this Agreement
shall be effective only upon receipt. Any notice required or permitted to be
mailed to a Certificateholder, unless otherwise provided herein, shall be given
by first-class mail, postage prepaid, at the address of such Certificateholder
as shown in the Certificate Register; any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the Certificateholder receives such notice.

         Section 11.06 SEVERABILITY OF PROVISIONS.

         If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.

         Section 11.07 ASSIGNMENT.

         Notwithstanding anything to the contrary contained herein, except as
provided pursuant to Section 7.02, this Agreement may not be assigned by the
Master Servicer, the Seller or the Depositor.

         Section 11.08 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.

         The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, nor entitle such Certificateholder's
legal representative or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a petition or winding up of the Trust
Fund, or otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.

         No Certificateholder shall have any right to vote (except as provided
herein) or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything herein
set forth or contained in the terms of the Certificates be construed so as to
constitute the Certificateholders from time to time as partners or members

                                      132
<PAGE>

of an association; nor shall any Certificateholder be under any liability to any
third party by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.

         No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of an Event of Default and of the continuance thereof, as hereinbefore provided,
the Holders of Certificates evidencing not less than 25% of the Voting Rights
evidenced by the Certificates shall also have made written request to the
Trustee to institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses, and liabilities to be incurred therein
or thereby, and the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity shall have neglected or refused to institute any
such action, suit or proceeding; it being understood and intended, and being
expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder or to enforce any
right under this Agreement, except in the manner herein provided and for the
common benefit of all Certificateholders. For the protection and enforcement of
the provisions of this Section 11.08, each and every Certificateholder or the
Trustee shall be entitled to such relief as can be given either at law or in
equity.

         Section 11.09 INSPECTION AND AUDIT RIGHTS. The Master Servicer agrees
that, on reasonable prior notice, it will permit any representative of the
Depositor or the Trustee during the Master Servicer's normal business hours, to
examine all the books of account, records, reports and other papers of the
Master Servicer relating to the Mortgage Loans, to make copies and extracts
therefrom, to cause such books to be audited by independent certified public
accountants selected by the Depositor and the Trustee and to discuss its
affairs, finances and accounts relating to such Mortgage Loans with its
officers, employees and independent public accountants (and by this provision
the Master Servicer hereby authorizes such accountants to discuss with such
representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any out-of-pocket expense
incident to the exercise by the Depositor or the Trustee of any right under this
Section 11.09 shall be borne by the party requesting such inspection, subject to
such party's right to reimbursement hereunder (in the case of the Trustee,
pursuant to Section 9.05 hereof.

         Section 11.10 CERTIFICATES NONASSESSABLE AND FULLY PAID.

         It is the intention of the Depositor that Certificateholders shall not
be personally liable for obligations of the Trust Fund, that the interests in
the Trust Fund represented by the Certificates shall be nonassessable for any
reason whatsoever, and that the Certificates, upon due authentication thereof by
the Trustee pursuant to this Agreement, are and shall be deemed fully paid.

(a)

                                      133
<PAGE>

                                      * * *

                                      134
<PAGE>

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

                                     BEAR STEARNS ASSET BACKED SECURITIES I LLC,
                                     as Depositor

                                     By: /s/ Baron Silverstein
                                        ---------------------------------------
                                     Name:   Baron Silverstein
                                     Title:  Vice President

                                     EMC MORTGAGE CORPORATION,
                                              as Seller and Master Servicer

                                     By: /s/ Sue Stepanek
                                        ---------------------------------------
                                     Name:   Sue Stepanek
                                     Title:  Executive Vice President

                                     LASALLE BANK NATIONAL ASSOCIATION
                                     as Trustee

                                     By: /s/ Christopher Lewis
                                        ---------------------------------------
                                     Name:   Christopher Lewis
                                     Title:  Assistant Vice President

<PAGE>

STATE OF NEW YORK         )
                          ) ss.:
COUNTY OF NEW YORK        )

         On this 30th day of November, 2004, before me, a notary public in and
for said State, appeared Baron Silverstein, personally known to me on the basis
of satisfactory evidence to be an authorized representative of Bear Stearns
Asset Backed Securities I LLC, one of the companies that executed the within
instrument, and also known to me to be the person who executed it on behalf of
such 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

[Notarial Seal]

<PAGE>

STATE OF TEXAS      )
                    ) ss.:
COUNTY OF DALLAS    )

         On this 30th day of November, 2004, before me, a notary public in and
for said State, appeared Sue Stepanek, personally known to me on the basis of
satisfactory evidence to be an authorized representative of EMC Mortgage
Corporation, one of the corporations that executed the within instrument, and
also known to me to be the person who executed it on behalf of such corporation
and acknowledged to me that such corporation executed the within instrument.

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

                                         _______________________________________
                                         Notary Public

[Notarial Seal]

<PAGE>

STATE OF ILLINOIS      )
                       ) ss.:
COUNTY OF COOK         )

         On this 30th day of November, 2004, before me, a notary public in and
for said State, appeared _________________ , personally known to me on the basis
of satisfactory evidence to be an authorized representative of LaSalle Bank
National Association that executed the within instrument, and also known to me
to be the person who executed it on behalf of such corporation, and acknowledged
to me that such corporation executed the within instrument.

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

                                         _______________________________________
                                         Notary Public

[Notarial Seal]

<PAGE>

                                   EXHIBIT A-1

                          Form of Class A 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 (THE "CODE").

         THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED
BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE
PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE
PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.

                                     A-1-1
<PAGE>

<TABLE>
<CAPTION>
<S>                                                        <C>
Certificate No. 1                                          Variable Pass-Through Rate

Class [I-A-1][I-A-2][I-A-3][II-A-1][II-A-2] Senior

Date of Pooling and Servicing Agreement                    Aggregate Initial Certificate  Principal Balance of this
and Cut-off Date: November 1, 2004                         Certificate as of the Cut-off Date:
                                                           $[__________]

First Distribution Date:                                   Initial   Certificate    Principal   Balance   of   this
December 27, 2004                                          Certificate as of the Cut-off Date:
                                                           $[__________]

Master Servicer:                                           CUSIP: [_____]
EMC Mortgage Corporation

Last Scheduled Distribution Date:
[___________ , ___]
</TABLE>

                            ASSET-BACKED CERTIFICATE
                                SERIES 2004-HE10

         evidencing a fractional undivided interest in the distributions
         allocable to the Class [I-A-1][I-A-2][I-A-3][II-A-1][II-A-2]
         Certificates with respect to a Trust Fund consisting primarily of a
         pool of conventional, closed-end, first and second lien, one- to
         four-family fixed and adjustable interest rate mortgage loans sold by
         BEAR STEARNS ASSET BACKED SECURITIES I LLC.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Bear Stearns Asset Backed
Securities I LLC, the Master Servicer or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage Loans
are guaranteed or insured by any governmental entity or by Bear Stearns Asset
Backed Securities I LLC, the Master Servicer or the Trustee or any of their
affiliates or any other person. None of Bear Stearns Asset Backed Securities I
LLC, the Master Servicer or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable from
payments on the Certificates.

         This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced hereby in the beneficial ownership interest of
Certificates of the same Class as this Certificate in a trust (the "Trust Fund")
generally consisting of conventional, closed-end first and second lien, fixed
and adjustable rate mortgage loans secured by one- to four- family residences
(collectively, the "Mortgage Loans") sold by Bear Stearns Asset Backed
Securities I LLC ("BSABS I"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to

                                     A-1-2
<PAGE>

BSABS I. EMC will act as master servicer of the Mortgage Loans (the "Master
Servicer," which term includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement, dated as of the Cut-off Date specified above (the
"Agreement"), among BSABS I, as depositor (the "Depositor"), EMC Mortgage
Corporation as seller and Master Servicer and LaSalle Bank National Association,
as trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, capitalized
terms used herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such Holder is bound.

         Interest on this Certificate will accrue from and including the
immediately preceding Distribution Date (or with respect to the First
Distribution Date, the Closing Date) to and including the day prior to the
current Distribution Date on the Certificate Principal Balance hereof at a per
annum rate equal to the Pass-Through Rate set forth above. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "Distribution Date"),
commencing on the First Distribution Date specified above, to the Person in
whose name this Certificate is registered at the close of business on the
Business Day immediately preceding such Distribution Date so long as such
Certificate remains in book-entry form (and otherwise, the close of business on
the last Business Day of the month immediately preceding the month of such
Distribution Date), an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to the Holders of Certificates of the same Class as
this Certificate.

         Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. 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 and designated in such notice. The initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of
distributions allocable to principal hereon and any Realized Losses applicable
hereto.

         This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"). The
Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund 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 hereby, and the rights,
duties and immunities of the Trustee.

                                     A-1-3
<PAGE>

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Agreement from time
to time by the parties thereto with the consent of the Holders of each Class of
Certificates affected thereby evidencing over 50% of the Voting Rights of such
Class or Classes. 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 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 with the Trustee upon
surrender of this Certificate for registration of transfer at the offices or
agencies maintained by the Trustee for such purposes, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Percentage Interest will be issued
to the designated transferee.

         The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.

         No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of Depositor, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

         The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition
of all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement, or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans is less than a certain percentage of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date as set forth in
the Pooling & Servicing Agreement. The exercise of such right will effect the
early retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the expiration of 21 years after the
death of certain persons identified in the Agreement.

                                     A-1-4
<PAGE>

         Unless this Certificate has been countersigned by an authorized
signatory of the Trustee 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: _____________, ____                  LASALLE BANK NATIONAL ASSOCIATION
                                            not in its individual capacity but
                                            solely as Trustee

                                            By:_________________________________
                                                     Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class [I-A-1][I-A-2][I-A-3][II-A-1][II-A-2]
Certificates referred to in the within-mentioned Agreement.

                                            LASALLE BANK NATIONAL ASSOCIATION
                                            Authorized signatory of
                                            LaSalle Bank National
                                            Association, not in its
                                            individual capacity but
                                            solely as Trustee

                                            By:_________________________________
                                                     Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Percentage Interest
evidenced by the within Asset-Backed Certificate and hereby authorizes the
transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

         I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

Dated:                              _____________________________________
                                    Signature by or on behalf of assignor

                                    _____________________________________
                                             Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

         The assignee should include the following for purposes of distribution:

         Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

         This information is provided by __________________, the assignee named
above, or ________________________, as its agent.

<PAGE>

                                   EXHIBIT A-2

               Form of Class M-[1][2][3][4][5][6][7] Certificates

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES [,] [AND] [CLASS M-1 CERTIFICATES] [,] [AND] [CLASS M-2
CERTIFICATES] [,] [AND] [CLASS M-3 CERTIFICATES] [,] [AND] [CLASS M-4
CERTIFICATES] [,] [AND] [CLASS M-5 CERTIFICATES] [,] [AND] [CLASS M-6
CERTIFICATES] AS DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

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

         THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED
BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES APPLICABLE THERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE
PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE
PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

         [FOR CLASS M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5 AND CLASS
M-6] [EACH BENEFICIAL OWNER OF A CERTIFICATE OR ANY INTEREST THEREIN SHALL BE
DEEMED TO HAVE REPRESENTED, BY VIRTUE OF ITS ACQUISITION OR HOLDING OF THAT
CERTIFICATE OR INTEREST THEREIN, THAT EITHER (I) IT IS NOT A PLAN OR INVESTING
WITH "PLAN ASSETS", (II) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATE IN
RELIANCE ON PROHIBITED TRANSACTION EXEMPTION 2002-41 AS AMENDED ("EXEMPTION"),
AND THAT IT UNDERSTANDS THAT THERE ARE CERTAIN CONDITIONS TO THE AVAILABILITY OF
THE EXEMPTION, INCLUDING THAT THE CERTIFICATE MUST BE RATED, AT THE TIME OF
PURCHASE, NOT LOWER THAN "BBB-" (OR ITS EQUIVALENT) BY S&P, FITCH RATINGS OR
MOODY'S, AND THE CERTIFICATE IS SO RATED OR (III) (1) IT IS AN INSURANCE
COMPANY, (2) THE SOURCE OF FUNDS USED TO ACQUIRE OR HOLD THE CERTIFICATE OR
INTEREST THEREIN IS AN "INSURANCE COMPANY GENERAL ACCOUNT," AS SUCH TERM IS
DEFINED IN PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, AND (3) THE
CONDITIONS IN SECTIONS I AND III OF PTCE 95-60 HAVE BEEN SATISFIED.]

         [FOR CLASS M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5 AND CLASS
M-6]

         [UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED

                                     A-2-1
<PAGE>

REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS
MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]

         [FOR CLASS M-7] [THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3)
IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT
OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS
PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN
THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION.]

         [FOR CLASS M-7] [THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR
INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE
PROPOSED TRANSFER AND HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND
OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED
TRANSACTION WHICH IS NOT

                                     A-2-2
<PAGE>

COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION,
INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14,
PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23 AND (II) WILL NOT GIVE RISE TO ANY
ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE MASTER SERVICER OR THE
TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY
CERTIFICATE OR A GLOBAL CERTIFICATE OR UNLESS THE OPINION SPECIFIED IN SECTION
6.02 OF THE AGREEMENT IS PROVIDED.]

                                     A-2-3
<PAGE>

<TABLE>
<CAPTION>
<S>                                                       <C>
Certificate No.1                                          Variable Pass-Through Rate

Class M-[1][2][3][4][5][6][7] Subordinate

Date of Pooling and Servicing Agreement and Cut-off       Aggregate Initial  Certificate  Principal Balance of this
Date: November 1, 2004                                    Certificate as of the Cut-off Date:
                                                          $[__________]

First Distribution Date:                                  Initial    Certificate    Principal   Balance   of   this
December 27, 2004                                         Certificate as of the Cut-off Date:
                                                          $[__________]

Master Servicer:                                          CUSIP: [_____]
EMC Mortgage Corporation

Last Scheduled Distribution Date:
December 25, 2034
</TABLE>

                            ASSET-BACKED CERTIFICATE
                                SERIES 2004-HE10

         evidencing a fractional undivided interest in the distributions
         allocable to the Class M-[1][2][3][4][5][6][7] Certificates with
         respect to a Trust Fund consisting primarily of a pool of conventional,
         closed-end one- to four-family first and second lien, fixed and
         adjustable interest rate mortgage loans sold by BEAR STEARNS ASSET
         BACKED SECURITIES I LLC.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Bear Stearns Asset Backed
Securities I LLC, the Master Servicer or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage Loans
are guaranteed or insured by any governmental entity or by Bear Stearns Asset
Backed Securities I LLC, the Master Servicer or the Trustee or any of their
affiliates or any other person. None of Bear Stearns Asset Backed Securities I
LLC, the Master Servicer or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable from
payments on the Certificates.

         This certifies that ____________________ is the registered owner of the
Percentage Interest evidenced hereby in the beneficial ownership interest of
Certificates of the same Class as this Certificate in a trust (the "Trust Fund")
generally consisting of conventional, closed-end first and second lien, fixed
and adjustable rate mortgage loans secured by one- to four- family residences
(collectively, the "Mortgage Loans") sold by Bear Stearns Asset Backed

                                     A-2-4
<PAGE>

Securities I LLC ("BSABS I"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to BSABS I. EMC will act as master servicer of the Mortgage
Loans (in that capacity, the "Master Servicer," which term includes any
successors thereto under the Agreement referred to below). The Trust Fund was
created pursuant to the Pooling and Servicing Agreement, dated as of the Cut-off
Date specified above (the "Agreement"), among BSABS I, as depositor (the
"Depositor"), EMC Mortgage Corporation as seller and Master Servicer and LaSalle
Bank National Association as trustee (the "Trustee"), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, capitalized terms used herein shall have the meaning ascribed to
them 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 its acceptance hereof assents and by which such
Holder is bound.

         [For Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class
M-6] [Interest on this Certificate will accrue from and including the
immediately preceding Distribution Date (or with respect to the First
Distribution Date, the Closing Date) to and including the day prior to the
current Distribution Date on the Certificate Principal Balance hereof at a per
annum rate equal to the Pass-Through Rate set forth above. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "Distribution Date"),
commencing on the First Distribution Date specified above, to the Person in
whose name this Certificate is registered at the close of business on the
Business Day immediately preceding such Distribution Date so long as such
Certificate remains in book-entry form (and otherwise, the close of business on
the last Business Day of the month immediately preceding the month of such
Distribution Date), an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to the Holders of Certificates of the same Class as
this Certificate.]

         [For Class M-7] [Interest on this Certificate will accrue from and
including the immediately preceding Distribution Date (or with respect to the
First Distribution Date, the Closing Date) to and including the day prior to the
current Distribution Date on the Certificate Principal Balance hereof at a per
annum rate equal to the Pass-Through Rate set forth above. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "Distribution Date"),
commencing on the First Distribution Date specified above, to the Person in
whose name this Certificate is registered at the close of business on the last
Business Day of the month immediately preceding the month of such Distribution
date so long as this Certificate remains in non-book entry form (and otherwise,
the close of business on the Business Day immediately preceding such
Distribution Date) an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to the Holders of Certificates of the same Class as
this Certificate.]

         Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. 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

                                     A-2-5
<PAGE>

presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose and designated in such notice. The initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of
distributions allocable to principal hereon and any Realized Losses allocable
hereto.

         [For Class M-7] [No transfer of this Class M-7 certificate will be made
unless such transfer is (i) exempt from the registration requirements of the
Securities Act of 1933, as amended, and any applicable state securities laws or
is made in accordance with said Act and laws and (ii) made in accordance with
Section 6.02 of the Agreement. In the event that such transfer is to be made the
Trustee shall register such transfer if, (i) made to a transferee who has
provided the Trustee with evidence as to its QIB status; or (ii) (A) the
transferor has advised the Trustee in writing that the Certificate is being
transferred to an Institutional Accredited Investor and (B) prior to such
transfer the transferee furnishes to the Trustee an Investment Letter; provided
that if based upon an Opinion of Counsel to the effect that (A) and (B) above
are not sufficient to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and other applicable laws, the Trustee shall
as a condition of the registration of any such transfer require the transferor
to furnish such other certifications, legal opinions or other information prior
to registering the transfer of this Certificate as shall be set forth in such
Opinion of Counsel.]

         This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"). The
Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund 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 hereby, and the rights,
duties and immunities of the Trustee.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Agreement from time
to time by the parties thereto with the consent of the Holders of the Class or
Classes of Certificates affected thereby evidencing over 50% of the Voting
Rights of such Class or Classes. 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 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 with the Trustee upon
surrender of this Certificate for registration of transfer at the offices or
agencies maintained by the Trustee for such purposes,

                                     A-2-6
<PAGE>

duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Percentage Interest
will be issued to the designated transferee.

         [For Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class
M-6] [Each beneficial owner of a Certificate or any interest therein shall be
deemed to have represented, by virtue of its acquisition or holding of that
certificate or interest therein, that either (i) it is not a Plan or investing
with "Plan Assets", (ii) it has acquired and is holding such certificate in
reliance on the Exemption, and that it understands that there are certain
conditions to the availability of the Exemption, including that the certificate
must be rated, at the time of purchase, not lower than "BBB-" (or its
equivalent) by S&P, Fitch Ratings or Moody's, and the certificate is so rated or
(iii) (1) it is an insurance company, (2) the source of funds used to acquire or
hold the certificate or interest therein is an "insurance company general
account," as such term is defined in Prohibited Transaction Class Exemption
("PTCE") 95-60, and (3) the conditions in Sections I and III of PTCE 95-60 have
been satisfied.]

         [For Class M-7] [This Certificate may not be acquired directly or
indirectly by, or on behalf of, an employee benefit plan or other retirement
arrangement which is subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code
of 1986, as amended, unless the transferee certifies or represents that the
proposed transfer and holding of a Certificate and the servicing, management and
operation of the trust and its assets: (i) will not result in any prohibited
transaction which is not covered under an individual or class prohibited
transaction exemption, including, but not limited to, Prohibited Transaction
Exemption ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 or PTE 96-23 and (ii)
will not give rise to any additional obligations on the part of the Depositor,
the Securities Administrator, the Master Servicer or the Trustee, which will be
deemed represented by an owner of a Book-Entry Certificate or a Global
Certificate or unless the opinion specified in section 6.02 of the Agreement is
provided. This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"). The
Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.]

         The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.

         No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

                                     A-2-7
<PAGE>

         The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition
of all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement, or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans is less than a certain percentage of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date as set forth in
the Pooling & Servicing Agreement. The exercise of such right will effect the
early retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the expiration of 21 years after the
death of certain persons identified in the Agreement.

         Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                     A-2-8
<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ______________, _____                LASALLE BANK NATIONAL ASSOCIATION
                                            not in its individual capacity but
                                            solely as Trustee

                                            By:_________________________________
                                                     Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class M-[1][2][3][4][5][6][7] Certificates referred
to in the within-mentioned Agreement.

                                            LASALLE BANK NATIONAL ASSOCIATION
                                            Authorized  signatory  of LaSalle
                                            Bank  National  Association,
                                            not in its individual capacity but
                                            solely as Trustee

                                            By:_________________________________
                                                    Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Percentage Interest
evidenced by the within Asset-Backed Certificate and hereby authorizes the
transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

         I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:

Dated:                              _____________________________________
                                    Signature by or on behalf of assignor

                                    _____________________________________
                                             Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

         The assignee should include the following for purposes of distribution:

         Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

         This information is provided by __________________, the assignee named
above, or ________________________, as its agent.

<PAGE>

                                   EXHIBIT A-3

                           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 (THE "CODE").

         THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED
BY THE PRINCIPAL PAYMENTS HEREON. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF
THE CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE
DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE
MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE NAMED
HEREIN.

         THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
"INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN WHICH
ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY
THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND
(B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION.

                                     A-3-1
<PAGE>

         NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 6.02 OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE
AND HOLDING OF THIS CERTIFICATE IS PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR
SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE, MASTER SERVICER OR
THE DEPOSITOR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN
THE AGREEMENT.

                                     A-3-2
<PAGE>

<TABLE>
<CAPTION>
<S>                                                        <C>
Certificate No.1                                           Percentage Interest: 100%

Class P

Date of Pooling and Servicing Agreement and                Aggregate Initial Certificate  Principal Balance of this
Cut-off Date: November 1, 2004                             Certificate as of the Cut-off Date:
                                                           $100.00

First Distribution Date:                                   Initial   Certificate    Principal   Balance   of   this
December 27, 2004                                          Certificate as of the Cut-off Date:
                                                           $100.00

Master Servicer:                                           CUSIP:  [_____]
EMC Mortgage Corporation

Last Scheduled Distribution Date:
December 25, 2034
</TABLE>

                            ASSET-BACKED CERTIFICATE
                                SERIES 2004-HE10

         evidencing a fractional undivided interest in the distributions
         allocable to the Class P Certificates with respect to a Trust Fund
         consisting primarily of a pool of conventional, closed-end one- to
         four-family first and second lien, fixed and adjustable interest rate
         mortgage loans sold by BEAR STEARNS ASSET BACKED SECURITIES I LLC.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Bear Stearns Asset Backed
Securities I LLC, the Master Servicer or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage Loans
are guaranteed or insured by any governmental entity or by Bear Stearns Asset
Backed Securities I LLC, the Master Servicer, the Trustee or any of their
affiliates or any other person. None of Bear Stearns Asset Backed Securities I
LLC, the Master Servicer or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable from
payments on the Certificates.

         This certifies that ___________________ is the registered owner of the
Percentage Interest evidenced hereby in the beneficial ownership interest of
Certificates of the same Class as this Certificate in a trust (the "Trust Fund")
generally consisting primarily of a pool of fixed and adjustable interest rate,
conventional, closed-end mortgage loans that are secured by first and second
liens on one- to four-family residences (collectively, the "Mortgage Loans")
sold by Bear Stearns Asset Backed Securities I LLC ("BSABS I"). The Mortgage
Loans

                                     A-3-3
<PAGE>

were sold by EMC Mortgage Corporation ("EMC") to BSABS I. EMC will act as master
servicer of the Mortgage Loans (in that capacity, the "Master Servicer," which
term includes any successors thereto under the Agreement referred to below). The
Trust Fund was created pursuant to the Pooling and Servicing Agreement, dated as
of the Cut-off Date specified above (the "Agreement"), among BSABS I, as
depositor (the "Depositor"), EMC Mortgage Corporation as seller and Master
Servicer and LaSalle Bank National Association, as trustee (the "Trustee"), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have the
meaning ascribed to them 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 its acceptance hereof
assents and by which such Holder is bound.

         Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
United States Person and a Permitted Transferee, (ii) the transfer of any
Ownership Interest in this Certificate will be conditioned upon the delivery to
the Trustee of, among other things, an affidavit to the effect that it is a
United States Person and Permitted Transferee, (iii) any attempted or purported
transfer of any Ownership Interest in this Certificate in violation of such
restrictions will be absolutely null and void and will vest no rights in the
purported transferee, and (iv) if any person other than a United States Person
and a Permitted Transferee acquires any Ownership Interest in this Certificate
in violation of such restrictions, then the Depositor will have the right, in
its sole discretion and without notice to the Holder of this Certificate, to
sell this Certificate to a purchaser selected by the Depositor, which purchaser
may be the Depositor, or any affiliate of the Depositor, on such terms and
conditions as the Depositor may choose.

         The Trustee will distribute on the 25th day of each month, or, if such
25th day is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
immediately preceding the month in which the Distribution Date occurs, an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates of the
same Class as this Certificate.

         Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. 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 and designated in such notice.

         No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is

                                     A-3-4
<PAGE>

made in a transaction that does not require such registration or qualification.
In the event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee shall require receipt of (i) if such
transfer is purportedly being made in reliance upon Rule 144A under the 1933
Act, written certifications from the Holder of the Certificate desiring to
effect the transfer, and from such Holder's prospective transferee,
substantially in the forms attached to the Agreement as Exhibit D and either
Exhibit E or Exhibit F, as applicable, and (ii) in all other cases, an Opinion
of Counsel satisfactory to it that such transfer may be made without such
registration or qualification (which Opinion of Counsel shall not be an expense
of the Trust Fund or of the Depositor, the Trustee or the Master Servicer in
their respective capacities as such), together with copies of the written
certification(s) of the Holder of the Certificate desiring to effect the
transfer and/or such Holder's prospective transferee upon which such Opinion of
Counsel is based. Neither the Depositor 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 Holder desiring to effect a transfer of this
Certificate shall be required to indemnify the Trustee, the Depositor, the
Seller and the Master 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 Class P Certificate will be made unless the Trustee
shall have received either (i) the opinion of counsel set forth in Section
6.02(b) of the Agreement or (ii) a representation letter under Section 6.02 of
the Agreement, in the form as described by the Agreement, stating that the
transferee is not an employee benefit or other plan subject to the prohibited
transaction provisions of ERISA or Section 4975 of the Code (a "Plan"), or any
other person (including an investment manager, a named fiduciary or a trustee of
any Plan) acting, directly or indirectly, on behalf of or purchasing any
Certificate with "plan assets" of any Plan.

         This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"). The
Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund 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 hereby, and the rights,
duties and immunities of the Trustee.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Agreement from time
to time by the parties thereto with the consent of the Holders of the Class or
Classes of Certificates affected thereby evidencing over 50% of the Voting
Rights of such Class or Classes. 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

                                     A-3-5
<PAGE>

any Certificate issued upon the transfer hereof 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 with the Trustee upon
surrender of this Certificate for registration of transfer at the offices or
agencies maintained by the Trustee for such purposes, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Percentage Interest will be issued
to the designated transferee.

         The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.

         No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

         The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition
of all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement, or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as set
forth in the Pooling & Servicing Agreement. The exercise of such right will
effect the early retirement of the Certificates. In no event, however, will the
Trust Fund created by the Agreement continue beyond the expiration of 21 years
after the death of certain persons identified in the Agreement.

         Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                     A-3-6
<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ___________, ____                    LASALLE BANK NATIONAL ASSOCIATION,
                                            not in its individual capacity but
                                            solely as Trustee

                                            By:_________________________________
                                                     Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class P Certificates referred to in the
within-mentioned Agreement.

                                            LASALLE BANK NATIONAL ASSOCIATION
                                            Authorized  signatory  of LaSalle
                                            Bank  National  Association,
                                            not in its individual capacity but
                                            solely as Trustee

                                            By:_________________________________
                                                     Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Percentage Interest
evidenced by the within Asset-Backed Certificate and hereby authorizes the
transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

         I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

Dated:                              _____________________________________
                                    Signature by or on behalf of assignor

                                    _____________________________________
                                             Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

         The assignee should include the following for purposes of distribution:

         Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

         This information is provided by __________________, the assignee named
above, or ________________________, as its agent.

<PAGE>

                                   EXHIBIT A-4

                          Form of Class CE Certificates

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES AND THE CLASS M CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS
DEFINED BELOW).

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

         THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN
"INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN WHICH
ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY
THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND
(B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION.

         NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 6.02(B) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE MASTER SERVICER AND THE
TRUSTEE THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE IS PERMISSIBLE

                                     A-4-1
<PAGE>

UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE
TRUSTEE TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE
AGREEMENT.

                                     A-4-2
<PAGE>

<TABLE>
<CAPTION>
<S>                                                        <C>
Certificate No.1                                           Percentage Interest: 100%

Class CE                                                   Variable Pass-Through Rate

Date of Pooling and Servicing Agreement                    Initial Certificate Notional Balance of this
and Cut-off Date: November 1, 2004                         Certificate as of the Cut-off Date:
                                                           $[__________]

First Distribution Date:                                   Aggregate Certificate Notional Balance of this
December 27, 2004                                          Certificate as of the Cut-off Date:
                                                           $[__________]

Master Servicer:                                           CUSIP: [_____]
EMC Mortgage Corporation

Last Scheduled Distribution Date:
December 25, 2034
</TABLE>

                            ASSET-BACKED CERTIFICATE
                                SERIES 2004-HE10

         evidencing a fractional undivided interest in the distributions
         allocable to the Class CE Certificates with respect to a Trust Fund
         consisting primarily of a pool of fixed and adjustable interest rate,
         conventional, closed-end mortgage loans that are secured by first and
         second liens on one- to four-family residences sold by BEAR STEARNS
         ASSET BACKED SECURITIES I LLC.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Bear Stearns Asset Backed
Securities I LLC, the Master Servicer or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage Loans
are guaranteed or insured by any governmental entity or by Bear Stearns Asset
Backed Securities I LLC, the Master Servicer or the Trustee or any of their
affiliates or any other person. None of Bear Stearns Asset Backed Securities I
LLC, the Master Servicer or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable from
payments on the Certificates.

         This certifies that __________________ is the registered owner of the
Percentage Interest evidenced hereby in the beneficial ownership interest of
Certificates of the same Class as this Certificate in a trust (the "Trust Fund")
generally consisting primarily of a pool of fixed and adjustable interest rate,
conventional, closed-end mortgage loans that are secured by first and second
liens on one- to four-family residences (collectively, the "Mortgage Loans")
sold by Bear Stearns Asset Backed Securities I LLC ("BSABS I"). The Mortgage
Loans were sold by EMC

                                     A-4-3
<PAGE>

Mortgage Corporation ("EMC") to BSABS I. EMC will act as master servicer of the
Mortgage Loans (in that capacity, the "Master Servicer," which term includes any
successors thereto under the Agreement referred to below). The Trust Fund was
created pursuant to the Pooling and Servicing Agreement, dated as of the Cut-off
Date specified above (the "Agreement"), among BSABS I, as depositor (the
"Depositor"), EMC Mortgage Corporation as seller and Master Servicer and LaSalle
Bank National Association, as trustee (the "Trustee"), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, capitalized terms used herein shall have the meaning ascribed to
them 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 its acceptance hereof assents and by which such
Holder is bound.

         The Trustee will distribute on the 25th day of each month, or, if such
25th day is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
immediately preceding the month in which the Distribution Date occurs, an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates of the
same Class as this Certificate.

         Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. 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 and designated in such notice.

         No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an 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 such a transfer of this Certificate is to be made without
registration or qualification, the Trustee shall require receipt of (i) if such
transfer is purportedly being made in reliance upon Rule 144A under the 1933
Act, written certifications from the Holder of the Certificate desiring to
effect the transfer, and from such Holder's prospective transferee,
substantially in the forms attached to the Agreement as Exhibit D and either
Exhibit E or Exhibit F, as applicable, and (ii) in all other cases, an Opinion
of Counsel satisfactory to it that such transfer may be made without such
registration or qualification (which Opinion of Counsel shall not be an expense
of the Trust Fund or of the Depositor, the Trustee, or the Master Servicer in
their respective capacities as such), together with copies of the written
certification(s) of the Holder of the Certificate desiring to effect the
transfer and/or such Holder's prospective transferee upon which such Opinion of
Counsel is based. Neither the Depositor 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

                                     A-4-4
<PAGE>

Certificates without registration or qualification. Any Holder desiring to
effect a transfer of this Certificate shall be required to indemnify the
Trustee, the Depositor, the Seller and the Master 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 Class CE Certificate will be made unless the
Trustee shall have received the opinion of counsel set forth in section 6.02(b)
of the Agreement or (ii) a representation letter under Section 6.02 of the
Agreement, in the form as described by the Agreement, stating that the
transferee is not an employee benefit or other plan subject to the prohibited
transaction provisions of ERISA or Section 4975 of the Code (a "Plan"), or any
other person (including an investment manager, a named fiduciary or a trustee of
any Plan) acting, directly or indirectly, on behalf of or purchasing any
Certificate with "plan assets" of any Plan.

         This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"). The
Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund 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 hereby, and the rights,
duties and immunities of the Trustee.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Agreement from time
to time by the parties thereto with the consent of the Holders of the Class or
Classes of Certificates affected thereby evidencing over 50% of the Voting
Rights of such Class or Classes. 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 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 with the Trustee upon
surrender of this Certificate for registration of transfer at the offices or
agencies maintained by the Trustee for such purposes, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Percentage Interest will be issued
to the designated transferee.

         The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more

                                     A-4-5
<PAGE>

new Certificates evidencing the same Class and in the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.

         No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

         The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition
of all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement, or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans is less than a certain percentage of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date as set forth in
the Pooling & Servicing Agreement. The exercise of such right will effect the
early retirement of the Certificates. In no event, however, will the Trust Fund
created by the Agreement continue beyond the expiration of 21 years after the
death of certain persons identified in the Agreement.

         Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                     A-4-6
<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ___________, ____                LASALLE BANK NATIONAL ASSOCIATION
                                        not in its individual capacity but
                                        solely as Trustee

                                        By:_____________________________________
                                                  Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class CE Certificates referred to in the
within-mentioned Agreement.

                                        LASALLE BANK NATIONAL ASSOCIATION
                                        Authorized  signatory  of LaSalle Bank
                                        National  Association,
                                        not in its individual capacity but
                                        solely as Trustee

                                        By:_____________________________________
                                                 Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Percentage Interest
evidenced by the within Asset-Backed Certificate and hereby authorizes the
transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

         I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

Dated:                              _____________________________________
                                    Signature by or on behalf of assignor

                                    _____________________________________
                                             Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

         The assignee should include the following for purposes of distribution:

         Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

         This information is provided by __________________, the assignee named
above, or ________________________, as its agent.

<PAGE>

                                   EXHIBIT A-5

                     Form of Class R[-1][-2][X] Certificates

         THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED
STATES PERSON OR A DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).

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

         NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 6.02(B) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE
AND HOLDING OF THIS CERTIFICATE IS PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR
SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE MASTER SERVICER OR THE TRUSTEE
TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT.

         ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER
SERVICER AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES,
ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES,
OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN
INSTRUMENTALITY WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO
TAX AND EXCEPT FOR FREDDIE MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT
SELECTED BY SUCH GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C)
ANY ORGANIZATION (OTHER THAN CERTAIN FARMERS' COOPERATIVES DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE (INCLUDING THE TAX IMPOSED BY SECTION 511 OF THE CODE ON UNRELATED BUSINESS
TAXABLE INCOME), (D) RURAL ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN
SECTION 1381(A)(2)(C) OF THE CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER
SECTION 775(A) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE

                                     A-5-1
<PAGE>

FOREGOING CLAUSES (A), (B), (C), (D) OR (E) BEING HEREIN REFERRED TO AS A
"DISQUALIFIED ORGANIZATION"), OR (F) AN AGENT OF A DISQUALIFIED ORGANIZATION,
(2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX
AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE
FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION
IN THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS
CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED
ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE
OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.

                                     A-5-2
<PAGE>

<TABLE>
<CAPTION>
<S>                                                        <C>
Certificate No.1

Class R[-1][-2][X]                                         Percentage Interest: 100%

Date of Pooling and Servicing  Agreement and
Cut-off Date: November 1, 2004

First Distribution Date:
December 27, 2004

Master Servicer:                                           CUSIP: [_____]
EMC Mortgage Corporation

Last Scheduled Distribution Date:
December 25, 2034
</TABLE>

                            ASSET-BACKED CERTIFICATE
                                SERIES 2004-HE10

         evidencing a fractional undivided interest in the distributions
         allocable to the Class R[-1][-2][X] Certificates with respect to a
         Trust Fund consisting primarily of a pool of conventional, closed-end
         first and second lien one- to four-family fixed and adjustable interest
         rate mortgage loans sold by BEAR STEARNS ASSET BACKED SECURITIES I LLC.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Bear Stearns Asset Backed
Securities I LLC, the Master Servicer or the Trustee or any of their affiliates
or any other person. Neither this Certificate nor the underlying Mortgage Loans
are guaranteed or insured by any governmental entity or by Bear Stearns Asset
Backed Securities I LLC, the Master Servicer, the Trustee or any of their
affiliates or any other person. None of Bear Stearns Asset Backed Securities I
LLC, the Master Servicer or any of their affiliates will have any obligation
with respect to any certificate or other obligation secured by or payable from
payments on the Certificates.

         This certifies that Bear, Stearns Securities Corp. is the registered
owner of the Percentage Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") generally consisting of conventional, closed-end first and second
lien, fixed and adjustable rate mortgage loans secured by one- to four- family
residences (collectively, the "Mortgage Loans") sold by Bear Stearns Asset
Backed Securities I LLC ("BSABS I"). The Mortgage Loans were sold by EMC
Mortgage Corporation ("EMC") to BSABS I. EMC will act as master servicer of the
Mortgage Loans (in that capacity, the "Master Servicer," which term includes any
successors thereto under the Agreement referred

                                     A-5-3
<PAGE>

to below). The Trust Fund was created pursuant to the Pooling and Servicing
Agreement, dated as of the Cut-off Date specified above (the "Agreement"), among
BSABS I, as depositor (the "Depositor"), EMC Mortgage Corporation as seller and
Master Servicer and LaSalle Bank National Association as trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, capitalized terms used herein
shall have the meaning ascribed to them 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 its
acceptance hereof assents and by which such Holder is bound.

         Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
United States Person and a Permitted Transferee, (ii) the transfer of any
Ownership Interest in this Certificate will be conditioned upon the delivery to
the Trustee of, among other things, an affidavit to the effect that it is a
United States Person and Permitted Transferee, (iii) any attempted or purported
transfer of any Ownership Interest in this Certificate in violation of such
restrictions will be absolutely null and void and will vest no rights in the
purported transferee, and (iv) if any person other than a United States Person
and a Permitted Transferee acquires any Ownership Interest in this Certificate
in violation of such restrictions, then the Depositor will have the right, in
its sole discretion and without notice to the Holder of this Certificate, to
sell this Certificate to a purchaser selected by the Depositor, which purchaser
may be the Depositor, or any affiliate of the Depositor, on such terms and
conditions as the Depositor may choose.

         The Trustee will distribute on the 25th day of each month, or, if such
25th day is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
immediately preceding the month in which the Distribution Date occurs, an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates of the
same Class as this Certificate.

         Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement. 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 and designated in such notice.

         No transfer of this Class R Certificate will be made unless the Trustee
shall have received either (i) the opinion of counsel set forth in section 6.02
of the Agreement or (ii) a representation letter, in the form as described by
the Agreement, stating that the transferee is not an employee benefit or other
plan subject to the prohibited transaction provisions of ERISA or Section 4975
of the Code (a "Plan"), or any other person (including an investment manager, a

                                     A-5-4
<PAGE>

named fiduciary or a trustee of any Plan) acting, directly or indirectly, on
behalf of or purchasing any Certificate with "plan assets" of any Plan.

         This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"). The
Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.

         The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund 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 hereby, and the rights,
duties and immunities of the Trustee.

         The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Agreement from time
to time by the parties thereto with the consent of the Holders of the Class or
Classes of Certificates affected thereby evidencing over 50% of the Voting
Rights of such Class or Classes. 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 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 with the Trustee upon
surrender of this Certificate for registration of transfer at the offices or
agencies maintained by the Trustee for such purposes, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Percentage Interest will be issued
to the designated transferee.

         The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.

         No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of Depositor, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

                                     A-5-5
<PAGE>

         The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition
of all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement, or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the terms
of the Agreement. Such optional repurchase may be made only on or after the
first Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans is less than or equal to 10% of the aggregate Stated Principal
Balance of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the expiration of 21
years after the death of certain persons identified in the Agreement.

         Unless this Certificate has been countersigned by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.

                                     A-5-6
<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated: ____________, ____              LASALLE BANK NATIONAL ASSOCIATION,
                                       not in its individual capacity but solely
                                       as Trustee

                                       By:______________________________________
                                                 Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class R[-1][-2][X] Certificates referred to in the
within-mentioned Agreement.

                                       LASALLE BANK NATIONAL ASSOCIATION
                                       Authorized signatory of
                                       LaSalle Bank National Association, not
                                       in its individual capacity but
                                       solely as Trustee

                                       By:______________________________________
                                                 Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Percentage Interest
evidenced by the within Asset-Backed Certificate and hereby authorizes the
transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

         I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

Dated:                              _____________________________________
                                    Signature by or on behalf of assignor

                                    _____________________________________
                                             Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

         The assignee should include the following for purposes of distribution:

         Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

         This information is provided by __________________, the assignee named
above, or ________________________, as its agent.

<PAGE>

                                    EXHIBIT B

                             MORTGAGE LOAN SCHEDULE
                             ----------------------

                             [provided upon request]

                                      B-1
<PAGE>

                                    EXHIBIT C

                           FORM OF TRANSFER AFFIDAVIT

                                    Affidavit pursuant to Section 860E(e)(4) of
                                    the Internal Revenue Code of 1986, as
                                    amended, and for other purposes

STATE OF          )
                  )ss:
COUNTY OF         )

         [NAME OF OFFICER], being first duly sworn, deposes and says:

         1.       That he/she is [Title of Officer] of [Name of Investor] (the
"Investor"), a [savings institution] [corporation] duly organized and existing
under the laws of [the State of _____] [the United States], on behalf of which
he makes this affidavit.

         2.       That (i) the Investor is not a "disqualified organization" as
defined in Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended
(the "Code"), and will not be a disqualified organization as of [Closing Date]
[date of purchase]; (ii) it is not acquiring the Bear Stearns Asset-Backed
Securities I LLC Asset-Backed Certificates, Series 2004-HE10, Class R[-1][-2][X]
Certificates (the "Residual Certificates") for the account of a disqualified
organization; (iii) it consents to any amendment of the Pooling and Servicing
Agreement that shall be deemed necessary by Bear Stearns Asset Backed Securities
I LLC (upon advice of counsel) to constitute a reasonable arrangement to ensure
that the Residual Certificates will not be owned directly or indirectly by a
disqualified organization; and (iv) it will not transfer such Residual
Certificates unless (a) it has received from the transferee an affidavit in
substantially the same form as this affidavit containing these same four
representations and (b) as of the time of the transfer, it does not have actual
knowledge that such affidavit is false.

         3.       That the Investor is one of the following: (i) a citizen or
resident of the United States, (ii) a corporation or partnership (including an
entity treated as a corporation or partnership for federal income tax purposes)
created or organized in, or under the laws of, the United States or any state
thereof or the District of Columbia (except, in the case of a partnership, to
the extent provided in regulations), provided that no partnership or other
entity treated as a partnership for United States federal income tax purposes
shall be treated as a United States Person unless all persons that own an
interest in such partnership either directly or through any entity that is not a
corporation for United States federal income tax purposes are United States
Persons, (iii) an estate whose income is subject to United States federal income
tax regardless of its source, or (iv) a trust other than a "foreign trust," as
defined in Section 7701 (a)(31) of the Code.

         4.       That the Investor's taxpayer identification number is
______________________.

         5.       That no purpose of the acquisition of the Residual
Certificates is to avoid or impede the assessment or collection of tax.

                                      C-1
<PAGE>

         6.       That the Investor understands that, as the holder of the
Residual Certificates, the Investor may incur tax liabilities in excess of any
cash flows generated by such Residual Certificates.

         7.       That the Investor intends to pay taxes associated with holding
the Residual Certificates as they become due.

         IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[Title of Officer] this ____ day of _________, 20__.

                                          [NAME OF INVESTOR]

                                          By:_______________________________
                                             [Name of Officer]
                                             [Title of Officer]
                                             [Address of Investor for receipt
                                             of distributions]

                                             Address of Investor
                                             for receipt of tax information:

                                      C-2
<PAGE>

         Personally appeared before me the above-named [Name of Officer], known
or proved to me to be the same person who executed the foregoing instrument and
to be the [Title of Officer] of the Investor, and acknowledged to me that he/she
executed the same as his/her free act and deed and the free act and deed of the
Investor.

         Subscribed and sworn before me this ___ day of _________, 20___.

NOTARY PUBLIC

COUNTY OF

STATE OF

My commission expires the ___ day of ___________________, 20___.

<PAGE>

                                    EXHIBIT D

                         FORM OF TRANSFEROR CERTIFICATE

                              ______________,200___

Bear Stearns Asset Backed Securities I LLC
383 Madison Avenue
New York, New York 10179

LaSalle Bank National Association
135 South LaSalle Street, Suite 1625
Chicago, Illinois 60603

Attention: Bear Stearns Asset Backed Securities Trust 2004-HE10

         Re:      Bear Stearns Asset Backed Securities I LLC
                  ASSET-BACKED CERTIFICATES, SERIES 2004-HE10, CLASS[ ]_

Ladies and Gentlemen:

         In connection with the sale by ___________ (the "Seller") to ________
(the "Purchaser") of $_________ Initial Certificate Principal Balance of
Asset-Backed Certificates, Series 2004-HE10, Class _____ (the "Certificates"),
issued pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of November 1, 2004, among Bear Stearns Asset
Backed Securities I LLC, as depositor (the "Depositor"), EMC Mortgage
Corporation, as seller and master servicer and LaSalle Bank National
Association, as trustee (the "Trustee"). The Seller hereby certifies, represents
and warrants to, a covenants with, the Depositor and the Trustee that:

         Neither the Seller nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) has solicited any offer to buy or to accept a pledge, disposition or
other transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner, or
(e) has taken any other action, that (as to any of (a) through (e) above) would
constitute a distribution of the Certificates under the Securities Act of 1933
(the "Act"), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not act in any
manner set forth in the foregoing sentence with respect to any Certificate. The
Seller has not and will not sell or otherwise transfer any of the Certificates,
except in compliance with the provisions of the Pooling and Servicing Agreement.

                                      D-1
<PAGE>

                                       Very truly yours,

                                       __________________________________
                                       (Seller)

                                       By:_______________________________

                                       Name:_____________________________

                                       Title:____________________________

<PAGE>

                                    EXHIBIT E

                     FORM OF INVESTMENT LETTER-NON RULE 144A

                                                                 [Date]
[SELLER]

Bear Stearns Asset Backed Securities I LLC
383 Madison Avenue
New York, New York 10179

LaSalle Bank National Association
135 South LaSalle Street, Suite 1625
Chicago, Illinois 60603

         Re:      Bear Stearns Asset-Backed Securities I Trust 2004-HE10,
                  Asset-Backed Certificates, Series 2004-HE10 (the
                  "Certificates"), including the Class __ CERTIFICATES (THE
                  "PRIVATELY OFFERED CERTIFICATES")

Dear Ladies and Gentlemen:

         In connection with our purchase of Privately Offered Certificates, we
confirm that:

                  (i)      we understand that the Privately Offered Certificates
                           are not being registered under the Securities Act of
                           1933, as amended (the "Act") or any applicable state
                           securities or "Blue Sky" laws, and are being sold to
                           us in a transaction that is exempt from the
                           registration requirements of such laws;

                  (ii)     any information we desired concerning the
                           Certificates, including the Privately Offered
                           Certificates, the trust in which the Certificates
                           represent the entire beneficial ownership interest
                           (the "Trust") or any other matter we deemed relevant
                           to our decision to purchase Privately Offered
                           Certificates has been made available to us;

                  (iii)    we are able to bear the economic risk of investment
                           in Privately Offered Certificates; we are an
                           institutional "accredited investor" as defined in
                           Section 501(a) of Regulation D promulgated under the
                           Act and a sophisticated institutional investor;

                  (iv)     we are acquiring Privately Offered Certificates for
                           our own account, not as nominee for any other person,
                           and not with a present view to any distribution or
                           other disposition of the Privately Offered
                           Certificates;

                  (v)      we agree the Privately Offered Certificates must be
                           held indefinitely by us (and may not be sold,
                           pledged, hypothecated or in any way disposed of)
                           unless subsequently registered under the Act and any
                           applicable state securities or "Blue Sky" laws or an
                           exemption from the registration

                                      E-1
<PAGE>

                           requirements of the Act and any applicable state
                           securities or "Blue Sky" laws is available;

                  (vi)     we agree that in the event that at some future time
                           we wish to dispose of or exchange any of the
                           Privately Offered Certificates (such disposition or
                           exchange not being currently foreseen or
                           contemplated), we will not transfer or exchange any
                           of the Privately Offered Certificates unless:

                                    (A) (1) the sale is to an Eligible Purchaser
                           (as defined below), (2) if required by the Pooling
                           and Servicing Agreement (as defined below) a letter
                           to substantially the same effect as either this
                           letter or, if the Eligible Purchaser is a Qualified
                           Institutional Buyer as defined under Rule 144A of the
                           Act, the Rule 144A and Related Matters Certificate in
                           the form attached to the Pooling and Servicing
                           Agreement (as defined below) (or such other
                           documentation as may be acceptable to the Trustee) is
                           executed promptly by the purchaser and delivered to
                           the addressees hereof and (3) all offers or
                           solicitations in connection with the sale, whether
                           directly or through any agent acting on our behalf,
                           are limited only to Eligible Purchasers and are not
                           made by means of any form of general solicitation or
                           general advertising whatsoever; and

                                    (B) if the Privately Offered Certificate is
                           not registered under the Act (as to which we
                           acknowledge you have no obligation), the Privately
                           Offered Certificate is sold in a transaction that
                           does not require registration under the Act and any
                           applicable state securities or "blue sky" laws and,
                           if LaSalle Bank National Association (the "Trustee")
                           so requests, a satisfactory Opinion of Counsel is
                           furnished to such effect, which Opinion of Counsel
                           shall be an expense of the transferor or the
                           transferee;

                  (vii)    we agree to be bound by all of the terms (including
                           those relating to restrictions on transfer) of the
                           Pooling and Servicing, pursuant to which the Trust
                           was formed; we have reviewed carefully and understand
                           the terms of the Pooling and Servicing Agreement;

                  (viii)   we either: (i) are not acquiring the Privately
                           Offered Certificate directly or indirectly by, or on
                           behalf of, an employee benefit plan or other
                           retirement arrangement which is subject to Title I of
                           the Employee Retirement Income Security Act of 1974,
                           as amended, and/or section 4975 of the Internal
                           Revenue Code of 1986, as amended, or (ii) in the case
                           of the Privately Offered Certificates, have provided
                           a Certification or Opinion of Counsel as required by
                           the Agreement.

                  (ix)     We understand that each of the Privately Offered
                           Certificates bears, and will continue to bear, a
                           legend to substantiate the following effect: "THIS
                           CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED

                                      E-2
<PAGE>

                           UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
                           "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES
                           LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
                           CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE
                           REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
                           ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
                           APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A
                           UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON
                           THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
                           INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
                           (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
                           PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
                           HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
                           PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
                           RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
                           REGISTRATION PROVIDED BY RULE 144 UNDER THE
                           SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED
                           FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN
                           THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or
                           (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN
                           WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH
                           PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN
                           VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE
                           RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN
                           THE FORM PROVIDED IN THE AGREEMENT AND (B) THE
                           RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
                           ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE,
                           PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
                           SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH
                           CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
                           LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
                           JURISDICTION. [In the case of the Class M-7
                           Certificates: THIS CERTIFICATE MAY NOT BE ACQUIRED
                           DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN
                           EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
                           WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
                           RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
                           OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
                           AS AMENDED, UNLESS THE TRANSFEREE CERTIFIES OR
                           REPRESENTS THAT THE PROPOSED TRANSFER AND HOLDING OF
                           A CERTIFICATE AND THE SERVICING, MANAGEMENT AND
                           OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT
                           RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT
                           COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED
                           TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED

                                      E-3
<PAGE>

                           TO, PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14,
                           PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23 AND (II)
                           WILL NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON
                           THE PART OF THE DEPOSITOR, THE SECURITIES
                           ADMINISTRATOR, THE MASTER SERVICER OR THE TRUSTEE,
                           WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A
                           BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE OR
                           UNLESS THE OPINION SPECIFIED IN SECTION 6.02 OF THE
                           AGREEMENT IS PROVIDED. [In the case of the Class P
                           Certificates and Class CE Certificates]: NO TRANSFER
                           OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS
                           THE TRANSFEREE PROVIDES EITHER A CERTIFICATION
                           PURSUANT TO SECTION 6.02 OF THE AGREEMENT OR AN
                           OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT
                           THE PURCHASE AND HOLDING OF THIS CERTIFICATE IS
                           PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE
                           OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION
                           UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME
                           SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR SECTION
                           4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE,
                           MASTER SERVICER OR THE DEPOSITOR TO ANY OBLIGATION OR
                           LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE
                           AGREEMENT.]

         "ELIGIBLE PURCHASER" means a corporation, partnership or other entity
which we have reasonable grounds to believe and do believe (i) can make
representations with respect to itself to substantially the same effect as the
representations set forth herein, and (ii) is either a Qualified Institutional
Buyer as defined under Rule 144A of the Act or an institutional "Accredited
Investor" as defined under Rule 501 of the Act.

         Terms not otherwise defined herein shall have the meanings assigned to
them in the Pooling and Servicing Agreement, dated as of November 1, 2004, among
Bear Stearns Asset Backed Securities I LLC, as depositor, EMC Mortgage
Corporation, as seller and master and LaSalle Bank National Association, as
Trustee (the "Pooling and Servicing Agreement').

         If the Purchaser proposes that its Certificates be registered in the
name of a nominee on its behalf, the Purchaser has identified such nominee
below, and has caused such nominee to complete the Nominee Acknowledgment at the
end of this letter.

Name of Nominee (if any):_______________________

                                      E-4
<PAGE>

         IN WITNESS WHEREOF, this document has been executed by the undersigned
who is duly authorized to do so on behalf of the undersigned Eligible Purchaser
on the ___ day of ________, 20___.

                                              Very truly yours,

                                              [PURCHASER]

                                              By:_______________________________
                                                       (Authorized Officer)

                                              By:_______________________________
                                                       (Attorney-in-fact)

<PAGE>

                             Nominee Acknowledgment

         The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.

                                                  [NAME OF NOMINEE]

                                                  By:___________________________
                                                        (Authorized Officer)

                                                  By:___________________________
                                                        (Attorney-in-fact)

<PAGE>

                                    EXHIBIT F

                FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE

[SELLER]

Bear Stearns Asset Backed Securities I LLC
383 Madison Avenue
New York, New York 10179

LaSalle Bank National Association
135 South LaSalle Street, Suite 1625
Chicago, Illinois 60603

         Re:      Bear Stearns Asset Backed Securities I Trust 2004-HE10,
                  Asset-Backed Certificates, Series 2004-HE10 (the
                  "Certificates"), including the Class __ CERTIFICATES (THE
                  "PRIVATELY OFFERED CERTIFICATES")

Dear Ladies and Gentlemen:

         In connection with our purchase of Privately Offered Certificates, the
undersigned certifies to each of the parties to whom this letter is addressed
that it is a qualified institutional buyer (as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act")) as follows:

1.       It owned and/or invested on a discretionary basis eligible securities
(excluding affiliate's securities, bank deposit notes and CD's, loan
participations, repurchase agreements, securities owned but subject to a
repurchase agreement and swaps), as described below:

         Date: ______________, 20__ (must be on or after the close of its most
recent fiscal year)

         Amount: $ _____________________; and

2.       The dollar amount set forth above is:

         a.       greater than $100 million and the undersigned is one of the
following entities:

                  (x)      [ ]  an insurance company as defined in Section
                                2(13) of the Act1; or

                  (y)      [ ]  an investment company registered under the
                                Investment Company Act or any business
                                development company as defined in Section
                                2(a)(48) of the Investment Company Act of
                                1940; or
__________________________
1        A Purchase by an insurance company for one or more of its separate
         accounts, as defined by Section 2(a)(37) of the Investment Company Act
         of 1940, which are neither registered nor required to be registered
         thereunder, shall be demmed to be a purchase for the account of such
         insurance company.

                                      F-1
<PAGE>

                  (z)      [ ]  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; or

                  (aa)     [ ]  a plan (i) established and maintained by a
                                state, its political subdivisions, or any
                                agency or instrumentality of a state or its
                                political subdivisions, the laws of which
                                permit the purchase of securities of this
                                type, for the benefit of its employees and
                                (ii) the governing investment guidelines of
                                which permit the purchase of securities of
                                this type; or

                  (bb)     [ ]  a business development company as defined in
                                Section 202(a)(22) of the Investment
                                Advisers Act of 1940; or

                  (cc)     [ ]  a corporation (other than a U.S. bank,
                                savings and loan association or equivalent
                                foreign institution), partnership,
                                Massachusetts or similar business trust, or
                                an organization described in Section
                                501(c)(3) of the Internal Revenue Code; or

                  (dd)     [ ]  a U.S. bank, savings and loan association or
                                equivalent foreign institution, which has an
                                audited net worth of at least $25 million as
                                demonstrated in its latest annual financial
                                statements; or

                  (ee)     [ ]  an investment adviser registered under the
                                Investment Advisers Act; or

                  b.       [ ]  greater than $10 million, and the
                                undersigned is a broker-dealer registered
                                with the SEC; or

                  c.       [ ]  less than $ 10 million, and the undersigned
                                is a broker-dealer registered with the SEC
                                and will only purchase Rule 144A securities
                                in transactions in which it acts as a
                                riskless principal (as defined in Rule
                                144A); or

                  d.       [ ]  less than $100 million, and the undersigned
                                is an investment company registered under
                                the Investment Company Act of 1940, which,
                                together with one or more registered
                                investment companies having the same or an
                                affiliated investment adviser, owns at least
                                $100 million of eligible securities; or

                  e.       [ ]  less than $100 million, and the undersigned
                                is an entity, all the equity owners of which
                                are qualified institutional buyers.

         The undersigned further certifies that it is purchasing a Privately
Offered Certificate for its own account or for the account of others that
independently qualify as "Qualified Institutional Buyers" as defined in Rule
144A. It is aware that the sale of the Privately Offered Certificates is being
made in reliance on its continued compliance with Rule 144A. It is aware that
the transferor may rely on the exemption from the provisions of Section 5 of the
Act provided by

                                      F-2
<PAGE>

Rule 144A. The undersigned understands that the Privately Offered Certificates
may be resold, pledged or transferred only to (i) 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 in Rule 144A, or (ii) an
institutional "accredited investor," as such term is defined under Rule 501 of
the Act in a transaction that otherwise does not constitute a public offering.

         The undersigned agrees that if at some future time it wishes to dispose
of or exchange any of the Privately Offered Certificates, it will not transfer
or exchange any of the Privately Offered Certificates to a Qualified
Institutional Buyer without first obtaining a Rule 144A and Related Matters
Certificate in the form hereof from the transferee and delivering such
certificate to the addressees hereof. Prior to making any transfer of Privately
Offered Certificates, if the proposed Transferee is an institutional "accredited
investor," the transferor shall obtain from the transferee and deliver to the
addressees hereof an Investment Letter in the form attached to the Pooling and
Servicing Agreement, dated as of November 1, 2004, among Bear Stearns Asset
Backed Securities I LLC, EMC Mortgage Corporation and LaSalle Bank National
Association, as Trustee, pursuant to which the Certificates were issued.

         The undersigned certifies that it either: (i) is not acquiring the
Privately Offered Certificate directly or indirectly by, or on behalf of, an
employee benefit plan or other retirement arrangement which is subject to Title
I of the Employee Retirement Income Security Act of 1974, as amended, and/or
section 4975 of the Internal Revenue Code of 1986, as amended, or (ii) in the
case of the Privately Offered Certificates, has provided the Opinion of Counsel
required by the Agreement.

         If the Purchaser proposes that its Certificates be registered in the
name of a nominee on its behalf, the Purchaser has identified such nominee
below, and has caused such nominee to complete the Nominee Acknowledgment at the
end of this letter.

Name of Nominee (if any):_______________

                                      F-3
<PAGE>

IN WITNESS WHEREOF, this document has been executed by the undersigned who is
duly authorized to do so on behalf of the undersigned Eligible Purchaser on the
____ day of ___________, 20___.

                                         Very truly yours,

                                         [PURCHASER]

                                         By:__________________________________
                                                  (Authorized Officer)

                                         By:__________________________________
                                                   (Attorney-in-fact)

<PAGE>

                             Nominee Acknowledgment

         The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.

                                            [NAME OF NOMINEE]

                                         By:__________________________________
                                                  (Authorized Officer)

                                         By:__________________________________
                                                   (Attorney-in-fact)

<PAGE>

                                    EXHIBIT G

                           FORM OF REQUEST FOR RELEASE

To:      LaSalle Bank National Association
         135 South LaSalle Street, Suite 1625
         Chicago, Illinois 60603

         RE:      Pooling and Servicing Agreement, dated as of November 1, 2004,
                  among Bear Stearns Asset Backed Securities I LLC, as
                  Depositor, EMC Mortgage Corporation, as seller and MASTER
                  SERVICER AND LASALLE BANK NATIONAL ASSOCIATION, AS TRUSTEE

         In connection with the administration of the Mortgage Loans held by you
pursuant to the above-captioned Pooling and Servicing Agreement, we request the
release, and hereby acknowledge receipt, of the Mortgage File for the Mortgage
Loan described below, for the reason indicated.

MORTGAGE LOAN NUMBER:

Mortgagor Name, Address & Zip Code:

Reason for Requesting Documents (check one):

_____     1.   Mortgage Paid in Full and proceeds have been deposited into the
               Custodial Account

_____     2.   Foreclosure

_____     3.   Substitution

_____     4.   Other Liquidation

_____     5.   Nonliquidation              Reason:___________________________

_____     6.   California Mortgage Loan paid in full

                                                By:_____________________________
                                                         (authorized signer)

                                                Issuer:_________________________
                                                Address:________________________

                                                Date:___________________________

                                      G-1
<PAGE>

                                    EXHIBIT H

                          DTC Letter of Representations
                             [provided upon request]

                                      H-1
<PAGE>

                                    EXHIBIT I

                   Schedule of Mortgage Loans with Lost Notes
                             [provided upon request]

                                      I-1
<PAGE>

                                    EXHIBIT J

                           FORM OF CUSTODIAL AGREEMENT
                           ---------------------------

         THIS CUSTODIAL AGREEMENT (as amended and supplemented from time to
time, the "Agreement"), dated as of November 30, 2004, by and among LASALLE BANK
NATIONAL ASSOCIATION, not individually but solely as trustee under the Pooling
and Servicing Agreement defined below (including its successors under the
Pooling and Servicing Agreement defined below, the "Trustee"), BEAR STEARNS
ASSET BACKED SECURITIES I LLC, as depositor (together with any successor in
interest, the "Depositor"), EMC MORTGAGE CORPORATION, as seller (in that
capacity, the "Seller") and master servicer (together with any successor in
interest or successor under the Pooling and Servicing Agreement referred to
below, the "Master Servicer") and [WELLS FARGO BANK, NATIONAL ASSOCIATION, as
custodian] [and LASALLE BANK NATIONAL ASSOCIATION, as custodian] (together with
any successor in interest or any successor appointed hereunder, the
"Custodian").

                                WITNESSETH THAT:
                                ----------------

         WHEREAS, the Depositor, the Seller, the Master Servicer and the Trustee
have entered into a Pooling and Servicing Agreement, dated as of November 1,
2004, relating to the issuance of Bear Stearns Asset Backed Securities I Trust
2004-HE10, Asset-Backed Certificates, Series 2004-HE10 (as in effect on the date
of this Agreement, the "Original Pooling and Servicing Agreement," and as
amended and supplemented from time to time, the "Pooling and Servicing
Agreement"); and

         WHEREAS, the Custodian has agreed to act as agent for the Trustee on
behalf of the Certificateholders for the purposes of receiving and holding
certain documents and other instruments delivered by the Depositor, the Seller
or the Master Servicer under the Pooling and Servicing Agreement and the
Servicers under their respective Servicing Agreements, all upon the terms and
conditions and subject to the limitations hereinafter set forth;

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the Trustee, the Depositor, the
Seller, the Master Servicer and the Custodian hereby agree as follows:

                                   ARTICLE I.
                                   DEFINITIONS

         Capitalized terms used in this Agreement and not defined herein shall
have the meanings assigned in the Original Pooling and Servicing Agreement,
unless otherwise required by the context herein.

                                  ARTICLE II.
                          CUSTODY OF MORTGAGE DOCUMENTS

         Section 2.1. CUSTODIAN TO ACT AS AGENT: ACCEPTANCE OF MORTGAGE FILES.
The custodian, as the duly appointed custodial agent of the Trustee for these
purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a)) receipt

                                      J-1
<PAGE>

of the Mortgage Files relating to the Mortgage Loans identified on the schedule
attached hereto (the "Mortgage Files") and declares that it holds and will hold
such Mortgage Files as agent for the Trustee, in trust, for the use and benefit
of all present and future Certificateholders.

         Section 2.2. RECORDATION OF ASSIGNMENTS. If any Mortgage File includes
one or more assignments of Mortgage that have not been recorded pursuant to the
provisions of Section 2.01 of the Pooling and Servicing Agreement and the
related Mortgage Loan is not a MOM Loan or the related Mortgaged Properties are
located in jurisdictions specifically excluded by the Opinion of Counsel
delivered to the Trustee pursuant to Section 2.01 of the Pooling and Servicing
Agreement, each such assignment shall be delivered by the Custodian to the
Seller for the purpose of recording it in the appropriate public office for real
property records, and the Seller, at no expense to the Custodian, shall promptly
cause to be recorded in the appropriate public office for real property records
each such assignment of Mortgage and, upon receipt thereof from such public
office, shall return each such assignment of Mortgage to the Custodian.

         Section 2.3. REVIEW OF MORTGAGE FILES.

         (a)      On or prior to the Closing Date, in accordance with Section
2.02 of the Pooling and Servicing Agreement, the Custodian shall deliver to the
Seller and the Trustee an Initial Certification in the form annexed hereto as
Exhibit One evidencing receipt (subject to any exceptions noted therein) of a
Mortgage File for each of the Mortgage Loans listed on the Schedule attached
hereto (the "Mortgage Loan Schedule").

         (b)      Within 90 days of the Closing Date, the Custodian agrees, for
the benefit of Certificateholders, to review, in accordance with the provisions
of Section 2.02 of the Pooling and Servicing Agreement, each such document, and
shall deliver to the Seller, the Master Servicer and the Trustee an Interim
Certification in the form annexed hereto as Exhibit Two to the effect that all
such documents have been executed and received and that such documents relate to
the Mortgage Loans identified on the Mortgage Loan Schedule, except for any
exceptions listed on Schedule A attached to such Interim Certification. The
Custodian shall be under no duty or obligation to inspect, review or examine
said documents, instruments, certificates or other papers to determine that the
same are genuine, enforceable, or appropriate for the represented purpose or
that they have actually been recorded or that they are other than what they
purport to be on their face.

         (c)      Not later than 180 days after the Closing Date, the Custodian
shall review, for the benefit of Certificateholders, the Mortgage Files as
provided in Section 2.02 of the Pooling and Servicing Agreement and deliver to
the Seller, the Master Servicer and the Trustee a Final Certification in the
form annexed hereto as Exhibit Three evidencing the completeness of the Mortgage
Files.

         (d)      In reviewing the Mortgage Files as provided herein and in the
Pooling and Servicing Agreement, the Custodian shall make no representation as
to and shall not be responsible to verify (i) the validity, legality,
enforceability, due authorization, recordability, sufficiency or genuineness of
any of the documents included in any Mortgage File or (ii) the collectibility,
insurability, effectiveness or suitability of any of the documents in any
Mortgage File.

                                      J-2
<PAGE>

         Upon receipt of written request from the Trustee, the Custodian shall
as soon as practicable supply the Trustee with a list of all of the documents
relating to the Mortgage Loans missing from the Mortgage Files.

         Section 2.4. NOTIFICATION OF BREACHES OF REPRESENTATIONS AND
WARRANTIES. Upon discovery by the Custodian of a breach of any representation or
warranty made by the Depositor as set forth in the Pooling and Servicing
Agreement with respect to a Mortgage Loan relating to a Mortgage File, the
Custodian shall give prompt written notice to the Depositor, the Master Servicer
and the Trustee.

         Section 2.5. CUSTODIAN TO COOPERATE: RELEASE OF MORTGAGE FILES. Upon
receipt of written notice from the Trustee that the Seller has repurchased a
Mortgage Loan pursuant to Article II of the Pooling and Servicing Agreement, and
a request for release (a "Request for Release") confirming that the purchase
price therefore has been deposited in the Protected Account or the Distribution
Account, then the Custodian agrees to promptly release to the Seller the related
Mortgage File.

         Upon the Custodian's receipt of a Request for Release substantially in
the form of Exhibit H to the Pooling and Servicing Agreement signed by a
Servicing Officer of the Master Servicer, stating that it has received payment
in full of a Mortgage Loan or that payment in full will be escrowed in a manner
customary for such purposes, the Custodian agrees promptly to release to the
Master Servicer, the related Mortgage File. The Depositor shall deliver to the
Custodian and the Custodian agrees to review in accordance with the provisions
of the Custodial Agreement the Mortgage Note and other documents constituting
the Mortgage File with respect to any Replacement Mortgage Loan.

         From time to time as is appropriate for the servicing or foreclosure of
any Mortgage Loan, including, for this purpose, collection under any Primary
Mortgage Insurance Policy or LPMI Policy, the Master Servicer shall deliver to
the Custodian a Request for Release signed by a Servicing Officer requesting
that possession of all of the Mortgage File be released to the Master Servicer
and certifying as to the reason for such release and that such release will not
invalidate any insurance coverage provided in respect of the Mortgage Loan under
any of the Insurance Policies. Upon receipt of the foregoing, the Custodian
shall deliver the Mortgage File to the Master Servicer. The Master Servicer
shall cause each Mortgage File or any document therein so released to be
returned to the Custodian when the need therefore by the Master Servicer no
longer exists, unless (i) the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Protected Account or the Distribution Account or (ii) 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 to the
Custodian a certificate of a Servicing Officer certifying as to 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.

         At any time that the Master Servicer is required to deliver to the
Custodian a Request for Release, the Master Servicer shall deliver two copies of
the Request for Release if

                                      J-3
<PAGE>

delivered in hard copy or the Master Servicer may furnish such Request for
Release electronically to the Custodian, in which event the Servicing Officer
transmitting the same shall be deemed to have signed the Request for Release. In
connection with any Request for Release of a Mortgage File because of a
repurchase of a Mortgage Loan, such Request for Release shall be accompanied by
an assignment of mortgage, without recourse, representation or warranty from the
Trustee to the Seller (unless such Mortgage Loan is a MOM Loan) and the related
Mortgage Note shall be endorsed without recourse, representation or warranty by
the Trustee and be returned to the Seller. In connection with any Request for
Release of a Mortgage File because of the payment in full of a Mortgage Loan,
such Request for Release shall be accompanied by a certificate of satisfaction
or other similar instrument to be executed by or on behalf of the Trustee and
returned to the Master Servicer.

         Section 2.6. ASSUMPTION AGREEMENTS. In the event that any assumption
agreement, substitution of liability agreement or sale of servicing agreement is
entered into with respect to any Mortgage Loan subject to this Agreement in
accordance with the terms and provisions of the Pooling and Servicing Agreement,
the Master Servicer, to the extent provided in the Pooling and Servicing
Agreement, shall notify the Custodian that such assumption or substitution
agreement has been completed by forwarding to the Custodian the original of such
assumption or substitution agreement, which shall be added to the related
Mortgage File and, for all purposes, shall be considered a part of such Mortgage
File to the same extent as all other documents and instruments constituting
parts thereof.

                                  ARTICLE III.
                            CONCERNING THE CUSTODIAN

         Section 3.1. CUSTODIAN A BAILEE AND AGENT OF THE TRUSTEE. With respect
to each Mortgage Note, Mortgage and other documents constituting each Mortgage
File which are delivered to the Custodian, the Custodian is exclusively the
bailee and custodial agent of the Trustee and has no instructions to hold any
Mortgage Note or Mortgage for the benefit of any person other than the Trustee
and the Certificateholders and undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement and in the Pooling and
Servicing Agreement. Except upon compliance with the provisions of Section 2.5
of this Agreement, no Mortgage Note, Mortgage or Mortgage File shall be
delivered by the Custodian to the Seller, the Depositor or the Master Servicer
or otherwise released from the possession of the Custodian.

         Section 3.2. CUSTODIAN MAY OWN CERTIFICATES. The Custodian in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Custodian.

         Section 3.3. MASTER SERVICER TO PAY CUSTODIAN'S FEES AND EXPENSES. The
Master Servicer covenants and agrees to pay to the Custodian from time to time,
and the Custodian shall be entitled to, reasonable compensation for all services
rendered by it in the exercise and performance of any of the powers and duties
hereunder of the Custodian, and the Master Servicer will pay or reimburse the
Custodian upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Custodian in accordance with any of the
provisions of this Agreement (including the reasonable compensation and the
expenses and

                                      J-4
<PAGE>

disbursements of its counsel and of all persons not regularly in its employ),
except any such expense, disbursement or advance as may arise from its
negligence or bad faith or to the extent that such cost or expense is
indemnified by the Depositor pursuant to the Pooling and Servicing Agreement.

         Section 3.4. CUSTODIAN MAY RESIGN; TRUSTEE MAY REMOVE CUSTODIAN. The
Custodian may resign from the obligations and duties hereby imposed upon it as
such obligations and duties relate to its acting as Custodian of the Mortgage
Loans. Upon receiving such written notice of resignation, the Trustee shall
either take custody of the Mortgage Files itself and give prompt written notice
thereof to the Depositor, the Master Servicer and the Custodian, or promptly
appoint a successor Custodian by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Custodian and one copy to
the successor Custodian. If the Trustee shall not have taken custody of the
Mortgage Files and no successor Custodian shall have been so appointed and have
accepted appointment within 30 days after the giving of such written notice of
resignation, the resigning Custodian may petition any court of competent
jurisdiction for the appointment of a successor Custodian.

         The Trustee, at the direction of 25% of the Certificateholders, shall
remove the Custodian at any time upon 60 days prior written notice to Custodian.
In such event, the Trustee shall appoint, or petition a court of competent
jurisdiction to appoint, a successor Custodian hereunder. Any successor
Custodian shall be a depository institution subject to supervision or
examination by federal or state authority shall be able to satisfy the other
requirements contained in Section 3.7 and shall be unaffiliated with the Master
Servicer and the Depositor.

         Any resignation or removal of the Custodian and appointment of a
successor Custodian pursuant to any of the provisions of this Section 3.4 shall
become effective upon acceptance of appointment by the successor Custodian. The
Trustee shall give prompt notice to the Depositor and the Master Servicer of the
appointment of any successor Custodian. Notwithstanding anything to the contrary
set forth herein, no successor Custodian shall be appointed by the Trustee
without the prior approval of the Depositor and the Master Servicer.

         Section 3.5. MERGER OR CONSOLIDATION OF CUSTODIAN. Any Person into
which the Custodian may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding. Section 3.6. REPRESENTATIONS OF THE CUSTODIAN. The Custodian
hereby represents that it is a depository institution subject to supervision or
examination by a federal or state authority, has a combined capital and surplus
of at least $15,000,000 and is qualified to do business in the jurisdictions in
which it will hold any Mortgage File.

ISection 3.7. LIMITATION ON LIABILITY. Neither the Custodian nor any of its
directors, officers, agents or employees, shall be liable for any action taken
or omitted to be taken by it or them hereunder or in connection herewith in good
faith and believed (which belief may be based upon the opinion or advice of
counsel selected by it in the exercise of reasonable

                                      J-5
<PAGE>

care) by it or them to be within the purview of this Agreement, except for its
or their own negligence, lack of good faith or willful misconduct. The Custodian
and any director, officer, employee or agent of the Custodian 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. In no event shall the
Custodian or its directors, officers, agents and employees be held liable for
any special, indirect or consequential damages resulting from any action taken
or omitted to be taken by it or them hereunder or in connection herewith even if
advised of the possibility of such damages.

         Notwithstanding anything herein to the contrary, the Custodian agrees
to indemnify the Trust Fund, the Trustee and each of their respective officers,
directors and agents for any and all liabilities, obligations, losses, damages,
payments, costs or expenses of any kind whatsoever that may be imposed on,
incurred by or asserted against the Trustee or Trust Fund, due to any act or
omission by the Custodian with respect to the Mortgage Files; provided, however,
that the Custodian shall not be liable to any of the foregoing Persons for any
amount and any portion of any such amount resulting from the willful
misfeasance, bad faith or negligence of such Person. The provisions of this
Section 3.7 shall survive the termination of this Custodial Agreement.

         The Custodian and its directors, officers, employees and agents shall
be entitled to indemnification and defense from the Trust Fund for any loss,
liability or expense incurred without negligence, willful misconduct, bad faith
on their part, arising out of, or in connection with, the acceptance or
administration of the custodial arrangement created hereunder, including the
costs and expenses of defending themselves against any claim or liability in
connection with the exercise or performance of any of their powers or duties
hereunder.

                                  ARTICLE IV.
                            MISCELLANEOUS PROVISIONS

         Section 4.1. NOTICES. All notices, requests, consents and demands and
other communications required under this Agreement or pursuant to any other
instrument or document delivered hereunder shall be in writing and, unless
otherwise specifically provided, may be delivered personally, by telegram or
telex, or by registered or certified mail, postage prepaid, return receipt
requested, at the addresses specified on the signature page hereof (unless
changed by the particular party whose address is stated herein by similar notice
in writing), in which case the notice will be deemed delivered when received.

         Section 4.2. AMENDMENTS. No modification or amendment of or supplement
to this Agreement shall be valid or effective unless the same is in writing and
signed by all parties hereto. The Trustee shall give prompt notice to the
Custodian of any amendment or supplement to the Pooling and Servicing Agreement
and furnish the Custodian with written copies thereof.

         Section 4.3. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICT OF LAWS PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW.

                                      J-6
<PAGE>

         Section 4.4. RECORDATION OF AGREEMENT. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Depositor and at the Trust's expense, but
only upon direction accompanied by an Opinion of Counsel reasonably satisfactory
to the Depositor to the effect that the failure to effect such recordation is
likely to materially and adversely affect the interests of the
Certificateholders.

         For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.

         Section 4.5. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.

                                      J-7
<PAGE>

         IN WITNESS WHEREOF, this Agreement is executed as of the date first
above written.

Address:                                      LASALLE BANK NATIONAL ASSOCIATION,
                                              not individually but solely as
                                              Trustee
135 South LaSalle Street
Chicago, IL 60603
                                              By:_______________________________
Attention:                                    Name:   Christopher Lewis
                  BSABS I 2004-HE10           Title:  Assistant Vice President
Telecopy:
Confirmation:
Address:                                      BEAR STEARNS ASSET BACKED
                                              SECURITIES I LLC

383 Madison Avenue
New York, New York 10179                      By:_______________________________
                                              Name:
                                              Title:

Address:                                      EMC MORTGAGE CORPORATION

909 Hidden Ridge Drive, Suite 200
Irving, Texas 75038                           By:_______________________________
                                              Name:  Sue Stepanek
                                              Title: Executive Vice President

Address:                                      [WELLS FARGO BANK,
                                              NATIONAL ASSOCIATION, as
                                              Custodian][LASALLE BANK
                                              NATIONAL ASSOCIATION, as
[1015 Tenth Avenue Southeast                  Custodian]
Minneapolis, Minnesota 55414]
[2571 Busse Rd., Suite 200                    By:_______________________________
Elk Grove Village, IL 60007]                  Name:
                                              Title:

<PAGE>

STATE OF ILLINOIS    )
                     ) ss:
COUNTY OF COOK       )

         On the 30th day of November 2004 before me, a notary public in and for
said State, personally appeared Christopher Lewis, known to me to be an
Assistant Vice President of LaSalle Bank National Association, one of the
parties that executed the within agreement, and also known to me to be the
person who executed the within agreement on behalf of said party and
acknowledged to me that such party 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

[SEAL]

<PAGE>

STATE OF NEW YORK                           )
                                            ) ss:
COUNTY OF NEW YORK                          )

         On the 30th day of November 2004 before me, a notary public in and for
said State, personally appeared __________________ known to me to be a
_______________ of Bear Stearns Asset Backed Securities I LLC, and also known to
me to be the person who executed the within instrument on behalf of said party,
and acknowledged to me that such party 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

[SEAL]

<PAGE>

STATE OF TEXAS       )
                     ) ss:
COUNTY OF DALLAS     )

         On the 30th day of November 2004 before me, a notary public in and for
said State, personally appeared Sue Stepanek, known to me to be a Vice President
of EMC Mortgage Corporation, one of the parties that executed the within
instrument, and also known to me to be the person who executed the within
instrument on behalf of said party, and acknowledged to me that such party
executed the within instrument.

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

                                                   _____________________________
                                                          Notary Public

[Notarial Seal]

<PAGE>

STATE OF [MINNESOTA]    )
                        ) ss:
COUNTY OF [HENNEPIN]    )

         On the 30th day of November 2004 before me, a notary public in and for
said State, personally appeared ________________, known to me to be a[n]
_____________________ of [Wells Fargo Bank, National Association]
[_________________] of [LaSalle Bank National Association], one of the national
parties that executed the within instrument, and also known to me to be the
person who executed it on behalf of said party, and acknowledged to me that such
party executed the within instrument.

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

                                                   _____________________________
                                                          Notary Public

[Notarial Seal]

<PAGE>

                                   EXHIBIT ONE

                     FORM OF CUSTODIAN INITIAL CERTIFICATION

                                                            November 30, 2004

LaSalle Bank National Association
135 South LaSalle Street
Chicago, IL 60603

EMC Mortgage Corporation
909 Hidden Ridge Drive, Suite 200
Irving, Texas 75038

Attention: Bear Stearns Asset Backed Securities I LLC, Series 2004-HE10

         Re:      Custodial Agreement, dated as of November 30, 2004, by and
                  among LaSalle Bank National Association, as trustee, [LaSalle
                  Bank National Association, as Custodian][Wells Fargo Bank,
                  National Association, as Custodian], Bear Stearns Asset Backed
                  Securities I LLC, as depositor and EMC Mortgage Corporation,
                  as seller relating to Bear Stearns Asset Backed Securities I
                  Trust 2004-HE10, Asset-BACKED CERTIFICATES, SERIES 2004-HE10

Ladies and Gentlemen:

         In accordance with Section 2.3(a) of the above-captioned Custodial
Agreement, and subject to Section 2.02(a) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File (which contains an original Mortgage Note or lost note
affidavit) to the extent required in Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, with any exceptions listed on Schedule A attached hereto.

         Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Custodial Agreement.

                                     J-1-1
<PAGE>

                                        [WELLS FARGO BANK, NATIONAL ASSOCIATION]
                                        [LASALLE BANK NATIONAL ASSOCIATION]

                                        By:_____________________________________
                                        Name:___________________________________
                                        Title:__________________________________

<PAGE>

                                   EXHIBIT TWO

                     FORM OF CUSTODIAN INTERIM CERTIFICATION

                                                                       [DATE]

LaSalle Bank National Association
135 South LaSalle Street
Chicago, IL 60603

EMC Mortgage Corporation
909 Hidden Ridge Drive, Suite 200
Irving, Texas 75038

Attention: Bear Stearns Asset Backed Securities I LLC, Series 2004-HE10

         Re:      Custodial Agreement, dated as of November 30, 2004, by and
                  among LaSalle Bank National Association, as trustee, [LaSalle
                  Bank National Association, as Custodian][Wells Fargo Bank,
                  National Association, as Custodian], Bear Stearns Asset Backed
                  Securities I LLC, as depositor and EMC Mortgage Corporation,
                  as seller relating to Bear Stearns Asset Backed Securities I
                  Trust 2004-HE10, Asset-BACKED CERTIFICATES, SERIES 2004-HE10

Ladies and Gentlemen:

         In accordance with Section 2.3(b) of the above-captioned Custodial
Agreement and subject to Section 2.02(a) of the Pooling and Servicing Agreement,
the undersigned, as Custodian, hereby certifies that it has received a Mortgage
File to the extent required pursuant to Section 2.01 of the Pooling and
Servicing Agreement with respect to each Mortgage Loan listed in the Mortgage
Loan Schedule, and it has reviewed the Mortgage File and the Mortgage Loan
Schedule and has determined that: all required documents have been executed and
received and that such documents related to the Mortgage Loans identified on the
Mortgage Loan Schedule, with any exceptions listed on Schedule A attached
hereto.

         Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Custodial Agreement.

                                     J-2-1
<PAGE>

                                      [WELLS FARGO BANK, NATIONAL ASSOCIATION]
                                      [LASALLE BANK NATIONAL ASSOCIATION]

                                      By:_____________________________________
                                      Name:___________________________________
                                      Title:__________________________________

<PAGE>

                                  EXHIBIT THREE

                      FORM OF CUSTODIAN FINAL CERTIFICATION

                                                                [DATE]

LaSalle Bank National Association
135 South LaSalle Street
Chicago, IL 60603

EMC Mortgage Corporation
909 Hidden Ridge Drive, Suite 200
Irving, Texas 75038

Attention: Bear Stearns Asset Backed Securities I LLC, Series 2004-HE10

         Re:      Custodial Agreement, dated as of November 30, 2004, by and
                  among LaSalle Bank National Association, Wells Fargo Bank,
                  National Association, Bear Stearns Asset Backed Securities I
                  LLC and EMC Mortgage Corporation relating to Bear Stearns
                  Asset Backed Securities I Trust 2004-HE10, ASSET-BACKED
                  CERTIFICATES, SERIES 2004-HE10

Ladies and Gentlemen:

         In accordance with Section 2.3(c) of the above-captioned Custodial
Agreement and, subject to Section 2.02(b) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File to the extent required pursuant to Section 2.01 of the Pooling
and Servicing Agreement with respect to each Mortgage Loan listed in the
Mortgage Loan Schedule, and it has reviewed the Mortgage File and the Mortgage
Loan Schedule and has determined that: all required documents have been executed
and received and that such documents relate to the Mortgage Loans identified on
the Mortgage Loan Schedule, with any exceptions listed on Schedule A attached
hereto.

         Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Custodial Agreement or in the
Pooling and Servicing Agreement, as applicable.

                                      [WELLS FARGO BANK, NATIONAL ASSOCIATION]
                                      [LASALLE BANK NATIONAL ASSOCIATION]

                                      By:_____________________________________
                                      Name:___________________________________
                                      Title:__________________________________

                                     J-3-1
<PAGE>

                                   SCHEDULE A
                             (Provided upon request)

                                     J-3-2
<PAGE>

                                    EXHIBIT K

             FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE

         This certificate is being delivered pursuant to Section 3.16 of the
Pooling and Servicing Agreement, dated as of November 1, 2004 (the "Agreement"),
among Bear Stearns Asset Backed Securities I LLC, as depositor (the
"Depositor"), EMC Mortgage Corporation as seller (in that capacity, the
"Seller") and master servicer (in that capacity, the "Master Servicer") and
LaSalle Bank National Association as trustee (the "Trustee"). Capitalized terms
used herein and not otherwise defined have the meanings set forth in the
Agreement.

         I, [identify the certifying individual], on behalf of LaSalle Bank
National Association, as trustee (the "Trustee") certify 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 or servicing
reports filed in respect of periods included in the year covered by that annual
report, of the trust (the "Trust") created pursuant to the Pooling and Servicing
Agreement, dated November 1, 2004 (the "P&S Agreement"); and

         2.       Based on my knowledge, the distribution information in these
reports and any other information provided by the Trustee for inclusion 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 the statements were made, not misleading
as of the last day of the period covered by that annual report.

                                    Date:_______________________________________

                                    [Signature]
                                    Name:
                                    Title:

                                      K-1
<PAGE>

                                    EXHIBIT L

                    FORM OF MORTGAGE LOAN PURCHASE AGREEMENT
                    ----------------------------------------

         MORTGAGE LOAN PURCHASE AGREEMENT, dated as of November 30, 2004, as
amended and supplemented by any and all amendments hereto (collectively, "THIS
AGREEMENT"), by and between EMC MORTGAGE CORPORATION, a Delaware corporation
(the "MORTGAGE LOAN SELLER") and BEAR STEARNS ASSET BACKED SECURITIES I LLC, a
Delaware limited liability company (the "PURCHASER").

         Upon the terms and subject to the conditions of this Agreement, the
Mortgage Loan Seller agrees to sell, and the Purchaser agrees to purchase,
certain conventional, closed-end, fixed rate and adjustable rate, first and
second lien mortgage loans secured by one- to four-family residences
(collectively, the "MORTGAGE Loans") as described herein. The Purchaser intends
to deposit the Mortgage Loans into a trust fund (the "TRUST Fund") and create
Bear Stearns Asset-Backed Securities I Trust 2004-HE10, Asset-Backed
Certificates, Series 2004-HE10 (the "CERTIFICATES"), under a pooling and
servicing agreement, to be dated as of November 1, 2004 (the "POOLING AND
SERVICING AGREEMENT"), among the Purchaser, as depositor, the Mortgage Loan
Seller, as seller and master servicer (in that capacity, the "MASTER SERVICER")
and LaSalle Bank National Association, as trustee (the "TRUSTEE").

         The Purchaser has filed with the Securities and Exchange Commission
(the "COMMISSION") a registration statement on Form S-3 (Number 333-113636)
relating to its Mortgage Pass-Through Certificates and the offering of certain
series thereof (including certain classes of the Certificates) from time to time
in accordance with Rule 415 under the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder (the
"SECURITIES ACT"). Such registration statement, when it became effective under
the Securities Act, and the prospectus relating to the public offering of
certain classes of the Certificates by the Purchaser (the "PUBLIC OFFERING"), as
each may be amended or supplemented from time to time pursuant to the Securities
Act or otherwise, are referred to herein as the "REGISTRATION STATEMENT" and the
"PROSPECTUS," respectively. The "PROSPECTUS SUPPLEMENT" shall mean that
supplement, dated November 23, 2004, to the Prospectus, dated April 26, 2004,
relating to certain classes of the Certificates. With respect to the Public
Offering of certain classes of the Certificates, Bear, Stearns & Co. Inc. ("BEAR
STEARNS") and the Purchaser have entered into a terms agreement, dated as of
November 23, 2004, to an underwriting agreement, dated April 28, 2004 (together,
the "UNDERWRITING AGREEMENT") among Bear Stearns, WaMu Capital Corp. ("WCC"; and
together with Bear Stearns, the "Underwriters") and the Purchaser.

         Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties hereto agree as follows:

         SECTION 1. DEFINITIONS. Certain terms are defined herein. Capitalized
terms used herein but not defined herein shall have the meanings specified in
the Pooling and Servicing Agreement. The following other terms are defined as
follows:

                                       L-1
<PAGE>

         ACQUISITION PRICE: Cash in an amount equal to $ * (plus $ * in accrued
interest) and the retained certificates.

         BEAR STEARNS: Bear, Stearns & Co. Inc.

         CLOSING DATE: November 30, 2004.

         CUSTODIAL AGREEMENT: Any of the LaSalle Custodial Agreement or Wells
Fargo Custodial Agreement.

         CUT-OFF DATE: November 1, 2004.

         CUT-OFF DATE BALANCE: Shall mean $612,590,220.28

         DELETED MORTGAGE LOAN: A Mortgage Loan replaced or to be replaced by a
Replacement Mortgage Loan.

         DUE DATE: As to any Mortgage Loan, the date in each month on which the
related Scheduled Payment is due, as set forth in the related Mortgage Note.

         LASALLE: LaSalle Bank National Association, or its successors in
interest.

         LASALLE CUSTODIAL AGREEMENT: The custodial agreement, dated as November
30, 2004, among the Depositor, the Seller, the Master Servicer, the Trustee and
LaSalle Bank National Association as Custodian relating to the Mortgage Loans
identified in such custodial agreement.

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

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

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

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

         MORTGAGE FILE: The items referred to in EXHIBIT 1 pertaining to a
particular Mortgage Loan and any additional documents required to be added to
such documents pursuant to this Agreement.

         MORTGAGE RATE: The annual rate of interest borne by a Mortgage Note as
stated herein.

____________________________
*       Please contact Bear Stearns for pricing information.

                                       L-2
<PAGE>

         MORTGAGOR: The obligor(s) on a Mortgage Note.

         NET MORTGAGE RATE: As to each Mortgage Loan, and at any time, the per
annum rate equal to the Mortgage Rate less the sum of (i) the Servicing Fee
Rate, (ii) the Trustee Fee Rate and (iii) the rate at which the LPMI Fee is
calculated, if any.

         OPINION OF COUNSEL: A written opinion of counsel, who may be counsel
for the Mortgage Loan Seller or the Purchaser, reasonably acceptable to the
Trustee.

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

         PURCHASE PRICE: With respect to any Mortgage Loan required to be
purchased by the Mortgage Loan Seller pursuant to the applicable provisions of
this Agreement, an amount equal to the sum of (i) 100% of the principal
remaining unpaid on such Mortgage Loan as of the date of purchase (including if
a foreclosure has already occurred, the principal balance of the related
Mortgage Loan at the time the Mortgaged Property was acquired), (ii) accrued and
unpaid interest thereon at the Mortgage Interest Rate through and including the
last day of the month of purchase and (iii) any costs and damages (if any)
incurred by the Trust in connection with any violation of such Mortgage Loan of
any anti-predatory lending laws.

         RATING AGENCIES: Standard & Poor's and Moody's, each a "RATING AGENCY."

         REPLACEMENT MORTGAGE LOAN: A mortgage loan substituted for a Deleted
Mortgage Loan which must meet on the date of such substitution the requirements
stated herein and in the Pooling and Servicing Agreement; upon such
substitution, such mortgage loan shall be a "Mortgage Loan" hereunder.

         SECURITIES ACT: The Securities Act of 1933, as amended.

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

         VALUE: The value of the Mortgaged Property at the time of origination
of the related Mortgage Loan, such value being the lesser of (i) the value of
such property set forth in an appraisal accepted by the applicable originator of
the Mortgage Loan or (ii) the sales price of such property at the time of
origination.

         WCC: WaMu Capital Corp., or its successors in interest.

         WELLS FARGO: Wells Fargo Bank, National Association, or its successors
in interest.

         WELLS FARGO CUSTODIAL AGREEMENT: The custodial agreement, dated as
November 30, 2004, among the Depositor, the Seller, the Master Servicer, the
Trustee and Wells Fargo Bank, National Association as Custodian relating to the
Mortgage Loans identified in such custodial agreement.

                                       L-3
<PAGE>

         SECTION 2. PURCHASE AND SALE OF THE MORTGAGE LOANS AND RELATED RIGHTS.
(a) Upon satisfaction of the conditions set forth in Section 10 hereof, the
Mortgage Loan Seller agrees to sell, and the Purchaser agrees to purchase
Mortgage Loans having an aggregate outstanding principal balance as of the
Cut-off Date equal to the Cut-off Date Balance.

         (b)      The closing for the purchase and sale of the Mortgage Loans
and the closing for the issuance of the Certificates will take place on the
Closing Date at the office of the Purchaser's counsel in New York, New York or
such other place as the parties shall agree.

         (c)      Upon the satisfaction of the conditions set forth in Section
10 hereof, on the Closing Date, the Purchaser shall pay to the Mortgage Loan
Seller the Acquisition Price for the Mortgage Loans in immediately available
funds by wire transfer to such account or accounts as shall be designated by the
Mortgage Loan Seller.

         SECTION 3. MORTGAGE LOAN SCHEDULES. The Mortgage Loan Seller agrees to
provide to the Purchaser as of the date hereof a preliminary listing of the
Mortgage Loans (the "PRELIMINARY MORTGAGE LOAN SCHEDULE") setting forth the
information listed on EXHIBIT 2 to this Agreement with respect to each of the
Mortgage Loans being sold by the Mortgage Loan Seller. If there are changes to
the Preliminary Mortgage Loan Schedule, the Mortgage Loan Seller shall provide
to the Purchaser as of the Closing Date a final schedule (the "FINAL MORTGAGE
LOAN Schedule") setting forth the information listed on EXHIBIT 2 to this
Agreement with respect to each of the Mortgage Loans being sold by the Mortgage
Loan Seller to the Purchaser. The Final Mortgage Loan Schedule shall be
delivered to the Purchaser on the Closing Date, shall be attached to an
amendment to this Agreement to be executed on the Closing Date by the parties
hereto and shall be in form and substance mutually agreed to by the Mortgage
Loan Seller and the Purchaser (the "AMENDMENT"). If there are no changes to the
Preliminary Mortgage Loan Schedule, the Preliminary Mortgage Loan Schedule shall
be the Final Mortgage Loan Schedule for all purposes hereof.

         SECTION 4. MORTGAGE LOAN TRANSFER.

         (a)      The Purchaser will be entitled to all scheduled payments of
principal and interest on the Mortgage Loans due after the Cut-off Date
(regardless of when actually collected) and all payments thereof. The Mortgage
Loan Seller will be entitled to all scheduled payments of principal and interest
on the Mortgage Loans due on or before the Cut-off Date (including payments
collected after the Cut-off Date) and all payments thereof. Such principal
amounts and any interest thereon belonging to the Mortgage Loan Seller as
described above will not be included in the aggregate outstanding principal
balance of the Mortgage Loans as of the Cut-off Date as set forth on the Final
Mortgage Loan Schedule.

         (b)      Pursuant to various conveyancing documents to be executed on
the Closing Date and pursuant to the Pooling and Servicing Agreement, the
Purchaser will assign on the Closing Date all of its right, title and interest
in and to the Mortgage Loans to the Trustee for the benefit of the
Certificateholders. In connection with the transfer and assignment of the
Mortgage Loans, the Mortgage Loan Seller has delivered or will deliver or cause
to be delivered to the Trustee, or the related Custodian on behalf of the
Trustee, by the Closing Date or such later date as is agreed to by the Purchaser
and the Mortgage Loan Seller (each of the Closing

                                       L-4
<PAGE>

Date and such later date is referred to as a "MORTGAGE FILE DELIVERY DATE"), the
items of each Custodian's respective Mortgage File, PROVIDED, HOWEVER, that in
lieu of the foregoing, the Mortgage Loan Seller may deliver the following
documents, under the circumstances set forth below: (x) in lieu of the original
Mortgage, assignments to the Trustee or intervening assignments thereof which
have been delivered, are being delivered or will upon receipt of recording
information relating to the Mortgage required to be included thereon, be
delivered to recording offices for recording and have not been returned in time
to permit their delivery as specified above, the Mortgage Loan Seller may
deliver a true copy thereof with a certification by the Mortgage Loan Seller or
the Master Servicer, on the face of such copy, substantially as follows:
"Certified to be a true and correct copy of the original, which has been
transmitted for recording;" (y) in lieu of the Mortgage, assignments to the
Trustee or intervening assignments thereof, if the applicable jurisdiction
retains the originals of such documents or if the originals are lost (in each
case, as evidenced by a certification from the Mortgage Loan Seller or the
Master Servicer to such effect), the Mortgage Loan Seller may deliver
photocopies of such documents containing an original certification by the
judicial or other governmental authority of the jurisdiction where such
documents were recorded; and (z) in lieu of the Mortgage Notes relating to the
Mortgage Loans, each identified in the list delivered by the Purchaser to the
Trustee on the Closing Date and attached hereto as EXHIBIT 5 the Mortgage Loan
Seller may deliver lost note affidavits and indemnities of the Mortgage Loan
Seller; and provided further, however, that in the case of Mortgage Loans which
have been prepaid in full after the Cut-off Date and prior to the Closing Date,
the Mortgage Loan Seller, in lieu of delivering the above documents, may deliver
to the Trustee a certification by the Mortgage Loan Seller or the Master
Servicer to such effect. The Mortgage Loan Seller shall deliver such original
documents (including any original documents as to which certified copies had
previously been delivered) or such certified copies to the Trustee, or the
related Custodian on behalf of the Trustee, promptly after they are received.
The Mortgage Loan Seller shall cause the Mortgage and intervening assignments,
if any, and the assignment of the Mortgage to be recorded not later than 180
days after the Closing Date unless such assignment is not required to be
recorded under the terms set forth in Section 6(a) hereof.

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

                                       L-5
<PAGE>

         (d)      The Mortgage Loan Seller and the Purchaser acknowledge
hereunder that all of the Mortgage Loans will ultimately be assigned to LaSalle
Bank National Association, as Trustee for the benefit of the Certificateholders,
on the date hereof.

         SECTION 5. EXAMINATION OF MORTGAGE FILES.

         (a)      On or before the Mortgage File Delivery Date, the Mortgage
Loan Seller will have made the Mortgage Files available to the Purchaser or its
agent for examination which may be at the offices of the Trustee or the Mortgage
Loan Seller and/or the Mortgage Loan Seller's custodian. The fact that the
Purchaser or its agent has conducted or has failed to conduct any partial or
complete examination of the Mortgage Files shall not affect the Purchaser's
rights to demand cure, repurchase, substitution or other relief as provided in
this Agreement. In furtherance of the foregoing, the Mortgage Loan Seller shall
make the Mortgage Files available to the Purchaser or its agent from time to
time so as to permit the Purchaser to confirm the Mortgage Loan Seller's
compliance with the delivery and recordation requirements of this Agreement and
the Pooling and Servicing Agreement. In addition, upon request of the Purchaser,
the Mortgage Loan Seller agrees to provide to the Purchaser, Bear Stearns and to
any investors or prospective investors in the Certificates information regarding
the Mortgage Loans and their servicing, to make the Mortgage Files available to
the Purchaser, Bear Stearns, and to such investors or prospective investors
(which may be at the offices of the Mortgage Loan Seller and/or the Mortgage
Loan Seller's custodian) and to make available personnel knowledgeable about the
Mortgage Loans for discussions with the Purchaser, Bear Stearns and such
investors or prospective investors, upon reasonable request during regular
business hours, sufficient to permit the Purchaser, Bear Stearns and such
investors or potential investors to conduct such due diligence as any such party
reasonably believes is appropriate.

         (b)      Pursuant to the Pooling and Servicing Agreement, on the
Closing Date the Trustee (or the related Custodian as obligated under the
applicable Custodial Agreement) for the benefit of the Certificateholders will
review items of the Mortgage Files as set forth on EXHIBIT 1 and will deliver to
the Mortgage Loan Seller an initial certification in the form attached as
Exhibit One to the applicable Custodial Agreement.

         (c)      Within 90 days of the Closing Date, the Trustee or the related
Custodian on its behalf shall, in accordance with the provisions of Section 2.02
of the Pooling and Servicing Agreement, deliver to the Mortgage Loan Seller and
the Trustee an Interim Certification in the form attached as Exhibit Two to the
applicable Custodial Agreement to the effect that all such documents have been
executed and received and that such documents relate to the Mortgage Loans
identified on the Mortgage Loan Schedule, except for any exceptions listed on
Schedule A attached to such Interim Certification. The related Custodian shall
be under no duty or obligation to inspect, review or examine said documents,
instruments, certificates or other papers to determine that the same are
genuine, enforceable, or appropriate for the represented purpose or that they
have actually been recorded or that they are other than what they purport to be
on their face.

         (d)      The Trustee or the related Custodian on its behalf will review
the Mortgage Files within 180 days of the Closing Date and will deliver to the
Mortgage Loan Seller and the Master Servicer, and if reviewed by the related
Custodian, the Trustee, a final

                                       L-6
<PAGE>

certification substantially in the form of Exhibit Three to the applicable
Custodial Agreement. If the Trustee or the related Custodian on its behalf is
unable to deliver a final certification with respect to the items listed in
EXHIBIT 1 due to any document that is missing, has not been executed, is
unrelated, determined on the basis of the Mortgagor name, original principal
balance and loan number, to the Mortgage Loans identified in the Final Mortgage
Loan Schedule (a "MATERIAL DEFECT"), the Trustee or the related Custodian on its
behalf shall notify the Mortgage Loan Seller of such Material Defect. The
Mortgage Loan Seller shall correct or cure any such Material Defect within 90
days from the date of notice from the Trustee, the Depositor or the Master
Servicer of the Material Defect and if the Mortgage Loan Seller does not correct
or cure such Material Defect within such period and such defect materially and
adversely affects the interests of the Certificateholders in the related
Mortgage Loan, the Mortgage Loan Seller will, in accordance with the terms of
the Pooling and Servicing Agreement, within 90 days of the date of notice,
provide the Trustee with a Replacement Mortgage Loan (if within two years of the
Closing Date) or purchase the related Mortgage Loan at the applicable Purchase
Price; PROVIDED, HOWEVER, that if such defect relates solely to the inability of
the Mortgage Loan Seller to deliver the original security instrument or
intervening assignments thereof, or a certified copy because the originals of
such documents, or a certified copy, have not been returned by the applicable
jurisdiction, the Mortgage Loan Seller shall not be required to purchase such
Mortgage Loan if the Mortgage Loan Seller delivers such original documents or
certified copy promptly upon receipt, but in no event later than 360 days after
the Closing Date. The foregoing repurchase obligation shall not apply in the
event that the Mortgage Loan Seller cannot deliver such original or copy of any
document submitted for recording to the appropriate recording office in the
applicable jurisdiction because such document has not been returned by such
office; provided that the Mortgage Loan Seller shall instead deliver a recording
receipt of such recording office or, if such receipt is not available, a
certificate of Mortgage Loan Seller or a Servicing Officer confirming that such
documents have been accepted for recording, and delivery to the Trustee shall be
effected by the Mortgage Loan Seller within thirty days of its receipt of the
original recorded document.

         (e)      At the time of any substitution, the Mortgage Loan Seller
shall deliver or cause to be delivered the Replacement Mortgage Loan, the
related Mortgage File and any other documents and payments required to be
delivered in connection with a substitution pursuant to the Pooling and
Servicing Agreement. At the time of any purchase or substitution, the Trustee
shall (i) assign the selected Mortgage Loan to the Mortgage Loan Seller and
shall release or cause the related Custodian to release the documents
(including, but not limited to, the Mortgage, Mortgage Note and other contents
of the Mortgage File) in the possession of the Trustee or the related Custodian,
as applicable relating to the Deleted Mortgage Loan and (ii) execute and deliver
such instruments of transfer or assignment, in each case without recourse, as
shall be necessary to vest in the Mortgage Loan Seller title to such Deleted
Mortgage Loan.

         SECTION 6. RECORDATION OF ASSIGNMENTS OF MORTGAGE.

         (a)      The Mortgage Loan Seller will, promptly after the Closing
Date, cause each Mortgage and each assignment of Mortgage from the Mortgage Loan
Seller to the Trustee, and all unrecorded intervening assignments, if any,
delivered on or prior to the Closing Date, to be recorded in all recording
offices in the jurisdictions where the related Mortgaged Properties

                                       L-7
<PAGE>

are located; PROVIDED, HOWEVER, the Mortgage Loan Seller need not cause to be
recorded any assignment which relates to a Mortgage Loan that is a MOM Loan or
for which the related Mortgaged Property is located in any jurisdiction under
the laws of which, as evidenced by an Opinion of Counsel delivered by the
Mortgage Loan Seller to the Trustee and the Rating Agencies, the recordation of
such assignment is not necessary to protect the Trustee's interest in the
related Mortgage Loan; PROVIDED, HOWEVER, notwithstanding the delivery of any
Opinion of Counsel, each assignment of Mortgage shall be submitted for recording
by the Mortgage Loan 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
the Holders of Certificates evidencing Percentage Interests aggregating not less
than 25% of the Trust, (ii) the occurrence of an Event of Default, (iii) the
occurrence of a bankruptcy, insolvency or foreclosure relating to the Mortgage
Loan Seller under the Pooling and Servicing Agreement, (iv) the occurrence of a
servicing transfer or an assignment of the servicing as described in Section
7.07 of the Pooling and Servicing Agreement or (iv) with respect to any one
assignment of Mortgage, the occurrence of a bankruptcy, insolvency or
foreclosure relating to the Mortgagor under the related Mortgage.

         While each such Mortgage or assignment is being recorded, if necessary,
the Mortgage Loan Seller shall leave or cause to be left with the Trustee or the
related Custodian on its behalf a certified copy of such Mortgage or assignment.
In the event that, within 180 days of the Closing Date, the Trustee has not been
provided with an Opinion of Counsel as described above or received evidence of
recording with respect to each Mortgage Loan delivered to the Purchaser pursuant
to the terms hereof or as set forth above and the related Mortgage Loan is not a
MOM Loan, the failure to provide evidence of recording or such Opinion of
Counsel shall be considered a Material Defect, and the provisions of Section
5(c) and (d) shall apply. All customary recording fees and reasonable expenses
relating to the recordation of the assignments of mortgage to the Trustee or the
Opinion of Counsel, as the case may be, shall be borne by the Mortgage Loan
Seller.

         (b)      It is the express intent of the parties hereto that the
conveyance of the Mortgage Loans by the Mortgage Loan Seller to the Purchaser,
as contemplated by this Agreement be, and be treated as, a sale. It is, further,
not the intention of the parties that such conveyance be deemed a pledge of the
Mortgage Loans by the Mortgage Loan Seller to the Purchaser to secure a debt or
other obligation of the Mortgage Loan Seller. However, in the event that,
notwithstanding the intent of the parties, the Mortgage Loans are held by a
court to continue to be property of the Mortgage Loan Seller, then (a) this
Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the applicable Uniform Commercial Code; (b) the transfer of
the Mortgage Loans provided for herein shall be deemed to be a grant by the
Mortgage Loan Seller to the Purchaser of a security interest in all of the
Mortgage Loan Seller's right, title and interest in and to the Mortgage Loans
and all amounts payable to the holders of the Mortgage Loans in accordance with
the terms thereof and all proceeds of the conversion, voluntary or involuntary,
of the foregoing into cash, instruments, securities or other property, to the
extent the Purchaser would otherwise be entitled to own such Mortgage Loans and
proceeds pursuant to Section 4 hereof, including all amounts, other than
investment earnings, from time to time held or invested in any accounts created
pursuant to the Pooling and Servicing Agreement, whether in the form of cash,
instruments, securities or other property; (c) the possession by the Purchaser
or the Trustee (or the related Custodian on its

                                       L-8
<PAGE>

behalf) of Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to be
"possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-305 (or comparable provision) of the applicable
Uniform Commercial Code; and (d) notifications to persons holding such property,
and acknowledgments, receipts or confirmations from persons holding such
property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Purchaser for the purpose of perfecting such security interest under
applicable law. Any assignment of the interest of the Purchaser pursuant to any
provision hereof or pursuant to the Pooling and Servicing Agreement shall also
be deemed to be an assignment of any security interest created hereby. The
Mortgage Loan Seller and the Purchaser shall, to the extent consistent with this
Agreement, take such actions as may be reasonably necessary to ensure that, if
this Agreement were deemed to create a security interest in the Mortgage Loans,
such security interest would be deemed to be a perfected security interest of
first priority under applicable law and will be maintained as such throughout
the term of the Pooling and Servicing Agreement.

         SECTION 7. REPRESENTATIONS AND WARRANTIES OF MORTGAGE LOAN SELLER
CONCERNING THE MORTGAGE LOANS. The Mortgage Loan Seller hereby represents and
warrants to the Purchaser as of the Closing Date or such other date as may be
specified below with respect to each Mortgage Loan being sold by it:

         (a)      The information set forth in the Mortgage Loan Schedule on the
Closing Date is complete, true and correct.

         (b)      All payments required to be made prior to the Cut-off Date
with respect to each Mortgage Loan have been made and no Mortgage Loan is
delinquent thirty one or more days; and the Mortgage Loan Seller has not
advanced funds, or induced, solicited or knowingly received any advance of funds
from a party other than the owner of the Mortgaged Property subject to the
Mortgage, directly or indirectly, for the payment of any amount required under
any Mortgage Loan.

         (c)      If any of the Mortgage Loans are secured by a leasehold
interest, with respect to each leasehold interest: the use of leasehold estates
for residential properties is an accepted practice in the area where the related
Mortgaged Property is located; residential property in such area consisting of
leasehold estates is readily marketable; the lease is recorded and no party is
in any way in breach of any provision of such lease; the leasehold is in full
force and effect and is not subject to any prior lien or encumbrance by which
the leasehold could be terminated or subject to any charge or penalty; and the
remaining term of the lease does not terminate less than ten years after the
maturity date of such Mortgage Loan.

         (d)      Except with respect to taxes, insurance and other amounts
previously advanced by a prior servicer with respect to any Mortgage Loan, there
are no delinquent taxes, water charges, sewer rents, assessments, insurance
premiums, leasehold payments, including assessments payable in future
installments, or other outstanding charges affecting the related Mortgaged
Property.

                                       L-9
<PAGE>

         (e)      The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by written
instruments which in the case of the Mortgage Loans are in the Mortgage File and
have been or will be recorded, if necessary to protect the interests of the
Trustee, and which have been or will be delivered to the Trustee, all in
accordance with this Agreement. The substance of any such waiver, alteration or
modification has been approved by the title insurer, to the extent required by
the related policy. No Mortgagor has been released, in whole or in part, except
in connection with an assumption agreement approved by the title insurer, to the
extent required by the policy, and which assumption agreement in the case of the
Mortgage Loans is part of the Mortgage File.

         (f)      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, counterclaim or defense has been asserted with
respect thereto.

         (g)      All buildings upon, or comprising part of, the Mortgaged
Property are insured by an insurer acceptable to Fannie Mae and Freddie Mac
against loss by fire, hazards of extended coverage and such other hazards as are
customary in the area where the Mortgaged Property is located, and such insurer
is licensed to do business in the state where the Mortgaged Property is located.
All such insurance policies contain a standard mortgagee clause naming the
originator, its successors and assigns as mortgagee and Mortgage Loan Seller has
received no notice that all premiums thereon have not been paid. If upon
origination of the Mortgage Loan, the Mortgaged Property was, or was
subsequently deemed to be, in an area identified in the Federal Register by the
Federal Emergency Management Agency as having special flood hazards (and such
flood insurance has been made available), which require under applicable law
that a flood insurance policy meeting the requirements of the current guidelines
of the Federal Insurance Administration (or any successor thereto) be obtained,
such flood insurance policy is in effect which policy is with a generally
acceptable carrier in an amount representing coverage not less than the least of
(A) the Stated Principal Balance of the related Mortgage Loan, (B) the minimum
amount required to compensate for damage or loss on a replacement cost basis, or
(C) the maximum amount of insurance that is available under the Flood Disaster
Protection Act of 1973. The Mortgage obligates the Mortgagor thereunder to
maintain all such insurance at Mortgagor's cost and expense and, on the
Mortgagor's failure to do so, authorizes the holder of the Mortgage to maintain
such insurance at Mortgagor's cost and expense and to obtain reimbursement
therefor from the Mortgagor.

         (h)      Any and all requirements of any federal, state or local law
including, without limitation, usury, truth in lending, real estate settlement
procedures including, the Real Estate Settlement Procedures Act of 1974, as
amended, consumer credit protection, equal credit opportunity, disclosure and
reporting laws and all anti-predatory lending laws applicable to the Mortgage
Loan have been complied with in all material respects.

         (i)      The Mortgage has not been satisfied, canceled, subordinated,
or rescinded, in whole or in part, and the Mortgaged Property has not been
released from the lien of the

                                       L-10
<PAGE>

Mortgage, in whole or in part, nor has any instrument been executed that would
effect any such release, cancellation, subordination or rescission.

         (j)      The Mortgage is a valid, existing and enforceable first or
second lien on the Mortgaged Property, including all improvements on the
Mortgaged Property, if any, 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 specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan and which do
not adversely affect the Appraised Value of the Mortgaged Property and (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. The Mortgage Loan Seller has full right to sell and assign the
Mortgage to the Purchaser.

         (k)      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, except as the enforceability thereof
may be limited by bankruptcy, insolvency or reorganization or general principles
of equity.

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

         (m)      The proceeds of the Mortgage Loan have been fully disbursed
and there is no requirement for future advances 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 were paid, and the Mortgagor is not entitled to any
refund of any amounts paid or due under the Mortgage Note or Mortgage.

         (n)      Immediately prior to the conveyance of the Mortgage Loans by
the Mortgage Loan Seller to the Purchaser hereunder, the Mortgage Loan Seller
was the sole owner and holder of the Mortgage Loan; the related Originator or
the Mortgage Loan Seller was the custodian of the related escrow account, if
applicable; the Mortgage Loan had neither been assigned nor pledged, and the
Mortgage Loan Seller had good and marketable title thereto, and had full right
to transfer and sell the Mortgage Loan and the related servicing rights to the
Purchaser free and clear of any encumbrance, equity, lien, pledge, charge, claim
or security interest subject to the applicable servicing agreement and had full
right and authority subject to no interest or participation of, or agreement
with, any other party, to sell and assign the Mortgage Loan and the related
servicing rights, subject to the applicable servicing agreement, to the
Purchaser pursuant to the terms of this Agreement.

         (o)      All parties which have had any interest in the Mortgage,
whether as mortgagee, assignee, pledgee or otherwise, are (or, during the period
in which they held and disposed of such interest, were) (1) in compliance with
any and all applicable licensing requirements of the laws of the state wherein
the Mortgaged Property is located, and (2)

                                       L-11
<PAGE>

organized under the laws of such state, qualified to do business in such state,
a federal savings and loan association or national bank having principal offices
in such state or not deemed to be doing business in such state under applicable
law.

         (p)      The Mortgage Loan is covered by an ALTA lender's title
insurance policy or equivalent form acceptable to the Department of Housing and
Urban Development, or any successor thereto, and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring (subject to the
exceptions contained in clause (i) above) the Mortgage Loan Seller (as
assignee), its successors and assigns as to the first priority lien of the
Mortgage in the original principal amount of the Mortgage Loan. Additionally,
such lender's title insurance policy affirmatively insures ingress and egress,
and against encroachments by or upon the Mortgaged Property or any interest
therein. With respect to each Mortgage Loan, the Mortgage Loan Seller (as
assignee) is the sole insured of such lender's title insurance policy, and such
lender's title insurance policy is in full force and effect. No claims have been
made under such lender's title insurance policy, and no prior holder of the
related Mortgage, including the Mortgage Loan Seller, has done, by act or
omission, anything which would impair the coverage of such lender's title
insurance policy.

         (q)      Except as provided in clause (b), immediately prior to the
Cut-off Date, there was no default, breach, violation or event of acceleration
existing under the Mortgage or the Mortgage Note and there was no event which,
with the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event of acceleration,
and the Mortgage Loan Seller has not waived any default, breach, violation or
event of acceleration.

         (r)      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 with, the lien of the related Mortgage.

         (s)      At the time of origination, each Mortgaged Property was the
subject of a full appraisal which conformed to the underwriting requirements of
the originator of the Mortgage Loan. All improvements which were considered in
any appraisal which was used in determining the Appraised Value of the related
Mortgaged Property lay wholly within the boundaries and building restriction
lines of the Mortgaged Property, and no improvements on adjoining properties
encroach upon the Mortgaged Property.

         (t)      The origination, servicing and collection practices with
respect to each Mortgage Note and Mortgage including, the establishment,
maintenance and servicing of the escrow accounts and escrow payments, if any,
since origination, have been conducted in all respects in accordance with the
terms of Mortgage Note and in compliance with all applicable laws and
regulations and, unless otherwise required by law or Fannie Mae/Freddie Mac
standards, in accordance with the proper, prudent and customary practices in the
mortgage origination and servicing business. With respect to the escrow accounts
and escrow payments, if any, and a Mortgage Loan all such payments are in the
possession or under the control of the Mortgage Loan Seller (including pursuant
to a Subservicing Agreement) and there exists no deficiencies in connection
therewith for which customary arrangements for repayment thereof

                                       L-12
<PAGE>

have not been made. Any interest required to be paid pursuant to state and local
law has been properly paid and credited.

         (u)      The Mortgaged Property is free of material damage and waste
and there is no proceeding pending for the total or partial condemnation
thereof.

         (v)      The Mortgage contains customary and enforceable provisions to
render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security
intended to be 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 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 Mortgage
Loan Seller and the Mortgage Loan Seller has no knowledge of any relief
requested or allowed to the Mortgagor under the Servicemembers Civil Relief Act.

         (w)      The Mortgage Note is not and has not been secured by any
collateral except the lien of the applicable Mortgage.

         (x)      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 Certificateholders to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor.

         (y)      No Mortgage Loan contains a permanent or temporary "buydown"
provision. The Mortgage Loan is not a graduated payment mortgage loan.

         (z)      The Mortgagor has received all disclosure materials required
by applicable law with respect to the making of the Mortgage Loan.

         (aa)     No Mortgage Loan was made in connection with the construction
or rehabilitation of a Mortgaged Property.

         (bb)     To the best of Mortgage Loan Seller's knowledge, the Mortgaged
Property is lawfully occupied under applicable law and all inspections, licenses
and certificates required to be made or issued with respect to all occupied
portions of the Mortgaged Property and, with respect to the use and occupancy of
the same, including but not limited to certificates of occupancy, have been made
or obtained from the appropriate authorities.

         (cc)     The assignment of Mortgage with respect to a Mortgage Loan is
in recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located.

         (dd)     The Mortgaged Property consists of a single parcel of real
property with or without a detached single family residence erected thereon, or
an individual condominium unit, or a 2-4 family dwelling, or an individual unit
in a planned unit development as defined by

                                       L-13
<PAGE>

Fannie Mae or a townhouse, each structure of which is permanently affixed to the
Mortgaged Property, and is legally classified as real estate.

         (ee)     Each Mortgage Loan at the time of origination was underwritten
in general in accordance with guidelines not inconsistent with the guidelines
set forth in the Prospectus Supplement and generally accepted credit
underwriting guidelines.

         (ff)     No error, omission, misrepresentation, fraud or similar
occurrence with respect to a Mortgage Loan has taken place on the part of the
Mortgage Loan Seller or the related Originator.

         (gg)     None of the Mortgage Loans are (a) loans subject to 12 CFR
Part 226.31, 12 CFR Part 226.32 or 12 CFR Part 226.34 of Regulation Z, the
regulation implementing TILA, which implements the Home Ownership and Equity
Protection Act of 1994 ("HOEPA") or (b) classified and/or defined as a "high
cost home loan" (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) under any federal, state, or local law, including, but not limited
to, the States of Georgia or North Carolina.

         (hh)     None of the Mortgage Loans originated on or after October 1,
2002 and before March 7, 2003 was secured by property located in the State of
Georgia.

         (ii)     None of the Mortgage Loans that are secured by property
located in the State of Illinois are in violation of the provisions of the
Illinois Interest Act.

         (jj)     None of the Mortgage Loans contains provisions pursuant to
which monthly payments are (a) paid or partially paid with funds deposited in
any separate account established by the Mortgage Loan Seller, the mortgagor, or
anyone on behalf of the mortgagor, (b) paid by any source other than the
mortgagor or (c) contains any other similar provisions which may constitute a
"buydown" provision. None of the Mortgage Loans is a graduated payment mortgage
loan and no Mortgage Loan has a shared appreciation or other contingent interest
feature;

         (kk)     Each Mortgage Loan that contains a provision for the
assumption substitution of liability, pursuant to which the original mortgagor
is released from liability and another person is substituted as the mortgagor
and becomes liable under the Mortgage Note, shall be effective only if such
person satisfies the then current underwriting practices and procedures of
prudent mortgage lenders in a state in which the mortgaged property is located.

         (ll)     The Mortgaged Property and all improvements thereon comply
with all requirements of any applicable zoning and subdivision laws and
ordinances.

         (mm)     Each Mortgage is a valid and enforceable first lien on the
property securing the related Mortgage Note and each Mortgaged Property is owned
by the Mortgagor in fee simple (except with respect to common areas in the case
of condominiums, PUDs and de minimis PUDs) or by leasehold for a term longer
than the term of the related Mortgage, subject only to (i) the lien of current
real property taxes and assessments, (ii) covenants, conditions and

                                       L-14
<PAGE>

restrictions, rights of way, easements and other matters of public record as of
the date of recording of such Mortgage, such exceptions being acceptable to
mortgage lending institutions generally or specifically reflected in the
appraisal obtained in connection with the origination of the related Mortgage
Loan or referred to in the lender's title insurance policy delivered to the
originator of the related Mortgage Loan and (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 Appraisal Form
1004 or Form 2055 with an interior inspection for first lien Mortgage Loans has
been obtained. Form 704, 2065 or 2055 with an exterior only inspection for
junior lien Mortgage Loans has been obtained.

         (nn)     With respect to any mortgage loans in Loan Group II originated
on or after August 1, 2004, neither the related mortgage nor the related
mortgage note requires the borrower to submit to arbitration to resolve any
dispute arising out of or relating in any way to the mortgage loan transaction;

         (oo)     None of the Group II Loans originated before October 1, 2002
imposes a Prepayment Charge for a term exceeding five years; none of the Group
II Loans originated on or after October 1, 2002 imposes a Prepayment Charge for
a term exceeding three years.

         (pp)     No proceeds from any Group II Loan were used to finance
single-premium credit insurance policies.

         (qq)     The conforming one- to four-family mortgage loans in Loan
Group II, which may include the balance of any subordinated lien, each have an
original principal balance that does not exceed Freddie Mac's dollar amount
limits.

         (rr)     Each Prepayment Charge is enforceable and was originated in
compliance with all applicable federal, state and local laws.

         (ss)     With respect to any Mortgage Loan that contains a provision
permitting imposition of a premium upon a prepayment prior to maturity, the
prepayment premium is disclosed to the borrower in the loan documents pursuant
to applicable state and federal law.

         (tt)     No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable (as such terms are defined in Appendix E of the Standard & Poor's
Glossary For File Format For LEVELS(R) Version 5.6 Revised attached hereto aS
EXHIBIT 6).

         It is understood and agreed that the representations and warranties set
forth in this Section 7 will inure to the benefit of the Purchaser, its
successors and assigns, notwithstanding any restrictive or qualified endorsement
on any Mortgage Note or assignment of Mortgage or the examination of any
Mortgage File. Upon any substitution for a Mortgage Loan, the representations
and warranties set forth above shall be deemed to be made by the Mortgage Loan
Seller as to any Replacement Mortgage Loan as of the date of substitution.

         Upon discovery or receipt of notice by the Mortgage Loan Seller, the
Purchaser or the Trustee of a breach of any representation or warranty of the
Mortgage Loan Seller set forth in this Section 7 which materially and adversely
affects the value of the interests of the Purchaser,

                                       L-15
<PAGE>

the Certificateholders or the Trustee in any of the Mortgage Loans delivered to
the Purchaser pursuant to this Agreement, the party discovering or receiving
notice of such breach shall give prompt written notice to the others. It is
understood and agreed that a breach of any one of the representations contained
in clauses (gg), (hh) and (nn) through (qq) above in respect of a Group II Loan
will be deemed to materially adversely affect the interests of the related
Certificateholders. In the case of any such breach of a representation or
warranty set forth in this Section 7, within 90 days from the date of discovery
by the Mortgage Loan Seller, or the date the Mortgage Loan Seller is notified by
the party discovering or receiving notice of such breach (whichever occurs
earlier), the Mortgage Loan Seller will (i) cure such breach in all material
respects, (ii) purchase the affected Mortgage Loan at the applicable Purchase
Price or (iii) if within two years of the Closing Date, substitute a qualifying
Replacement Mortgage Loan in exchange for such Mortgage Loan; provided that, (A)
in the case of a breach of the representation and warranty concerning the
Mortgage Loan Schedule contained in clause (a) of this Section 7, if such breach
is material and relates to any field on the Mortgage Loan Schedule which
identifies any Prepayment Charge or (B) in the case of a breach of the
representation contained in clause (rr) of this Section 7, then, in each case,
in lieu of purchasing such Mortgage Loan from the Trust Fund at the Purchase
Price, the Mortgage Loan Seller shall pay the amount of the Prepayment Charge
(net of any amount previously collected by or paid to the Trust Fund in respect
of such Prepayment Charge) from its own funds and without reimbursement
therefor, and the Mortgage Loan Seller shall have no obligation to repurchase or
substitute for such Mortgage Loan. The obligations of the Mortgage Loan Seller
to cure, purchase or substitute a qualifying Replacement Mortgage Loan shall
constitute the Purchaser's, the Trustee's and the Certificateholder's sole and
exclusive remedy under this Agreement or otherwise respecting a breach of
representations or warranties hereunder with respect to the Mortgage Loans,
except for the obligation of the Mortgage Loan Seller to indemnify the Purchaser
for such breach as set forth in and limited by Section 13 hereof.

         Any cause of action against the Mortgage Loan Seller or relating to or
arising out of a breach by the Mortgage Loan Seller of any representations and
warranties made in this Section 7 shall accrue as to any Mortgage Loan upon (i)
discovery of such breach by the Mortgage Loan Seller or notice thereof by the
party discovering such breach and (ii) failure by the Mortgage Loan Seller to
cure such breach, purchase such Mortgage Loan or substitute a qualifying
Replacement Mortgage Loan pursuant to the terms hereof.

         SECTION 8. REPRESENTATIONS AND WARRANTIES CONCERNING THE MORTGAGE LOAN
SELLER. As of the date hereof and as of the Closing Date, the Mortgage Loan
Seller represents and warrants to the Purchaser as to itself in the capacity
indicated as follows:

         (a)      the Mortgage Loan Seller (i) is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and (ii) is qualified and in good standing to do business in each jurisdiction
where such qualification is necessary, except where the failure so to qualify
would not reasonably be expected to have a material adverse effect on the
Mortgage Loan Seller's business as presently conducted or on the Mortgage Loan
Seller's ability to enter into this Agreement and to consummate the transactions
contemplated hereby or thereby;

                                       L-16
<PAGE>

         (b)      the Mortgage Loan Seller has full power to own its property,
to carry on its business as presently conducted and to enter into and perform
its obligations under this Agreement;

         (c)      the execution and delivery by the Mortgage Loan Seller of this
Agreement has been duly authorized by all necessary action on the part of the
Mortgage Loan Seller; and neither the execution and delivery of this Agreement,
nor the consummation of the transactions herein or therein contemplated, nor
compliance with the provisions hereof or thereof, will conflict with or result
in a breach of, or constitute a default under, any of the provisions of any law,
governmental rule, regulation, judgment, decree or order binding on the Mortgage
Loan Seller or its properties or the charter or by-laws of the Mortgage Loan
Seller, except those conflicts, breaches or defaults which would not reasonably
be expected to have a material adverse effect on the Mortgage Loan Seller's
ability to enter into this Agreement and to consummate the transactions
contemplated hereby or thereby;

         (d)      the execution, delivery and performance by the Mortgage Loan
Seller of this Agreement and the consummation of the transactions contemplated
hereby or thereby do not require the consent or approval of, the giving of
notice to, the registration with, or the taking of any other action in respect
of, any state, federal or other governmental authority or agency, except those
consents, approvals, notices, registrations or other actions as have already
been obtained, given or made and, in connection with the recordation of the
Mortgages, powers of attorney or assignments of Mortgages not yet completed;

         (e)      this Agreement has been duly executed and delivered by the
Mortgage Loan Seller and, assuming due authorization, execution and delivery by
the Purchaser or the parties thereto, constitutes a valid and binding obligation
of the Mortgage Loan Seller enforceable against it in accordance with its terms
(subject to applicable bankruptcy and insolvency laws and other similar laws
affecting the enforcement of the rights of creditors generally);

         (f)      there are no actions, suits or proceedings pending or, to the
knowledge of the Mortgage Loan Seller, threatened against the Mortgage Loan
Seller, before or by any court, administrative agency, arbitrator or
governmental body (i) with respect to any of the transactions contemplated by
this Agreement or (ii) with respect to any other matter which in the judgment of
the Mortgage Loan Seller could reasonably be expected to be determined adversely
to the Mortgage Loan Seller and if determined adversely to the Mortgage Loan
Seller materially and adversely affect the Mortgage Loan Seller's ability to
perform its obligations under this Agreement; and the Mortgage Loan Seller is
not in default with respect to any order of any court, administrative agency,
arbitrator or governmental body so as to materially and adversely affect the
transactions contemplated by this Agreement; and

         (g)      the Mortgage Loan Seller's Information (as defined in Section
13(a) hereof) does not include any untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements made, in
light of the circumstances under which they were made, not misleading.

                                       L-17
<PAGE>

         SECTION 9. REPRESENTATIONS AND WARRANTIES CONCERNING THE PURCHASER. As
of the date hereof and as of the Closing Date, the Purchaser represents and
warrants to the Mortgage Loan Seller as follows:

         (a)      the Purchaser (i) is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware and (ii) is qualified and in good standing to do business in each
jurisdiction where such qualification is necessary, except where the failure so
to qualify would not reasonably be expected to have a material adverse effect on
the Purchaser's business as presently conducted or on the Purchaser's ability to
enter into this Agreement and to consummate the transactions contemplated hereby
or thereby;

         (b)      the Purchaser has full power to own its property, to carry on
its business as presently conducted and to enter into and perform its
obligations under this Agreement to which it is a party;

         (c)      the execution and delivery by the Purchaser of this Agreement
has been duly authorized by all necessary action on the part of the Purchaser;
and neither the execution and delivery of this Agreement, nor the consummation
of the transactions herein or therein contemplated, nor compliance with the
provisions hereof or thereof, will conflict with or result in a breach of, or
constitute a default under, any of the provisions of any law, governmental rule,
regulation, judgment, decree or order binding on the Purchaser or its properties
or the certificate of formation or limited liability company agreement of the
Purchaser, except those conflicts, breaches or defaults which would not
reasonably be expected to have a material adverse effect on the Purchaser's
ability to enter into this Agreement and to consummate the transactions
contemplated hereby;

         (d)      the execution, delivery and performance by the Purchaser of
this Agreement and the consummation of the transactions contemplated hereby or
thereby do not require the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any state,
federal or other governmental authority or agency, except those consents,
approvals, notices, registrations or other actions as have already been
obtained, given or made;

         (e)      this Agreement has been duly executed and delivered by the
Purchaser and, assuming due authorization, execution and delivery by the
Mortgage Loan Seller, constitutes a valid and binding obligation of the
Purchaser enforceable against it in accordance with its terms (subject to
applicable bankruptcy and insolvency laws and other similar laws affecting the
enforcement of the rights of creditors generally);

         (f)      there are no actions, suits or proceedings pending or, to the
knowledge of the Purchaser, threatened against the Purchaser, before or by any
court, administrative agency, arbitrator or governmental body (i) with respect
to any of the transactions contemplated by this Agreement or (ii) with respect
to any other matter which in the judgment of the Purchaser could reasonably be
expected to be determined adversely to the Purchaser and if determined adversely
to the Purchaser materially and adversely affect the Purchaser's ability to
perform its obligations under this Agreement; and the Purchaser is not in
default with respect to any order of any court,

                                       L-18
<PAGE>

administrative agency, arbitrator or governmental body so as to materially and
adversely affect the transactions contemplated by this Agreement; and

         (g)      the Purchaser's Information (as defined in Section 13(b)
hereof) does not include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading.

         SECTION 10. CONDITIONS TO CLOSING.

         (a)      The obligations of the Purchaser under this Agreement will be
subject to the satisfaction, on or prior to the Closing Date, of the following
conditions:

                  (1)      Each of the obligations of the Mortgage Loan Seller
required to be performed at or prior to the Closing Date pursuant to the terms
of this Agreement shall have been duly performed and complied with in all
material respects; all of the representations and warranties of the Mortgage
Loan Seller under this Agreement shall be true and correct as of the date or
dates specified in all material respects; and no event shall have occurred
which, with notice or the passage of time, would constitute a default under this
Agreement or the Pooling and Servicing Agreement; and the Purchaser shall have
received certificates to that effect signed by authorized officers of the
Mortgage Loan Seller.

                  (2)      The Purchaser shall have received all of the
following closing documents, in such forms as are agreed upon and reasonably
acceptable to the Purchaser, duly executed by all signatories other than the
Purchaser as required pursuant to the respective terms thereof:

                           (i)      If required pursuant to Section 3 hereof,
         the Amendment dated as of the Closing Date and any documents referred
         to therein;

                           (ii)     If required pursuant to Section 3 hereof,
         the Final Mortgage Loan Schedule containing the information set forth
         on EXHIBIT 2 hereto, one copy to be attached to each counterpart of the
         Amendment;

                           (iii)    The Pooling and Servicing Agreement, in form
         and substance reasonably satisfactory to the Trustee and the Purchaser,
         and all documents required thereby duly executed by all signatories;

                           (iv)     A certificate of an officer of the Mortgage
         Loan Seller dated as of the Closing Date, in a form reasonably
         acceptable to the Purchaser, and attached thereto the resolutions of
         the Mortgage Loan Seller authorizing the transactions contemplated by
         this Agreement, together with copies of the articles of incorporation,
         by-laws and certificate of good standing of the Mortgage Loan Seller;

                           (v)      One or more opinions of counsel from the
         Mortgage Loan Seller's counsel otherwise in form and substance
         reasonably satisfactory to the Purchaser, the Trustee and each Rating
         Agency;

                                       L-19
<PAGE>

                           (vi)     A letter from each of the Rating Agencies
         giving each Class of Certificates set forth on Schedule A hereto the
         rating set forth therein; and

                           (vii)    Such other documents, certificates
         (including additional representations and warranties) and opinions as
         may be reasonably necessary to secure the intended ratings from each
         Rating Agency for the Certificates.

                  (3)      The Certificates to be sold to Bear Stearns pursuant
to the Underwriting Agreement and the Purchase Agreement shall have been issued
and sold to Bear Stearns.

                  (4)      The Mortgage Loan Seller shall have furnished to the
Purchaser such other certificates of its officers or others and such other
documents and opinions of counsel to evidence fulfillment of the conditions set
forth in this Agreement and the transactions contemplated hereby as the
Purchaser and its counsel may reasonably request.

         (b)      The obligations of the Mortgage Loan Seller under this
Agreement shall be subject to the satisfaction, on or prior to the Closing Date,
of the following conditions:

                  (1)      The obligations of the Purchaser required to be
performed by it on or prior to the Closing Date pursuant to the terms of this
Agreement shall have been duly performed and complied with in all material
respects, and all of the representations and warranties of the Purchaser under
this Agreement shall be true and correct in all material respects as of the date
hereof and as of the Closing Date, and no event shall have occurred which would
constitute a breach by it of the terms of this Agreement or the Pooling and
Servicing Agreement, and the Mortgage Loan Seller shall have received a
certificate to that effect signed by an authorized officer of the Purchaser.

                  (2)      The Mortgage Loan Seller shall have received copies
of all of the following closing documents, in such forms as are agreed upon and
reasonably acceptable to the Mortgage Loan Seller, duly executed by all
signatories other than the Mortgage Loan Seller as required pursuant to the
respective terms thereof:

                           (i)      If required pursuant to Section 3 hereof,
         the Amendment dated as of the Closing Date and any documents referred
         to therein;

                           (ii)     The Pooling and Servicing Agreement, in form
                  and substance reasonably satisfactory to the Mortgage Loan
                  Seller and the Trustee, and all documents required thereby
                  duly executed by all signatories;

                           (iii)    A certificate of an officer of the Purchaser
                  dated as of the Closing Date, in a form reasonably acceptable
                  to the Mortgage Loan Seller, and attached thereto the written
                  consent of the member of the Purchaser authorizing the
                  transactions contemplated by this Agreement and the Pooling
                  and Servicing Agreement, together with copies of the
                  Purchaser's certificate of formation, limited liability
                  company agreement and evidence as to the good standing of the
                  Purchaser dated as of a recent date;

                                       L-20
<PAGE>

                           (iv)     One or more opinions of counsel from the
                  Purchaser's counsel in form and substance reasonably
                  satisfactory to the Mortgage Loan Seller, the Trustee and the
                  Rating Agencies; and

                           (v)      Such other documents, certificates
                  (including additional representations and warranties) and
                  opinions as may be reasonably necessary to secure the intended
                  rating from each Rating Agency for the Certificates.

         SECTION 11. FEES AND EXPENSES. Subject to Section 16 hereof, the
Mortgage Loan Seller shall pay on the Closing Date or such later date as may be
agreed to by the Purchaser (i) the fees and expenses of the Mortgage Loan
Seller's attorneys and the reasonable fees and expenses of the Purchaser's
attorneys, (ii) the fees and expenses of Deloitte & Touche llp, (iii) the fee
for the use of Purchaser's Registration Statement based on the aggregate
original principal amount of the Certificates and the filing fee of the
Commission as in effect on the date on which the Registration Statement was
declared effective, (iv) the fees and expenses including counsel's fees and
expenses in connection with any "blue sky" and legal investment matters, (v) the
fees and expenses of the Trustee which shall include without limitation the fees
and expenses of the Trustee (and the fees and disbursements of its counsel) with
respect to (A) legal and document review of this Agreement, the Pooling and
Servicing Agreement, the Certificates and related agreements, (B) attendance at
the Closing and (C) review of the Mortgage Loans to be performed by the Trustee
or the related Custodian on its behalf, (vi) the expenses for printing or
otherwise reproducing the Certificates, the Prospectus and the Prospectus
Supplement, (vii) the fees and expenses of each Rating Agency (both initial and
ongoing), (viii) the fees and expenses relating to the preparation and
recordation of mortgage assignments (including intervening assignments, if any
and if available, to evidence a complete chain of title from the originator to
the Trustee) from the Mortgage Loan Seller to the Trustee or the expenses
relating to the Opinion of Counsel referred to in Section 6(a) hereof, as the
case may be and (ix) Mortgage File due diligence expenses and other
out-of-pocket expenses incurred by the Purchaser in connection with the purchase
of the Mortgage Loans and by Bear Stearns in connection with the sale of the
Certificates. The Mortgage Loan Seller additionally agrees to pay directly to
any third party on a timely basis the fees provided for above which are charged
by such third party and which are billed periodically.

         SECTION 12. ACCOUNTANTS' LETTERS.

         (a)      Deloitte & Touche llp will review the characteristics of a
sample of the Mortgage Loans described in the Final Mortgage Loan Schedule and
will compare those characteristics to the description of the Mortgage Loans
contained in the Prospectus Supplement under the captions "Summary--The Mortgage
Loans" and "The Mortgage Pool" and in Schedule A thereto. The Mortgage Loan
Seller will cooperate with the Purchaser in making available all information and
taking all steps reasonably necessary to permit such accountants to complete the
review and to deliver the letters required of them under the Underwriting
Agreement. Deloitte & Touche llp will also confirm certain calculations as set
forth under the caption "Yield, Prepayment and Maturity Considerations" in the
Prospectus Supplement.

         (b)      To the extent statistical information with respect to the
Mortgage Loan Seller's servicing portfolio is included in the Prospectus
Supplement under the caption

                                       L-21
<PAGE>

"Servicing of the Mortgage Loans--The Master Servicer--Delinquency and
Foreclosure Experience of EMC," a letter from the certified public accountant
for the Mortgage Loan Seller will be delivered to the Purchaser dated the date
of the Prospectus Supplement, in the form previously agreed to by the Mortgage
Loan Seller and the Purchaser, with respect to such statistical information.

         SECTION 13. INDEMNIFICATION.

         (a)      The Mortgage Loan Seller shall indemnify and hold harmless the
Purchaser and its directors, officers and controlling persons (as defined in
Section 15 of the Securities Act) from and against any loss, claim, damage or
liability or action in respect thereof, to which they or any of them may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon (i) any untrue
statement of a material fact contained in the MORTGAGE LOAN SELLER'S INFORMATION
as identified in EXHIBIT 3, the omission to state in the Prospectus Supplement
or Prospectus (or any amendment thereof or supplement thereto approved by the
Mortgage Loan Seller and in which additional Mortgage Loan Seller's Information
is identified), in reliance upon and in conformity with Mortgage Loan Seller's
Information a material fact required to be stated therein or necessary to make
the statements therein in light of the circumstances in which they were made,
not misleading, (ii) any representation or warranty assigned or made by the
Mortgage Loan Seller in Section 7 or Section 8 hereof being, or alleged to be,
untrue or incorrect, or (iii) any failure by the Mortgage Loan Seller to perform
its obligations under this Agreement; and the Mortgage Loan Seller shall
reimburse the Purchaser and each other indemnified party for any legal and other
expenses reasonably incurred by them in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action.

         The foregoing indemnity agreement is in addition to any liability which
the Mortgage Loan Seller otherwise may have to the Purchaser or any other such
indemnified party.

         (b)      The Purchaser shall indemnify and hold harmless the Mortgage
Loan Seller and its respective directors, officers and controlling persons (as
defined in Section 15 of the Securities Act) from and against any loss, claim,
damage or liability or action in respect thereof, to which they or any of them
may become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon (i) any
untrue statement of a material fact contained in the PURCHASER'S INFORMATION as
identified in EXHIBIT 4, the omission to state in the Prospectus Supplement or
Prospectus (or any amendment thereof or supplement thereto approved by the
Purchaser and in which additional Purchaser's Information is identified), in
reliance upon and in conformity with the Purchaser's Information, a material
fact required to be stated therein or necessary to make the statements therein
in light of the circumstances in which they were made, not misleading, (ii) any
representation or warranty made by the Purchaser in Section 9 hereof being, or
alleged to be, untrue or incorrect, or (iii) any failure by the Purchaser to
perform its obligations under this Agreement; and the Purchaser shall reimburse
the Mortgage Loan Seller, and each other indemnified party for any legal and
other expenses reasonably incurred by them in connection with investigating or
defending or preparing to defend any such loss, claim, damage, liability or
action. The foregoing indemnity agreement is

                                       L-22
<PAGE>

in addition to any liability which the Purchaser otherwise may have to the
Mortgage Loan Seller, or any other such indemnified party.

         (c)      Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 13 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent it may elect by written notice delivered to the
indemnified party promptly (but, in any event, within 30 days) after receiving
the aforesaid notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party. Notwithstanding
the foregoing, the indemnified party or parties shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in writing by one of
the indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to have charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that there is a conflict of interest between itself or themselves and
the indemnifying party in the conduct of the defense of any claim or that the
interests of the indemnified party or parties are not substantially co-extensive
with those of the indemnifying party (in which case the indemnifying parties
shall not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the indemnifying parties (PROVIDED, HOWEVER, that the
indemnifying party shall be liable only for the fees and expenses of one counsel
in addition to one local counsel in the jurisdiction involved. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall not be
liable for any settlement or any claim or action effected without its written
consent; PROVIDED, HOWEVER, that such consent was not unreasonably withheld.

         (d)      If the indemnification provided for in paragraphs (a) and (b)
of this Section 13 shall for any reason be unavailable to an indemnified party
in respect of any loss, claim, damage or liability, or any action in respect
thereof, referred to in Section 13, then the indemnifying party shall in lieu of
indemnifying the indemnified party contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, in such proportion as shall be appropriate to reflect
the relative benefits received by the Mortgage Loan Seller on the one hand and
the Purchaser on the other from the purchase and sale of the Mortgage Loans, the
offering of the Certificates and the other transactions contemplated hereunder.
No person found liable for a fraudulent misrepresentation shall be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation.

                                       L-23
<PAGE>

         (e)      The parties hereto agree that reliance by an indemnified party
on any publicly available information or any information or directions furnished
by an indemnifying party shall not constitute negligence, bad faith or willful
misconduct by such indemnified party.

         SECTION 14. NOTICES. All demands, notices and communications hereunder
shall be in writing but may be delivered by facsimile transmission subsequently
confirmed in writing. Notices to the Mortgage Loan Seller shall be directed to
EMC Mortgage Corporation, 909 Hidden Ridge Drive, Suite 200 Irving, Texas 75038,
(Telecopy: (972-444-2880)), and notices to the Purchaser shall be directed to
Bear Stearns Asset Backed Securities I LLC, 383 Madison Avenue, New York, New
York 10179, (Telecopy: (212-272-7206)), Attention: Chief Counsel; or to any
other address as may hereafter be furnished by one party to the other party by
like notice. Any such demand, notice or communication hereunder shall be deemed
to have been received on the date received at the premises of the addressee (as
evidenced, in the case of registered or certified mail, by the date noted on the
return receipt) provided that it is received on a business day during normal
business hours and, if received after normal business hours, then it shall be
deemed to be received on the next business day.

         SECTION 15. TRANSFER OF MORTGAGE LOANS. The Purchaser retains the right
to assign the Mortgage Loans and any or all of its interest under this Agreement
to the Trustee without the consent of the Mortgage Loan Seller, and, upon such
assignment, the Trustee shall succeed to the applicable rights and obligations
of the Purchaser hereunder; provided, however, the Purchaser shall remain
entitled to the benefits set forth in Sections 11, 13 and 17 hereto and as
provided in Section 2(a). Notwithstanding the foregoing, the sole and exclusive
right and remedy of the Trustee with respect to a breach of representation or
warranty of the Mortgage Loan Seller shall be the cure, purchase or substitution
obligations of the Mortgage Loan Seller contained in Sections 5 and 7 hereof.

         SECTION 16. TERMINATION. This Agreement may be terminated (a) by the
mutual consent of the parties hereto prior to the Closing Date, (b) by the
Purchaser, if the conditions to the Purchaser's obligation to close set forth
under Section 10(a) hereof are not fulfilled as and when required to be
fulfilled or (c) by the Mortgage Loan Seller, if the conditions to the Mortgage
Loan Seller's obligation to close set forth under Section 10(b) hereof are not
fulfilled as and when required to be fulfilled. In the event of termination
pursuant to clause (b), the Mortgage Loan Seller shall pay, and in the event of
termination pursuant to clause (c), the Purchaser shall pay, all reasonable
out-of-pocket expenses incurred by the other in connection with the transactions
contemplated by this Agreement. In the event of a termination pursuant to clause
(a), each party shall be responsible for its own expenses.

         SECTION 17. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Mortgage Loan Seller
submitted pursuant hereto, shall remain operative and in full force and effect
and shall survive delivery of the Mortgage Loans to the Purchaser (and by the
Purchaser to the Trustee). Subsequent to the delivery of the Mortgage Loans to
the Purchaser, each of the Mortgage Loan Seller's representations and warranties
contained herein with respect to the Mortgage Loans shall be deemed to relate to
the Mortgage Loans actually delivered to the Purchaser and included in the Final
Mortgage Loan Schedule and

                                      L-24
<PAGE>

any Replacement Mortgage Loan and not to those Mortgage Loans deleted from the
Preliminary Mortgage Loan Schedule pursuant to Section 3 hereof prior to the
Closing.

         SECTION 18. SEVERABILITY. If any provision of this Agreement shall be
prohibited or invalid under applicable law, this Agreement shall be ineffective
only to such extent, without invalidating the remainder of this Agreement.

         SECTION 19. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which will be an original, but which together shall
constitute one and the same agreement.

         SECTION 20. AMENDMENT. This Agreement cannot be amended or modified in
any manner without the prior written consent of each party.

         SECTION 21. GOVERNING LAW. THIS AGREEMENT shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to conflict of laws principles thereof other than Section 5-1401 of the New York
General Obligations Law.

         SECTION 22. FURTHER ASSURANCES. Each of the parties agrees to execute
and deliver such instruments and take such actions as another party may, from
time to time, reasonably request in order to effectuate the purpose and to carry
out the terms of this Agreement including any amendments hereto which may be
required by either Rating Agency.

         SECTION 23. SUCCESSORS AND ASSIGNS.

         (a)      This Agreement shall bind and inure to the benefit of and be
enforceable by the Mortgage Loan Seller and the Purchaser and their permitted
successors and assigns and, to the extent specified in Section 13 hereof, Bear
Stearns, and their directors, officers and controlling persons (within the
meaning of federal securities laws), to the extent of its rights as a third
party beneficiary hereunder. The Mortgage Loan Seller acknowledges and agrees
that the Purchaser may assign its rights under this Agreement (including,
without limitation, with respect to the Mortgage Loan Seller's representations
and warranties respecting the Mortgage Loans) to the Trustee. Any person into
which the Mortgage Loan Seller may be merged or consolidated (or any person
resulting from any merger or consolidation involving the Mortgage Loan Seller),
any person resulting from a change in form of the Mortgage Loan Seller or any
person succeeding to the business of the Mortgage Loan Seller, shall be
considered the "successor" of the Mortgage Loan Seller hereunder and shall be
considered a party hereto without the execution or filing of any paper or any
further act or consent on the part of any party hereto. Except as provided in
the two preceding sentences, this Agreement cannot be assigned, pledged or
hypothecated by either party hereto without the written consent of the other
parties to this Agreement and any such assignment or purported assignment shall
be deemed null and void.

         SECTION 24. THE MORTGAGE LOAN SELLER. The Mortgage Loan Seller will
keep in full force and effect its existence, all rights and franchises as a
corporation under the laws of the State of its incorporation and will obtain and
preserve its qualification to do business as a

                                       L-25
<PAGE>

foreign corporation in each jurisdiction in which such qualification is
necessary to perform its obligations under this Agreement.

         SECTION 25. ENTIRE AGREEMENT. This Agreement contains the entire
agreement and understanding between the parties with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or written,
of any nature whatsoever with respect to the subject matter hereof.

         SECTION 26. NO PARTNERSHIP. Nothing herein contained shall be deemed or
construed to create a partnership or joint venture between the parties hereto.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       L-26
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective duly authorized officers as of the date first
above written.

                                         EMC MORTGAGE CORPORATION

                                         By:____________________________________
                                         Name:  Sue Stepanek
                                         Title: Executive Vice President

                                         BEAR STEARNS ASSET BACKED
                                         SECURITIES I LLC

                                         By:____________________________________
                                         Name:   Baron Silverstein
                                         Title:  Vice President

<PAGE>

                                    EXHIBIT 1
                            CONTENTS OF MORTGAGE FILE

         With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser or its designee, and which shall be delivered to the Purchaser or its
designee pursuant to the terms of this Agreement.

                  (i)      The original Mortgage Note, including any riders
         thereto, endorsed without recourse to the order of "LaSalle Bank
         National Association", as Trustee for certificateholders of Bear
         Stearns Asset Backed Securities I LLC Asset Backed Certificates, Series
         2004-HE10," and showing to the extent available to the Mortgage Loan
         Seller an unbroken chain of endorsements from the original payee
         thereof to the Person endorsing it to the Trustee;

                  (ii)     the original Mortgage and, if the related Mortgage
         Loan is a MOM Loan, noting the presence of the MIN and language
         indicating that such Mortgage Loan is a MOM Loan, which shall have been
         recorded (or if the original is not available, a copy), with evidence
         of such recording indicated thereon (or if clause (x) in the proviso
         below applies, shall be in recordable form);

                  (iii)    unless the Mortgage Loan is a MOM Loan, the
         assignment (either an original or a copy, which may be in the form of a
         blanket assignment if permitted in the jurisdiction in which the
         Mortgaged Property is located) to the Trustee of the Mortgage with
         respect to each Mortgage Loan in the name of "LaSalle Bank National
         Association", as Trustee for certificateholders of Bear Stearns Asset
         Backed Securities I LLC Asset Backed Certificates, Series 2004-HE10,"
         which shall have been recorded (or if clause (x) in the proviso below
         applies, shall be in recordable form);

                  (iv)     an original or a copy of all intervening assignments
         of the Mortgage, if any, to the extent available to the Mortgage Loan
         Seller, with evidence of recording thereon;

                  (v)      the original policy of title insurance or mortgagee's
         certificate of title insurance or commitment or binder for title
         insurance, if available, or a copy thereof, or, in the event that such
         original title insurance policy is unavailable, a photocopy thereof, or
         in lieu thereof, a current lien search on the related Mortgaged
         Property and

                  (vi)     originals or copies of all available assumption,
         modification or substitution agreements, if any; provided, however,
         that in lieu of the foregoing, the Mortgage Loan Seller may deliver the
         following documents, under the circumstances set forth below: x) if any
         Mortgage, assignment thereof to the Trustee or intervening assignments
         thereof have been delivered or are being delivered to recording offices
         for recording and have not been returned in time to permit their
         delivery as specified above, the Purchaser may deliver a true copy
         thereof with a certification by the Mortgage Loan Seller or the title
         company issuing the commitment for title insurance, on the face of such
         copy, substantially as follows: "Certified to be a true and correct
         copy of the original,

                                     L-1-1
<PAGE>

         which has been transmitted for recording"; and (y) in lieu of the
         Mortgage Notes relating to the Mortgage Loans identified in the list
         set forth in Exhibit J to the Pooling and Servicing Agreement, the
         Purchaser may deliver a lost note affidavit and indemnity and a copy of
         the original note, if available; and provided, further, however, that
         in the case of Mortgage Loans which have been prepaid in full after the
         Cut-Off Date and prior to the Closing Date, the Purchaser, in lieu of
         delivering the above documents, may deliver to the Trustee and its
         related Custodian a certification of a Servicing Officer to such effect
         and in such case shall deposit all amounts paid in respect of such
         Mortgage Loans, in the Protected Account or in the Distribution Account
         on the Closing Date. In the case of the documents referred to in clause
         (x) above, the Purchaser shall deliver such documents to the Trustee or
         its related Custodian promptly after they are received. The Mortgage
         Loan Seller shall cause, at its expense, the Mortgage and intervening
         assignments, if any, and to the extent required in accordance with the
         foregoing, the assignment of the Mortgage to the Trustee to be
         submitted for recording promptly after the Closing Date; provided that
         the Mortgage Loan Seller need not cause to be recorded any assignment
         (a) in any jurisdiction under the laws of which, as evidenced by an
         Opinion of Counsel addressed to the Trustee delivered by the Mortgage
         Loan Seller to the Trustee and the Rating Agencies, the recordation of
         such assignment is not necessary to protect the Trustee's interest in
         the related Mortgage Loan or (b) if MERS is identified on the Mortgage
         or on a properly recorded assignment of the Mortgage as mortgagee of
         record solely as nominee for Mortgage Loan Seller and its successors
         and assigns. In the event that the Mortgage Loan Seller, the Purchaser
         or the Master Servicer gives written notice to the Trustee that a court
         has recharacterized the sale of the Mortgage Loans as a financing, the
         Mortgage Loan Seller shall submit or cause to be submitted for
         recording as specified above or, should the Mortgage Loan Seller fail
         to perform such obligations, the Master Servicer shall cause each such
         previously unrecorded assignment to be submitted for recording as
         specified above at the expense of the Trust. In the event a Mortgage
         File is released to the Mortgage Loan Seller or the Master Servicer as
         a result of such Person having completed a Request for Release, the
         related Custodian shall, if not so completed, complete the assignment
         of the related Mortgage in the manner specified in clause (iii) above.

                                       L-1-2
<PAGE>

                                    EXHIBIT 2
                       MORTGAGE LOAN SCHEDULE INFORMATION
                       ----------------------------------

         The Preliminary and Final Mortgage Loan Schedules shall set forth the
following information with respect to each Mortgage Loan:

                  (i)      the loan number;

                  (ii)     the Mortgage Rate in effect as of the Cut-off Date;

                  (iii)    the Servicing Fee Rate;

                  (iv)     the Trustee Fee Rate;

                  (v)      the LPMI Fee, if applicable;

                  (vi)     the Net Mortgage Rate in effect as of the Cut-off
         Date;

                  (vii)    the maturity date;

                  (viii)   the original principal balance;

                  (ix)     the Cut-off Date Principal Balance;

                  (x)      the original term;

                  (xi)     the remaining term;

                  (xii)    the property type;

                  (xiii)   the MIN with respect to each MOM Loan;

                  (xiv)    with respect to each Adjustable Rate Mortgage Loan,
         the Minimum Mortgage Rate;

                  (xv)     with respect to each Adjustable Rate Mortgage Loan,
         the Maximum Mortgage Rate;

                  (xvi)    with respect to each Adjustable Rate Mortgage Loan,
         the Gross Margin;

                  (xvii)   with respect to each Adjustable Rate Mortgage Loan,
         the next Adjustment Date;

                  (xviii)  with respect to each Adjustable Rate Mortgage Loan,
         the Periodic Rate Cap; and

                                       L-2-1
<PAGE>

                  (xxv)    the Loan Group; and

                  (xxvi)   a code indicating whether such Mortgage Loan is a
         first lien Mortgage Loan or a second lien Mortgage Loan.

                                       L-2-2
<PAGE>

                                    EXHIBIT 3
                       MORTGAGE LOAN SELLER'S INFORMATION
                       ----------------------------------

         All information in the Prospectus Supplement described under the
following captions: "SUMMARY -- The Mortgage Loans," "THE MORTGAGE POOL" and
"SCHEDULE A -- Mortgage Loan Statistical Data."

                                      L-3-1

<PAGE>

                                    EXHIBIT 4
                             PURCHASER'S INFORMATION
                             -----------------------

         All information in the Prospectus Supplement and the Prospectus, except
the Mortgage Loan Seller's Information.

                                      L-4-1

<PAGE>

                                    EXHIBIT 5
                             SCHEDULE OF LOST NOTES
                             ----------------------

                             Available Upon Request

                                      L-5-1

<PAGE>

                                    EXHIBIT 6

                                                     REVISED OCTOBER 18, 2004

         APPENDIX E - STANDARD & POOR'S ANTI-PREDATORY LENDING CATEGORIZATION

Standard & Poor's has categorized loans governed by anti-predatory lending laws
in the Jurisdictions listed below into three categories based upon a combination
of factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note that
certain loans classified by the relevant statute as Covered are included in
Standard & Poor's High Cost Loan Category because they included thresholds and
tests that are typical of what is generally considered High Cost by the
industry.

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
Arkansas                Arkansas  Home Loan  Protection Act, Ark. Code      High Cost Home Loan
                        Ann. ss.ss. 23-53-101 et seq.

                        Effective July 16, 2003
---------------------   -------------------------------------------------   --------------------------------
Cleveland Heights, OH   Ordinance  No.  72-2003 (PSH), Mun. Code  ss.ss.    Covered Loan
                        757.01 et seq.

                        Effective June 2, 2003
---------------------   -------------------------------------------------   --------------------------------
Colorado                Consumer Equity Protection, Colo. Stat. Ann.        Covered Loan
                        ss.ss. 5-3.5-101 et seq.

                        Effective for covered loans offered or entered
                        into  on  or  after   January  1,  2003.   Other
                        provisions  of the Act  took  effect  on June 7,
                        2002
---------------------   -------------------------------------------------   --------------------------------
Connecticut             Connecticut  Abusive Home Loan Lending Practices    High Cost Home Loan
                        Act, Conn. Gen. Stat. ss.ss. 36a-746 et seq.

                        Effective October 1, 2001
---------------------   -------------------------------------------------   --------------------------------
District of Columbia    Home  Loan   Protection   Act,   D.C.               Covered Loan
                        Code  ss.ss. 26-1151.01 et seq.

                        Effective for loans closed on or after January
                        28, 2003
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

                                      L-6-1

<PAGE>
<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
Florida                 Fair Lending Act,  Fla.  Stat.  Ann. ss.ss.         High Cost Home Loan
                        494.0078 et seq.

                        Effective October 2, 2002
---------------------   -------------------------------------------------   --------------------------------
Georgia (Oct.  1,       Georgia  Fair  Lending  Act, Ga. Code Ann. ss.ss.   High Cost Home Loan
2002 - Mar. 6, 2003)    7-6A-1 et seq.

                        Effective October 1, 2002 - March 6, 2003
---------------------   -------------------------------------------------   --------------------------------
Georgia as amended      Georgia  Fair  Lending  Act, Ga.  Code Ann. ss.ss.  High Cost Home Loan
(Mar. 7, 2003           7-6A-1 et seq.
- current)
                        Effective  for loans closed on or after March 7,
                        2003
---------------------   -------------------------------------------------   --------------------------------
HOEPA Section 32        Home  Ownership  and  Equity  Protection  Act of    High Cost Loan
                        1994, 15 U.S.C. ss. 1639, 12 C.F.R.  ss.ss. 226.32
                        and 226.34

                        Effective October 1, 1995, amendments October
                        1, 2002
---------------------   -------------------------------------------------   --------------------------------
Illinois                High Risk Home Loan Act, Ill. Comp.  Stat.  tit.    High Risk Home Loan
                        815, ss.ss. 137/5 et seq.

                        Effective  January 1, 2004  (prior to this date,
                        regulations under  Residential  Mortgage License
                        Act effective from May 14, 2001)
---------------------   -------------------------------------------------   --------------------------------
Indiana                 Indiana Home Loan  Practices Act, Ind. Code Ann.    High Cost Home Loan
                        ss.ss. 24-9-1-1 et seq.

                        Effective for loans originated on or after
                        January 1, 2005.
---------------------   -------------------------------------------------   --------------------------------
Kansas                  Consumer   Credit  Code, Kan. Stat. Ann.  ss.ss.    High  Loan  to  Value  Consumer
                        16a-1-101 et seq.                                   Loan (id. ss. 16a-3-207) and;
                                                                            ---------------------------------
                        Sections 16a-1-301 and 16a-3-207 became             High APR  Consumer  Loan (id. ss.
                        effective April 14, 1999; Section 16a-3-308a        16a-3-308a)
                        became effective July 1, 1999
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

                                      L-6-2
<PAGE>

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
Kentucky                2003 KY H.B.  287 - High Cost Home Loan Act, Ky.    High Cost Home Loan
                        Rev. Stat. ss.ss. 360.100 et seq.

                        Effective June 24, 2003
---------------------   -------------------------------------------------   --------------------------------
Maine                   Truth in Lending,  Me. Rev. Stat. tit. 9-A, ss.ss.  High Rate High Fee Mortgage
                        8-101 et seq.

                        Effective September 29, 1995 and as amended
                        from time to time
---------------------   -------------------------------------------------   --------------------------------
Massachusetts           Part 40 and  Part  32, 209 C.M.R. ss.ss. 32.00 et   High Cost Home Loan
                        seq. and 209 C.M.R. ss.ss. 40.01 et seq.

                        Effective  March 22, 2001 and amended  from time
                        to time
---------------------   -------------------------------------------------   --------------------------------
                        Massachusetts Predatory Home Loan Practices Act     High Cost Home Mortgage Loan
                        Mass. Gen. Laws ch. 183C,  ss.ss. 1 et seq.

                        Effective November 7, 2004
---------------------   -------------------------------------------------   --------------------------------
Nevada                  Assembly  Bill  No.  284, Nev. Rev. Stat. ss.ss.    Home Loan
                        598D.010 et seq.

                        Effective October 1, 2003
---------------------   -------------------------------------------------   --------------------------------
New Jersey              New Jersey Home Ownership  Security Act of 2002,    High Cost Home Loan
                        N.J. Rev. Stat. ss.ss. 46:10B-22 et seq.

                        Effective for loans closed on or after November
                        27, 2003
---------------------   -------------------------------------------------   --------------------------------
New Mexico              Home Loan  Protection  Act, N.M. Rev. Stat. ss.ss.  High Cost Home Loan
                        58-21A-1 et seq.

                        Effective as of January 1, 2004; Revised as of
                        February 26, 2004
---------------------   -------------------------------------------------   --------------------------------
New York                N.Y. Banking Law Article 6-l                        High Cost Home Loan

                        Effective for applications made on or after
                        April 1, 2003
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

                                      L-6-3
<PAGE>

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
North Carolina          Restrictions  and  Limitations on High Cost Home    High Cost Home Loan
                        Loans, N.C. Gen. Stat. ss.ss. 24-1.1E et seq.

                        Effective July 1, 2000; amended October 1,
                        2003 (adding open-end lines of credit)
---------------------   -------------------------------------------------   --------------------------------
Ohio                     H.B. 386  (codified  in various  sections of the   Covered Loan
                        Ohio Code), Ohio Rev. Code Ann. ss.ss. 1349.25 et
                        seq.

                        Effective May 24, 2002
---------------------   -------------------------------------------------   --------------------------------
Oklahoma                Consumer   Credit  Code   (codified  in  various    Subsection 10 Mortgage
                        sections of Title 14A)

                        Effective July 1, 2000; amended effective
                        January 1, 2004
---------------------   -------------------------------------------------   --------------------------------
South Carolina          South  Carolina  High  Cost  and  Consumer  Home    High Cost Home Loan
                        Loans Act, S.C. Code Ann. ss.ss. 37-23-10 et seq.

                        Effective for loans taken on or after January
                        1, 2004
---------------------   -------------------------------------------------   --------------------------------
West Virginia           West  Virginia   Residential   Mortgage  Lender,    West  Virginia   Mortgage  Loan
                        Broker and  Servicer Act, W. Va. Code Ann. ss.ss.   Act Loan
                        31-17-1 et seq.

                        Effective June 5, 2002
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
Georgia  (Oct.  1,      Georgia  Fair  Lending Act, Ga. Code Ann. ss.ss.    Covered Loan
2002 - Mar. 6, 2003)    7-6A-1 et seq.
---------------------   -------------------------------------------------   --------------------------------

</TABLE>

                                      L-6-4

<PAGE>

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
                        Effective October 1, 2002 - March 6, 2003
---------------------   -------------------------------------------------   --------------------------------
New Jersey              New Jersey Home Ownership  Security Act of 2002,    Covered Home Loan
                        N.J. Rev. Stat. ss.ss. 46:10B-22 et seq.

                        Effective November 27, 2003 - July 5, 2004
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
Georgia  (Oct.  1,      Georgia  Fair  Lending Act, Ga. Code Ann. ss.ss.    Home Loan
2002 - Mar. 6, 2003)    7-6A-1 et seq.

                        Effective October 1, 2002 - March 6, 2003
---------------------   -------------------------------------------------   --------------------------------
Indiana                 Indiana Home Loan  Practices Act, Ind. Code Ann.    Home Loan
                        ss.ss. 24-9-1-1 et seq.

                        Effective for loans originated on or after
                        January 1, 2005.
---------------------   -------------------------------------------------   --------------------------------
New Jersey              New Jersey Home Ownership  Security Act of 2002,    Home Loan
                        N.J. Rev. Stat. ss.ss. 46:10B-22 et seq.

                        Effective for loans closed on or after November
                        27, 2003
---------------------   -------------------------------------------------   --------------------------------
New Mexico              Home Loan  Protection Act, N.M. Rev. Stat. ss.ss.   Home Loan
                        58-21A-1 et seq.

                        Effective as of January 1, 2004; Revised as of
                        February 26, 2004
---------------------   -------------------------------------------------   --------------------------------
North Carolina          Restrictions  and  Limitations on High Cost Home    Consumer Home Loan
                        Loans, N.C. Gen. Stat. ss.ss. 24-1.1E et seq.

                        Effective July 1, 2000; amended October 1,
                        2003 (adding open-end lines of credit)
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

                                      L-6-5
<PAGE>

<TABLE>
<CAPTION>
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
------------------------------------------------------------------------------------------------------------
State/Jurisdiction      Name of Anti-Predatory                              Category under Applicable
                        Lending Law/Effective Date                          Anti-Predatory Lending Law
---------------------   -------------------------------------------------   --------------------------------
<S>                     <C>                                                 <C>
South Carolina          South Carolina High Cost and Consumer Home           Consumer Home Loan
                        Loans Act, S.C. Code Ann. ss.ss. 37-23-10
                        ET SEQ. Effective for loans taken on or
                        after January 1, 2004
---------------------   -------------------------------------------------   --------------------------------
</TABLE>

                                      L-6-6
<PAGE>

                                   SCHEDULE A

                 REQUIRED RATINGS FOR EACH CLASS OF CERTIFICATES

                               PUBLIC CERTIFICATES
                               --------------------
                 Class                     S&P                     Moody's
              ----------                 -------                  ----------
                 I-A-1                     AAA                       Aaa
                 I-A-2                     AAA                       Aaa
                 I-A-3                     AAA                       Aaa
                II-A-1                     AAA                       Aaa
                II-A-2                     AAA                       Aaa
                  M-1                      AA                        Aa2
                  M-2                       A                         A2
                  M-3                      A-                         A3
                  M-4                     BBB+                       Baa1
                  M-5                      BBB                       Baa2
                  M-6                     BBB-                       Baa3

                              PRIVATE CERTIFICATES
                              --------------------

                 Class                S&P                Moody's
              ----------            -------             ----------
                  M-7                 BB+                  Ba2
                  CE               Not Rated            Not Rated
                   P               Not Rated            Not Rated
                  R-1              Not Rated            Not Rated
                  R-2              Not Rated            Not Rated
                  RX               Not Rated            Not Rated

None of the above ratings has been lowered, qualified or withdrawn since the
dates of issuance of such ratings by the Rating Agencies.

                                      L-A-1
<PAGE>

                                    EXHIBIT M

                 NOTIONAL BALANCE SCHEDULE AND CAP RATE SCHEDULE

<TABLE>
<CAPTION>
                                                                             CAP RATE OF
                     NOTIONAL BALANCE    CAP RATE OF     NOTIONAL BALANCE    CLASS II-A    NOTIONAL BALANCE   CAP RATE OF
                       OF CLASS I-A    CLASS I-A YIELD     OF CLASS II-A        YIELD      OF CLASS M YIELD  CLASS M YIELD
     MONTH OF       YIELD MAINTENANCE    MAINTENANCE     YIELD MAINTENANCE   MAINTENANCE     MAINTENANCE      MAINTENANCE
DISTRIBUTION DATE       AGREEMENT         AGREEMENT          AGREEMENT        AGREEMENT       AGREEMENT        AGREEMENT
-----------------   -----------------  ---------------   -----------------   -----------   ----------------  -------------
<S>                     <C>                    <C>         <C>                    <C>        <C>                   <C>
December 2004....       $225,923,596.41        6.95%       $252,183,398.30        6.70%      $113,942,000.00       4.95%
January 2005.....        222,299,557.17        6.95         248,254,304.92        6.70        113,942,000.00       4.95
February 2005....        218,165,479.42        6.95         243,749,548.45        6.70        113,942,000.00       4.95
March 2005.......        213,531,798.47        6.95         238,680,170.42        6.70        113,942,000.00       4.95
April 2005.......        208,415,915.05        6.95         233,060,446.29        6.70        113,942,000.00       4.95
May 2005.........        202,843,562.70        6.95         226,907,879.51        6.70        113,942,000.00       4.95
June 2005........        196,833,266.37        6.95         220,247,116.69        6.70        113,942,000.00       4.95
July 2005........        190,407,345.17        6.95         213,111,658.41        6.70        113,942,000.00       4.95
August 2005......        183,910,616.91        6.95         205,758,203.97        6.70        113,942,000.00       4.95
September 2005...        177,562,638.37        6.95         198,587,478.26        6.70        113,942,000.00       4.95
October 2005.....        171,377,937.78        6.95         191,603,683.43        6.70        113,942,000.00       4.95
November 2005....        165,352,933.17        6.95         184,801,967.99        6.70        113,942,000.00       4.95
December 2005....        159,483,517.07        6.95         178,177,606.02        6.70        113,942,000.00       4.95
January 2006.....        153,765,687.43        6.95         171,725,993.89        6.70        113,942,000.00       4.95
February 2006....        148,195,544.84        6.95         165,442,647.09        6.70        113,942,000.00       4.95
March 2006.......        142,769,289.98        6.95         159,323,197.17        6.70        113,942,000.00       4.95
April 2006.......        137,483,221.01        6.95         153,363,388.76        6.70        113,942,000.00       4.95
May 2006.........        132,333,731.07        6.95         147,559,076.60        6.70        113,942,000.00       4.95
June 2006........        127,317,305.87        6.95         141,906,222.75        6.70        113,942,000.00       4.95
July 2006........        122,430,521.32        6.95         136,400,893.78        6.70        113,942,000.00       4.95
August 2006......        117,667,480.62        6.95         131,027,210.02        6.70        113,942,000.00       4.95
September 2006...        113,040,263.17        6.95         125,817,146.29        8.50        113,942,000.00       4.95
October 2006.....        108,532,394.35        8.50         120,742,778.98        8.50        113,942,000.00       4.95
November 2006....        104,140,809.02        8.50         115,800,591.18        8.50        113,942,000.00       4.95
December 2006....         99,862,520.51        8.50         110,987,156.83        8.50        113,942,000.00       4.95
January 2007.....         95,694,618.69        8.50         106,299,138.40        8.50        113,942,000.00       4.95
February 2007....                                                                             113,942,000.00       4.95
March 2007.......                                                                             113,942,000.00       4.95
April 2007.......                                                                             113,942,000.00       4.95
May 2007.........                                                                             113,942,000.00       4.95
June 2007........                                                                             113,942,000.00       4.95
July 2007........                                                                             113,942,000.00       4.95
August 2007......                                                                             113,942,000.00       4.95
September 2007...                                                                             113,942,000.00       4.95
October 2007.....                                                                             113,942,000.00       4.95
November 2007....                                                                             113,942,000.00       4.95
December 2007....                                                                             110,061,263.10       4.95
January 2008.....                                                                             103,901,940.66       4.95
February 2008....                                                                              97,902,558.58       4.95
</TABLE>

                                       M-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00075-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00075-of-00352.parquet"}]]