Document:

Exhibit 4.2

                                                             Execution Version

                            Dated 19 January 2005

                              NORTHERN ROCK PLC
                  as Seller, Cash Manager and a Beneficiary

                       GRANITE FINANCE TRUSTEES LIMITED
                             as Mortgages Trustee

                       GRANITE FINANCE FUNDING LIMITED
                         as Funding and a Beneficiary

                                   - and -

                      GRANITE FINANCE FUNDING 2 LIMITED
                        as Funding 2 and a Beneficiary

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                                TENTH AMENDED
                             MORTGAGES TRUST DEED

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                          SIDLEY AUSTIN BROWN & WOOD
                              WOOLGATE EXCHANGE
                             25 BASINGHALL STREET
                               LONDON, EC2V 5HA
                           TELEPHONE 020 7360 3600
                           FACSIMILE 020 7626 7937
                            REF:30507-30040/677664

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                                   CONTENTS

1.    Definitions and Construction............................................2

2.    Creation of Mortgages Trust.............................................2

3.    Conditions Precedent....................................................4

4.    Consideration...........................................................5

5.    Increasing and Decreasing the Seller Share of the Trust
      Property...............................................................10

6.    Increasing the Funding Share and the Funding 2 Share of the Trust
      Property...............................................................11

7.    Initial Funding Share, Initial Seller Share and Initial Funding 2
      Share..................................................................14

8.    Adjustment of Funding Share Percentage, Funding 2 Share Percentage
      and Seller Share Percentage............................................15

9.    Minimum Seller Share...................................................29

10.   Distribution of Revenue Receipts.......................................30

11.   Distribution of Principal Receipts.....................................33

12.   Allocation of Losses...................................................38

13.   Overpayments...........................................................39

14.   Arrears................................................................39

15.   Ledgers................................................................39

16.   Fees and Expenses of the Mortgages Trustee.............................40

17.   Beneficiary Directions.................................................41

18.   Early Termination of the Mortgages Trust...............................43

19.   Audit of Mortgage Loans Constituting the Trust Property................43

20.   Transfers..............................................................43

21.   Representations and Covenants..........................................44

22.   Power to Delegate......................................................45

23.   Power of Investment....................................................45

24.   Other Provisions Regarding the Mortgages Trustee.......................46

25.   No Retirement of Mortgages Trustee.....................................47

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26.   Termination............................................................47

27.   Further Assurances.....................................................48

28.   No Partnership or Agency...............................................48

29.   Calculations...........................................................48

30.   Confidentiality........................................................48

31.   Non Petition Covenant; Limited Recourse................................49

32.   Amendments and Waiver..................................................50

33.   Notices................................................................51

34.   Third Party Rights.....................................................52

35.   Execution in Counterparts; severability................................52

36.   Governing Law and Submission to Jurisdiction...........................52

SCHEDULE 1 REPRESENTATIONS AND WARRANTIES....................................54

                                      ii
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THIS MORTGAGES TRUST DEED WAS MADE ON 26 MARCH 2001 AND AMENDED AND RESTATED
PURSUANT TO THE DEEDS OF AMENDMENT AND RESTATEMENT DATED 23 JULY 2001, 28
SEPTEMBER 2001, 20 MARCH 2002, 23 SEPTEMBER 2002, 27 JANUARY 2003, 21 MAY
2003, 24 SEPTEMBER 2003, 26 JANUARY 2004, 26 MAY 2004 AND 19 JANUARY 2005
BETWEEN:

(1)      NORTHERN ROCK PLC (registered number 03273685), a public limited
         company incorporated under the laws of England and Wales whose
         registered office is at Northern Rock House, Gosforth, Newcastle upon
         Tyne NE3 4PL, in its capacity as Seller, in its capacity as Cash
         Manager and in its capacity as a Beneficiary;

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

(3)      GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
         limited company incorporated under the laws of Jersey, but acting out
         of its office established in England (registered overseas company
         number FC022999 and branch number BR005916) at 69 Park Lane, Croydon,
         CR9 1TQ, in its capacity as a Beneficiary; and

(4)      GRANITE FINANCE FUNDING 2 LIMITED (registered number 5249387), a
         private limited company incorporated under the laws of England and
         Wales, whose registered office is at Fifth Floor, 100 Wood Street,
         London EC2V 7EX, in its capacity as a Beneficiary.

WHEREAS:

(A)      The Mortgages Trustee wishes to declare the following trusts in
         respect of the Trust Property (being on 26 March, 2001, the sum of
         (GBP)100 which monies have been received by and are presently held by
         the Mortgages Trustee or to its order).

(B)      The Mortgages Trustee (acting as principal and not as agent of any
         party) has agreed to hold the Trust Property as bare trustee for the
         Beneficiaries upon, with and subject to the trusts, powers and
         provisions of this Deed. The Mortgages Trustee will receive amounts
         arising from the Trust Property and will distribute such amounts for
         the benefit of the Beneficiaries of the Mortgages Trust. It will
         delegate certain tasks in relation to the Mortgages Trust to the
         Administrator and the Cash Manager.

(C)      The Seller carries on the business of, inter alia, originating
         residential mortgage loans to individual Borrowers in England, Wales
         and Scotland and of managing and administering such mortgage loans.
         The Seller intends to sell and assign from time to time portfolios of
         such mortgage loans to the Mortgages Trustee pursuant to the Mortgage
         Sale Agreement entered into on or about 26 March 2001 (as the same
         have been and may be amended, varied or supplemented from time to
         time), which mortgage loans shall be held by the Mortgages Trustee as
         bare trustee for the Beneficiaries upon, with and subject to the
         trusts, powers and provisions of this Deed.

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NOW THIS DEED WITNESSES:

1.       DEFINITIONS AND CONSTRUCTION

1.1      The provisions of the Programme Master Definitions Schedule signed
         for identification purposes by Sidley Austin Brown & Wood and Allen &
         Overy LLP on 19 January, 2005 (as the same have been and may be
         amended, varied or supplemented from time to time with the consent of
         the parties hereto) are expressly and specifically incorporated into
         and shall apply to this Deed.

2.       CREATION OF MORTGAGES TRUST

2.1      Initial Trust Property

         The Mortgages Trustee hereby declares itself as trustee of the Trust
         Property, being, upon execution of this Deed, the sum of (GBP)100
         (one hundred pounds) (the "Initial Trust Property") which sum shall
         be held on trust by the Mortgages Trustee absolutely as to both
         capital and income for the benefit, as tenants in common (holding
         undivided beneficial interests), of the Seller as to the Initial
         Seller Share Percentage and Funding as to the Initial Funding Share
         Percentage. The Initial Trust Property shall be held by the Mortgages
         Trustee on the Mortgages Trust upon due execution of this Deed by all
         parties to it.

2.2      Closing Trust Property

         Pursuant to the provisions of the Mortgage Sale Agreement, the Seller
         intends to sell and assign the Initial Mortgage Portfolio to the
         Mortgages Trustee on the Initial Closing Date, which Initial Mortgage
         Portfolio including all related rights and benefits shall form part
         of the Trust Property (the "Closing Trust Property").

2.3      New Trust Property

         From time to time and pursuant to the Mortgage Sale Agreement, the
         Seller intends to sell and assign New Mortgage Portfolios to the
         Mortgages Trustee, which New Mortgage Portfolios including all
         related rights and benefits shall form part of the Trust Property
         (the "New Trust Property").

2.4      Other Trust Property

         (A)      In accordance with this Deed, from time to time Funding and
                  the Seller shall, subject to and in accordance with Clause 4
                  (Consideration), Clause 5 (Increasing and Decreasing the
                  Seller Share of the Trust Property) and/or Clause 6
                  (Increasing the Funding Share and the Funding 2 Share of the
                  Trust Property) provide consideration to the Mortgages
                  Trustee in the form of Contributions to be applied by the
                  Mortgages Trustee as set out in this Deed. Any Contribution
                  so provided to the Mortgages Trustee shall, on receipt by
                  the Mortgages Trustee and until it has been applied by the
                  Mortgages Trustee in accordance with the terms of this Deed,
                  form part of the Trust Property.

         (B)      Any Re-draws made under a Flexible Mortgage Loan which is
                  included in the Trust Property will also form part of the
                  Trust Property.

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         (C)      Amounts on deposit (and interest earned on such amounts)
                  from time to time in the Mortgages Trustee Bank Accounts
                  will also form part of the Trust Property.

         (D)      If the Seller subsequently decides not to repurchase any
                  Mortgage Loan (which is the subject of a Further Advance)
                  within the Trust Property and/or to sell and assign the
                  Further Advance to the Mortgages Trustee in accordance with
                  the Mortgage Sale Agreement, any Further Advance made in
                  respect of a Mortgage Loan in the Trust Property will also
                  form part of the Trust Property.

         (E)      Any Permitted Replacement Mortgage Loan and its Related
                  Security (including the rights under any related MIG Policy
                  and other insurance policies arranged by the Seller, but
                  excluding any Early Repayment Charge Receipts paid to the
                  Seller) relating to a Permitted Product Switch effected in
                  relation to a Mortgage Loan which forms part of the Trust
                  Property will also form part of the Trust Property.

         (F)      The proceeds of sale of any Mortgage Loan and its Related
                  Security forming part of the Trust Property pursuant to the
                  Mortgage Sale Agreement or other proceeds of sale of any
                  Trust Property will also form part of the Trust Property.

         (G)      Any Further Draws under a Personal Secured Loan which is
                  included in the Trust Property will also form part of the
                  Trust Property.

2.5      Payments of Early Repayment Charges

         Subject to and in accordance with the Mortgage Sale Agreement, the
         Mortgages Trustee will agree to pay to the Seller any Early Repayment
         Charge Receipts received by the Mortgages Trustee in respect of any
         Mortgage Loan included in the Initial Mortgage Portfolio or any New
         Mortgage Portfolio which the Seller sells and assigns to the
         Mortgages Trustee. Upon any such payment to the Seller, the benefit
         of such Early Repayment Charges will no longer form part of the Trust
         Property.

2.6      Trust Property/Declaration of Trust

         Subject to Clause 3 (Conditions Precedent), the Mortgages Trustee
         shall hold the Trust Property as to both capital and income on trust
         absolutely for Funding, Funding 2 and for the Seller as tenants in
         common upon, with and subject to all the trusts, powers and
         provisions of this Deed (such that each Beneficiary shall have an
         undivided beneficial interest in the Trust Property). For the
         purposes of Clause 2.1 (Initial Trust Property) to Clause 2.6 (Trust
         Property/Declaration of Trust) (inclusive), "Trust Property" means
         the Initial Trust Property, the Closing Trust Property, any New Trust
         Property (but excludes any Early Repayment Charge Receipts which have
         been paid to the Seller and any Mortgage Loans which have been
         purchased or repurchased (as applicable) by the Seller pursuant to
         the Mortgage Sale Agreement) and all Other Trust Property referred to
         under Clause 2.4 (Other Trust Property) less (a) any actual Losses in
         relation to Mortgage Loans and any actual redemptions occurring in
         respect of the Mortgage Loans as described in Clause 8.5 (Adjustments
         to Trust Property) and (b) distributions of principal made from time
         to time to the Beneficiaries.

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2.7      Additional Trust Property/Declaration of Trust

         With effect on and from the Funding 2 Programme Date, the Mortgages
         Trustee hereby declares itself as trustee of all rights, title,
         interest and benefit of all property and assets held by it at any
         time (to the extent that such rights, title, interest and benefit in
         such property and assets do not form part of the Initial Trust
         Property, the Closing Trust Property, the New Trust Property and/or
         any Trust Property referred to in Clause 2.4 (Other Trust Property))
         which rights, title, interest and benefit (the "Additional Trust
         Property") shall be held on trust by the Mortgages Trustee absolutely
         as to both capital and income for the benefit of the Seller, Funding
         and Funding 2 as tenants in common upon, with and subject to all of
         the trusts, powers and provisions of this Deed (such that each
         Beneficiary shall have an individual beneficial interest in the
         Additional Trust Property).

2.8      Funding 2 Contributions

         The consideration in the form of Contributions provided by Funding 2
         to the Mortgages Trustee subject to and in accordance with Clause 4
         (Consideration) and/or Clause 6 (Increasing the Funding Share and the
         Funding 2 Share of the Trust Property) to be applied by the Mortgages
         Trustee as set out in this Deed shall, until such Contributions form
         part of the Trust Property referred to in Clause 2.4 (Other Trust
         Property), form part of Additional Trust Property.

3.       CONDITIONS PRECEDENT

3.1      Closing Trust Property

         The Closing Trust Property shall be held by the Mortgages Trustee on
         the Mortgages Trust subject to satisfaction of the following
         conditions precedent:

         (A)      the due execution and delivery of the Mortgage Sale
                  Agreement by all parties to it;

         (B)      the due execution and delivery of this Deed by all parties
                  to it on the Initial Closing Date;

         (C)      the satisfaction or waiver in accordance with the terms of
                  the Mortgage Sale Agreement of the conditions to the sale
                  and assignment of the Initial Mortgage Portfolio as set out
                  in Clause 2 (Sale and Purchase of Initial Mortgage
                  Portfolio) and Clause 3 (Initial Closing Date) of the
                  Mortgage Sale Agreement;

         (D)      the payment by Funding to the Mortgages Trustee of Funding's
                  Initial Contribution for the Initial Funding Share
                  Percentage in accordance with Clause 4 (Consideration); and

         (E)      the payment by the Mortgages Trustee to the Seller of the
                  Initial Purchase Price for the sale and assignment to the
                  Mortgages Trustee of the Initial Mortgage Portfolio.

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3.2      New Trust Property

         Subject to the satisfaction or waiver, in accordance with the terms
         of the Mortgage Sale Agreement, of the conditions referred to in
         Clause 4 (Sale and Purchase of New Mortgage Loan Portfolios) of the
         Mortgage Sale Agreement for the transfer of New Mortgage Loan
         Portfolios to the Mortgages Trustee, any New Trust Property sold and
         assigned to the Mortgages Trustee, shall be held by the Mortgages
         Trustee on the Mortgages Trust .

3.3      Funding 2 Share

         The requirement for the Mortgages Trustee to hold the Trust Property
         on trust for Funding 2 shall be subject to and conditional upon the
         acquisition by Funding 2, by way of assignment, from the Seller of a
         portion of the Seller's beneficial interest in the Mortgages Trust in
         accordance with the terms of the Seller (Mortgages Trust) Assignment
         Agreement.

4.       CONSIDERATION

4.1      Consideration provided by Seller

         The Seller in its capacity as a Beneficiary shall provide
         consideration to the Mortgages Trustee for the Seller Share in the
         Trust Property:

         (A)      on the Initial Closing Date, by selling and assigning to the
                  Mortgages Trustee the Initial Mortgage Portfolio upon
                  payment by the Mortgages Trustee to the Seller of the
                  Initial Purchase Price for the Initial Mortgage Portfolio in
                  accordance with the terms of the Mortgage Sale Agreement;

         (B)      on each date after the Initial Closing Date on which (i) New
                  Mortgage Loans are acquired by the Mortgages Trustee from
                  the Seller in accordance with the Mortgage Sale Agreement
                  and (ii) the consideration provided to the Seller for that
                  sale is or includes the covenant of the Mortgages Trustee to
                  hold the Trust Property on trust for Funding, the Seller
                  and, upon the acquisition by Funding 2, by way of
                  assignment, from the Seller of a portion of the Seller's
                  beneficial interest in the Mortgages Trust in accordance
                  with the terms of the Seller (Mortgages Trust) Assignment
                  Agreement, Funding 2, in accordance with the terms of this
                  Deed, by the sale on such date by the Seller of such New
                  Mortgage Loans either for the payment by the Mortgages
                  Trustee of the Initial Purchase Price paid on such date or
                  (if no Initial Purchase Price is paid) without payment on
                  such date; and

         (C)      on each date on which the Seller increases the Seller Share
                  of the Trust Property in accordance with Clause 5
                  (Increasing and Decreasing the Seller Share of the Trust
                  Property) below, the Seller will pay the consideration to
                  the Mortgages Trustee specified in that Clause.

4.2      Consideration provided by Funding

         Funding in its capacity as a Beneficiary shall provide consideration
         to the Mortgages Trustee for the Funding Share of the Trust Property:

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         (A)      on the Initial Closing Date, by paying to the Mortgages
                  Trustee the Initial Contribution in respect of the Closing
                  Trust Property which shall be equal to (and from which the
                  Mortgages Trustee shall or shall procure that the Cash
                  Manager on its behalf shall pay) the Initial Purchase Price
                  in respect of the Initial Mortgage Portfolio payable by the
                  Mortgages Trustee to the Seller pursuant to the Mortgage
                  Sale Agreement on such date;

         (B)      on each Distribution Date, by paying to the Mortgages
                  Trustee a Deferred Contribution equal to the amount (if any)
                  of:

                  (1)      Mortgages Trustee Available Revenue Receipts to
                           which Funding is entitled on such date in
                           accordance with paragraph (D)(i) of Clause 10.2
                           (Distribution of Mortgages Trustee Available
                           Revenue Receipts); and

                  (2)      the Funding Proportion of the amount of any Early
                           Repayment Charge Receipts payable by the Mortgages
                           Trustee to the Seller under the Mortgage Sale
                           Agreement.

                  The amounts listed under sub-clauses (B)(1) and (B)(2) are,
                  together, referred to as the "Funding Relevant
                  Distribution". The Funding Relevant Distribution and the
                  Funding 2 Relevant Distribution (as defined in Clause 4.3(A)
                  below) are calculated as at such Distribution Date, and
                  shall be equal to (and from which the Mortgages Trustee
                  shall or shall procure that the Cash Manager on its behalf
                  shall pay) such amount of Deferred Purchase Price as is
                  payable by the Mortgages Trustee to the Seller pursuant to
                  the Mortgage Sale Agreement on such date. The parties to
                  this Deed agree that on any Distribution Date, the Funding
                  Relevant Distribution and the Deferred Contribution payable
                  by Funding (as calculated pursuant to this sub-clause (B))
                  to the Mortgages Trustee shall be set off against each other
                  such that, as between the Mortgages Trustee and Funding, no
                  amount shall be payable in respect of such Funding Relevant
                  Distribution or such Deferred Contribution on such date and
                  the Cash Manager on behalf of the Mortgages Trustee shall
                  pay to the Seller (in satisfaction (in part) of the
                  Mortgages Trustee's obligation to pay Deferred Purchase
                  Price to the Seller under the Mortgage Sale Agreement) those
                  funds which, were it not for such set-off, would have been
                  payable to Funding as the Funding Relevant Distribution;

         (C)      on each date after the Initial Closing Date on which (i) an
                  amount of the Initial Purchase Price is payable in respect
                  of New Mortgage Loans which are sold and assigned by the
                  Seller to the Mortgages Trustee on such date and (ii)
                  Funding receives the net proceeds of a Funding Intercompany
                  Loan from a Funding Issuer, by paying to the Mortgages
                  Trustee an Initial Contribution in respect of the Funding
                  Share of the Trust Property which shall be equal to (and
                  from which the Mortgages Trustee shall or shall procure that
                  the Cash Manager on its behalf shall pay) the Initial
                  Purchase Price in respect of such New Mortgage Loans payable
                  by the Mortgages Trustee to the Seller pursuant to the
                  Mortgage Sale Agreement on such date unless, in either case,
                  Funding has given notice to each relevant Funding Issuer of
                  its intention to use the proceeds of a Funding Intercompany
                  Loan to repay one or more of the Funding Intercompany Loans
                  from such Funding Issuers, and subject to

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                  Clause 6 (Increasing the Funding Share and the Funding 2
                  Share of the Trust Property) below;

         (D)      on each other date after the Initial Closing Date on which
                  Funding receives the net proceeds of a Funding Intercompany
                  Loan from a Funding Issuer, by paying to the Mortgages
                  Trustee a Further Contribution in respect of the Funding
                  Share of the Trust Property which shall be equal to (and
                  from which the Mortgages Trustee shall or shall procure that
                  the Cash Manager on its behalf shall pay) the Special
                  Distribution payable to the Seller in accordance with Clause
                  4.4 (Application by Mortgages Trustee) unless Funding has
                  given notice to each relevant Funding Issuer of its
                  intention to use the proceeds of a Funding Intercompany Loan
                  to repay one or more of the Funding Intercompany Loans from
                  such Funding Issuers subject to Clause 6 (Increasing the
                  Funding Share and the Funding 2 Share of the Trust Property)
                  below; and

         (E)      following the Final Repayment Date of the latest maturing
                  Funding Intercompany Loan made by any Funding Issuer to
                  Funding and provided that there are no further claims
                  outstanding under any Funding Intercompany Loan or on such
                  earlier date provided that all Funding Intercompany Loans
                  have either been repaid in full or there are no further
                  claims outstanding under any Funding Intercompany Loan,
                  Funding will make a final payment of Deferred Contribution
                  to the Mortgages Trustee (the "Funding Final Deferred
                  Contribution") in an amount equal to the aggregate amount
                  standing to the credit of the Funding Bank Accounts
                  (including any account established for the purposes of the
                  Issuer Reserve Fund and/or the Issuer Liquidity Reserve Fund
                  of any Funding Issuer) after making any payments ranking in
                  priority thereto, subject to and in accordance with the
                  relevant Funding Priority of Payments. The Funding Final
                  Deferred Contribution shall be in an amount equal to (and
                  from the Funding Final Deferred Contribution the Mortgages
                  Trustee shall or shall procure that the Cash Manager shall
                  on its behalf pay) an amount of Deferred Purchase Price
                  payable by the Mortgages Trustee to the Seller pursuant to
                  and in accordance with the Mortgage Sale Agreement.

4.3      Consideration provided by Funding 2

         Funding 2 in its capacity as a Beneficiary shall provide
         consideration to the Mortgages Trustee for the Funding 2 Share of the
         Trust Property:

         (A)      on each Distribution Date, by paying to the Mortgages
                  Trustee a Deferred Contribution equal to the amount (if any)
                  of:

                  (1)      Mortgages Trustee Available Revenue Receipts to
                           which Funding 2 is entitled on such date in
                           accordance with paragraph (D)(ii) of Clause 10.2
                           (Distribution of Mortgages Trustee Available
                           Revenue Receipts); and

                  (2)      the Funding 2 Proportion of the amount of any Early
                           Repayment Charge Receipts payable by the Mortgages
                           Trustee to the Seller under the Mortgage Sale
                           Agreement.

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                  The amounts listed under sub-clauses (A)(1) and (A)(2) are,
                  together, referred to as the "Funding 2 Relevant
                  Distribution". Together with the Funding Relevant
                  Distribution, the Funding 2 Relevant Distribution shall be
                  applied in accordance with Clause 4.2(B). The parties to
                  this Deed agree that on any Distribution Date, the Funding 2
                  Relevant Distribution and the Deferred Contribution payable
                  by Funding 2 (as calculated pursuant to this sub-clause (A))
                  to the Mortgages Trustee shall be set off against each other
                  such that, as between the Mortgages Trustee and Funding 2,
                  no amount shall be payable in respect of such Funding 2
                  Relevant Distribution or such Deferred Contribution on such
                  date and the Cash Manager on behalf of the Mortgages Trustee
                  shall pay to the Seller (in satisfaction (in part) of the
                  Mortgages Trustee's obligation to pay Deferred Purchase
                  Price to the Seller under the Mortgage Sale Agreement) those
                  funds which, were it not for such set-off, would have been
                  payable to Funding 2 as the Funding 2 Relevant Distribution;

         (B)      on each date after the Funding 2 Programme Date on which (i)
                  an amount of Initial Purchase Price is payable in respect of
                  New Mortgage Loans which are sold and assigned by the Seller
                  to the Mortgages Trustee on such date and (ii) Funding 2
                  receives the net proceeds of a Loan Tranche under the Global
                  Intercompany Loan, by paying to the Mortgages Trustee an
                  Initial Contribution in respect of the Funding 2 Share of
                  the Trust Property which shall be equal to (and from which
                  the Mortgages Trustee shall or shall procure that the Cash
                  Manager on its behalf shall pay) the Initial Purchase Price
                  in respect of such New Mortgage Loans payable by the
                  Mortgages Trustee to the Seller pursuant to the Mortgage
                  Sale Agreement on such date unless Funding 2 has given
                  notice to the Funding 2 Issuer of its intention to use the
                  proceeds of a Loan Tranche under the Global Intercompany
                  Loan to repay (in part or in full) one or more of the Loan
                  Tranches under the Global Intercompany Loan from the Funding
                  2 Issuer and subject to Clause 6 (Increasing the Funding
                  Share and the Funding 2 Share of the Trust Property) below;

         (C)      on each other date after the Funding 2 Programme Date on
                  which Funding 2 receives the net proceeds of a Loan Tranche
                  from the Funding 2 Issuer, by paying to the Mortgages
                  Trustee a Further Contribution in respect of the Funding 2
                  Share of the Trust Property which shall be equal to (and
                  from which the Mortgages Trustee shall pay or shall procure
                  that the Cash Manager on its behalf shall pay):

                  (1)      the Special Distribution payable to the Seller in
                           accordance with Clause 4.4 (Application by
                           Mortgages Trustee); and/or

                  (2)      the Special Distribution payable to Funding in
                           accordance with Clause 4.4 (Application by
                           Mortgages Trustee),

                  unless Funding 2 has given notice to the Funding 2 Issuer of
                  its intention to use the proceeds of a Loan Tranche to repay
                  (in part or in full) one or more of the Loan Tranches each
                  relating to a series and class of notes of the Funding 2
                  Issuer being refinanced and subject to Clause 6 (Increasing
                  the Funding Share and the Funding 2 Share of the Trust
                  Property) below.

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<PAGE>

         (D)      following the Final Repayment Date of the latest maturing
                  Loan Tranche made under the Funding 2 Intercompany Loan
                  Agreement by the Funding 2 Issuer to Funding 2 and provided
                  that there are no further claims outstanding in respect of
                  the Funding 2 Deed of Charge or on such earlier date
                  provided that all Funding 2 Secured Obligations have either
                  been repaid in full or there are no further claims
                  outstanding under the Funding 2 Deed of Charge, Funding 2
                  will make a final payment of Deferred Contribution to the
                  Mortgages Trustee (the "Funding 2 Final Deferred
                  Contribution") in an amount equal to the aggregate amount
                  standing to the credit of the Funding 2 Bank Accounts after
                  making any payments ranking in priority thereto, subject to
                  and in accordance with the relevant Funding 2 Priority of
                  Payments. The Funding 2 Final Deferred Contribution shall be
                  in an amount equal to (and from the Funding 2 Final Deferred
                  Contribution the Mortgages Trustee shall or shall procure
                  that the Cash Manager shall on its behalf pay) an amount of
                  Deferred Purchase Price payable by the Mortgages Trustee to
                  the Seller pursuant to and in accordance with the Mortgage
                  Sale Agreement.

         Funding 2 shall pay or shall procure the payment of the amount of any
         Initial Contribution or Further Contribution to be made by it to the
         Mortgages Trustee into the Mortgages Trustee Transaction Account.

4.4      Application by Mortgages Trustee

         (A)      If the Mortgages Trustee receives any Initial Contribution,
                  Deferred Contribution or the Final Deferred Contribution
                  from a Funding Beneficiary, the parties hereto direct the
                  Mortgages Trustee to, and the Mortgages Trustee covenants
                  that it shall, or shall procure that the Cash Manager on its
                  behalf shall, pay such funds to the Seller in satisfaction
                  of the Mortgages Trustee's obligation to make payment of the
                  Initial Purchase Price or, as the case may be, Deferred
                  Purchase Price in respect of the Initial Mortgage Portfolio
                  or any New Mortgage Loans which are sold and assigned to the
                  Mortgages Trustee by the Seller pursuant to the Mortgage
                  Sale Agreement.

         (B)      If the Mortgages Trustee receives a Further Contribution
                  from any Beneficiary, the parties hereto direct the
                  Mortgages Trustee to, and the Mortgages Trustee covenants
                  that it shall, or shall procure that the Cash Manager on its
                  behalf shall:

                  (1)      where such Further Contribution is made by Funding
                           2:

                           (a)      if Funding 2 so elects, in its sole
                                    discretion, pay all or part of such
                                    Further Contribution as a Special
                                    Distribution to Funding in accordance with
                                    the terms of this Deed provided that the
                                    amounts of such Special Distribution shall
                                    not exceed the aggregate outstanding
                                    principal balance of all Funding
                                    Intercompany Loans, and

                           (b)      if Funding 2 so elects, pay all or part of
                                    such Further Contribution as a Special
                                    Distribution to the Seller in accordance
                                    with the terms of this Deed;

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<PAGE>

                  (2)      where such Further Contribution is made by Funding,
                           pay such funds as a Special Distribution to the
                           Seller in accordance with the terms of this Deed;
                           and

                  (3)      where such Further Contribution is made by the
                           Seller, pay such funds in accordance with the terms
                           of this Deed.

5.       INCREASING AND DECREASING THE SELLER SHARE OF THE TRUST PROPERTY

5.1      Re-draws under Flexible Mortgage Loans

         (A)      If, in respect of any Flexible Mortgage Loan which is
                  included in the Mortgage Portfolio, the relevant Borrower
                  requests a Cash Re-draw and the Administrator (on behalf of
                  the Seller) grants such request pursuant to and in
                  accordance with the terms of the Administration Agreement,
                  the Seller as Beneficiary shall fund that Cash Re-draw in
                  the Mortgages Trust by making payment to the Borrower, in
                  accordance with the terms and conditions of the relevant
                  Mortgage Loan, of the Cash Re-draw Amount. Upon payment by
                  the Seller to the relevant Borrower of the Cash Re-draw
                  Amount, the aggregate Current Balance of the Mortgage Loans
                  included in the Mortgage Portfolio and the amount of the
                  Seller Share of the Trust Property shall be increased by an
                  amount equal to the Cash Re-draw Amount.

         (B)      If, in respect of any Flexible Mortgage Loan which is
                  included in the Mortgage Portfolio, the relevant Borrower
                  requests a Non-Cash Re-draw and the Administrator grants
                  such request or the Administrator otherwise permits the
                  relevant Borrower to take a Non-Cash Re-draw pursuant to and
                  in accordance with the terms of the Administration
                  Agreement, the Seller as Beneficiary shall fund such
                  Non-Cash Re-draw in the Mortgages Trust by making payment to
                  the Mortgages Trustee of a Further Contribution in an amount
                  equal to the Unpaid Interest Amount in respect of such
                  Non-Cash Re-draw. Upon payment by the Seller to the
                  Mortgages Trustee of such Further Contribution, the
                  aggregate Current Balance of the Mortgage Loans included in
                  the Mortgage Portfolio and the Seller Share of the Trust
                  Property shall be increased by an amount equal to the amount
                  of the Further Contribution so made to the Mortgages
                  Trustee. The parties agree that any such Further
                  Contribution received by the Mortgages Trustee from the
                  Seller will be treated as Revenue Receipts and will be
                  distributed to the Beneficiaries on the immediately
                  succeeding Distribution Date in accordance with Clause 10
                  (Distribution of Revenue Receipts) below.

5.2      Further Advances

         If at a future date the Seller does not purchase any Mortgage Loan
         which becomes the subject of a Further Advance from the Mortgages
         Trustee, the Seller will be solely responsible for funding any such
         Further Advance and, subject to the provisions of this Deed, upon the
         making of such Further Advance by the Seller, the aggregate Current
         Balance of the Mortgage Loans included in the Mortgage Portfolio and
         the Seller Share of the Trust Property shall be increased by an
         amount equal to the amount of the Further Advance paid to the
         relevant Borrower.

                                      10
<PAGE>

5.3      Together Connections Mortgage Loans and Connections Mortgage Loans

         If, in respect of any Together Connections Mortgage Loan or any
         Connections Mortgage Loan which is included in the Mortgage
         Portfolio, there has been a reduction in the outstanding balance of
         such Mortgage Loan from the relevant Borrower being allocated a
         portion of the Together Connections Mortgage Benefit or Connections
         Benefit (as the case may be) under such Mortgage Loan, the aggregate
         Current Balance of the Mortgage Loans included in the Mortgage
         Portfolio and the amount of the Seller Share of the Trust Property
         shall be decreased by an amount equal to the portion of the Together
         Connections Benefit or Connections Benefit (as the case may be)
         allocated to such Mortgage Loan.

5.4      Further Draws under Personal Secured Loans

         If, in respect of any Personal Secured Loan included in the Mortgage
         Portfolio which permits Further Draws, the relevant Borrower requests
         a Further Draw and the Administrator grants such request, the Seller
         will as Beneficiary fund such Further Draw in the Mortgages Trust by
         making payment to the Borrower of the Further Draw in accordance with
         the terms and conditions of the relevant Personal Secured Loan. Upon
         payment by the Seller to the relevant Borrower of such Further Draw,
         the aggregate Current Balance of the Mortgage Loans included in the
         Mortgage Portfolio and the amount of the Seller Share of the Trust
         Property shall be increased by an amount equal to the amount of the
         Further Draw paid to the relevant Borrower.

6. INCREASING THE FUNDING SHARE AND THE FUNDING 2 SHARE OF THE TRUST PROPERTY

6.1      Conditions precedent to the increase of the Funding Share

         Subject as provided below, Funding may increase the Funding Share (as
         defined in Clause 7.1 (Initial Funding Share) below) of the Trust
         Property, subject to satisfaction of the following conditions
         precedent:

         (A)      no Funding Event of Default under the Transaction Documents
                  shall have occurred which is continuing at the relevant
                  date;

         (B)      no Intercompany Loan Enforcement Notice has been served in
                  respect of any Funding Intercompany Loan;

         (C)      the Rating Agencies have confirmed in writing to the
                  Mortgages Trustee, the Security Trustee, the Funding 2
                  Security Trustee and each Issuer that the proposed increase
                  in the Funding Share of the Trust Property would not cause
                  the then-current ratings by the Rating Agencies (or any of
                  them) of the existing Notes of any Issuer to be reduced,
                  withdrawn or qualified;

         (D)      the New Notes have been issued by a Funding Issuer, the
                  subscription proceeds received on behalf of such Funding
                  Issuer and advanced by such Funding Issuer to Funding
                  pursuant to a Funding Intercompany Loan Agreement (which
                  proceeds Funding will pay to the Mortgages Trustee to
                  increase the Funding Share of the Trust Property on the
                  relevant date in accordance with Clause 6.3 (Completion));

                                      11
<PAGE>

         (E)      if necessary, each Funding Issuer, including any New Funding
                  Issuer (if any) has entered into appropriate hedging
                  arrangements;

         (F)      as of the last day of the immediately preceding Trust
                  Calculation Period the aggregate Current Balance of Mortgage
                  Loans in the Mortgage Portfolio which were at such time in
                  arrears for at least 3 months is less than 4 per cent. of
                  the aggregate Current Balance of all Mortgage Loans in the
                  Mortgage Portfolio at such time unless the Rating Agencies
                  have confirmed that the then-current ratings of the Notes of
                  each Funding Issuer will not be adversely affected;

         (G)      as of the last day of the immediately preceding Trust
                  Calculation Period the Moody's Portfolio Variation Test
                  Value of the Mortgage Loans in the Mortgage Portfolio on
                  such date (calculated by applying the Moody's Portfolio
                  Variation Test to such Mortgage Loans on such date) does not
                  exceed the most recently determined Moody's Portfolio
                  Variation Test Threshold Value (as calculated in relation to
                  the Mortgage Loans in the Mortgage Portfolio on the most
                  recent date on which Moody's performed a full pool analysis
                  on the Mortgage Portfolio) plus 0.30 per cent.;

         (H)      in respect of each Funding Issuer, each Issuer Reserve Fund
                  is fully funded on the relevant date up to the relevant
                  Issuer Reserve Required Amount; and

         (I)      as at the most recent Payment Date no deficiency was
                  recorded on the Issuer Principal Deficiency Ledger of any
                  Funding Issuer,

         provided always that Funding shall not be entitled to increase the
         Funding Share after the Payment Date falling in January 2008, if the
         option to redeem the First Issuer Notes on the Payment Date in
         January 2008 pursuant to Condition 5 of the First Issuer Notes is not
         exercised.

6.2      Conditions precedent to the increase of the Funding 2 Share

         Subject as provided below, Funding 2 may increase the Funding 2 Share
         of the Trust Property, subject to satisfaction of the following
         conditions precedent:

         (A)      no Funding 2 Event of Default under the Transaction
                  Documents shall have occurred which is continuing at the
                  relevant date;

         (B)      no Intercompany Loan Enforcement Notice has been served in
                  respect of any Funding 2 Intercompany Loan;

         (C)      the Rating Agencies have confirmed in writing to the
                  Mortgages Trustee, the Security Trustee, the Funding 2
                  Security Trustee and each Funding 2 Issuer that the proposed
                  increase in the Funding 2 Share of the Trust Property would
                  not cause the then-current ratings by the Rating Agencies
                  (or any of them) of the existing Notes of any Issuer to be
                  reduced, withdrawn or qualified;

         (D)      the New Notes have been issued by the Funding 2 Issuer, the
                  subscription proceeds received on behalf of the Funding 2
                  Issuer and advanced by the Funding 2 Issuer to Funding 2
                  pursuant to a Funding 2 Intercompany Loan Agreement (which
                  proceeds Funding 2 will pay to the Mortgages Trustee to

                                      12
<PAGE>

                  increase the Funding 2 Share of the Trust Property on the
                  relevant date in accordance with Clause 6.3 (Completion));

         (E)      if necessary, Funding 2 and/or the Funding 2 Issuer have
                  entered into appropriate hedging arrangements;

         (F)      as of the last day of the immediately preceding Trust
                  Calculation Period the aggregate Current Balance of Mortgage
                  Loans in the Mortgage Portfolio which were at such time in
                  arrears for at least 3 months is less than 4 per cent. of
                  the aggregate Current Balance of all Mortgage Loans in the
                  Mortgage Portfolio at such time unless the Rating Agencies
                  have confirmed that the then-current ratings of the existing
                  Notes of the Funding 2 Issuer will not be adversely
                  affected;

         (G)      as of the last day of the immediately preceding Trust
                  Calculation Period the Moody's Portfolio Variation Test
                  Value of the Mortgage Loans in the Mortgage Portfolio on
                  such date (calculated by applying the Moody's Portfolio
                  Variation Test to such Mortgage Loans on such date) does not
                  exceed the most recently determined Moody's Portfolio
                  Variation Test Threshold Value (as calculated in relation to
                  the Mortgage Loans in the Mortgage Portfolio on the most
                  recent date on which Moody's performed a full pool analysis
                  on the Mortgage Portfolio) plus 0.30 per cent.;

         (H)      as at the most recent Monthly Payment Date no deficiency was
                  recorded on the Funding 2 Principal Deficiency Ledger,

         provided always that Funding 2 shall not be entitled to increase the
         Funding 2 Share of the Trust Property after the date falling 12
         months after the occurrence of a Step-Up Date (the "twelve-month
         date") in respect of any Series and Class of Notes of a Funding 2
         Issuer, if the option to redeem such Notes by such twelve-month date
         pursuant to the terms and conditions of such Notes is not exercised.

6.3      Completion

         Subject to satisfaction of the conditions precedent set out in Clause
         6.1 (Conditions precedent to the Increase of the Funding Share) or
         Clause 6.2 (Conditions precedent to the Increase of the Funding 2
         Share) above, Funding or Funding 2, as applicable, shall pay to the
         Mortgages Trustee the consideration for such increase in the Funding
         Share or the Funding 2 Share, as applicable, in accordance with
         Clause 4 (Consideration) and the Current Funding Share, the Current
         Funding Share Percentage, the Current Funding 2 Share and the Current
         Funding 2 Share Percentage (as applicable) shall be recalculated in
         accordance with Clause 8.2 (Current Funding Share Percentage and
         Current Funding 2 Share Percentage) and Clause 8.4 (Current Funding
         Share and Current Funding 2 Share).

6.4      Distribution

         The parties hereto agree that any Initial Contribution or Further
         Contribution received by the Mortgages Trustee from a Funding
         Beneficiary in accordance with Clause 4 (Consideration) on any date
         shall be allocable and payable by the Mortgages Trustee to:

                                      13
<PAGE>

         (A)      the Seller (in its capacity as a Beneficiary of the
                  Mortgages Trust) as Initial Purchase Price or as a Special
                  Distribution; and/or

         (B)      Funding (in its capacity as a Beneficiary of the Mortgages
                  Trust) as a Special Distribution (in respect of Further
                  Contributions made by Funding 2),

         in each case, on such date whether or not such date is a Distribution
         Date. Any such Initial Purchase Price or Special Distribution shall
         reduce the Seller Share or the Funding Share of the Trust Property
         (as applicable) by the amount of such Initial Purchase Price or
         Special Distribution received by it.

7. INITIAL FUNDING SHARE, INITIAL SELLER SHARE AND INITIAL FUNDING 2 SHARE

7.1      Initial Funding Share

         The "Initial Funding Share" of the Trust Property shall be (GBP)86.61
         at 26 March, 2001 and (GBP)1,500,000,000 at the Initial Closing Date
         and the "Initial Funding Share Percentage" shall be the Initial
         Funding Share expressed as a percentage of the Trust Property at such
         date, that is to say, 86.61 per cent. References herein to the
         "Funding Share" shall mean, prior to the first Distribution Date, the
         Initial Funding Share and thereafter shall mean the Current Funding
         Share (as defined below).

7.2      Initial Seller Share

         The "Initial Seller Share" of the Trust Property shall be the sum
         which remains of the Trust Property after deduction of the Initial
         Funding Share. The Initial Seller Share of the Trust Property will be
         (GBP)13.39 at 26 March, 2001 and (GBP)232,000,000 at the Initial
         Closing Date and the "Initial Seller Share Percentage" shall be equal
         to 100 per cent. minus the Initial Funding Share Percentage, that is
         to say, 13.39 per cent. The amount of the Initial Seller Share and
         the Initial Seller Share Percentage on the Initial Closing Date will
         be determined immediately after the Initial Closing Date. References
         herein to the "Seller Share" shall mean, prior to the first
         Distribution Date, the Initial Seller Share and thereafter shall mean
         the Current Seller Share (as defined below).

7.3      Initial Funding 2 Share

         The "Initial Funding 2 Share" of the Trust Property shall, following
         the acquisition by Funding 2, by way of assignment, from the Seller
         of a portion of the Seller's beneficial interest in the Mortgages
         Trust in accordance with the Seller (Mortgages Trust) Assignment
         Agreement, be (GBP)100. References herein to the "Funding 2 Share"
         shall, from (and including) the Funding 2 Programme Date to (but
         excluding) the first Closing Date in relation to the issue of Notes
         by a Funding 2 Issuer, mean the Initial Funding 2 Share and
         thereafter shall mean the Current Funding 2 Share.

7.4      Rounding of percentage shares

         Except for the Initial Closing Date on which the Funding Share
         Percentage and the Seller Share Percentage shall be calculated to two
         decimal places, and unless otherwise agreed by the Beneficiaries, the
         Current Funding Share Percentage, the

                                      14
<PAGE>

         Current Funding 2 Share Percentage and the Current Seller Share
         Percentage shall be calculated to five decimal places.

8.       ADJUSTMENT OF FUNDING SHARE PERCENTAGE, FUNDING 2 SHARE PERCENTAGE
         AND SELLER SHARE PERCENTAGE

8.1      Effective Periods

         (A)      Subject to Clause 8.1(B) below, the Cash Manager will (on
                  behalf of the Beneficiaries) recalculate the Funding Share,
                  the Funding Share Percentage, the Funding 2 Share, the
                  Funding 2 Share Percentage, the Seller Share and the Seller
                  Share Percentage in respect of each Trust Calculation Period
                  on the Distribution Date occurring in such Trust Calculation
                  Period, based on the aggregate Current Balance of the
                  Mortgage Loans in the Mortgage Portfolio (as adjusted from
                  time to time) on the last day of the Trust Calculation
                  Period immediately preceding such Distribution Date.

         (B)      Notwithstanding Clause 8.1(A) above, if during any Trust
                  Calculation Period the Seller sells and assigns New Mortgage
                  Loans to the Mortgages Trustee or if a Funding Beneficiary
                  makes a Contribution (excluding any Deferred Contribution)
                  to the Mortgages Trustee to increase its respective share of
                  the Trust Property, the recalculation of the Funding Share,
                  the Funding Share Percentage, the Funding 2 Share, the
                  Funding 2 Share Percentage, the Seller Share and the Seller
                  Share Percentage made by the Cash Manager on the
                  Distribution Date occurring in such Trust Calculation Period
                  will be effective only in respect of the period beginning on
                  (and including) the first day of such Trust Calculation
                  Period and ending on (but excluding) the first Assignment
                  Date or Contribution Date, as applicable, to occur during
                  such Trust Calculation Period (such period in respect of
                  such Distribution Date, an "Interim Calculation Period"),
                  based on the aggregate Current Balance of the Mortgage Loans
                  in the Mortgage Portfolio (as adjusted from time to time) on
                  the last day of the Trust Calculation Period immediately
                  preceding such Distribution Date.

         (C)      In addition to the foregoing, if during any Trust
                  Calculation Period the Seller sells and assigns New Mortgage
                  Loans to the Mortgages Trustee or if a Funding Beneficiary
                  makes a Contribution (excluding any Deferred Contribution)
                  to the Mortgages Trustee to increase its respective share of
                  the Trust Property, the Cash Manager will (on behalf of the
                  Mortgages Trustee and the Beneficiaries) recalculate the
                  Funding Share, the Funding Share Percentage, the Funding 2
                  Share, the Funding 2 Share Percentage, the Seller Share and
                  the Seller Share Percentage on such Assignment Date or
                  Contribution Date, as applicable, in respect of the period
                  beginning on (and including) such Assignment Date or
                  Contribution Date, as applicable, and ending on the last day
                  of such Trust Calculation Period (and including such last
                  day of such Trust Calculation Period) (each such period in
                  respect of each Assignment Date or Contribution Date, as
                  applicable, an "Interim Calculation Period"), based on the
                  aggregate Current Balance of the Mortgage Loans in the
                  Mortgage Portfolio (as adjusted from time to time) on such
                  Assignment Date or Contribution Date, as applicable.

                                      15
<PAGE>

         The parties acknowledge and agree that the Mortgage Sale Agreement
         provides that (a) the Seller may not sell and assign New Mortgage
         Loans to the Mortgages Trustee during any Trust Calculation Period
         prior to the Distribution Date in such Trust Calculation Period, and
         (b) the Seller may only make one sale and assignment of New Mortgage
         Loans to the Mortgages Trustee during any Trust Calculation Period.

8.2      Current Funding Share Percentage and Current Funding 2 Share
         Percentage

         I.       Current Funding Share Percentage:

         (A)      On each Distribution Date (the "Relevant Distribution
                  Date"), the "Current Funding Share Percentage" will be
                  calculated by the Cash Manager in respect of the
                  then-current Trust Calculation Period or related Interim
                  Calculation Period, as applicable, for the purpose of
                  calculating the distributions to be made from the Trust
                  Property on the immediately succeeding Distribution Date,
                  and such Current Funding Share Percentage will be an amount,
                  expressed as a percentage (calculated to an accuracy of five
                  decimal places (rounded upwards)), equal to:

                                     A-B-C+D
                                     ------- X 100
                                        G
                  where,

                  A =      the Current Funding Share as calculated (a) on the
                           later of the Distribution Date, the Assignment Date
                           or Contribution Date (if any) immediately preceding
                           such Relevant Distribution Date, or (b) in the case
                           of the first Distribution Date, the Initial Funding
                           Share as at the Initial Closing Date;

                  B =      the amount of any Principal Receipts distributed to
                           Funding on such Relevant Distribution Date in
                           accordance with the provisions described in Clause
                           11 (Distribution of Principal Receipts) below;

                  C =      the amount of any Losses sustained on the Mortgage
                           Loans during the Trust Calculation Period
                           immediately preceding such Relevant Distribution
                           Date and the amount of any reductions occurring in
                           respect of the Mortgage Loans as described in
                           paragraph (A) of Clause 8.5 (Adjustments to Trust
                           Property) below which have been allocated to
                           Funding in the Trust Calculation Period ending on
                           the Relevant Distribution Date (based on (a) the
                           Current Funding Share Percentage thereof calculated
                           on the Distribution Date immediately preceding such
                           Relevant Distribution Date (provided that the
                           Seller had not sold and assigned New Mortgage Loans
                           to the Mortgages Trustee or that Funding had not
                           paid a Further Contribution to the Mortgages
                           Trustee in the Trust Calculation Period immediately
                           preceding such Relevant Distribution Date), or (b)
                           to the extent that the Seller had sold and assigned
                           New Mortgage Loans to the Mortgages Trustee or that
                           Funding had paid a Further Contribution to the
                           Mortgages Trustee during the Trust Calculation
                           Period immediately preceding such Relevant
                           Distribution Date, the Weighted Average Funding
                           Share

                                      16
<PAGE>

                           Percentage (as defined below) thereof calculated on
                           such Relevant Distribution Date prior to the
                           distribution to be made on such Relevant
                           Distribution Date, or (c) in the case of the first
                           Distribution Date, the Initial Funding Share
                           Percentage);

                  D =      an amount equal to any Capitalised Arrears which
                           have been allocated to Funding during the Trust
                           Calculation Period immediately preceding such
                           Relevant Distribution Date (based on the Current
                           Funding Share Percentage thereof calculated on the
                           Distribution Date immediately preceding such
                           Relevant Distribution Date or, in the case of the
                           first Distribution Date, the Initial Funding Share
                           Percentage); and

                  G =      the amount of the Mortgages Trustee Retained
                           Principal Receipts (if any) plus the aggregate
                           Current Balance of all the Mortgage Loans in the
                           Mortgage Portfolio as at the last day of the Trust
                           Calculation Period immediately preceding such
                           Relevant Distribution Date or, if applicable, on
                           the relevant Assignment Date or Contribution Date,
                           after making the distributions, allocations and
                           additions referred to in (B), (C) and (D) above and
                           after taking account of the following (being "Trust
                           Property Calculation Adjustments") (i) any
                           distribution of Principal Receipts to the Seller,
                           Funding and Funding 2, (ii) the amount of any
                           Losses or Capitalised Arrears allocated to the
                           Seller, Funding and Funding 2, (iii) the
                           adjustments referred to in paragraphs (A) through
                           (E) of Clause 8.5 (Adjustments to Trust Property)
                           (inclusive) below (or, if the Seller Share is zero,
                           the adjustments referred to in paragraph (A) only);
                           (iv) the amount of any other additions to or
                           removals from the Trust Property during such Trust
                           Calculation Period, including without limitation,
                           any additions to the Trust Property resulting from
                           Cash Re-draws, Non-Cash Redraws and Further Draws
                           by Borrowers under Flexible Mortgage Loans which
                           are in the Trust Property or (if the Seller
                           subsequently elects not to purchase Mortgage Loans
                           which are the subject of Further Advances from the
                           Mortgages Trustee) Further Advances sold and
                           assigned by the Seller; but excluding the addition
                           of Mortgage Loans on an Assignment Date and any
                           Initial Contribution or Further Contribution made
                           by Funding or Funding 2 during such Trust
                           Calculation Period and (v) any reduction in the
                           outstanding principal balances of Together
                           Connections Mortgage Loans and Connections Mortgage
                           Loans resulting from Borrowers being allocated a
                           portion of the related Together Connections Benefit
                           and Connections Benefit, respectively, under such
                           Mortgage Loans.

         (B)      If during any Trust Calculation Period the Seller sells and
                  assigns New Mortgage Loans to the Mortgages Trustee, the
                  Cash Manager will recalculate the Current Funding Share
                  Percentage on each such Assignment Date which is not also a
                  Contribution Date (the "Relevant Assignment Date") in
                  respect of the related Interim Calculation Period, for the
                  purposes of calculating the distributions to be made from
                  the Trust Property on the immediately succeeding
                  Distribution Date and determining the amount of Losses to be
                  allocated to Funding, and such Current Funding Share
                  Percentage will be an

                                      17
<PAGE>

                  amount, expressed as a percentage (calculated to an accuracy
                  of five decimal places (rounded upwards)), equal to:

                                     A+E
                                     --- X 100
                                      H

                  where,

                  A =      the Current Funding Share as calculated on the
                           Distribution Date immediately preceding such
                           Relevant Assignment Date;

                  E =      an amount equal to any Initial Contribution paid by
                           Funding to the Mortgages Trustee on such Relevant
                           Assignment Date in relation to the Funding Share of
                           any New Mortgage Loans assigned to the Mortgages
                           Trustee on such Relevant Assignment Date (which
                           amount the Mortgages Trustee is required pursuant
                           to Clause 4.4 (Application by Mortgages Trustee) to
                           pay to the Seller in satisfaction (in part) of the
                           Mortgages Trustee's obligation to pay to the Seller
                           the Initial Purchase Price in respect of New
                           Mortgage Loans sold and assigned to the Mortgages
                           Trustee on such Relevant Assignment Date); and

                  H =      the amount of the Mortgages Trustee Retained
                           Principal Receipts (if any), plus the aggregate
                           Current Balance of all the Mortgage Loans in the
                           Trust Property as at the Distribution Date
                           immediately preceding such Relevant Assignment Date
                           (after making the distributions, allocations and
                           additions on that preceding Distribution Date),
                           plus the aggregate Current Balance of the New
                           Mortgage Loans sold and assigned to the Mortgages
                           Trustee on such Relevant Assignment Date and after
                           taking account of Trust Property Calculation
                           Adjustments.

         (C)      If during any Trust Calculation Period a Funding Beneficiary
                  pays a Contribution (excluding a Deferred Contribution) to
                  the Mortgages Trustee to increase its share of the Trust
                  Property or receives from the Mortgages Trustee a Special
                  Distribution (where such Special Distribution is not made on
                  a Distribution Date) in accordance with Clause 11
                  (Distribution of Principal Receipts), the Cash Manager will
                  recalculate the Current Funding Share Percentage on each
                  such Contribution Date (the "Relevant Contribution Date") in
                  respect of the related Interim Calculation Period, for the
                  purposes of calculating the distributions to be made from
                  the Trust Property and determining the amount of Losses to
                  be allocated to Funding on the immediately succeeding
                  Distribution Date, and such Current Funding Share Percentage
                  will be an amount, expressed as a percentage (calculated to
                  an accuracy of five decimal places (rounded upwards)), equal
                  to:

                                     A+E+F-I
                                     ------- X 100
                                        J

                  where,

                  A =      the Current Funding Share as calculated on the
                           Distribution Date immediately preceding such
                           Relevant Contribution Date;

                                      18
<PAGE>

                  E =      (1) if that Relevant Contribution Date is also an
                           Assignment Date, the amount of any Initial
                           Contribution paid by Funding to the Mortgages
                           Trustee on that Contribution Date in respect of the
                           Funding Share of any New Trust Property, and (2) in
                           all other cases, zero;

                  F =      an amount equal to any Further Contribution paid by
                           Funding to the Mortgages Trustee on such Relevant
                           Contribution Date to increase Funding's beneficial
                           interest in the Trust Property;

                  I =      the amount of the Special Distribution distributed
                           to Funding on such date in accordance with the
                           provisions described in Clause 11 (Distribution of
                           Principal Receipts); and

                  J =      the amount of the Mortgages Trustee Retained
                           Principal Receipts (if any) plus the aggregate
                           Current Balance of all the Mortgage Loans in the
                           Trust Property as at the Distribution Date
                           immediately preceding such Relevant Contribution
                           Date (after making the distributions, allocations
                           and additions on that preceding Distribution Date)
                           plus the aggregate Current Balance of the New
                           Mortgage Loans sold and assigned to the Mortgages
                           Trustee on that Relevant Assignment Date and after
                           taking account of Trust Property Calculation
                           Adjustments.

         II.      Current Funding 2 Share Percentage

         (A)      On each Relevant Distribution Date falling after the Funding
                  2 Programme Date, the "Current Funding 2 Share Percentage"
                  will be calculated by the Cash Manager in respect of the
                  then-current Trust Calculation Period or related Interim
                  Calculation Period, as applicable, for the purpose of
                  calculating the distributions to be made from the Trust
                  Property on the immediately succeeding Distribution Date,
                  and such Current Funding 2 Share Percentage will be an
                  amount, expressed as a percentage (calculated to an accuracy
                  of five decimal places (rounded upwards)), equal to:

                                     A-B-C+D
                                     ------- X 100
                                        G

                  where, "A", "B", "C", "D" and "G" have the meanings
                  specified in Clause 8.2(I)(A), provided however that:

                  (1)      references to Funding (including references in any
                           defined term) are to be read as references to
                           Funding 2;

                  (2)      references to the first Distribution Date are to be
                           read as the first Distribution Date following the
                           Funding 2 Programme Date; and

                  (3)      references to the Initial Closing Date are to be
                           read as the Funding 2 Programme Date;

                  (4)      prior to the Funding 2 Programme Date, each of the
                           Current Funding 2 Share and the Current Funding 2
                           Share Percentage shall be zero.

                                      19
<PAGE>

         (B)      On each Relevant Assignment Date, the Cash Manager will
                  recalculate the Current Funding 2 Share Percentage in
                  respect of the related Interim Calculation Period, for the
                  purposes of calculating the distributions to be made from
                  the Trust Property on the immediately succeeding
                  Distribution Date and determining the amount of Losses to be
                  allocated to Funding 2, and such Current Funding 2 Share
                  Percentage will be an amount, expressed as a percentage
                  (calculated to an accuracy of five decimal places (rounded
                  upwards)), equal to:

                                     A+E
                                     --- X 100
                                      H

                  where, "A", "E" and "H" have the meanings specified in
                  clause 8.2(I)(B), provided, however that references to
                  Funding (including references in any defined term) are to be
                  read as references to Funding 2.

         (C)      On each Relevant Contribution Date, the Cash Manager will
                  recalculate the Current Funding 2 Share Percentage in
                  respect of the related Interim Calculation Period, for the
                  purposes of calculating the distributions to be made from
                  the Trust Property and determining the amount of Losses to
                  be allocated to Funding 2 on the immediately succeeding
                  Distribution Date, and such Current Funding 2 Share
                  Percentage will be an amount, expressed as a percentage
                  (calculated to an accuracy of five decimal places (rounded
                  upwards)), equal to:

                                     A+E+F
                                     ----- X 100
                                       J

                  where, "A", "E", "F" and "J" have the meanings specified in
                  clause 8.2(I)(C), provided, ED] however that references to
                  Funding (including references in any defined term) are to be
                  D] read as references to Funding 2. D]

         (D)      For the purposes of Clauses 8.2(II)(A), 8.2(II)(B) and
                  8.2(II)(C) above, in respect of the earliest to occur,
                  following the Funding 2 Programme Date, of (a) a
                  Distribution Date, (b) a Contribution Date or (c) an
                  Assignment Date, item "A" shall be the Initial Funding 2
                  Share.

8.3      Weighted Average Funding Share Percentage and Weighted Average
         Funding 2 Share Percentage

         (A)      Weighted Average Funding Share Percentage:

                  On any Distribution Date in respect to which:

                  (1)      the Seller had sold and assigned New Mortgage Loans
                           to the Mortgages Trustee; or

                  (2)      a Funding Beneficiary had made a Contribution
                           (excluding any Deferred Contribution) to the
                           Mortgages Trustee to increase its share of the
                           Trust Property; or

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<PAGE>

                  (3)      Funding had received a Special Distribution from
                           the Mortgages Trustee,

                  during the Trust Calculation Period immediately preceding
                  such Distribution Date, the Cash Manager (on behalf of the
                  Beneficiaries) will calculate (for the sole purpose of
                  making the distributions to be made on such Distribution
                  Date) the Weighted Average of the Current Funding Share
                  Percentages that were calculated previously in respect of
                  each Interim Calculation Period occurring in such
                  immediately preceding Trust Calculation Period based on the
                  amount of Revenue Receipts and Principal Receipts received
                  and Losses sustained during each such Interim Calculation
                  Period. The "Weighted Average Funding Share Percentage" for
                  any such Distribution Date will be equal to:

                  (i)      in respect of the distribution of Revenue Receipts
                           to be made on such Distribution Date, an amount
                           determined in accordance with the formula set forth
                           below:

                                     (AxB) + (CxD)

                           where,

                           A =      the related Current Funding Share
                                    Percentage for Interim Calculation Period
                                    1;

                           B =      the number of days in Interim Calculation
                                    Period 1 divided by the number of days in
                                    the Trust Calculation Period;

                           C =      the related Current Funding Share
                                    Percentage for Interim Calculation Period
                                    2; and

                           D =      the number of days in Interim Calculation
                                    Period 2 divided by the number of days in
                                    the Trust Calculation Period;

                  (ii)     in respect of the distribution of Principal
                           Receipts to be made on such Distribution Date, an
                           amount determined in accordance with the formula
                           set forth below:

                                     (AxB) + (CxD)

                           where, "A", "B", "C" and "D" have the meanings
                           specified in Clause 8.3(A)(i) above.

                  (iii)    in respect of the allocation of Losses to be made
                           on such Distribution Date, an amount determined in
                           accordance with the formula set forth below:

                                     (AxB) + (CxD)

                           where, "A", "B", "C" and "D" have the meanings
                           specified in Clause 8.3(A)(i) above.

                                      21
<PAGE>

         (B)      Weighted Average Funding 2 Share Percentage

                  On any Distribution Date in respect to which:

                  (1)      the Seller had sold and assigned New Mortgage Loans
                           to the Mortgages Trustee; or

                  (2)      a Funding Beneficiary had made a Contribution
                           (excluding any Deferred Contribution) to the
                           Mortgages Trustee to increase its share of the
                           Trust Property; or

                  (3)      Funding had received a Special Distribution from
                           the Mortgages Trustee,

                  during the Trust Calculation Period immediately preceding
                  such Distribution Date, the Cash Manager (on behalf of the
                  Beneficiaries) will calculate (for the sole purpose of
                  making the distributions to be made on such Distribution
                  Date) the Weighted Average of the Current Funding 2 Share
                  Percentages that were calculated previously in respect of
                  each Interim Calculation Period occurring in such
                  immediately preceding Trust Calculation Period based on the
                  amount of Revenue Receipts and Principal Receipts received
                  and Losses sustained during each such Interim Calculation
                  Period. The "Weighted Average Funding 2 Share Percentage"
                  for any such Distribution Date will be equal to:

                  (i)      in respect of the distribution of Revenue Receipts
                           to be made on such Distribution Date, an amount
                           determined in accordance with the formula set forth
                           below:

                                     (AxB) + (CxD)

                           where, "A", "B", "C" and "D" have the meanings
                           specified in Clause 8.3(A)(i) MITTED] above;
                           provided however that the references to Current
                           Funding Share Percentage are to be read as
                           references to Current Funding 2 Share Percentage.

                  (ii)     in respect of the distribution of Principal
                           Receipts to be made on such Distribution Date, an
                           amount determined in accordance with the formula
                           set forth below:

                                     (AxB) + (CxD)

                           where, "A", "B", "C" and "D" have the meanings
                           specified in Clause 8.3(A)(i) above; provided
                           however that the references to Current Funding
                           Share Percentage are to be read as references to
                           Current Funding 2 Share Percentage.

                  (iii)    in respect of the allocation of Losses to be made
                           on such Distribution Date, an amount determined in
                           accordance with the formula set forth below:

                                      22
<PAGE>

                                     (AxB) + (CxD)

                           where, "A", "B", "C" and "D" have the meanings
                           specified in Clause 8.3(A)(i) above; provided
                           however that the references to Current Funding
                           Share Percentage are to be read as references to
                           Current Funding 2 Share Percentage.

8.4      Current Funding Share and Current Funding 2 Share

         I.       Current Funding Share

         (A)      On each Distribution Date, the "Current Funding Share" will
                  be calculated by the Cash Manager in respect of the
                  then-current Trust Calculation Period or the related Interim
                  Calculation Period, as applicable, and will be an amount
                  equal to:

                                           A-B-C+D

                  where "A", "B", "C" and "D" have the meanings specified in
                  Clause 8.2(I)(A) above.

         (B)      On each Assignment Date (which is not also a Contribution
                  Date), the Current Funding Share will be calculated by the
                  Cash Manager in respect of the related Interim Calculation
                  Period and will be an amount equal to:

                                           A+E

                  where "A" and "E" have the meanings specified in Clause
                  8.2(I)(B) above.

         (C)      On each Contribution Date, the Current Funding Share will be
                  calculated by the Cash Manager in respect of the related
                  Interim Calculation Period and will be an amount equal to:

                                           A+E+F-I

                  where "A", "E" and "F" and "I" have the meanings specified
                  in Clause 8.2(I)(C) above. TTED]

         II.      Current Funding 2 Share

         (A)      On each Distribution Date, the "Current Funding 2 Share"
                  will be calculated by the Cash Manager in respect of the
                  then-current Trust Calculation Period or the related Interim
                  Calculation Period, as applicable, and will be an amount
                  equal to:

                                           A-B-C+D

                  where (subject to Clause 8.2(II)(D)) "A", "B", "C" and "D"
                  have the meanings specified in Clause 8.2(II)(A) above.

                                      23
<PAGE>

         (B)      On each Assignment Date (which is not also a Contribution
                  Date), the Current Funding 2 Share will be calculated by the
                  Cash Manager in respect of the related Interim Calculation
                  Period and will be an amount equal to:

                                     A + E

                  where (subject to Clause 8.2(II)(D)) "A" and "E" have the
                  meanings specified in Clause 8.2(II)(B).

         (C)      On each Contribution Date, the Current Funding 2 Share will
                  be calculated by the Cash Manager in respect of the related
                  Interim Calculation Period and will be an amount equal to:

                                   A + E + F

                  where (subject to Clause 8.2(II)(D)) "A", "E" and "F" have
                  the meanings specified in Clause 8.2(II)(C) above.

8.5      Adjustments to Trust Property

         If any of the following events has occurred during a Trust
         Calculation Period, then (subject to the Cash Manager receiving
         notice or otherwise being aware of the occurrence of the event) for
         the purposes of making the Trust Property Calculation Adjustments,
         the aggregate Current Balance of the Mortgage Loans in the Mortgage
         Portfolio shall be reduced or, as the case may be, deemed to be
         reduced:

         (A)      any Borrower exercises a right of set-off in relation to any
                  Mortgage Loan in the Mortgage Portfolio so that the amount
                  of principal and/or interest owing under such Mortgage Loan
                  is reduced but no corresponding payment is received by the
                  Mortgages Trustee, in which event the aggregate Current
                  Balance of the Mortgage Loans in the Mortgage Portfolio
                  shall be reduced by an amount equal to the amount so set-off
                  by such Borrower; and/or

         (B)      a Mortgage Loan or (as applicable) its Related Security (i)
                  was assigned to the Mortgages Trustee in breach of the
                  Representations and Warranties in the Mortgage Sale
                  Agreement as at the Initial Closing Date or, as the case may
                  be, the relevant Assignment Date or (ii) is the subject of a
                  Product Switch or a Further Advance or in respect of which
                  the Borrower has accepted an offer by the Seller of a
                  Personal Secured Loan and the Seller has elected to purchase
                  the relevant Mortgage Loan or Mortgage Loans and Related
                  Security, and in the case of (i) above the Seller fails to
                  repurchase and in the case of (ii) above the Seller fails to
                  purchase, the relevant Mortgage Loan or Mortgage Loans under
                  the relevant Mortgage Account and their Related Security as
                  required by the terms of the Mortgage Sale Agreement; in
                  which event the aggregate Current Balance of the Mortgage
                  Loans in the Mortgage Portfolio shall be deemed to be
                  reduced for the purposes of making the Trust Property
                  Calculation Adjustments by an amount equal to the Current
                  Balance of the relevant Mortgage Loan or Mortgage Loans
                  under the relevant Mortgage Account (together with Arrears
                  of Interest and Accrued Interest) which the Seller has
                  failed to repurchase or purchase, as applicable; and/or

                                      24
<PAGE>

         (C)      both the Security Trustee and the Funding 2 Security Trustee
                  are notified that a Flexible Mortgage Loan or part thereof
                  has been determined by a court judgment on the point or as a
                  result of a determination by a relevant regulatory authority
                  (whether or not in relation to an analogous flexible
                  mortgage loan product of another UK mortgage lender):

                  (1)      to be unenforceable; and/or

                  (2)      not to fall within the first ranking charge by way
                           of legal mortgage or first ranking standard
                           security over the relevant Mortgaged Property,

                  and, in either case, such Flexible Mortgage Loan is not
                  otherwise subject to the repurchase obligation under the
                  Mortgage Sale Agreement, in which event, the aggregate
                  Current Balance of the Mortgage Loans in the Mortgage
                  Portfolio shall be deemed to be reduced for the purposes of
                  making the Trust Property Calculation Adjustments by an
                  amount equal to that portion of the Current Balance of the
                  Flexible Mortgage Loan which is so determined to be
                  unenforceable or not to fall within the first ranking charge
                  by way of legal mortgage or first ranking standard security
                  over the relevant Mortgaged Property; and/or

         (D)      (i) in respect of breaches of Representations and Warranties
                  in the Mortgage Sale Agreement, the Seller would be required
                  to repurchase a Mortgage Loan and its Related Security and
                  (ii) in respect of a Mortgage Loan subject to a Further
                  Advance or a Product Switch or in respect of which the
                  Borrower has accepted an offer by the Seller of a Personal
                  Secured Loan, the Seller elects to purchase the relevant
                  Mortgage Loan or Mortgage Loans under the relevant Mortgage
                  Account (including any Personal Secured Loans and any
                  Further Draws made thereunder secured over the same
                  Mortgaged Property) and their Related Security in accordance
                  with the terms of the Mortgage Sale Agreement, but such
                  Mortgage Loan and its Related Security are not capable of
                  being repurchased or purchased, as applicable; in which
                  event the aggregate Current Balance of the Mortgage Loans in
                  the Mortgage Portfolio shall be deemed to be reduced for the
                  purposes of making the Trust Property Calculation
                  Adjustments by an amount equal to the Current Balance of the
                  relevant Mortgage Loan (together with Arrears of Interest
                  and Accrued Interest) which is not capable of being
                  repurchased or purchased, as applicable; and/or

         (E)      the Seller breaches any other material warranty under the
                  Mortgage Sale Agreement and/or (for so long as it is the
                  Administrator) the Administration Agreement, in which event
                  the aggregate Current Balance of Mortgage Loans in the
                  Mortgage Portfolio shall be deemed for the purposes of
                  making the Trust Property Calculation Adjustments to be
                  reduced by an amount equivalent to all losses, costs,
                  liabilities, claims, expenses and damages incurred by the
                  Beneficiaries as a result of such breach.

                  The reductions and deemed reductions set out in paragraphs
                  (A), (B), (C), (D) and (E) (including any resulting loss in
                  respect thereof) of this Clause and any losses arising in
                  respect of any Personal Secured Loans shall, subject to
                  Clause 9.1 (Initial Minimum Seller Share), be allocated on
                  the relevant Distribution

                                      25
<PAGE>

                  Date, Assignment Date or Contribution Date (as applicable)
                  first to the Seller Share of the Trust Property (or for the
                  purposes of calculating the Seller Share of the Trust
                  Property as the case may be) until the Seller Share is zero
                  and thereafter (in respect of paragraph (A) only) shall be
                  allocated to the Funding Share and the Funding 2 Share of
                  the Trust Property pro rata in accordance with the Funding
                  Proportion and the Funding 2 Proportion. If at, or any time
                  after the Initial Closing Date the Mortgages Trustee holds,
                  or there is held to its order, or it receives, or there is
                  received to its order, any property, interest, right or
                  benefit relating to the whole or that portion of any
                  Mortgage Loan and its Related Security which is or has been
                  subject to any matter described in paragraphs (A) through
                  (E) above or any Personal Secured Loan in respect of which
                  losses have arisen and in respect of which the Seller Share
                  of the Trust Property has been reduced or deemed reduced
                  such property, interest, right or benefit will constitute a
                  Revenue Receipt and the Mortgages Trustee will remit, assign
                  or transfer the same to Funding and to Funding 2 pro rata in
                  accordance with the Funding Proportion and the Funding 2
                  Proportion (but only if and to the extent that the related
                  reductions or deemed reductions were applied against the
                  Funding Share and the Funding 2 Share of the Trust Property)
                  and thereafter to the Seller, as the case may require, and
                  until it does so or to the extent that the Mortgages Trustee
                  is unable to effect such remittance, assignment or transfer,
                  the Mortgages Trustee will hold such property, interest,
                  right or benefit and/or the proceeds thereof upon trust
                  absolutely for Funding and/or Funding 2 and/or the Seller
                  (separate from the Mortgages Trust), as the case may
                  require.

8.6      Current Seller Share Percentage

         (A)      On each Relevant Distribution Date, the "Current Seller
                  Share Percentage" will be calculated by the Cash Manager in
                  respect of the then-current Trust Calculation Period or the
                  related Interim Calculation Period, as applicable, and the
                  distributions to be made from the Trust Property on the
                  immediately succeeding Distribution Date, and will be a
                  percentage equal to:

                  100% minus the sum of the Current Funding Share Percentage
                  and the Current Funding 2 Share Percentage

                  where the Current Funding Share Percentage and the Current
                  Funding 2 Share Percentage are calculated on such Relevant
                  Distribution Date in accordance with Clause 8.2(I)(A) and
                  (subject to Clause 8.2(II)(D)) Clause 8.2(II)(A)
                  respectively.

         (B)      On each Relevant Assignment Date, the Cash Manager will
                  recalculate the Current Seller Share Percentage in respect
                  of the related Interim Calculation Period and the
                  distributions to be made from the Trust Property on the
                  immediately succeeding Distribution Date and will be a
                  percentage equal to:

                  100% minus the sum of the Current Funding Share Percentage
                  and the Current Funding 2 Share Percentage

                  where the Current Funding Share Percentage and the Current
                  Funding 2 Share Percentage are as calculated on such
                  Relevant Assignment Date in accordance

                                      26
<PAGE>

                  with Clause 8.2(I)(B) and (subject to Clause 8.2(II)(D))
                  Clause 8.2(II)(B) respectively.

         (C)      On each Relevant Contribution Date, the Cash Manager will
                  recalculate the Current Seller Share Percentage in respect
                  of the related Interim Calculation Period and the
                  distributions to be made from the Trust Property on the
                  immediately succeeding Distribution Date and will be a
                  percentage equal to:

                  100% minus the sum of the Current Funding Share Percentage
                  and the Current Funding 2 Share Percentage

                  where the Current Funding Share Percentage and the Current
                  Funding 2 Share Percentage are as calculated on such
                  Relevant Contribution Date in accordance with Clause
                  8.2(I)(C) and (subject to Clause 8.2(II)(D)) Clause
                  8.2(II)(C) respectively.

8.7      Weighted Average Seller Share Percentage

         On any Distribution Date in respect to which:

         (1)      the Seller has assigned New Mortgage Loans to the Mortgages
                  Trustee; or

         (2)      a Funding Beneficiary has made a Contribution (excluding a
                  Deferred Contribution) to the Mortgages Trustee to increase
                  its share of the Trust Property; or

         (3)      Funding had received a Special Distribution from the
                  Mortgages Trustee,

         during the Trust Calculation Period immediately preceding such
         Distribution Date, the Cash Manager will calculate (for the sole
         purpose of making the distributions to be made on such Distribution
         Date) the Weighted Average of the Seller Share Percentages that were
         calculated previously in respect of the Revenue Receipts and
         Principal Receipts received, and Losses sustained, during each
         Interim Calculation Period occurring in such immediately preceding
         Trust Calculation Period and will be a percentage equal to:

         (A)      in respect of the distribution of Revenue Receipts to be
                  made on such Distribution Date:

                  100% minus the sum of the Weighted Average Funding Share
                  Percentage and the Weighted Average Funding 2 Share
                  Percentage

                  where such Weighted Average Funding Share Percentage and
                  Weighted Average Funding 2 Share Percentage are as
                  calculated on such Distribution Date in accordance with
                  Clauses 8.3(A)(i) and 8.3(B)(i) respectively;

         (B)      in respect of the distribution of Principal Receipts to be
                  made on such Distribution Date:

                  100% minus the sum of the Weighted Average Funding Share
                  Percentage and the Weighted Average Funding 2 Share
                  Percentage

                                      27
<PAGE>

                  where such Weighted Average Funding Share Percentage and
                  Weighted Average Funding 2 Share Percentage are as
                  calculated on such Distribution Date in accordance with
                  Clauses 8.3(A)(ii) and 8.3(B)(ii) respectively; and

         (C)      in respect of the allocation of Losses to be made on such
                  Distribution Date:

                  100% minus the sum of the Weighted Average Funding Share
                  Percentage and the Weighted Average Funding 2 Share
                  Percentage

                  where such Weighted Average Funding Share Percentage and
                  Weighted Average Funding 2 Share Percentage are as
                  calculated on such Distribution Date in accordance with
                  Clauses 8.3(A)(iii) and 8.3(B)(iii) respectively.

8.8      Current Seller Share

         (A)      On each Relevant Distribution Date, the "Current Seller
                  Share" will be calculated by the Cash Manager in respect of
                  the then-current Trust Calculation Period or the related
                  Interim Calculation Period, as applicable, and will be an
                  amount equal to:

                  The aggregate amount of the Trust Property (excluding
                  Revenue Receipts) as at the Relevant Distribution Date minus
                  the sum of the Current Funding Share and the Current Funding
                  2 Share

                  where "Current Funding Share" and "Current Funding 2 Share"
                  are as calculated on such Relevant Distribution Date in
                  accordance with Clauses 8.4(I)(A) and 8.4(II)(A)
                  respectively.

         (B)      On each Relevant Assignment Date, the Current Seller Share
                  will be calculated by the Cash Manager in respect of the
                  related Interim Calculation Period and will be an amount
                  equal to:

                  The aggregate amount of the Trust Property (excluding
                  Revenue Receipts) as at an Assignment Date minus the sum of
                  the Current Funding Share and the Current Funding 2 Share

                  where "Current Funding Share" and "Current Funding 2 Share"
                  are as calculated on such Relevant Assignment Date in
                  accordance with Clauses 8.4(I)(B) and 8.4(II)(B) above.

         (C)      On each Relevant Contribution Date, the Current Seller Share
                  will be calculated by the Cash Manager in respect of the
                  Interim Calculation Period and will be an amount equal to:

                  The aggregate amount of the Trust Property (excluding
                  Revenue Receipts) as at a Contribution Date minus the sum of
                  the Current Funding Share and the Current Funding 2 Share

                  where "Current Funding Share" and "Current Funding 2 Share"
                  are as calculated on such Relevant Contribution Date in
                  accordance with Clauses 8.4(I)(C) and 8.4(II)(C)
                  respectively.

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<PAGE>

8.9      Funding Share/Funding 2 Share/Seller Share

         The Funding Share, the Funding 2 Share and the Seller Share may not
         be reduced below zero. At all times the sum of the Funding Share
         Percentage, the Funding 2 Share Percentage and the Seller Share
         Percentage shall be equal to 100 per cent. of the Trust Property.

9.       MINIMUM SELLER SHARE

9.1      Initial Minimum Seller Share

         The Seller Share of the Trust Property includes an amount equal to
         the Minimum Seller Share. Unless and until both the Funding Share and
         the Funding 2 Share of the Trust Property are in an amount equal to
         zero or following the occurrence of an Asset Trigger Event, the
         Seller will not be entitled to receive Mortgages Trustee Principal
         Receipts which would reduce the Seller Share of the Trust Property to
         an amount less than the Minimum Seller Share and the Seller consents
         and directs the Mortgages Trustee accordingly.

9.2      Fluctuation of Minimum Seller Share on each Distribution Date

         At the Initial Closing Date, the Minimum Seller Share will be
         (GBP)50,000,000. The amount of the Minimum Seller Share will be
         recalculated on each Distribution Date in accordance with the
         following formula:

                                       W+X+Y+Z

         where:

         W =      100% of the sum of the average cleared credit balance of all
                  applicable accounts linked to Together Connections Mortgage
                  Loans and Connections Mortgage Loans in respect of each
                  calendar month or any part of any such calendar month;

         X =      2.0% of the aggregate Current Balance of all Mortgage Loans
                  in the Mortgage Portfolio as at the last day of the
                  immediately preceding Trust Calculation Period;

         Y =      the product of: p x q x r where:

                  p =      8%;

                  q =      the sum of (i) the "Flexible Cash Re-Draw
                           Capacity", being an amount equal to the difference
                           between (1) the maximum amount of Cash Re-draws
                           that Borrowers may draw under Flexible Mortgage
                           Loans included in the Mortgage Portfolio (whether
                           or not drawn) as at the last day of the immediately
                           preceding Trust Calculation Period and (2) the
                           aggregate Current Balance of Cash Re-draws in
                           respect of Mortgage Loans included in the Mortgage
                           Portfolio as at the last day of the immediately
                           preceding Trust Calculation Period; and (ii) the
                           "Further Draw Capacity", being an amount equal to
                           the difference between (1) the maximum amount of
                           Further Draws that Borrowers

                                      29
<PAGE>

                           may make in respect of Personal Secured Loans
                           included in the Mortgage Portfolio (whether or not
                           drawn) as at the last day of the immediately
                           preceding Trust Calculation Period and (2) the
                           aggregate Current Balance of Personal Secured Loans
                           which are included in the Mortgage Portfolio as at
                           the last day of the immediately preceding Trust
                           Calculation Period; and

                  r =      3; and

         Z =      the aggregate Current Balance of (i) Re-Draws and (ii)
                  Personal Secured Loans in the Mortgage Portfolio, in each
                  case as at the last day of the immediately preceding Trust
                  Calculation Period.

9.3      Recalculation of Minimum Seller Share following occurrence of
         exceptional events

         The calculation of the Minimum Seller Share in accordance with Clause
         9.2 (Fluctuation of Minimum Seller Share on each Distribution Date)
         above will be recalculated by the Cash Manager with the agreement of
         the parties hereto subject to the approval of the Rating Agencies if
         the Seller merges or otherwise combines its business with another
         bank or other financial institution so as to increase the risks
         associated with Borrowers holding deposits in Northern Rock accounts.

10.      DISTRIBUTION OF REVENUE RECEIPTS

10.1     Distribution of Third Party Amounts

         Pursuant to the Cash Management Agreement, the Cash Manager (at the
         direction of the Mortgages Trustee acting on behalf of the
         Beneficiaries at their direction and with their consent which is
         hereby given) will deduct, as and when identified, Third Party
         Amounts from the Revenue Receipts standing to the credit of the
         Mortgages Trustee GIC Account or Mortgages Trustee Transaction
         Account, and pay over the same to the proper recipients thereof. The
         Mortgages Trustee and the Beneficiaries hereby consent to such
         deductions.

10.2     Distribution of Mortgages Trustee Available Revenue Receipts

         Subject as provided in Clause 8.5 (Adjustments to Trust Property), on
         each Distribution Date the Cash Manager (at the direction of the
         Mortgages Trustee acting on behalf of the Beneficiaries at their
         direction and with their consent which is hereby given) will
         distribute Mortgages Trustee Available Revenue Receipts in the
         following order of priority:

         (A)      first, in no order of priority between them but in
                  proportion to the respective amounts due of:

                  (1)      any fees, costs, charges, liabilities and expenses
                           then due or to become due to the Mortgages Trustee
                           under the provisions of this Deed together with (if
                           applicable) VAT thereon (to the extent not already
                           included) as provided herein; and

                                      30
<PAGE>

                  (2)      any amounts due and payable by the Mortgages
                           Trustee to third parties in respect of the
                           Mortgages Trust but only if incurred without breach
                           by the Mortgages Trustee of the documents to which
                           it is a party and payment has not been provided for
                           elsewhere;

         (B)      second, in no order of priority between them but in
                  proportion to the respective amounts due of:

                  (1)      any remuneration then due and payable to the
                           Administrator and any costs, charges, liabilities
                           and expenses then due or to become due to the
                           Administrator under the provisions of the
                           Administration Agreement prior to the immediately
                           succeeding Distribution Date, in each case together
                           with (if applicable) VAT thereon (to the extent not
                           already included) as provided therein; and

                  (2)      any remuneration then due and payable to the Cash
                           Manager and any costs, charges, liabilities and
                           expenses then due or to become due to the Cash
                           Manager under the provisions of the Cash Management
                           Agreement prior to the immediately succeeding
                           Distribution Date, in each case together with (if
                           applicable) VAT thereon (to the extent not already
                           included) as provided therein;

         (C)      third, in no order of priority between them but in
                  proportion to the respective amounts due, and subject to the
                  proviso below, to allocate and pay Mortgages Trustee
                  Available Revenue Receipts to:

                  (1)      the Seller in an amount determined by multiplying
                           the total amount of the remaining Mortgages Trustee
                           Available Revenue Receipts by the Current Seller
                           Share Percentage of the Trust Property, as
                           determined on the immediately preceding
                           Distribution Date or, in the case of the first
                           Distribution Date immediately following the
                           relevant Closing Date, as of such Closing Date; and

                  (2)      Funding, in an amount which is equal to the lesser
                           of:

                           (i)      the aggregate of the amounts to be applied
                                    on the immediately succeeding Payment Date
                                    for Group 1 Issuers and the immediately
                                    succeeding Payment Date for Group 2
                                    Issuers as set forth under the Funding
                                    Pre-Enforcement Revenue Priority of
                                    Payments or, as the case may be, the
                                    Funding Post-Enforcement Priority of
                                    Payments (but excluding any principal
                                    amount due under any Funding Intercompany
                                    Loan (save that, for the avoidance of
                                    doubt, such exclusion shall not apply in
                                    respect of any Funding Available Revenue
                                    Receipts which are applied by a Funding
                                    Issuer to credit that Funding Issuer's
                                    Principal Deficiency Ledger and thereby
                                    reduce the principal payable under that
                                    Funding Issuer's Intercompany Loan) and
                                    any amount of Deferred Contribution due
                                    under paragraph (p) of the Funding
                                    Pre-Enforcement Revenue Priority of
                                    Payments and/or paragraph (F) of the
                                    Funding Post-Enforcement Priority of
                                    Payments), less all other amounts (not
                                    derived from the

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                                    distribution of Mortgages Trustee
                                    Available Revenue Receipts under this
                                    Deed) which will constitute Funding
                                    Available Revenue Receipts on the
                                    immediately succeeding Payment Date, such
                                    amount not to be less than zero; and

                           (ii)     an amount determined by multiplying the
                                    total amount of the remaining Mortgages
                                    Trustee Available Revenue Receipts by the
                                    Current Funding Share Percentage of the
                                    Trust Property, as determined on the
                                    immediately preceding Distribution Date
                                    (or, in the case of the first Distribution
                                    Date, the Initial Funding Share
                                    Percentage);

                  (3)      Funding 2 in an amount which is equal to the lesser
                           of:

                           (i)      the aggregate of the amounts to be applied
                                    on the immediately succeeding Monthly
                                    Payment Date as set forth under the
                                    Funding 2 Pre-Enforcement Revenue Priority
                                    of Payments or, as the case may be, the
                                    Funding 2 Post-Enforcement Priority of
                                    Payments (but excluding any principal
                                    amount due under the Global Intercompany
                                    Loan Agreement (save that, for the
                                    avoidance of doubt, such exclusion shall
                                    not apply in respect of any Funding 2
                                    Available Revenue Receipts which are
                                    applied by Funding 2 to credit any
                                    Principal Deficiency Subledgers and
                                    thereby reduce the principal payable under
                                    the related Loan Tranches) and any amount
                                    of Deferred Contribution under paragraph
                                    (X) of the Funding 2 Pre-Enforcement
                                    Revenue Priority of Payments and/or
                                    paragraph (O) of the Funding 2
                                    Post-Enforcement Priority of Payments),
                                    less all other amounts (not derived from
                                    the distribution of Mortgages Trustee
                                    Available Revenue Receipts under this
                                    Deed) which will constitute Funding 2
                                    Available Revenue Receipts on the
                                    immediately succeeding Monthly Payment
                                    Date, such amount not to be less than
                                    zero; and

                           (ii)     an amount determined by multiplying the
                                    total amount of the remaining Mortgages
                                    Trustee Available Revenue Receipts by the
                                    Current Funding 2 Share Percentage of the
                                    Trust Property, as determined on the
                                    immediately preceding Distribution Date;

         (D)      fourth, to allocate:

                  (i)      to Funding but pay at the direction of Funding to
                           the Seller an amount equal to the Funding
                           Proportion of YY - ZZ; and

                  (ii)     to Funding 2 but pay at the direction of Funding 2
                           to the Seller an amount equal to the Funding 2
                           Proportion of YY - ZZ,

                  where "YY" is the amount of the Mortgages Trustee Available
                  Revenue Receipts and "ZZ" is the amount of such Mortgages
                  Trustee Available Revenue Receipts applied and/or allocated
                  under items (A) to (C) above, such

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<PAGE>

                  amount to be in satisfaction of amounts of Deferred Purchase
                  Price due to the Seller under the terms of the Mortgage Sale
                  Agreement;

         PROVIDED THAT if an Assignment Date or a Contribution Date has
         occurred during the Trust Calculation Period immediately preceding
         such Distribution Date, then the Cash Manager will use (i) the
         Weighted Average Seller Share Percentage (instead of the Current
         Seller Share Percentage) as calculated pursuant to Clause 8.7(A)
         above in determining the amount of Mortgages Trustee Available
         Revenue Receipts to distribute to the Seller pursuant to Clause
         10.2(C)(1) above, (ii) the Weighted Average Funding Share Percentage
         (instead of the Current Funding Share Percentage) as calculated
         pursuant to Clause 8.3(A) above in determining the Funding (Mortgages
         Trust) Revenue Amounts pursuant to Clause 10.2(C)(2) and Clause 10.3
         (Calculation of Funding (Mortgages Trust) Revenue Amount and Funding
         2 (Mortgages Trust) Revenue Amount) and (iii) the Weighted Average
         Funding 2 Share Percentage (instead of the Current Funding 2 Share
         Percentage) as calculated pursuant to Clause 8.3(B) above in
         determining the amount of Funding 2 (Mortgages Trust) Revenue Amounts
         pursuant to Clause 10.2(C)(2) and Clause 10.3 (Calculation of Funding
         (Mortgages Trust) Revenue Amount and Funding 2 (Mortgages Trust)
         Revenue Amount).

11.      DISTRIBUTION OF PRINCIPAL RECEIPTS

11.1     Distribution of Principal Receipts prior to the occurrence of a
         Trigger Event

         Subject as provided in Clause 8.6 (Adjustments to Trust Property),
         prior to the occurrence of a Trigger Event (and whether or not there
         has been an enforcement of the Funding Security, the Funding 2
         Security, any Funding Issuer Security or any Funding 2 Issuer
         Security), on each Distribution Date (or, in respect of any Initial
         Purchase Price or Special Distribution, on any Contribution Date),
         the Cash Manager (at the direction of the Mortgages Trustee acting on
         behalf of the Beneficiaries at their direction and with their consent
         which is hereby given) shall, subject to the provisos below, allocate
         and distribute Mortgages Trustee Principal Receipts as follows:

         (A)      first, to the Seller an amount in respect of any Initial
                  Purchase Price (if any) or Special Distribution which is
                  then allocable and payable to the Seller under Clause 6.4
                  (Distribution) above;

         (B)      second, to Funding the amount of any Special Distribution
                  which is then allocable and payable to Funding in accordance
                  with Clause 6.4 (Distribution) above;

         (C)      third, in no order of priority between them but in
                  proportion to the respective amounts due:

                  (1)      to Funding an amount in respect of each Funding
                           Issuer which is equal to the lesser of:

                           (a)         (i)   prior to the occurrence of an ACA
                                             Trigger Event, the principal
                                             amount due on the Funding
                                             Intercompany Loan of such Funding
                                             Issuer equal to the Controlled
                                             Amortisation Amounts due, if any,
                                             on such Funding

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<PAGE>

                                             Issuer's Payment Date immediately
                                             succeeding such Distribution Date
                                             (in each case determined on the
                                             assumption that the Issuer
                                             Reserve Requirement, the Issuer
                                             Arrears Test and the Subordinated
                                             Principal Test (as applicable)
                                             are satisfied on such date; that
                                             the Controlled Amortisation
                                             Amount is the relevant amount as
                                             set forth in the tables contained
                                             in Schedule 4 to the Current
                                             Issuer Cash Management Agreement;
                                             and that the proviso appearing at
                                             the end of such tables does not
                                             apply); and

                                    (ii)     upon and after the occurrence of
                                             an ACA Trigger Event, (x) in
                                             respect of each Funding Issuer
                                             that is not an ACA Issuer, an
                                             amount as set forth in (1)(a)(i)
                                             above; and (y) in respect of each
                                             ACA Issuer, up to an amount equal
                                             to the ACA Limit Amount in
                                             respect of such ACA Issuer; and

                           (b)      an amount in respect of each Funding
                                    Issuer equal to:

                            Current Funding Share          Outstanding
                                Percentage as            Principal Balance
                              calculated on the           on such Funding
                           immediately preceding          Issuer's Funding
                           Distribution Date (or,        Intercompany Loan
                                                         ------------------
          Mortgages      in the case of the first            Aggregate
            Trustee  x      Distribution Date        x      Outstanding
 Principal Receipts       following the Closing          Principal Balance
                          Date in respect of such         on all Funding
                            Issuer, as of the              Intercompany
                           relevant Closing Date)           Loans

                  (2)      to Funding 2 in an amount equal to the lesser of:

                           (a)      if Funding 2 has a Repayment Requirement
                                    on that Distribution Date, the amount of
                                    such Repayment Requirement; and

                           (b)      an amount determined by multiplying the
                                    total amount of remaining Mortgages
                                    Trustee Principal Receipts by the Current
                                    Funding 2 Share Percentage of the Trust
                                    Property;

         (D)      fourth, in no order between them but in proportion to the
                  respective amounts due to Funding and Funding 2, to the
                  extent not already paid pursuant to item (C) above, up to
                  the amounts set forth in item (C)(1)(a) and item (C)(2)(a)
                  above, respectively; and

         (E)      fifth, if such Distribution Date is not a Seller Share Event
                  Distribution Date, to allocate to the Seller an amount equal
                  to AA - BB, where "AA" is the amount of Mortgages Trustee
                  Principal Receipts and "BB" is the amount of such Mortgages
                  Trustee Principal Receipts applied and/or allocated under
                  (A) through (D) above;

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<PAGE>

         provided that, if an Assignment Date or a Contribution Date has
         occurred during the Trust Calculation Period immediately preceding
         that Distribution Date, then the Cash Manager will use (i) the
         Weighted Average Funding 2 Share Percentage (instead of the Funding 2
         Share Percentage) in determining the amount of Mortgages Trustee
         Principal Receipts to distribute to Funding 2 on that Distribution
         Date and (ii) the Weighted Average Funding Share Percentage in
         determining the amount of Mortgages Trustee Principal Receipts to
         distribute to Funding on that Distribution Date.

PROVIDED THAT in relation to (A) through (E) above the following rules (the
"Rules for the application of Mortgages Trustee Principal Receipts") shall
apply:

          (1)        (a)   If the Notes of any Funding Issuer have become
                           immediately due and payable as a result of the
                           service of a Note Enforcement Notice or if the
                           Intercompany Loan of any Funding Issuer has (and
                           the other Intercompany Loans of any other Funding
                           Issuers have) become immediately due and payable as
                           a result of the service of an Intercompany Loan
                           Enforcement Notice on Funding, principal payments
                           in respect of the Intercompany Loan of that Funding
                           Issuer may be made in excess of any Controlled
                           Amortisation Amount and paragraph (C)(1)(a) above
                           shall no longer apply in relation to that Funding
                           Issuer and, except following a Non-Asset Trigger
                           Event, the amount of Mortgages Trustee Principal
                           Receipts to be distributed to Funding in respect of
                           that Funding Issuer on that Distribution Date may
                           not exceed the amount determined under paragraph
                           (C)(1)(b) above.

                  (b)      If the Notes of any Funding 2 Issuer have become
                           immediately due and payable as a result of the
                           service of an Issuer Enforcement Notice or if the
                           Loan Tranches under any Funding 2 Intercompany Loan
                           Agreement have become immediately due and payable
                           as a result of the service of a Funding 2
                           Intercompany Loan Enforcement Notice, principal
                           payments in respect of the Funding 2 Intercompany
                           Loan may be made in excess of any Bullet Repayment
                           Loan Amount, Scheduled Repayment Loan Amount or
                           Controlled Repayment Loan Amount and paragraph
                           (C)(2)(a) above shall no longer apply and, except
                           following a Non-Asset Trigger Event, the amount of
                           Mortgages Trustee Principal Receipts to be
                           distributed to Funding 2 on that Distribution Date
                           may not exceed the amount determined under
                           paragraph (C)(2)(b) above.

          (2)     (a)      If the Notes of any Funding Issuer have become
                           immediately due and payable as a result of the
                           service of a Note Enforcement Notice or if the
                           Intercompany Loan of any Funding Issuer has (and
                           the other Intercompany Loans of any other Funding
                           Issuers have) become immediately due and payable as
                           a result of the service of an Intercompany Loan
                           Enforcement Notice on Funding, then for the purpose
                           of calculating the amount in respect of that
                           Funding Issuer under paragraph (C)(1)(b) above,
                           that amount may be reduced to the extent of any
                           remaining amounts standing to the credit of the
                           Issuer Reserve Ledger and/or the Issuer Liquidity
                           Reserve Ledger (if any) for

                                      35
<PAGE>

                           that Funding Issuer which are to be utilised on the
                           immediately succeeding Payment Date to repay
                           principal on that Funding Issuer's Intercompany
                           Loan, but only to the extent that those amounts
                           would not otherwise be payable on that Funding
                           Intercompany Loan on that Payment Date.

                  (b)      If the Notes of any Funding 2 Issuer have become
                           immediately due and payable as a result of the
                           service of an Issuer Enforcement Notice or if the
                           Loan Tranches advanced under the Intercompany Loan
                           Agreement of any Funding 2 Issuer has (and the Loan
                           Tranches advanced under any Intercompany Loan
                           Agreements of any other Funding 2 Issuers have)
                           become immediately due and payable as a result of
                           the service of an Intercompany Loan Enforcement
                           Notice on Funding 2, then for the purpose of
                           calculating the amount under paragraph (C)(2)(b)
                           above, that amount will be reduced to the extent of
                           any remaining amounts standing to the credit of the
                           Funding 2 Reserve Ledger and/or the Funding 2
                           Liquidity Reserve Ledger (if any) which are to be
                           utilised on the immediately succeeding Monthly
                           Payment Date to repay principal on that Funding 2
                           Issuer's Intercompany Loan, but only to the extent
                           that those amounts would not otherwise be payable
                           on any Funding 2 Intercompany Loan on that Monthly
                           Payment Date.

         (3)      (a)      The amount of Mortgages  Trustee  Principal Receipts
                           payable to Funding in respect of each Funding
                           Issuer on a Distribution Date will be reduced in
                           proportion to the aggregate of the Issuer Available
                           Revenue Receipts of that Funding Issuer which are
                           to be applied on the immediately succeeding Payment
                           Date in reduction of deficiencies recorded on the
                           Issuer Principal Deficiency Ledger of that Funding
                           Issuer, but only to the extent that the Funding
                           Issuer Available Revenue Receipts which are to be
                           so applied on that Payment Date would not otherwise
                           be payable as principal on the relevant Notes on
                           that Payment Date.

                  (b)      The amount of Mortgages Trustee Principal Receipts
                           payable to Funding 2 on a Distribution Date will be
                           reduced in proportion to the aggregate of Mortgages
                           Trustee Available Revenue Receipts allocable to
                           Funding 2 on such Distribution Date which are to be
                           applied on the immediately succeeding Monthly
                           Payment Date in reduction of deficiencies recorded
                           on the Funding 2 Principal Deficiency Ledger, but
                           only to the extent that the Mortgages Trustee
                           Available Revenue Receipts which are to be so
                           applied on that Monthly Payment Date would not
                           otherwise be payable as principal of the relevant
                           Notes to be paid on that Monthly Payment Date.

         (4)      For the purpose of determining the Mortgages Trustee
                  Principal Receipts to be distributed to Funding in respect
                  of the amount due on the Intercompany Loan of any Funding
                  Issuer under (B) and (D) above, the Outstanding Principal
                  Balance of that Intercompany Loan shall be deemed to be
                  reduced by the amount of:

                                      36
<PAGE>

                  (a)      any deficiency recorded on the Issuer Principal
                           Deficiency Ledger of that Issuer as at that
                           Distribution Date, but only to the extent that such
                           deficiency has arisen as a result of (i) Losses on
                           the Mortgage Loans allocated by Funding to that
                           Issuer and/or (ii) the application of Funding
                           Available Principal Receipts to fund the Issuer
                           Liquidity Reserve Fund of that Issuer but not as a
                           result of any other principal deficiency of that
                           Issuer; and

                  (b)      the Outstanding Principal Balance as at such
                           Distribution Date of any Special Repayment Notes
                           issued by that Issuer

         (5)      Funding will not be entitled to receive and the Cash Manager
                  shall procure that Funding does not receive any amount of
                  Mortgages Trustee Principal Receipts from the Mortgages
                  Trustee on a Distribution Date which is not required by
                  Funding to repay principal falling due on any Intercompany
                  Loan on the immediately succeeding Payment Date in order to
                  fund payments of principal falling due on any Notes issued
                  by any Funding Issuer on that Payment Date.

         (6)      The Mortgages Trustee will not distribute any Overpayment
                  (other than a Capital Payment) in respect of any
                  Non-Flexible Mortgage Loan until the first Distribution Date
                  following December 31 of the year in which such Overpayment
                  is received; provided that if a Borrower has made an
                  Underpayment of principal in respect of such Non-Flexible
                  Mortgage Loan following the Overpayment then the Mortgages
                  Trustee will distribute principal in an amount up to the
                  amount of such Underpayment (but not exceeding the amount of
                  the Overpayment previously made) on the immediately
                  succeeding Distribution Date.

         (7)      On a Seller Share Event Distribution Date, the Cash Manager
                  shall not distribute the remaining Mortgages Trustee
                  Principal Receipts to the Seller and shall deposit all
                  Mortgages Trustee Retained Principal Receipts in the
                  Mortgages Trustee GIC Account and make a corresponding
                  credit to the Mortgages Trustee Principal Ledger.

11.2     Distribution of Mortgages Trustee Principal Receipts on or after the
         occurrence of an Asset Trigger Event

         On or after the occurrence of an Asset Trigger Event, the Cash
         Manager (at the direction of the Mortgages Trustee acting on behalf
         of the Beneficiaries at their direction and with their consent which
         is hereby given) shall, on each Distribution Date (including, if
         applicable, any Distribution Date on which an Asset Trigger Event
         occurs), allocate and distribute all Mortgages Trustee Principal
         Receipts as follows:

         (a)      if the immediately preceding Distribution Date was a Seller
                  Share Event Distribution Date, all of the Mortgages Trustee
                  Retained Principal Receipts to Funding and Funding 2 in no
                  order of priority among them and pro rata in accordance with
                  the Funding Proportion and the Funding 2 Proportion; and
                  then

                                      37
<PAGE>

         (b)      among Funding, Funding 2 and the Seller, in no order of
                  priority among them and pro rata according to their
                  respective Shares of the Trust Property until the Funding
                  Share and the Funding 2 Share of the Trust Property are
                  reduced to zero (and, for the avoidance of doubt, such
                  payments may reduce the Seller Share of the Trust Property
                  to an amount less than the Minimum Seller Share).
                  Notwithstanding the foregoing, if an Assignment Date or a
                  Contribution Date has occurred during the Trust Calculation
                  Period immediately preceding any such Distribution Date, the
                  Cash Manager will apply all Mortgages Trustee Principal
                  Receipts remaining after (a) above among Funding, Funding 2
                  and the Seller in no order of priority between them but in
                  proportion to the Weighted Average Funding Share Percentage,
                  the Weighted Average Funding 2 Share Percentage and the
                  Weighted Average Seller Share Percentage, each in respect of
                  Mortgages Trustee Principal Receipts, for that Distribution
                  Date until the Funding Share and Funding 2 Share of the
                  Trust Property is zero.

11.3     Distribution of Principal Receipts on or after the occurrence of a
         Non-Asset Trigger Event

         On or after the occurrence of a Non-Asset Trigger Event and until the
         occurrence of an Asset Trigger Event, the Cash Manager (at the
         direction of the Mortgages Trustee acting on behalf of the
         Beneficiaries at their direction and with their consent which is
         hereby given) shall, on each Distribution Date (including, if
         applicable, any Distribution Date on which a Non-Asset Trigger Event
         occurs), apply all Mortgages Trustee Principal Receipts to Funding
         and Funding 2 in no order of priority among them and pro rata in
         accordance with the Funding Proportion and the Funding 2 Proportion
         until the Funding Share and the Funding 2 Share of the Trust Property
         have been reduced to zero and shall thereafter, on each Distribution
         Date, apply all Mortgages Trustee Principal Receipts to the Seller.

12.      ALLOCATION OF LOSSES

12.1     Subject as provided otherwise herein (including Clause 8.5
         (Adjustments to Trust Property) of this Deed), all Losses sustained
         on the Mortgage Loans (other than any Personal Secured Loans) during
         a Trust Calculation Period shall be applied in reducing pro rata the
         Funding Share of the Trust Property, the Funding 2 Share of the Trust
         Property and the Seller Share of the Trust Property on the
         Distribution Date immediately succeeding such Trust Calculation
         Period by multiplying the Losses sustained in the relevant Trust
         Calculation Period by the Funding Share Percentage and the Funding 2
         Share Percentage, respectively, (in each case as calculated on the
         Distribution Date immediately preceding such Trust Calculation
         Period) until the Funding Share of the Trust Property and the Funding
         2 Share of the Trust Property are both zero, PROVIDED THAT if during
         the Trust Calculation Period immediately preceding a Distribution
         Date the Seller has sold and assigned New Mortgage Loans to the
         Mortgages Trustee or if Funding or Funding 2 made a Further
         Contribution to the Mortgages Trustee to increase the Funding Share
         or the Funding 2 Share of the Trust Property, such Losses shall be
         multiplied by the Weighted Average Funding Share Percentage and the
         Weighted Average Funding 2 Share Percentage, as applicable (in each
         case as calculated on such Distribution Date pursuant to Clause
         8.3(A)(3) or 8.3(B)(3) above) rather than the Funding Share
         Percentage and/or the Funding 2 Share Percentage. The remainder of
         such Losses shall be allocated to the Seller.

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<PAGE>

12.2     All losses sustained during a Trust Calculation Period on Personal
         Secured Loans in the Mortgage Portfolio shall be applied first to
         reduce the Seller Share of the Trust Property (including, for the
         avoidance of doubt, that portion of the Seller Share which represents
         the Minimum Seller Share) on the Distribution Date immediately
         succeeding such Trust Calculation Period until the Seller Share is
         zero and thereafter shall be applied to reduce the Funding Share and
         the Funding 2 Share of the Trust Property on a pro rata basis in
         accordance with the Funding Proportion and the Funding 2 Proportion.

13.      OVERPAYMENTS

13.1     Non-Flexible Mortgage Loans
         The Mortgages Trustee shall not distribute to the Beneficiaries any
         Overpayment in respect of any Non-Flexible Mortgage Loan which does
         not constitute a Capital Payment until the first Distribution Date
         following 31st December of the year in which such Overpayment is
         received, save to the extent that any such Overpayment by a Borrower
         is applied in reduction of an Underpayment by such Borrower in
         respect of such Mortgage Loan prior to such date. Any such
         Overpayment shall be retained in the Mortgages Trustee GIC Account
         and the Cash Manager will maintain a separate ledger to record its
         receipt and subsequent payment from time to time. Where any such
         Overpayment has been made in error the Cash Manager and/or the
         Administrator will be authorised to refund the amount of such
         Overpayment to the relevant Borrower at any time prior to 31st
         December of the year in which such Overpayment was made.

13.2     Flexible Mortgage Loans

         Overpayments in respect of any Flexible Mortgage Loan (including the
         amount of any Together Connections Benefit applied to the related
         Together Connections Mortgage Loans or any Connections Benefit
         applied to the related Connections Mortgage Loans) will not be
         retained in the Mortgages Trustee GIC Account but will be distributed
         to the Beneficiaries on the immediately succeeding Distribution Date
         as Principal Receipts.

14.      ARREARS

         The aggregate Current Balance of the Mortgage Loans in the Mortgage
         Portfolio will be increased at any time by the amount in which the
         Mortgage Loans that have been sold and assigned to the Mortgages
         Trustee are in arrears and those arrears have been capitalised. Such
         increase shall be allocated to the Beneficiaries at any time in
         proportion to their respective percentage shares in the Trust
         Property as determined in respect of the Trust Calculation Period or
         Interim Calculation Period, as the case may be, in which the arrears
         occur.

15.      LEDGERS

         The Mortgages Trustee shall maintain, or shall procure that the Cash
         Manager shall maintain, the following Mortgages Trustee Ledgers:

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<PAGE>

         (a)      the Principal Ledger, which shall record (i) all receipts of
                  Principal Receipts and distribution of the same to Funding,
                  Funding 2 and the Seller and (ii) any Mortgages Trustee
                  Retained Principal Receipts;

         (b)      the Revenue Ledger, which shall record all receipts of
                  Revenue Receipts and distribution of the same in accordance
                  with this Deed;

         (c)      the Losses Ledger, which shall record Losses in relation to
                  the Mortgage Loans;

         (d)      the Funding Share/Funding 2 Share/Seller Share Ledger which
                  shall record the Funding Share, the Funding 2 Share and the
                  Seller Share of the Trust Property, and the Funding Share
                  Percentage, the Funding 2 Share Percentage and the Seller
                  Share Percentage;

         (e)      the Overpayments Ledger; which shall be divided into sub
                  ledgers to record (i) Overpayments on Non-Flexible Mortgage
                  Loans received into and paid out of the Mortgages Trustee
                  GIC Account from time to time and (ii) Overpayments on
                  Flexible Mortgage Loans;

         (f)      the Non-Flexible Underpayments Ledger; which shall record
                  Underpayments on Non-Flexible Mortgage Loans from time to
                  time;

         (g)      the Re-Draw Ledger, which shall be divided into sub ledgers
                  to record (i) Cash Re-Draws made in respect of Flexible
                  Mortgage Loans and (ii) Non-Cash Re-Draws made in respect of
                  Flexible Mortgage Loans;

         (h)      the Contributions Ledger, which will be divided into sub
                  ledgers to record (i) the making by Funding of Contributions
                  to the Mortgages Trust, (ii) the making by Funding 2 of
                  Contributions to the Mortgages Trust, (iii) the making by
                  the Seller of Contributions to the Mortgages Trust and the
                  application of such Contributions by the Mortgages Trustee
                  in payment to the Seller of (a) amounts of Initial Purchase
                  Price for the sale of any New Mortgage Portfolio which is
                  acquired by the Mortgages Trustee from the Seller under the
                  provisions of the Mortgage Sale Agreement or (b) amounts of
                  Deferred Purchase Price in accordance with the Mortgage Sale
                  Agreement or (c) any Special Distribution in accordance with
                  the terms of this Deed and the application of such
                  Contributions by the Mortgages Trustee in payment to Funding
                  of any Special Distribution in accordance with the terms of
                  this Deed; and

         (i)      the Further Draw Ledger, which shall record all Further
                  Draws in relation to Personal Secured Loans.

16.      FEES AND EXPENSES OF THE MORTGAGES TRUSTEE

16.1     Remuneration

         The Mortgages Trustee shall be entitled to charge and be remunerated
         for the work undertaken by it as trustee of the trusts created by
         this Deed. The remuneration shall be on such terms (if any) as the
         Mortgages Trustee may from time to time agree with the Beneficiaries
         in writing.

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<PAGE>

16.2     Expenses and Liabilities

         Each Beneficiary shall indemnify the Mortgages Trustee from time to
         time with such regularity as is reasonably agreed between the
         parties, in respect of the Funding Share, the Funding 2 Share and the
         Seller Share, respectively, of the documentable costs, expenses
         and/or liabilities directly and properly incurred by the Mortgages
         Trustee in performing its obligations hereunder or otherwise in
         acting as trustee in accordance with the terms of this Deed and the
         other Transaction Documents to which the Mortgages Trustee is a party
         inclusive (if applicable) of any amounts in respect of Irrecoverable
         VAT incurred in respect of such costs and expenses.

17.      BENEFICIARY DIRECTIONS

17.1     Administration Agreement  and Cash Management Agreement

         On the Initial Closing Date the Mortgages Trustee shall enter into
         the Administration Agreement and the Cash Management Agreement.

17.2     Directions from Beneficiaries

         Subject to Clause 17.3 (No Breach), Clause 17.7 (Controlling
         Directions) and to any agreement between the Beneficiaries, the
         Mortgages Trustee covenants with the Beneficiaries that the Mortgages
         Trustee shall take all necessary steps and do everything which the
         Funding Beneficiaries and the Seller (acting together) may reasonably
         request or direct it to do in order to give effect to the terms of
         this Deed or the other Transaction Documents to which the Mortgages
         Trustee is a party; provided that at any time after the Funding Share
         and the Funding 2 Share have both been reduced to zero the Mortgages
         Trustee shall not be required to act at the direction of the Funding
         Beneficiaries and the Seller (acting together) and shall instead act
         in accordance with any direction given solely by the Seller.

17.3     No breach

         Each of Funding, Funding 2 and the Seller covenants with each other
         and with the Mortgages Trustee that none of them shall direct or
         request the Mortgages Trustee to do any act or thing which breaches
         the terms of, or is otherwise expressly dealt with (such that the
         Mortgages Trustee has no discretion) under any of the Transaction
         Documents.

17.4     Mortgages Trustee entitled to decline to follow directions

         The Mortgages Trustee shall have the right to decline to follow any
         such direction if the Mortgages Trustee, being advised by counsel,
         determines that the proceedings, actions or steps may not be lawfully
         taken or if the Mortgages Trustee in good faith determines that the
         proceedings, actions or steps so directed would be illegal or involve
         it in personal liability (save where it has been indemnified and/or
         secured to its satisfaction against such liability).

17.5     Mortgages Trustee to provide information

         When the Mortgages Trustee is required to take any proceedings,
         actions or steps under or in connection with the Transaction
         Documents for which it requires

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         directions from the Funding Beneficiaries and the Seller, it shall as
         soon as reasonably practicable, provide sufficient information to the
         Funding Beneficiaries and the Seller as they may require in order to
         be able to give such directions.

17.6     Timing of directions

         Where a Beneficiary directs the Mortgages Trustee as to any matter,
         such Beneficiary shall give written particulars of such direction to
         the Mortgages Trustee and each other Beneficiary.

17.7     Controlling Directions

         Except in the case of Clause 18 (Early Termination of the Mortgages
         Trust), in which case the terms of Clause 18 (Early Termination of
         the Mortgages Trust) shall prevail, in the event of any conflict
         between the directions of the Beneficiaries then each Beneficiary
         irrevocably agrees that the Controlling Directions shall apply and as
         such, the Mortgages Trustee is to follow the Controlling Directions
         as if it were the direction of all Beneficiaries but if there is no
         Controlling Directions the Mortgages Trustee shall not act.

17.8     No requirement to act

         The Mortgages Trustee will not be bound and shall have no power to
         take any proceedings, actions or steps under or in connection with
         any of this Deed or the other Transaction Documents to which it is a
         party unless:

         (a)      it shall have been directed to do so by the Beneficiaries or
                  it is required to do so under any express provision of this
                  Deed or the other Transaction Documents (but subject to
                  Clause 17.2 (Directions from Beneficiaries) in respect of
                  conflict of directions); and

         (b)      it shall have been indemnified to its satisfaction against
                  all liabilities, proceedings, claims and demands to which it
                  may be or become liable and all costs, charges and expenses
                  which may be incurred by it in connection therewith and the
                  terms of such indemnity may include the provision of a
                  fighting fund, non-recourse loan or other similar
                  arrangement.

17.9     Covenant of the Mortgages Trustee

         Subject to the foregoing provision of this Clause 17 (Beneficiary
         Directions) the Mortgages Trustee covenants with each of the Seller,
         Funding and Funding 2 to exercise all of its rights arising under or
         in respect of the Trust Property (including without limitation any
         rights of enforcement) for the benefit of and on behalf of the
         Beneficiaries.

17.10    Mortgages Trustee not liable

         Provided that the Mortgages Trustee has complied with the provisions
         of this Clause 17 (Beneficiary directions), the Mortgages Trustee
         shall not be liable to the Beneficiaries notwithstanding that the way
         in which the relevant discretion, trust, power or remedy was
         exercised by the Mortgages Trustee did not reflect the particular
         wishes of any Beneficiary.

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18.      EARLY TERMINATION OF THE MORTGAGES TRUST

         Prior to its termination in accordance with Clause 26 (Termination),
         provided that all amounts due from Funding to the Funding Secured
         Creditors have been repaid in full and the Funding Share of the Trust
         Property has been reduced to zero, and further provided that all
         amounts due from Funding 2 to the Funding 2 Secured Creditors have
         been repaid in full and the Funding 2 Share of the Trust Property has
         been reduced to zero, the Mortgages Trust constituted by this Deed
         may be terminated at the option of the Seller, following a request in
         writing by the Seller to the Mortgages Trustee (which shall be copied
         to Funding, Funding 2 and the Cash Manager) at any time on or after
         the date on which all of the Intercompany Loans have been repaid in
         full or there is no further claim under any Intercompany Loan or such
         other date as may be agreed in writing between the Mortgages Trustee,
         Funding, Funding 2 and the Seller.

19.      AUDIT OF MORTGAGE LOANS CONSTITUTING THE TRUST PROPERTY

         If the long term, unsecured, unguaranteed and unsubordinated debt
         obligations of the Seller fall below A3 by Moody's then, if required
         by Moody's, the Beneficiaries shall appoint a firm of independent
         auditors (approved by the Rating Agencies) to determine whether the
         Mortgage Loans and their Related Security (or any part of them) in
         the Mortgage Portfolio complied with the representations and
         warranties set out in Schedule 1 (Representations and Warranties) of
         the Mortgage Sale Agreement as at the date such Mortgage Loans were
         sold and assigned to the Mortgages Trustee. The costs of such
         independent auditors shall be borne by the Beneficiaries pro rata
         according to their respective current percentage shares in the Trust
         Property.

20.      TRANSFERS
20.1     Funding shall not assign

         Subject to the right of Funding to assign by way of security its
         right, title, benefit and interest in the Trust Property and/or under
         this Deed to the Security Trustee under the Funding Deed of Charge
         and subject to the right of the Security Trustee or a Receiver to
         sell the Funding Share of the Trust Property and/or such right and
         interest under this Deed following the service on Funding of an
         Intercompany Loan Enforcement Notice (which right is hereby
         conferred), Funding covenants with each of the Seller and Funding 2
         that it shall not, and shall not purport to, sell, assign, transfer,
         convey, charge, declare a trust over, create any beneficial interest
         in, or otherwise dispose of the Funding Share in the Trust Property,
         or any of Funding's rights, title, interest or benefit in any of the
         Mortgage Portfolio or the Trust Property.

20.2     Funding 2 shall not assign

         Subject to the right of Funding 2 to assign by way of security its
         right, title, benefit and interest in the Trust Property and/or under
         this Deed to the Funding 2 Security Trustee under the Funding 2 Deed
         of Charge and subject to the right of the Funding 2 Security Trustee
         or a Receiver to sell the Funding 2 Share of the Trust Property
         and/or such right and interest under this Deed following the service
         on Funding 2 of an Intercompany Loan Enforcement Notice (which right
         is hereby conferred), Funding 2 covenants with each of the Seller and
         Funding that it shall not, and shall not purport

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         to, sell, assign, transfer, convey, charge, declare a trust over,
         create any beneficial interest in, or otherwise dispose of the
         Funding 2 Share in the Trust Property, or any of Funding 2's rights,
         title, interest or benefit in any of the Mortgage Portfolio or the
         Trust Property.

20.3     Seller shall not assign

         The Seller covenants with each of Funding and Funding 2 that it shall
         not, and shall not purport to, sell, assign, transfer, convey,
         charge, declare a trust over, create any beneficial interest in, or
         otherwise dispose of the Seller Share in the Trust Property or any of
         the Seller's rights, title, interest or benefit in the Trust
         Property, other than pursuant to the Transaction Documents.

21.      REPRESENTATIONS AND COVENANTS

21.1     Representations

         On the date hereof, each of the parties to this Deed makes the
         representations and warranties set out in Schedule 1 (Representation
         and Warranties) to this Deed to each of the other parties hereto.

21.2     Covenants of the Mortgages Trustee

         Save with the prior written consent of or at the direction of the
         Beneficiaries or as provided in or envisaged by this Deed and/or the
         other Transaction Documents, the Mortgages Trustee shall not, so long
         as it is acting as Mortgages Trustee hereunder:

         (a)      Negative Pledge: create or permit to subsist any mortgage,
                  standard security, pledge, lien, charge or other security
                  interest whatsoever (unless arising by operation of law),
                  upon the whole or any part of its assets (including any
                  uncalled capital) or its undertakings (present or future) or
                  (to the extent that it is within the control of the
                  Mortgages Trustee) upon the whole or any part of the Trust
                  Property;

         (b)      Disposal: transfer, sell, lend, part with or otherwise
                  dispose of, or deal with, or grant any option or present or
                  future right to acquire any of its assets or undertakings or
                  (to the extent that it is within the control of the
                  Mortgages Trustee) the Trust Property or any interest,
                  estate, right, title or benefit therein or thereto or agree
                  or attempt or purport to do so;

         (c)      Equitable Interest: knowingly permit any person other than
                  the Beneficiaries to have any equitable or beneficial
                  interest in any of its assets or undertakings or (to the
                  extent that it is within the control of the Mortgages
                  Trustee) the Trust Property or any interest, estate, right,
                  title or benefit therein;

         (d)      Bank Accounts: have an interest in any bank account, other
                  than as set out in the Transaction Documents.

         (e)      Restrictions on Activities: carry on any business other than
                  as described in this Deed and the Transaction Documents;

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         (f)      Borrowings: incur any indebtedness in respect of borrowed
                  money whatsoever or give any guarantee or indemnity in
                  respect of any such indebtedness;

         (g)      Merger: consolidate or merge with any other person or convey
                  or transfer its properties or assets substantially or as an
                  entirety to any other person;

         (h)      Premises or Employees: have any premises or employees or
                  subsidiaries; or

         (i)      Further shares: issue any further shares;

         (j)      United States activities: engage in any activities in the
                  United States (directly or through agents) or derive any
                  income from United States sources as determined under United
                  States income tax principles or hold any property if doing
                  so would cause it to be engaged or deemed to be engaged in a
                  trade or business within the United States as determined
                  under United States tax principles;

         (k)      Conduct of affairs: take any management decisions or direct
                  the conduct of its affairs in any Member State of the
                  European Union, including holding any board meetings in any
                  Member State of the European Union.

22.      POWER TO DELEGATE

22.1     Power to delegate

         Subject to Clause 22.2 (No further appointments), the Mortgages
         Trustee may (notwithstanding any rule of law or equity to the
         contrary) delegate (revocably or irrevocably and for a limited or
         unlimited period of time) the performance of all or any of its
         obligations and the exercise of all or any of its powers under this
         Deed or imposed or conferred on it by law or otherwise to any person
         or body of persons fluctuating in number selected by it and any such
         delegation may be by power of attorney or in such other manner as the
         Mortgages Trustee may think fit and may be made upon such terms and
         conditions (including the power to sub-delegate) as the Mortgages
         Trustee may think fit.

22.2     No further appointments

         Notwithstanding the provisions of Clause 22.1 (Power to delegate),
         the Mortgages Trustee shall not appoint any agent, attorney or other
         delegate having power to act in respect of the Trust Property unless
         it is directed in writing to do so by the Beneficiaries. The
         appointment of any agent, attorney or other delegate hereunder above
         shall terminate immediately upon the occurrence of a Trigger Event.

23.      POWER OF INVESTMENT

         The Mortgages Trustee may invest, and may appoint the Cash Manager to
         invest on its behalf, any amounts standing to the credit of the
         Mortgages Trustee Transaction Account in Authorised Investments. Save
         as expressly provided in this Deed, the Mortgages Trustee Guaranteed
         Investment Contract and the Bank Account Agreement, the Mortgages
         Trustee shall have no further or other powers of investment with
         respect to the Trust Property and (to the extent permitted by
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<PAGE>

         applicable law) the Trustee Act 2000 shall not nor shall any other
         provision relating to trustee powers of investment implied by statute
         or general law shall apply to the Mortgages Trust.

24.      OTHER PROVISIONS REGARDING THE MORTGAGES TRUSTEE

24.1     No action to impair Trust Property

         Except for actions expressly authorised by this Deed, the Mortgages
         Trustee shall take no action reasonably likely to impair the
         interests of the Beneficiaries in any Trust Property now existing or
         hereafter created or to impair the value of any Mortgage Loan or its
         Related Security subject to the Mortgages Trust.

24.2     Litigation

         The Mortgages Trustee must not prosecute or defend any legal or other
         proceedings anywhere in the world (at the cost of the Trust Property)
         unless it obtains legal or other advice that it is in the interests
         of the Beneficiaries to do so.

24.3     No Implied Duties

         The duties and obligations of the Mortgages Trustee under the
         Mortgages Trust shall be determined solely by the express provisions
         of this Deed (but without prejudice to the duties and obligations of
         the Mortgages Trustee under any of the other Transaction Documents).
         The Mortgages Trustee shall not be liable under this Deed except for
         the performance of such duties and obligations as shall be
         specifically set forth in this Deed. No implied covenants or
         obligations shall be read into this Deed against the Mortgages
         Trustee, and the permissible right of the Mortgages Trustee to do
         things set out in this Deed shall not be construed as a duty.

24.4     No Liability

         Neither the Mortgages Trustee, Funding (in its capacity as a
         Beneficiary hereunder), Funding 2 (in its capacity as a Beneficiary
         hereunder) nor the Seller (in its capacity as a Beneficiary
         hereunder) shall be liable to each other, in the absence of wilful
         default, gross negligence or breach of the terms of this Deed, in
         respect of any loss or damage which arises out of the exercise or
         attempted or purported exercise or failure to exercise any of their
         respective powers.

24.5     Reliance on Certificates

         The Mortgages Trustee may rely on and shall be protected in acting
         on, or in refraining from acting in accordance with, any resolution,
         officer's certificate, certificate of auditors or any other
         certificate, statement, instrument, opinion, report, notice, request,
         consent, order, appraisal, bond or other paper or document believed
         by it to be genuine and to have been signed or presented to it
         pursuant to the Transaction Documents by the proper party or parties.

24.6     Reliance on Third Parties

         The Mortgages Trustee may, in relation to these presents, act on the
         opinion or advice of or a certificate or any information obtained
         from any lawyer, banker, valuer,

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         broker, accountant, financial adviser, securities dealer, merchant
         bank, computer consultant or other expert in the United Kingdom or
         elsewhere and shall not, provided that it shall not have acted
         fraudulently or in breach of any of the provisions of the Transaction
         Documents, be responsible for any loss occasioned by so acting. Any
         such opinion, advice, certificate or information may be sent or
         obtained by letter, telemessage, telex, cable or facsimile device and
         the Mortgages Trustee shall not be liable for acting on any opinion,
         advice, certificate or information purporting to be so conveyed
         although the same shall contain some error or shall not be authentic,
         provided that such error or lack of authenticity shall not be
         manifest.

24.7     MIG Policies

         The Mortgages Trustee is not required to maintain any MIG Policy with
         the then-current insurer and may contract for mortgage indemnity
         guarantee protection from any insurer then providing MIG insurance
         policies, subject to prior agreement with the Rating Agencies and
         confirmation that the then-current ratings by the Rating Agencies (or
         any of them) of the Notes issued by any Issuer would not be adversely
         affected.

25.      NO RETIREMENT OF MORTGAGES TRUSTEE

25.1     No Retirement

         The Mortgages Trustee shall not, and shall not purport to, retire as
         the trustee of the Mortgages Trust or appoint any additional trustee
         of the Mortgages Trust and shall have no power to retire or appoint
         any additional trustee under the Trustee Act 1925 or otherwise.

25.2     No Replacement

         Neither the Seller, Funding nor Funding 2 shall at any time remove or
         purport to remove and/or replace the Mortgages Trustee as the trustee
         of the Mortgages Trust.

25.3     No Termination

         Prior to the payment by Funding and Funding 2 of all amounts owing
         under the Funding Intercompany Loan Agreements and/or the Funding 2
         Intercompany Loan Agreements, as applicable, and under the other
         Transaction Documents, neither the Seller, Funding nor Funding 2
         shall at any time, except in accordance with the provisions of Clause
         18 (Early Termination of the Mortgages Trust) and Clause 26
         (Termination), terminate or purport to terminate the Mortgages Trust
         and, in particular, but without prejudice to the generality of the
         foregoing, the Seller, Funding and Funding 2 shall not in reliance on
         their absolute beneficial interests in the Trust Property call for
         the transfer to them or vesting in them of the legal estate in all or
         any part of the Trust Property.

26.      TERMINATION

         Subject to Clause 18 (Early Termination of the Mortgages Trust), the
         Mortgages Trust hereby constituted shall terminate upon the date upon
         which the Trust Property is zero.

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27.      FURTHER ASSURANCES

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

28.      NO PARTNERSHIP OR AGENCY

         Nothing in this Deed shall be taken to constitute or create a
         partnership between any of the parties to this Deed or to make or
         appoint the Seller the agent of Funding (or vice versa) or the agent
         of Funding 2 (or vice versa) or Funding the agent of Funding 2 (or
         vice versa).

29.      CALCULATIONS

         In the absence of manifest error, any determination or calculation by
         or on behalf of the Mortgages Trustee in connection with the
         provisions of this Deed shall be deemed to be conclusive.

30.      CONFIDENTIALITY

30.1     General Obligation of Confidentiality

         Unless otherwise required by applicable law, and subject to Clause
         30.2 (Exceptions) below, each of the parties agrees to maintain the
         confidentiality of this Deed in its communications with third parties
         and otherwise. None of the parties shall disclose to any person any
         information relating to the business, finances or other matters of a
         confidential nature of or relating to any other party to this Deed or
         any of the Transaction Documents which it may have obtained as a
         result of having entered into this Deed or otherwise.

30.2     Exceptions

         The provisions of Clause 30.1 (General Obligation of Confidentiality)
         above shall not apply:

         (a)      to the disclosure of any information to any person who is a
                  party to any of the Transaction Documents as expressly
                  permitted by the Transaction Documents;

         (b)      to the disclosure of any information which is or becomes
                  public knowledge otherwise than as a result of the wrongful
                  conduct of the recipient;

         (c)      to the extent that the recipient is required to disclose the
                  same pursuant to any law or order of any court or pursuant
                  to any direction or requirement (whether or not having the
                  force of law) of any central bank or any governmental or
                  other regulatory or Taxation authority;

         (d)      to the disclosure of any information to professional
                  advisers who receive the same under a duty of
                  confidentiality;

         (e)      to the disclosure of any information with the consent of the
                  parties hereto;

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<PAGE>

         (f)      to the disclosure to the Rating Agencies or any of them of
                  such information as may be requested by any of them for the
                  purposes of setting or reviewing the rating assigned to the
                  Notes (or any of them), provided that no information which
                  would disclose the identity of a Borrower shall be disclosed
                  to the Rating Agencies or any of them;

         (g)      to the disclosure of any information disclosed to a
                  prospective assignee of Funding or Funding 2 (provided that
                  it is disclosed on the basis that the recipient will hold it
                  confidential); or

         (h)      to any disclosure for the purposes of collecting in or
                  enforcing the Trust Property or any of it.

31.      NON PETITION COVENANT; LIMITED RECOURSE

31.1     Non Petition Covenant

         Each of the parties hereto hereby agrees that it shall not institute
         against either Funding, Funding 2 or the Mortgages Trustee any
         winding-up, administration, insolvency or similar proceedings so long
         as any sum is outstanding under any Intercompany Loan Agreement of
         any Issuer or for two years plus one day since the last day on which
         any such sum was outstanding.

31.2     Limited Recourse

         Each of the parties hereto agrees that:

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

         (b)      in relation to Funding:

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

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

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<PAGE>

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

         (c) in relation to Funding 2:

                  (A)      only the Funding 2 Security Trustee may enforce the
                           security created in favour of the Funding 2
                           Security Trustee under the Funding 2 Deed of Charge
                           in accordance with the provisions thereof;

                  (B)      notwithstanding any other provision of this Deed or
                           any other Transaction Document, no sum due or owing
                           to any party to this Deed from or by Funding 2
                           under this Deed shall be payable by Funding 2
                           except to the extent that Funding 2 has sufficient
                           funds available or (following enforcement of the
                           Funding 2 Security) the Funding 2 Security Trustee
                           has realised sufficient funds from the Funding 2
                           Security to pay such sum subject to and in
                           accordance with the relevant Funding 2 Priority of
                           Payments and provided that all liabilities of
                           Funding 2 required to be paid in priority thereto
                           or pari passu therewith pursuant to such Funding 2
                           Priority of Payments have been paid, discharged
                           and/or otherwise provided for in full; and

                  (C)      it shall not take any steps for the purpose of
                           recovering any amount payable by Funding 2 or
                           enforcing any rights arising out of this Deed
                           against Funding 2 otherwise than in accordance with
                           the Funding 2 Deed of Charge.

31.3     Corporate Obligations

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

32.      AMENDMENTS AND WAIVER

32.1     Entire Agreement

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

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<PAGE>

32.2     Amendments and Waiver

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

32.3     Rights cumulative

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

33.      NOTICES

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

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

         (b)      in the case of the Mortgages Trustee, to Granite Finance
                  Trustees Limited, 22 Grenville Street, St. Helier, Jersey
                  JE4 8PX, Channel Islands (facsimile number 01534 609 333)
                  for the attention of the Company Secretary (with a copy to
                  the Seller in accordance with (a) above);

         (c)      in the case of Funding, to Granite Finance Funding Limited
                  69 Park Lane, Croydon, CR9 1TQ (facsimile number 020 8409
                  8911) for the attention of the Company Secretary (with a
                  copy to the Seller in accordance with (a) above);

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

         (e)      in the case of Funding 2, to Granite Finance Funding 2
                  Limited situated at Fifth Floor, 100 Wood Street, London
                  EC2V 7EX (facsimile number 020 7606 0643) for the attention
                  of The Company Secretary (with a copy to the Seller in
                  accordance with (a) above);

         (f)      in the case of the Funding 2 Security Trustee, to The Bank
                  of New York, 48th Floor, One Canada Square, London, E14 5AL
                  (facsimile number 020 7964 6399) for the attention of the
                  Global Structured Finance (Corporate Trust);

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<PAGE>

         (g)      in the case of the Fitch Ratings Ltd, to Fitch Ratings Ltd,
                  Eldon House, 2 Eldon Street, London EC2M 7UA (facsimile
                  number 020 7417 6262) for the attention of European
                  Structured Finance Surveillance;

         (h)      in the case of Moody's, to Moody's, 1st Floor, 2 Minster
                  Court, Mincing Lane, London EC3R 7XB (facsimile number 020
                  7772 5400) for the attention of Head of Monitoring Group,
                  Structured Finance (with a copy to the Seller in accordance
                  with (a) above);

         (i)      in the case of Standard & Poor's, to Standard & Poor's, 20
                  Cannon Square, Canary Wharf, London E14 5LH (facsimile
                  number 020 7826 3598) for the attention of Structured
                  Finance Surveillance Group (with a copy to the Seller in
                  accordance with (a) above),

         or to such other address or facsimile number or for the attention of
         such other person or entity as may from time to time be notified by
         any party to the others by fifteen days prior written notice in
         accordance with the provisions of this Clause 33.

34.      THIRD PARTY RIGHTS

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

35.      EXECUTION IN COUNTERPARTS; SEVERABILITY

35.1     Counterparts

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

35.2     Severability

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

36.      GOVERNING LAW AND SUBMISSION TO JURISDICTION

36.1     Governing Law

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

36.2     Submission to Jurisdiction

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

                                      52
<PAGE>

36.3     Process Agent

         The Mortgages Trustee irrevocably and unconditionally appoints
         Mourant & Co. Capital (SPV) Limited at 69 Park Lane, Croydon CR9 1TQ
         or otherwise at its registered office for the time being as its agent
         for service of process in England in respect of any proceedings in
         respect of this Agreement and undertakes that in the event of Mourant
         & Co. Capital (SPV) Limited ceasing so to act it will appoint another
         person with a registered office in London as its agent for service of
         process.

36.4     Forum

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

                                      53
<PAGE>

                                  SCHEDULE 1
                        REPRESENTATIONS AND WARRANTIES

1.       Status

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

2.       Powers and authority

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

3.       Legal validity

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

4.       Non-conflict

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

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

         (b)      conflict with its constitutional documents; or

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

5.       No litigation

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

6.       Consents and Licences

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

                                      54
<PAGE>

                                EXECUTION PAGE

IN WITNESS WHEREOF this Deed has been executed as a deed and delivered by the
parties hereto on the day and year first above written.

as Beneficiary, Cash Manager and Seller
EXECUTED AND DELIVERED AS A DEED          )
for and on behalf of                      )
NORTHERN ROCK PLC                         )
by its duly authorised attorney           )

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

Name:

in the presence of:
                                  Signature      ______________________________
                                                 Witness
                                  Full name
                                  Occupation     Trainee Solicitor
                                  Address        c/o Sidley Austin Brown & Wood
                                                 Woolgate Exchange
                                                 25 Basinghall Street
                                                 London EC2V 5HA

                                      55
<PAGE>

as Mortgages Trustee
EXECUTED AND DELIVERED AS A DEED                              )
for and on behalf of                                          )
GRANITE FINANCE TRUSTEES LIMITED                              )
a company incorporated in Jersey, Channel Islands, by         )
               and                  , being persons           )
who, in accordance with the laws of that territory are        )
acting under the authority of the company                     )

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

Name:

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

Name:

in the presence of:
                                  Signature      ______________________________
                                                 Witness
                                  Full name
                                  Occupation
                                  Address

                                      56
<PAGE>

as Funding and a Beneficiary

EXECUTED AND DELIVERED AS A DEED                          )
for and on behalf of                                      )
GRANITE FINANCE FUNDING LIMITED                           )
a company incorporated in Jersey, Channel Islands, by     )
           and                      , being persons       )
who, in accordance with the laws of that territory are    )
acting under the authority of the company                 )

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

Name:

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

Name:

in the presence of:
                                  Signature      ______________________________
                                                 Witness
                                  Full name
                                  Occupation
                                  Address

                                      57
<PAGE>

as Funding 2 and a Beneficiary
EXECUTED AND DELIVERED AS A DEED    )
for and on behalf of                )
GRANITE FINANCE FUNDING 2 LIMITED   )
acting by two directors             )

-------------------------------
for and on behalf of
LDC Securitisation Director No. 1 Limited
Director

Name:

-------------------------------
for and on behalf of
LDC Securitisation Director No. 2 Limited
Director

Name:

                                      58
<PAGE>Exhibit 4.3

                                                               Execution Version

                             Dated 19 January, 2005

                               NORTHERN ROCK PLC
                          as Seller and a Beneficiary

                        GRANITE FINANCE TRUSTEES LIMITED
                              as Mortgages Trustee

                        GRANITE FINANCE FUNDING LIMITED
                                 as Beneficiary

                       GRANITE FINANCE FUNDING 2 LIMITED
                                 as Beneficiary

                                    - and -

                              THE BANK OF NEW YORK
               as Security Trustee and Funding 2 Security Trustee

 ------------------------------------------------------------------------------
                                 TENTH AMENDED
                            MORTGAGE SALE AGREEMENT
 ------------------------------------------------------------------------------

                           SIDLEY AUSTIN BROWN & WOOD
                               WOOLGATE EXCHANGE
                              25 BASINGHALL STREET
                                LONDON EC2V 5HA
                            TELEPHONE 020 7360 3600
                            FACSIMILE 020 7626 7937
                             REF:30507-30030/678148

<PAGE>

                                    CONTENTS

1.       Definitions and Construction.........................................1

2.       Sale and Purchase of Initial Mortgage Portfolio......................2

3.       Initial Closing Date.................................................2

4.       Sale and Purchase of New Mortgage Portfolios.........................4

5.       Trust of Monies.....................................................12

6.       Perfection of the Assignment........................................13

7.       Undertakings........................................................16

8.       Warranties and Repurchase by the Seller.............................20

9.       Further Assurance...................................................26

10.      Consequences of Breach..............................................26

11.      Subordination.......................................................26

12.      Non-Merger..........................................................27

13.      No Agency or Partnership............................................27

14.      Payments............................................................27

15.      Assignment..........................................................27

16.      Funding Security Trustees...........................................28

17.      New Intercompany Loans..............................................29

18.      Non Petition Covenant; Limited Recourse.............................29

19.      Amendments and Waiver...............................................31

20.      Notices.............................................................31

21.      Third Party Rights..................................................32

22.      Execution in Counterparts; Severability.............................32

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

24.      Process Agent.......................................................32

25.      Appropriate Forum...................................................33

26.      Transaction Documents...............................................33

<PAGE>

SCHEDULE 1 REPRESENTATIONS AND WARRANTIES....................................35

SCHEDULE 2 FORMS OF TRANSFERS: REGISTERED AND UNREGISTERED LAND AND
         SCOTTISH TRANSFERS..................................................44

Part 1  FORM OF TRANSFER (REGISTERED LAND - ENGLAND AND WALES)...............45

Part 2  FORM OF TRANSFER (UNREGISTERED LAND - ENGLAND AND WALES).............46

Part 3  FORM OF TRANSFER (LAND REGISTER - SCOTLAND)..........................48

Part 4  FORM OF TRANSFER (SASINE REGISTER - SCOTLAND)........................50

SCHEDULE 3 ASSIGNMENT OF INSURANCE CONTRACTS.................................52

SCHEDULE 4 INSURANCE CONTRACTS...............................................54

SCHEDULE 5...................................................................55

Part 1  ASSIGNMENT OF GUARANTEES.............................................55

Part 2  ASSIGNATION OF GUARANTEES............................................57

SCHEDULE 6 NEW MORTGAGE PORTFOLIO NOTICE.....................................60

SCHEDULE 7  LOAN REPURCHASE NOTICE...........................................63

SCHEDULE 8 FORM OF NOTIFICATION TO BORROWERS.................................65

SCHEDULE 9 OFFER UNDER CLAUSE 8.6 (REPURCHASE OF FIXED RATE
         MORTGAGE LOANS).....................................................66

SCHEDULE 10..................................................................67

Part 1  POWER OF ATTORNEY IN FAVOUR OF THE MORTGAGES TRUSTEE,
        FUNDING AND THE SECURITY TRUSTEE.....................................67

Part 2  POWER OF ATTORNEY IN FAVOUR OF THE MORTGAGES TRUSTEE,
        EACH FUNDING BENEFICIARY AND EACH FUNDING SECURITY TRUSTEE...........70

SCHEDULE 11 FORM OF SCOTTISH TRUST DEED......................................73

SCHEDULE 12 LENDING CRITERIA ................................................80

SCHEDULE 13 STANDARD DOCUMENTATION...........................................83

APPENDIX A THE INITIAL MORTGAGE LOAN PORTFOLIO...............................92

<PAGE>

THIS AGREEMENT IS MADE ON 26 MARCH, 2001 AND AMENDED AND RESTATED PURSUANT TO
THE DEEDS OF AMENDMENT AND RESTATMENT DATED 23 JULY 2001, 28 SEPTEMBER 2001, 20
MARCH 2002, 27 JANUARY 2003, 14 APRIL, 2003, 21 MAY 2003, 26 JANUARY 2004, 28
JANUARY, 2004, 22 SEPTEMBER, 2004 AND 19 JANUARY, 2005 BETWEEN:

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

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

(3)   GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
      limited company incorporated under the laws of Jersey, but acting out of
      its branch office established in England (registered overseas company
      number FC022999 and branch number BR005916) at 69 Park Lane, Croydon CR9
      1TQ in its capacity as a Beneficiary;

(4)   GRANITE FINANCE FUNDING 2 LIMITED (registered number 5249387), a private
      limited company incorporated under the laws of England and Wales, whose
      registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX in
      its capacity as a Beneficiary; and

(5)   THE BANK OF NEW YORK a New York banking corporation whose London branch
      address is at 48th Floor, One Canada Square, London E14 5AL in its
      capacity as (1) Security Trustee and (2) as Funding 2 Security Trustee.

WHEREAS:

(A)   The Seller carries on the business (inter alia) of originating mortgage
      loans secured on residential properties located in England, Wales and
      Scotland.

(B)   The Seller has agreed to sell and assign to the Mortgages Trustee certain
      mortgage loans, together with the benefit of the related security for the
      same, on the terms and subject to, the conditions set out in this Mortgage
      Sale Agreement (the "Agreement").

(C)   The Mortgages Trustee has agreed to hold the above mentioned mortgage
      loans together with the benefit of the related security as bare trustee
      for the Beneficiaries upon, with and subject to the trusts, powers and
      provisions of the Mortgages Trust Deed.

IT IS HEREBY AGREED AS FOLLOWS:

1.       Definitions and Construction

1.1.     The provisions of the Programme Master Definitions Schedule signed for
         the purposes of identification by Sidley Austin Brown & Wood and Allen
         & Overy LLP on 19 January 2005 (as the same have been and may be
         amended, varied or

<PAGE>

         supplemented from time to time with the consent of the parties hereto)
         are expressly and specifically incorporated into and shall apply to
         this Agreement.

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

2.       Sale and Purchase of Initial Mortgage Portfolio

2.1.     Agreement to Assign: Subject to Clause 2.2 (Conditions), in
         consideration of the Purchase Price for the Initial Mortgage Portfolio
         (which shall be paid in accordance with Clause 3.3 (Effect of Payment
         of Initial Purchase Price)) and the covenant of the Mortgages Trustee
         to hold the Trust Property upon trust for the Seller and Funding as
         beneficiaries of the Mortgages Trust upon, with and subject to all the
         trusts, powers and provisions of the Mortgages Trust Deed and the
         Mortgages Trustee's agreement in Clause 3.5 (Early Repayment Charges)
         to pay to the Seller any and all Early Repayment Charge Receipts, the
         Seller hereby agrees to sell and assign the Initial Mortgage Portfolio
         to the Mortgages Trustee on the Initial Closing Date with full title
         guarantee.

2.2.     Conditions: The obligation of the Seller under Clause 2.1 (Agreement to
         Assign) shall be subject to and conditional upon:

         (a)      the issue by the First Issuer of the Notes on the Initial
                  Closing Date and the borrowing by Funding of the amount
                  provided for under the First Issuer Intercompany Loan
                  Agreement;

         (b)      the constitution of the Mortgages Trust on or prior to the
                  Initial Closing Date;

         (c)      the Transaction Documents having been executed and delivered
                  by the parties thereto on or before the Initial Closing Date
                  or, in the case of any Transaction Documents which are to be
                  executed immediately after the Initial Closing Date, the same
                  having been executed and being available for delivery and none
                  of the parties knowing of any reason why the same should not
                  be delivered immediately thereafter;

         (d)      the payment of the Initial Contribution by Funding to the
                  Mortgages Trustee in accordance with the terms of the
                  Mortgages Trust Deed; and

         (e)      the payment of the Initial Purchase Price by the Mortgages
                  Trustee to the Seller in accordance with paragraph (a) of
                  Clause 3.2 (Purchase Price).

3.       Initial Closing Date

3.1.     Initial Closing and Conditions Precedent: A meeting shall take place on
         the Initial Closing Date at the offices of Brown & Wood, 7 Princes
         Court, London EC2R 8AQ, or such offices as the parties may agree, at
         which the Seller shall deliver to the Security Trustee (upon request),
         Funding and the Mortgages Trustee or the representative of such party
         (or procure such delivery to such party of) the following documents:

                                       2
<PAGE>
         (a)      an original power of attorney in the form set out in Part 1 of
                  Schedule 10 (Power of Attorney in favour of the Mortgages
                  Trustee, Funding and the Security Trustee) duly executed by
                  the Seller;

         (b)      a certificate of solvency in relation to the Seller dated as
                  at the Initial Closing Date (in the form of the agreed draft)
                  duly executed by the Seller;

         (c)      a list of the Mortgage Loans in the Initial Mortgage
                  Portfolio;

         (d)      an assignment of the Insurance Contracts to the extent that
                  such Insurance Contracts relate to the Initial Mortgage
                  Portfolio in the form set out in Schedule 3 (Assignment of
                  Insurance Contracts) duly executed by the Seller; and

         (e)      a certified copy of the board minutes of the securitisation
                  sub-committee of the Seller authorising its duly appointed
                  representatives to agree to the sale and assignment of the
                  Initial Mortgage Portfolio and authorising the execution and
                  performance of this Agreement, the other Transaction Documents
                  and all of the documentation to be entered into pursuant to
                  the Transaction Documents.

3.2.     Purchase Price: Subject to fulfilment of the conditions referred to in
         paragraphs (a) to (and including) (e) of Clause 2.2 (Conditions) and
         Clause 3.1 (Initial Closing and Conditions Precedent), the Mortgages
         Trustee shall pay the Purchase Price for the Initial Mortgage Portfolio
         to the Seller, in the manner that the Seller directs, for value, as
         follows:

         (a)      the Initial Purchase Price for the Initial Mortgage Portfolio
                  shall be paid by the Mortgages Trustee to the Seller on the
                  Initial Closing Date (which Initial Purchase Price shall be
                  paid by the Mortgages Trustee from funds received by the
                  Mortgages Trustee from Funding on such date in respect of
                  Funding's Initial Contribution for the Funding Share of the
                  Closing Trust Property pursuant to the Mortgages Trust Deed);

         (b)      subject to and in accordance with the Mortgages Trustee
                  Revenue Priority of Payments, an amount of Deferred Purchase
                  Price in respect of the Mortgage Portfolio shall be paid by
                  the Mortgages Trustee to the Seller on each Distribution Date
                  but only from and to the extent (if any) of any Relevant
                  Distribution (as defined under paragraph (b) of Clause 4.2
                  (Consideration provided by Funding) of the Mortgages Trust
                  Deed) available for payment on such date and in an amount
                  equal to the Deferred Contribution for the Funding Share of
                  the Trust Property paid by Funding to the Mortgages Trustee on
                  such date or in respect of which the payment of such Deferred
                  Contribution is otherwise satisfied on such date in accordance
                  with the Mortgages Trust Deed; and

         (c)      a final amount of Deferred Purchase Price in respect of the
                  Mortgage Portfolio shall be paid by the Mortgages Trustee to
                  the Seller following the receipt by the Mortgages Trustee from
                  Funding of any Final Deferred Contribution, which payment
                  shall be in an amount equal to such Final Deferred
                  Contribution for the Funding Share of the Trust Property paid
                  by Funding to the Mortgages Trustee or in respect of which the
                  payment of such Final

                                       3
<PAGE>

                  Deferred Contribution is otherwise satisfied in accordance
                  with the Mortgages Trust Deed.

3.3.     Effect of Payment of Initial Purchase Price: The parties hereto
         acknowledge that the effect of the payment to the Seller by the
         Mortgages Trustee of the Initial Purchase Price on the Initial Closing
         Date will be the assignment to the Mortgages Trustee of the beneficial
         ownership of, and all of the Seller's beneficial right, title, interest
         and benefit in and to, the Initial Mortgage Portfolio subject to the
         terms and provisions of the Mortgages Trust Deed, which assignment will
         be perfected upon the occurrence of any of the events set forth in
         Clause 6 (Perfection of the Assignment) and the transfer to the
         Mortgages Trustee of legal title to the Initial Mortgage Portfolio in
         accordance with Clause 6 (Perfection of the Assignment).

3.4.     Documents: The Seller undertakes that from the Initial Closing Date
         until the perfection of the assignment in accordance with Clause 6.1
         (Perfection Events) and delivery of the Title Deeds in accordance with
         Clause 6.2 (Perfection), the Seller shall hold the deeds and documents
         constituting the Title Deeds and Mortgage Loan Files and all other
         certificates, notices, policies, endorsements and other matters
         necessary to establish title thereto relating to the Mortgage Portfolio
         that are in its possession or under its control or held to its order to
         the order of the Mortgages Trustee or as the Mortgages Trustee shall
         direct.

3.5.     Early Repayment Charges: The Mortgages Trustee hereby agrees to pay to
         the Seller as part of the Deferred Purchase Price any and all Early
         Repayment Charge Receipts received by the Mortgages Trustee in respect
         of the Mortgage Loans included in the Initial Mortgage Portfolio
         PROVIDED THAT, if any Mortgage Loans in respect of which Early
         Repayment Charges are payable are the subject of a trust pursuant to
         Clause 5.1 (Trust in favour of Mortgages Trustee), the Seller, the
         Mortgages Trustee, Funding and the Security Trustee agree that the
         benefit of any Early Repayment Charges payable in respect of such
         Mortgage Loan shall, on the date of payment to the Seller of the
         related Early Repayment Charge Receipts, be released from such trust.

3.6.     Insurance: The Seller shall as soon as reasonably practical after the
         sale and assignment of the Initial Mortgage Portfolio on the Initial
         Closing Date procure that the respective interests of the Mortgages
         Trustee, Funding and the Security Trustee are noted by the relevant
         insurers in relation to each Insurance Contract.

4.       Sale and Purchase of New Mortgage Portfolios

4.1.     Agreement to Assign: Subject to fulfilment of the conditions set out in
         Clauses 2.2 (Conditions), 3.1 (Initial Closing and Conditions
         Precedent), 4.2 (Conditions to Effecting an Assignment of New Mortgage
         Loans) and 4.3 (No Further Assignment), in consideration of either:

         (a)      the Purchase Price, if any is payable (which if it is payable
                  shall be paid in accordance with Clause 4.5 (Purchase Price)),
                  for the New Mortgage Portfolio and the covenant by the
                  Mortgages Trustee to hold the Trust Property upon trust for
                  the Seller, Funding and (from and including the Funding 2
                  Programme Date) Funding 2 as beneficiaries of the Mortgages

                                       4
<PAGE>

         Trust, upon, and with and subject to the trusts, powers and provisions
         of the Mortgages Trust Deed; or

         (b)      the covenant by the Mortgages Trustee to hold the Trust
                  Property upon trust for the Seller, Funding and (from and
                  including the Funding 2 Programme Date) Funding 2 as
                  beneficiaries of the Mortgages Trust upon, and with and
                  subject to the trusts, powers and provisions of the Mortgages
                  Trust Deed,

         and (in either case) the Mortgages Trustee's agreement in Clause 4.8
         (Early Repayment Charges) to pay to the Seller any and all Early
         Repayment Charge Receipts, if the Seller shall at any time and from
         time to time serve a properly completed New Mortgage Portfolio Notice
         as set out in Schedule 6 (New Mortgage Portfolio Notice) on the
         Mortgages Trustee, Funding and (from and including the Funding 2
         Programme Date) Funding 2 with a copy (upon request) to the Security
         Trustee and/or (from and including the Funding 2 Programme Date) the
         Funding 2 Security Trustee (such service to be in the Seller's sole
         discretion), then on the Assignment Date specified in the New Mortgage
         Portfolio Notice the Seller agrees that it shall sell and assign to the
         Mortgages Trustee the relevant New Mortgage Portfolio with full title
         guarantee (or, in relation to assets and rights situated in or governed
         by the law of Scotland, with absolute warrandice), PROVIDED THAT (a)
         the Seller hereby covenants and undertakes that it will not sell and
         assign New Mortgage Loans to the Mortgages Trustee during any Trust
         Calculation Period prior to the Distribution Date in such Trust
         Calculation Period, and (b) the Seller hereby agrees that it is only
         permitted to make one sale and assignment of New Mortgage Loans to the
         Mortgages Trustee during any Trust Calculation Period.

4.2.     Conditions to Effecting an Assignment of New Mortgage Loans: The
         conditions to be met as at each Assignment Date in order to effect a
         sale and assignment of New Mortgage Loans are:

         (a)      the aggregate Arrears of Interest in respect of all of the
                  Mortgage Loans in the Mortgage Portfolio, as a percentage of
                  the aggregate gross interest due during the previous 12 months
                  on all Mortgage Loans outstanding during all or part of such
                  period, does not exceed 2 per cent., or such other percentage
                  as agreed to by the Rating Agencies on such Assignment Date.
                  "Arrears of Interest" for this purpose in respect of a
                  Mortgage Loan on any date means the aggregate amount overdue
                  on the Mortgage Loan on that date, but only where such
                  aggregate amount overdue equals or exceeds an amount equal to
                  the Monthly Payment then due on the Mortgage Loan and such
                  amount has been overdue for an entire calendar month;

         (b)      the long term, unsecured, unguaranteed and unsubordinated debt
                  obligations of the Seller are rated no lower than A3 by
                  Moody's and A- by Fitch at the time of, and immediately
                  following, the assignment of the New Mortgage Loans to the
                  Mortgages Trustee;

         (c)      on the relevant Assignment Date, the aggregate Current Balance
                  of the Mortgage Loans in the Mortgage Portfolio, in respect of
                  which the aggregate amount is then in arrears for at least 3
                  months, is less than 4 per cent. of the aggregate Current
                  Balance of all Mortgage Loans in the Mortgage Portfolio on

                                       5
<PAGE>

                  such Assignment Date, unless the Rating Agencies have
                  confirmed that the then current ratings of the Notes will
                  not be adversely affected;

         (d)      the Lending Criteria applicable at the time of origination of
                  a relevant New Mortgage Loan have been applied to such New
                  Mortgage Loan and to the circumstances of the Borrower at the
                  time such New Mortgage Loan was made, provided that material
                  variations from such Lending Criteria may occur so long as the
                  Rating Agencies have been notified of any such material
                  variations;

         (e)      no New Mortgage Loan has on the relevant Assignment Date an
                  aggregate amount in arrears which is greater than the amount
                  of the Monthly Payment then due;

         (f)      the Rating Agencies have not provided written confirmation to
                  the Mortgages Trustee, each Funding Security Trustee and any
                  Issuer that the assignment to the Mortgages Trustee of the New
                  Mortgage Loans on the Assignment Date will adversely affect
                  the then current ratings of the existing Notes of any Issuer
                  (provided that, in respect of the assignment by the Seller to
                  the Mortgages Trustee of a New Mortgage Portfolio in
                  connection with the issuance by an Issuer of Notes and the
                  drawing by a Funding Beneficiary of a loan pursuant to an
                  Intercompany Loan Agreement, the condition to be met at the
                  relevant Assignment Date of such New Mortgage Portfolio will
                  be that the Rating Agencies have confirmed in writing to the
                  Mortgages Trustee, each Funding Security Trustee and such
                  Issuer that the assignment to the Mortgages Trustee of the New
                  Mortgage Portfolio on such Assignment Date will not cause the
                  then current ratings of the existing Notes of any Issuer to be
                  reduced, withdrawn or qualified);

         (g)      the aggregate Current Balance of New Mortgage Loans
                  transferred in any one Interest Period does not exceed 10 per
                  cent. of the aggregate Current Balance of Mortgage Loans in
                  the Mortgage Portfolio as at the beginning of that Interest
                  Period;

         (h)      each Issuer Reserve Fund is fully funded on the relevant
                  Assignment Date up to the relevant required amount or, if any
                  Issuer Reserve Fund is not so fully funded, no payments have
                  been made from such Issuer Reserve Fund;

         (i)      the Funding 2 Reserve Fund is fully funded on the relevant
                  Assignment Date up to the relevant required amount or, if the
                  Funding 2 Reserve Fund is not so fully funded, no payments
                  have been made from it;

         (j)      no Intercompany Loan Enforcement Notice has been served in
                  respect of any Intercompany Loan;

         (k)      the assignment of the New Mortgage Portfolio on the relevant
                  Assignment Date does not result in the product of WAFF and
                  WALS for the Mortgage Portfolio after such purchase,
                  calculated on the relevant Assignment Date in the same way as
                  for the Initial Mortgage Portfolio (or as agreed by the
                  Administrator and Standard & Poor's and Fitch from time to
                  time), exceeding

                                       6
<PAGE>

                  the product of WAFF and WALS for the Mortgage Portfolio
                  calculated on the most recent preceding Closing Date plus
                  0.25 per cent.;

         (l)      the assignment of New Mortgage Loans does not result in the
                  Moody's Portfolio Variation Test Value of the Mortgage Loans
                  in the Mortgages Portfolio after such assignment (calculated
                  by applying the Moody's Portfolio Variation Test to such
                  Mortgage Loans on such Assignment Date), exceeding the most
                  recently determined Moody's Portfolio Variation Test Threshold
                  Value as calculated in relation to the Mortgage Loans in the
                  Mortgage Portfolio as the most recent date on which Moody's
                  performed a full pool analysis on the Mortgages Portfolio plus
                  0.30%;

         (m)      to the extent necessary, each Funding Beneficiary and/or each
                  Issuer, as applicable, has entered into appropriate hedging
                  arrangements in respect of such New Mortgage Loans before such
                  Mortgage Loans are assigned to the Mortgage Trust;

         (n)      no event of default under the Transaction Documents has
                  occurred which is continuing as at the relevant Assignment
                  Date;

         (o)      the weighted average yield on the Mortgage Portfolio together
                  with the New Mortgage Portfolio to be assigned to the
                  Mortgages Trustee on the relevant Assignment Date is not less
                  than LIBOR for three-month sterling deposits plus 0.50 per
                  cent., taking into account the weighted average yield on the
                  Mortgage Loans and the margins on any Basis Rate Swaps as at
                  the relevant Assignment Date;

         (p)      no New Mortgage Loan has a maturity date on or after January
                  2039 or, following the redemption in full of all Notes issued
                  by the Funding Issuers, on or after January 2052;

         (q)      the related Borrower under each New Mortgage Loan has made at
                  least one Monthly Payment;

         (r)      for so long as any Notes issued by any Issuer that have a
                  Final Repayment Date earlier than January 2041 are
                  outstanding, the assignment of New Mortgage Loans to the
                  Mortgages Trustee may only occur if, following such
                  assignment, the aggregate number of Repayment Mortgage Loans
                  in the Mortgage Portfolio is greater than or equal to 25 per
                  cent. of the aggregate number of Mortgage Loans in the
                  Mortgage Portfolio;

         (s)      the Rating Agencies have provided written confirmation that
                  the then current ratings on the Notes of any Issuer would not
                  be adversely affected by the assignment to the Mortgages
                  Trustee of a New Mortgage Loan in respect of a mortgage loan
                  product having characteristics and/or features that differ
                  materially from the characteristics and/or features of the
                  Mortgage Loans in the Initial Mortgage Portfolio;

         (t)      following the purchase by the Mortgages Trustee of any New
                  Mortgage Portfolio, the aggregate Current Balance of Mortgage
                  Loans in the Mortgage Portfolio that are subject to a maximum
                  rate of interest and which charge

                                       7
<PAGE>

                  interest at the lesser of the Seller's Standard Variable
                  Rate and the maximum rate of interest (as specified in the
                  relevant Mortgage Conditions) (the "Capped Rate Mortgage
                  Loans") will not exceed 3 per. cent of the aggregate Current
                  Balance of all Mortgage Loans in the Mortgage Portfolio
                  (including such Capped Rate Mortgage Loans) as of such
                  Assignment Date, unless Moody's has confirmed in writing
                  that the then current ratings of the Notes will not be
                  adversely affected,

         PROVIDED THAT, if an Initial Purchase Price is payable to the Seller by
         the Mortgages Trustee on the relevant Assignment Date, only the
         conditions set out in paragraphs (e), (f), (j), (m), (n), (o), (p), (q)
         and (s) are required to be satisfied to effect an assignment of the New
         Mortgage Loans.

         Notwithstanding the foregoing, the Mortgages Trustee may waive or vary
         any of the conditions set forth in Clause 4.2 provided that each of the
         Rating Agencies has confirmed in writing (whether or not such
         confirmation is addressed to the Mortgages Trustee) that the relevant
         waiver or variation will not adversely affect the then current ratings
         of the existing Notes of any Issuer or that it approves the relevant
         waiver or variation.

4.3.     No Further Assignment: The Seller and the Mortgages Trustee agree that
         the Seller may not sell and assign any New Mortgage Portfolio after the
         earlier to occur of:

         (a)      the Step-up Date in respect of the Notes of any Funding Issuer
                  if the option to redeem any such Notes on the related Step-up
                  Date pursuant to Condition 5(D) of those Notes is not
                  exercised; or

         (b)      the Step-up Date in respect of the Notes of any Funding 2
                  Issuer if the option to redeem any such Notes on the related
                  Step-up Date pursuant to Condition 5(D) of those Notes is not
                  exercised and the aggregate Principal Amount Outstanding of
                  such Notes (together with any other Notes of such Funding 2
                  Issuer in respect of which the applicable Step-Up Date has
                  occurred) as at such Step-Up Date exceeds (GBP)1,000,000,000;
                  or

         (c)      the date falling 12 months after the Step-Up Date (the "twelve
                  month date") in respect of any Series and Class of Notes of
                  any Funding 2 Issuer, if the option to redeem any such Notes
                  on or before such twelve month date pursuant to the terms and
                  conditions of such Notes is not exercised.

4.4.     Closing and Conditions Precedent: A meeting shall take place on the
         date of the sale and assignment of the relevant New Mortgage Portfolio
         at the offices of the Seller or at such other office as may be agreed
         by the parties at which the Seller shall deliver to the Security
         Trustee and (from and including the Funding 2 Programme Date) the
         Funding 2 Security Trustee or their respective representatives the
         following documents:

         (a)      a certificate of solvency in relation to the Seller dated the
                  relevant Assignment Date (in the form of the agreed draft)
                  duly executed by the Seller;

                                       8
<PAGE>

         (b)      an assignment of the Insurance Contracts to the extent that
                  such Insurance Contracts relate to the New Mortgage Portfolio
                  in the form set out in Schedule 3 (Assignment of Insurance
                  Contracts) duly executed by the Seller;

         (c)      a certificate of a duly authorised officer of the Seller
                  attaching a copy of the board minutes referred to in paragraph
                  (e) of Clause 3.1 (Initial Closing and Conditions Precedent)
                  and confirming that the resolutions referred to therein are in
                  full force and effect and have not been amended or rescinded
                  as at the date of the certificate; and

         (d)      a Scottish Trust Deed in respect of the Scottish Mortgage
                  Loans in the New Mortgage Portfolio (if any) and their Related
                  Security, in the form set out in Schedule 11 and with the
                  annexure thereto duly completed, duly executed by the Seller,

         and in any case, after the Funding 2 Programme Date, where only one
         certificate or instrument (in each case, the "Relevant Document") is
         available under (a), (b), (c) and/or (d) above and whilst the Funding
         Security Trustees remain the same entity, delivery of the Relevant
         Documentation to one Funding Security Trustee shall be deemed to be
         delivery to both of them.

4.5.     Purchase Price: Subject to fulfilment of the conditions referred to in
         Clauses 4.2 (Conditions to Effecting an Assignment of New Mortgage
         Loans), 4.3 (No Further Assignment) and 4.4 (Closing and Conditions
         Precedent), the Mortgages Trustee shall, if and to the extent that the
         same is payable, pay the Purchase Price for the New Mortgage Portfolio
         to the Seller, in the manner that the Seller directs, for value, as
         follows:

         (a)      if any Initial Purchase Price is payable in respect of the New
                  Mortgage Portfolio (which shall only be the case if an Initial
                  Contribution is paid by any Funding Beneficiary to the
                  Mortgages Trustee on such date pursuant to the terms of the
                  Mortgages Trust Deed) such Initial Purchase Price shall be
                  paid by the Mortgages Trustee to the Seller on the relevant
                  Assignment Date (which Initial Purchase Price shall be paid by
                  the Mortgages Trustee either from funds received by the
                  Mortgages Trustee from Funding on such date in respect of an
                  Initial Contribution by Funding for the Funding Share of the
                  New Trust Property or from Funding 2 on such date in respect
                  of an Initial Contribution by Funding 2 for the Funding 2
                  Share of the New Trust Property, in each case pursuant to the
                  Mortgages Trust Deed), PROVIDED THAT if on any date the Seller
                  is obliged to repurchase any Mortgage Loan or Mortgage Loans
                  pursuant to Clause 8.4 (Repurchase), 8.5 (Purchase of Product
                  Switches, Further Advances and purchases relating to Personal
                  Secured Loans) or 8.6 (Repurchase of Fixed Rate Mortgage
                  Loans), and on such date the Seller sells and assigns New
                  Mortgage Loans and their Related Security to the Mortgages
                  Trustee, the Seller is entitled to set-off against the
                  repurchase price payable by it on such repurchase as set forth
                  under Clause 8.7 (Completion of Repurchase) the amount of any
                  Initial Purchase Price payable for any such New Mortgage Loans
                  and shall instead pay (or be paid) such net amount; and

                                       9
<PAGE>

         (b)      subject to and in accordance with the Mortgages Trustee
                  Revenue Priority of Payments, an amount of Deferred Purchase
                  Price in respect of the Mortgage Portfolio shall be paid by
                  the Mortgages Trustee to the Seller on each Distribution Date
                  but only from and to the extent (if any) of any Funding
                  Relevant Distribution and/or Funding 2 Relevant Distribution
                  available for payment on such date and in an amount equal to
                  the Deferred Contribution paid by the Funding Beneficiaries to
                  the Mortgages Trustee on such date or in respect of which the
                  payment of such Deferred Contribution is otherwise satisfied
                  on such date in accordance with the Mortgages Trust Deed.

4.6.     Effect of Payment of Initial Purchase Price or Fulfilment of
         Conditions: The parties hereto acknowledge that the effect of either
         the payment to the Seller by the Mortgages Trustee of the Initial
         Purchase Price on the relevant Assignment Date or, if no Initial
         Purchase Price is payable on such date, the confirmation from the
         Seller of the fulfilment of the conditions referred to in Clauses 4.2
         (Conditions to Effecting an Assignment of New Mortgage Loans) and the
         delivery to each Funding Security Trustee of the documents referred to
         in Clause 4.4 (Closing and Conditions Precedent) on such date, will be
         the assignment and transfer to the Mortgages Trustee of the beneficial
         ownership of, and all of the Seller's beneficial right, title, interest
         and benefit in and to, the New Mortgage Portfolio subject to the terms
         and provisions of the Mortgages Trust Deed. Upon payment to the Seller
         by the Mortgages Trustee of the Initial Purchase Price on the relevant
         Assignment Date or, if no Initial Purchase Price is payable on such
         date, upon receipt of confirmation from the Seller of the fulfilment of
         the conditions referred to in Clauses 4.2 (Conditions to Effecting an
         Assignment of New Mortgage Loans), the fact that any of the conditions
         referred to in Clause 4.2 (Conditions to Effecting an Assignment of New
         Mortgage Loans) may not have been satisfied or waived, or any of the
         conditions precedent set out in Clause 4.4 (Closing and Conditions
         Precedent) have not been delivered or waived, shall not prevent the
         sale and assignment of the New Mortgage Portfolio to the Mortgages
         Trustee on the relevant Assignment Date (or prevent any Scottish Trust
         Deed from taking effect) and any unsatisfied conditions precedent shall
         be deemed to have been waived. The foregoing is without prejudice to
         all of the rights and remedies of the Mortgages Trustee against the
         Seller, including without limitation, all claims for breach of
         Representation and Warranty. Each such assignment and transfer will be
         perfected upon the occurrence of any of the events set forth in Clause
         6 (Perfection of the Assignment) and the transfer and assignation to
         the Mortgages Trustee of legal title to such New Mortgage Portfolio in
         accordance with Clause 6 (Perfection of the Assignment).

4.7.     Documents: The Seller undertakes that from the relevant Assignment Date
         until the perfection of the assignment in accordance with Clause 6.1
         (Perfection Events) and the delivery of the Title Deeds in accordance
         with Clause 6.2 (Perfection), the Seller shall hold the deeds and
         documents constituting the Title Deeds and Mortgage Loan Files and all
         other certificates, notices, policies, endorsements and other matters
         necessary to establish title thereto relating to the Mortgage Portfolio
         that are in its possession or under its control or held to its order to
         the order of the Mortgages Trustee or as the Mortgages Trustee shall
         direct.

4.8.     Early Repayment Charges: The Mortgages Trustee hereby agrees to pay to
         the Seller as part of the Deferred Purchase Price any and all Early
         Repayment Charge Receipts

                                       10
<PAGE>

         received by the Mortgages Trustee in respect of the Mortgage Loans
         included in the New Mortgage Portfolio PROVIDED THAT, if any Mortgage
         Loans in respect of which Early Repayment Charges are payable are the
         subject of a trust pursuant to Clause 5.1 (Trust in favour of Mortgages
         Trustee), the Seller, the Mortgages Trustee, each Funding Beneficiary
         and each Funding Security Trustee agree that the benefit of any Early
         Repayment Charges payable in respect of such Mortgage Loan shall, on
         the date of payment to the Seller of the related Early Repayment Charge
         Receipts, be released from such trust.

4.9.     Insurance: The Seller shall as soon as reasonably practical after
         completion of the sale and assignment of each New Mortgage Portfolio
         procure that the respective interests of the Mortgages Trustee, each
         Funding Beneficiary and each Funding Security Trustee are noted by the
         relevant insurers in relation to each Insurance Contract.

4.10.    Mortgage Portfolio: Prior to the earliest to occur of:

         (a)      a Trigger Event; and

         (b)      if Funding does not enter into a New Intercompany Loan
                  Agreement, the Payment Date in January 2008; and

         (c)      on each occasion that Funding enters into a New Intercompany
                  Loan Agreement, the latest Payment Date specified by Funding
                  by notice in writing to the Seller and the Mortgages Trustee
                  as applying in relation to this covenant; and (d) on each
                  occasion that Funding 2 enters into a Funding 2 Intercompany
                  Loan Agreement or receives a further advance under any
                  existing Funding 2 Intercompany Loan Agreement, the latest
                  Loan Payment Date specified by Funding 2 by notice in writing
                  to the Seller and the Mortgages Trustee as applying in
                  relation to this covenant,

         the Seller undertakes to use all reasonable efforts to offer to sell
         and assign, in accordance with the provisions of this Clause 4 (Sale
         and Purchase of New Mortgage Portfolios), to the Mortgages Trustee, and
         the Mortgages Trustee undertakes to use all reasonable endeavours to
         acquire from the Seller and to hold pursuant to the terms of the
         Mortgages Trust Deed, sufficient New Mortgage Loans and their Related
         Security so that the Overcollateralisation Test is not breached on
         three consecutive Distribution Dates PROVIDED THAT the Seller shall not
         be obliged to sell and assign to the Mortgages Trustee, and the
         Mortgages Trustee shall not be obliged to acquire, New Mortgage Loans
         and their Related Security if in the opinion of the Seller the sale and
         assignment to the Mortgages Trustee of New Mortgage Loans and their
         Related Security would adversely affect the business of the Seller.

         For the purposes of this Clause 4.10, the "Overcollateralisation Test"
         shall be calculated on each Distribution Date and shall be breached on
         any Distribution Date where the aggregate Current Balance of Mortgage
         Loans in the Mortgage Portfolio on such Distribution Date is less than
         an amount equal to the product of 1.05 and the aggregate Principal
         Amount Outstanding of all Notes of all Issuers at such Distribution
         Date, and for this purpose:

                                       11
<PAGE>

                  (i)      where such Notes outstanding are Controlled
                           Amortisation Notes or Scheduled Redemption Notes, the
                           aggregate Principal Amount Outstanding of such Notes
                           will be calculated on a straight-line basis by
                           applying the appropriate "CPR" (being the CPR rate
                           most recently calculated by the Administrator and
                           detailed in the most recent report provided under
                           Clause 12.4(a) of the Administration Agreement) to
                           such Notes on a monthly, rather than a quarterly
                           basis; and

                  (ii)     where such Notes outstanding are Bullet Redemption
                           Notes, the amount standing to the credit of the
                           Funding 2 Cash Accumulation Ledger will be deducted
                           from the aggregate Principal Amount Outstanding of
                           such Notes.

5.       Trust of Monies

5.1.     Trust in favour of Mortgages Trustee: Notwithstanding the assignment
         and transfer effected by this Agreement (or by any Scottish Trust Deed
         made pursuant hereto) if at, or at any other time after, the Initial
         Closing Date or, as the case may be in respect of any New Mortgage
         Portfolio, the relevant Assignment Date (but prior to any repurchase in
         accordance with Clause 8.5 (Purchase of Product Switches, Further
         Advances and purchases relating to Personal Secured Loans)) the Seller
         holds, or there is held to its order, or it receives, or there is
         received to its order any property, interest, right or benefit and/or
         the proceeds thereof hereby agreed to be sold to the Mortgages Trustee,
         the Seller undertakes with the Mortgages Trustee, each Funding
         Beneficiary and each Funding Security Trustee that it will hold such
         property, interest, right or benefit and/or the proceeds thereof upon
         trust for the Mortgages Trustee (pursuant, in the case of any property,
         interest, right or benefit and/or the proceeds thereof relating to a
         Scottish Mortgage Loan or its Related Security, to the relevant
         Scottish Trust Deed) subject at all times to the Mortgages Trust. In
         addition, if for any reason the assignment and transfer of the Initial
         Mortgage Portfolio, or any New Mortgage Portfolio (or any part
         thereof), or any property, interest, right or benefit therein or any of
         the proceeds thereof (each a "relevant asset"), is held to be
         ineffective or unenforceable against any Borrower, the Seller
         undertakes with the Mortgages Trustee, each Funding Beneficiary and
         each Funding Security Trustee and hereby declares that it will hold
         such relevant asset upon trust for the Mortgages Trustee. The Mortgages
         Trustee agrees that it will hold its beneficial interest in such
         relevant asset subject at all times to the Mortgages Trust.

5.2.     Trust in favour of Seller: If at, or any time after, the Initial
         Closing Date (in the case of the Initial Mortgage Portfolio) or the
         relevant Assignment Date (in the case of any New Mortgage Portfolio),
         the Mortgages Trustee holds, or there is held to its order, or it
         receives, or there is received to its order, any property, interest,
         right or benefit relating to:

         (a)      any Mortgage Loan or Mortgage Loans under a Mortgage Account
                  and their Related Security repurchased by the Seller pursuant
                  to Clause 8 (Warranties and Repurchase by the Seller); or

         (b)      (without prejudice to Clause 10 (Consequences of Breach)) any
                  Early Repayment Charges payable by a Borrower in respect of
                  any Mortgage Loan in the Mortgages Trust;

                                       12
<PAGE>

         and/or the proceeds thereof, the Mortgages Trustee undertakes with the
         Seller that it will remit, assign or transfer the same to the Seller,
         as the case may require, and until it does so or to the extent that the
         Mortgages Trustee is unable to effect such remittance, assignment or
         transfer, the Mortgages Trustee undertakes to hold such property,
         interest, right or benefit and/or the proceeds thereof upon trust for
         the Seller as the sole beneficial owner thereof or as the Seller may
         direct provided that the Mortgages Trustee shall not be in breach of
         its obligations under this Clause 5 if, having received any such moneys
         and paid them to third parties in error, it pays (at the direction of
         the Beneficiaries) to the Seller an amount equal to the moneys so paid
         in error in accordance with the Administration Agreement. In addition,
         if the Seller is required or elects to repurchase any Mortgage Loan and
         its Related Security pursuant to Clauses 8.4 (Repurchase), 8.5
         (Purchase of Product Switches, Further Advances and purchases relating
         to Personal Secured Loans) or 8.6 (Repurchase of Fixed Rate Mortgage
         Loans) and such Mortgage Loan or its Related Security, or any part
         thereof, or any property, interest, right or benefit therein or any of
         the proceeds thereof (each, a "relevant asset"), is held by the Seller
         subject to a trust pursuant to Clause 5.1 (Trust in favour of Mortgages
         Trustee), then the Seller, the Mortgages Trustee, each Funding
         Beneficiary and each Funding Security Trustee agree that such relevant
         asset shall be released from the trust constituted pursuant to Clause
         5.1 (Trust in favour of Mortgages Trustee) on the date that such
         relevant asset would otherwise have been repurchased or re-transferred
         pursuant to Clause 8.7 (Completion of Repurchase).

6.       Perfection of the Assignment

6.1.     Perfection Events: The execution of transfers and assignations of the
         Mortgages to the Mortgages Trustee and the notifications to Borrowers
         notifying such Borrowers of the assignment or assignation of their
         Mortgage Loans and Related Security to the Mortgages Trustee shall be
         completed within 20 business days of receipt of a written request in
         accordance with Clause 6.2 (Perfection) upon the occurrence of any of
         the following events:

         (a)      the valid service:

                  (i)      of a Funding Intercompany Loan Enforcement Notice;

                  (ii)     of a Funding 2 Intercompany Loan Enforcement Notice;

                  (iii)    of a Note Enforcement Notice (on any Funding Issuer);
                           or

                  (iv)     of an Issuer Enforcement Notice (on any Funding 2
                           Issuer),

                  provided that the perfection of an assignment of the Mortgage
                  Portfolio shall not be required if the sole reason for the
                  service of any Note Enforcement Notice (on any Funding Issuer)
                  or any Issuer Enforcement Notice (on any Funding 2 Issuer) is
                  a default by a Swap Provider of any Issuer;

         (b)      unless otherwise agreed by the Rating Agencies, the
                  termination of the Seller's role as Administrator under the
                  Administration Agreement and failure of any substitute
                  administrator to assume the duties of the Administrator; or

                                       13
<PAGE>

         (c)      the Seller being required by an order of a court of competent
                  jurisdiction, or by a change in law occurring after the
                  Initial Closing Date, or by a regulatory authority of which
                  the Seller is a member or with whose instructions it is
                  customary that the Seller comply, to perfect the transfer of
                  legal title to the Mortgage Loans and the Related Security in
                  favour of the Mortgages Trustee; or

         (d)      the security under:

                  (i)      the Funding Deed of Charge or any material part of
                           such security; or

                  (ii)     the Funding 2 Deed of Charge or any material part of
                           such security,

                  being in jeopardy and it being necessary to perfect the
                  transfer of legal title to the Mortgage Loans and their
                  Related Security in favour of the Mortgages Trustee in order
                  to reduce such jeopardy materially; or

                  (e)      the occurrence of an Insolvency Event in relation to
                           the Seller; or

                  (f)      notice in writing from the Seller to the Mortgages
                           Trustee and each Funding Beneficiary (with a copy to
                           each Funding Security Trustee) requesting such
                           transfer.

6.2.     Perfection: If an event set forth in any of paragraphs (a) to (f) of
         Clause 6.1 (Perfection Events) occurs and either the Mortgages Trustee
         or the Funding Beneficiaries (with the consent of the Funding Security
         Trustees) or the Funding Security Trustees so request in writing the
         Seller shall perfect the assignments as contemplated by and in
         accordance with this Clause 6 (Perfection of the Assignment) in
         relation to all Mortgage Loans then in the Mortgage Portfolio and
         shall:

                  (i)      deliver to the Mortgages Trustee all Title Deeds and
                           (subject to receipt of up to date schedules) the
                           transfers and assignations referred to in Clause 6.3
                           (Transfer Documents) duly executed by the Seller; and

                  (ii)     give formal notice of the transfers and assignations
                           to the relevant Borrowers, insurers and other persons
                           (all such notices being in such form or forms as may
                           be required by the Mortgages Trustee or the Funding
                           Beneficiaries (with the written consent of the
                           Funding Security Trustees) or the Funding Security
                           Trustees).

6.3.     Transfer Documents: If an event set forth in any of paragraphs (a) to
         (f) of Clause 6.1 (Perfection Events) occurs, the transfers that the
         Seller is required to deliver are:

         (a)      transfers in the form set out in Part 1 of Schedule 2 (Form of
                  Transfer (Registered Land - England and Wales)) of all the
                  English Mortgages then in the Mortgage Portfolio secured (or
                  intended to be secured) over English Properties which comprise
                  registered land (including any English Property which is the
                  subject of an application for first registration at the Land
                  Registry);

         (b)      transfers in the form set out in Part 2 of Schedule 2 (Form of
                  Transfer (Unregistered Land - England and Wales)) of all the
                  English Mortgages then

                                       14
<PAGE>

                  in the Mortgage Portfolio secured (or intended to be
                  secured) over English Properties which comprise unregistered
                  land (excluding any which is the subject of an application
                  for first registration);

         (c)      assignations in the form set out in Part 3 of Schedule 2 (Form
                  of Transfer (Land Register - Scotland)) of all the Scottish
                  Mortgages then in the Mortgage Portfolio secured (or intended
                  to be secured over Scottish Properties title to which is
                  registered (or in the course of being registered) in the Land
                  Register of Scotland;

         (d)      assignations in the form set out in Part 4 of Schedule 2 (Form
                  of Transfer (Sasine Register - Scotland)) of all the Scottish
                  Mortgages then in the Mortgage Portfolio secured (or intended
                  to be secured) over Scottish Properties title to which is
                  recorded (or in the course of being recorded) in the General
                  Register of Sasines;

         (e)      transfers and assignations of the benefit of the Guarantees
                  relating to any relevant Mortgage Loan in the form of the
                  Assignment of Guarantees set out in Part 1 of Schedule 5
                  (Assignment of Guarantees) in relation to Guarantees governed
                  by English law and in the form of the Assignation of
                  Guarantees set out in Part 2 of Schedule 5 (Assignation of
                  Guarantees) in relation to Guarantees governed by Scots law;
                  and

         (f)      transfers and assignations of the Related Security or any
                  other property or security sold to the Mortgages Trustee under
                  this Agreement in such form as the Mortgages Trustee or the
                  Funding Security Trustees may reasonably require.

         The Mortgages Trustee or any one of the Funding Beneficiaries (with the
         consent of the relevant Funding Security Trustee) or any one of the
         Funding Security Trustees may require that the form of any transfer or
         assignation referred to in this Clause 6.3 be changed at any time to
         reflect changes in law or relevant registry practice or requirements.

6.4.     Prior to Perfection: Prior to perfection pursuant to Clause 6.1
         (Perfection Events) and subject to Clause 7.3 (Seller Ratings) and
         Clauses 3.6 (Insurance) and 4.9 (Insurance) neither the Mortgages
         Trustee nor any Funding Beneficiary nor any Funding Security Trustee
         will:

         (a)      register or record itself at, or submit or require the
                  submission of any notice, form, request or application to, or
                  pay any fee for the registration or recording of, or the
                  noting of any interest at, the Land Charges Department of the
                  Land Registry or in the Registers of Scotland or at the Land
                  Registry in relation to the Mortgages Trustee's and/or
                  Funding's and/or Funding 2's interests in the Mortgage
                  Portfolio;

         (b)      give or require the giving of any notice to any Borrower,
                  insurer or any other person of:

                                       15
<PAGE>

                  (i)      the assignment or assignation of that Borrower's
                           Mortgage Loan and its Related Security or such other
                           property as may be included in the Mortgage Portfolio
                           to the Mortgages Trustee; or

                  (ii)     the charge by Funding of Funding's beneficial
                           interest in that Borrower's Mortgage Loan and its
                           Related Security or such other property to the
                           Security Trustee pursuant to the Funding Deed of
                           Charge; or

                  (iii)    the charge by Funding 2 of Funding 2's beneficial
                           interest in that Borrower's Mortgage Loan and its
                           Related Security or such other property to the
                           Funding 2 Security Trustee pursuant to the Funding 2
                           Deed of Charge; or

         (c)      send or require to be sent to any solicitor who has acted on
                  behalf of the Seller in respect of any Mortgage with respect
                  to which the Seller has not received a complete set of the
                  Title Deeds a letter or other communication requiring such
                  solicitor to hold such documents to the order of the Mortgages
                  Trustee, the Security Trustee or the Funding 2 Security
                  Trustee (as the case may be).

6.5.     Further Assurance: The Seller shall, subject to the other provisions of
         this Clause 6 (Perfection of the Assignment), upon request do all such
         other deeds, assurances, agreements, instruments, acts and things as
         the Mortgages Trustee, the Funding Beneficiaries or the Funding
         Security Trustees may require in order to give effect to the terms of
         this Agreement and the assignments and assignations contemplated
         herein.

7.       Undertakings

7.1.     Administration: The Mortgages Trustee and each Funding Beneficiary
         undertake that they will at all times (or will direct the Administrator
         at all times to) administer and enforce (and exercise their powers and
         rights and perform their obligations under) the Mortgage Conditions and
         the Mortgage Loan Agreement relating to each Mortgage Loan comprised in
         the Mortgage Portfolio and their Related Security in accordance with
         the Administration Procedures (for so long as these exist and
         thereafter in accordance with such policies as would be applied by a
         reasonable, prudent mortgage lender in the conduct of its business).

7.2.     Reimbursement of Borrower: The Seller hereby undertakes with the
         Mortgages Trustee and each Funding Beneficiary that, in the event that
         any Borrower establishes that it has at any time prior to the Initial
         Closing Date or, as the case may be, the relevant Assignment Date, paid
         to the Seller any amounts in excess of sums due to the Seller as at the
         date of payment under the Mortgage Conditions applicable to that
         Mortgage Loan (other than any Overpayment made by a Borrower under
         Flexible Mortgage Loan) the Seller will reimburse the Borrower for such
         overpayment together with any interest, cost or other expense
         associated therewith. The Seller further agrees to hold the Mortgages
         Trustee and each Funding Beneficiary harmless against any such claims
         and to indemnify the Mortgages Trustee and each Funding Beneficiary on
         an after Tax basis in relation to any costs, expense, loss or other
         claim which may arise in connection therewith. Any payment made by the
         Seller to the Mortgages Trustee and each Funding Beneficiary in
         discharge of the foregoing

                                       16
<PAGE>

         indemnity shall be regarded as a rebate of part of the Purchase Price
         of the relevant Mortgage Loan.

7.3.     Seller Ratings: The Seller hereby undertakes with the Mortgages
         Trustee, each Funding Beneficiary and each Funding Security Trustee
         that if the long term unsecured, unsubordinated and unguaranteed debt
         obligations of the Seller cease to be assigned a long term credit
         rating:

         (a)      from Moody's of no lower than Baal or from Fitch of no lower
                  than BBB+, the Seller (unless Moody's or Fitch, as applicable,
                  confirms that the then current ratings of the Notes will not
                  be adversely affected) will deliver to the Mortgages Trustee,
                  each Funding Beneficiary and each Funding Security Trustee
                  (upon request) and the Rating Agencies details of the names
                  and addresses of the Borrowers with Mortgage Loans then in the
                  Mortgage Portfolio on computer diskette and a draft letter of
                  notice to such Borrowers of the sale and assignment of those
                  Mortgage Loans and their Related Security to the Mortgages
                  Trustee in the form set out in Schedule 8 (Form of
                  Notification to Borrowers); and

         (b)      from S&P of no lower than BBB-, from Moody's of no lower than
                  Baa3 or from Fitch of no lower than BBB-, the Seller (unless
                  S&P, Moody's and Fitch, as applicable, confirms that the
                  then-current ratings of the Notes will not be adversely
                  affected) shall within 10 Business Days of such cessation give
                  notice of the sale and assignment effected by this Agreement
                  (and, in the case of any Scottish Mortgage Loan, the making of
                  the relevant Scottish Trust Deed) to each Borrower with a
                  Mortgage Loan then in the Mortgage Portfolio in the form set
                  out in Schedule 8 (Form of Notification to Borrowers) (and if
                  the Seller fails to give such notice, then the Mortgages
                  Trustee shall give such notice as the Seller's attorney under
                  the power of attorney set out in Schedule 10 (Power of
                  Attorney in favour of the Mortgages Trustee, each Funding
                  Beneficiary and each Funding Security Trustee)),

         (c)      provided that, in respect of Clause 7.3(a), should the Seller
                  be required as described in such Clause to provide the details
                  of the names and addresses of Borrowers to the Mortgages
                  Trustee and/or each Funding Beneficiary, the Mortgages Trustee
                  and each Funding Beneficiary (to the extent, in respect of
                  Funding, that such information is to be delivered to Funding
                  other than at its United Kingdom branch office) hereby agrees
                  to appoint an agent that is located in the United Kingdom and
                  which maintains all appropriate registrations, notifications,
                  licences and authorities (if any) required under the Data
                  Protection Act 1998 to receive and maintain such information
                  on its behalf, and under no circumstances shall either the
                  Mortgages Trustee or Funding accept such information at its
                  Jersey registered office or otherwise in Jersey (unless Jersey
                  is declared an "approved state" by the European Commission, in
                  which case such data may be delivered to the Mortgages Trustee
                  and/or Funding at their respective Jersey offices).

7.4.     Pending Perfection: The Seller undertakes to the Mortgages Trustee,
         each Funding Beneficiary and each Funding Security Trustee that,
         pending perfection under Clause 6 (Perfection of the Assignment), the
         Seller:

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<PAGE>

         (a)      shall promptly notify the Mortgages Trustee, each Funding
                  Beneficiary and (upon request) each Funding Security Trustee
                  if it receives written notice of any litigation or claim
                  calling into question in any material way the Seller's or the
                  Mortgages Trustee's title to any Mortgage Loan comprised in
                  the Mortgage Portfolio or its Related Security or if it
                  becomes aware of any material breach of any of the
                  Representations and Warranties or other obligations under this
                  Agreement; and

         (b)      shall, if reasonably required so to do by the Mortgages
                  Trustee, participate or join in and lend its name to and take
                  such other steps as may reasonably be required by the
                  Mortgages Trustee in relation to, any legal proceedings in
                  respect of the Mortgage Loans and their Related Security to
                  the extent necessary to protect, preserve and enforce the
                  Seller's or the Mortgages Trustee's or any Funding
                  Beneficiary's or any Funding Security Trustee's title to or
                  interest in any Mortgage Loan or its Related Security provided
                  that the Seller is reimbursed, subject to and in accordance
                  with the relevant priority of payments under and in accordance
                  with the Transaction Documents, by the Mortgages Trustee and
                  the Funding Beneficiaries for the reasonable legal expenses
                  and costs of such proceedings.

7.5.     Responsibility of Seller: The Seller hereby further undertakes with the
         Mortgages Trustee and each Funding Beneficiary that it is and at all
         times shall remain solely responsible for any Product Switches (other
         than a Re-Fixed Mortgage Loan), for funding any Cash Re-Draws made by a
         Borrower under the Mortgage Conditions and the Mortgage Loan Agreement
         relating to a Flexible Mortgage Loan, for funding any request for any
         Further Advance made by a Borrower, for funding any request for any
         Further Draw under a Personal Secured Loan and for paying to the
         Mortgages Trustee from time to time an amount equal to the Unpaid
         Interest associated with any Non-Cash Re-Draw made by a Borrower under
         the Mortgage Conditions and the Mortgage Loan Agreement relating to a
         Flexible Mortgage Loan. For the avoidance of doubt, neither the
         Mortgages Trustee nor any Funding Beneficiary will be required to
         advance moneys to the Seller or to a Borrower in order to fund such a
         Re-Draw or Further Advance or Further Draw in any circumstances
         whatsoever.

7.6.     Product Switches and Further Advances:

         (a)      The Administrator shall not:

                  (i)      accept an application from, or issue to any Borrower
                           any offer of a Further Advance; or

                  (ii)     accept an application from, or issue to any Borrower
                           any offer of a Product Switch (except in relation to
                           the exercise of an option by any Borrower for a new
                           fixed rate under a Fixed Rate Mortgage Loan),

                  without first having given notice in writing to the Seller
                  seeking confirmation from the Seller that the Seller will
                  repurchase the Mortgage Loan to which such offer relates
                  from the Mortgages Trustee in accordance with the terms of
                  this Agreement.

                                       18
<PAGE>

         (b)      If the Seller gives such confirmation to the Administrator,
                  the Administrator shall then issue to that Borrower the
                  relevant offer referred to in paragraph (a) above on behalf of
                  the Seller and shall (in the case of any offer referred to in
                  paragraph (a) above) then notify the Seller and Mortgages
                  Trustee in writing as soon as the Administrator has accepted
                  the mortgage documentation completed by the Borrower in
                  relation to such offer.

         (c)      The Mortgages Trustee shall not itself offer or make any
                  Product Switch or Further Advance (except in relation to the
                  exercise of an option by any Borrower for a new fixed rate
                  under a Fixed Rate Mortgage Loan).

7.7.     Standard Variable Rate: Subject to the provisions of Clause 7.9
         (Shortfall), the Seller covenants with and undertakes to the Mortgages
         Trustee, each Funding Beneficiary and each Funding Security Trustee
         that, where the Administrator determines on any date that there will be
         a Shortfall during the next succeeding Interest Period and notifies the
         Seller to such effect, the Seller shall take all steps which are
         necessary, including publishing any notice which is required in
         accordance with the Mortgage Conditions, to set the Standard Variable
         Rate and such other discretionary rates and margins applicable to the
         Mortgage Loans at such levels as may be notified to the Seller by the
         Mortgages Trustee, any Funding Beneficiary or any Funding Security
         Trustee (which rates shall be the same rates as previously notified to
         the Mortgages Trustee, each Funding Beneficiary and each Funding
         Security Trustee in accordance with Clause 4.3(b) of the Administration
         Agreement) as being the rates required in order for no Shortfall to
         arise.

7.8.     Security Powers of Attorney: On the Funding 2 Programme Date, the
         Seller shall grant security powers of attorney to the Mortgages
         Trustee, each Funding Beneficiary and each Funding Security Trustee in
         the form set out in Part 2 of Schedule 10 (Power of Attorney in favour
         of the Mortgages Trustee, each Funding Beneficiary and each Funding
         Security Trustee) allowing the Mortgages Trustee, any Funding
         Beneficiary and/or any Funding Security Trustee and their delegates
         from time to time (inter alia) to set the Standard Variable Rate, such
         other discretionary rates and margins applicable to the Mortgage Loans
         and (save for any Funding Security Trustee) the rate of (and terms
         relating to) the Existing Borrowers' Re-Fix Rate should the Seller fail
         to do so in accordance with its obligations under this Agreement, but
         only to the extent that such rates have been previously notified to the
         Mortgages Trustee, each Funding Beneficiary and each Funding Security
         Trustee in accordance with Clause 4.3(b) of the Administration
         Agreement. On the delivery of such power of attorney in accordance with
         the previous sentence, the parties hereto agree that the power of
         attorney delivered by the Seller on 26 March 2001 in accordance with
         Clause 3.1(a) shall terminate and be of no further effect. Nothing in
         this Clause 7.8 shall prevent the Seller (or any of its attorneys from
         time to time) from setting a higher Northern Rock Standard Variable
         Rate or higher rates for other discretionary rates and margins (or in
         the case of the Existing Borrowers' Re-Fix Rate setting a higher rate
         and imposing terms more advantageous to the Mortgages Trustee) than
         those to be set or required by the Mortgages Trustee, each Funding
         Beneficiary and/or (other than in respect to an Existing Borrower's
         Re-Fix Rate) each Funding Security Trustee.

7.9.     Shortfall: Unless the Mortgages Trustee, any Funding Beneficiary or any
         Funding Security Trustee needs to do so to avoid a Shortfall, none of
         the Mortgages Trustee, each Funding Beneficiary or each Funding
         Security Trustee shall set the Standard

                                       19
<PAGE>

         Variable Rate and other discretionary rates and margins for Mortgage
         Loans which are in the Mortgages Trust (disregarding any discounts or
         additions to it) at rates higher than the then equivalent rates for
         mortgage loans which are not in the Mortgage Portfolio.

7.10.    Forwarding of Notice: Each Funding Security Trustee undertakes, upon
         receipt of any notice as specified in Clause 8.5(C) of the Mortgages
         Trust Deed, to forward such notice to the Mortgages Trustee, each
         Funding Beneficiary, the Seller and the Cash Manager in the manner set
         forth in Clause 20 (Notices) within three (3) London Business Days of
         receipt thereof. Each Funding Security Trustee shall have no other
         obligation other than the foregoing following receipt of such notice.

8.       Warranties and Repurchase by the Seller

8.1.     Representations and Warranties: The Seller makes the Representations
         and Warranties set out in Schedule 1 (Representations and Warranties)
         to the Mortgages Trustee, each Funding Beneficiary and each Funding
         Security Trustee:

         (a)      in respect of each Mortgage Loan and its Related Security in
                  the Initial Mortgage Portfolio as at the date hereof and on
                  the Initial Closing Date;

         (b)      in relation to each New Mortgage Loan (other than Personal
                  Secured Loans if specifically excluded from a Representation
                  and Warranty) and its Related Security in a New Mortgage
                  Portfolio, on the date of the service of the relevant New
                  Mortgage Portfolio Notice and on the relevant Assignment Date;

         (c)      in the form set out in Part 2 of Schedule 1 (Representations
                  and Warranties) in relation to the matters and at the dates
                  set out therein; and

         (d)      in the form set out in Part 3 of Schedule 1 (Representations
                  and Warranties) in relation to the matters and at the dates
                  set out therein.

8.2.     Reliance: The Seller acknowledges that the Representations and
         Warranties are made with a view to inducing the Mortgages Trustee, each
         Funding Beneficiary and each Funding Security Trustee either to enter
         into this Agreement and the other Transaction Documents to which each
         is a party or to agree to purchase the New Mortgage Loans and their
         Related Security comprised in each New Mortgage Portfolio, and that the
         Mortgages Trustee, each Funding Beneficiary and each Funding Security
         Trustee has entered into this Agreement and the other Transaction
         Documents to which it is a party in reliance upon the Representations
         and Warranties notwithstanding any information possessed or
         discoverable by the Mortgages Trustee any Funding Beneficiary and/or
         any Funding Security Trustee. The Mortgages Trustee, each Funding
         Beneficiary and each Funding Security Trustee acknowledges that they
         have not entered into this Agreement in reliance upon any
         representation, warranty or undertaking other than those set out in
         this Agreement or upon any other enquiry, investigation or search
         whatsoever.

8.3.     Remedies: The sole remedy of the Mortgages Trustee, each Funding
         Beneficiary and each Funding Security Trustee in respect of a breach of
         any of the Representations and Warranties shall be to take action under
         this Clause 8 (Warranties and Repurchase by the Seller) or under Clause
         8.4 (Adjustments to Trust Property) of the

                                       20
<PAGE>

         Mortgages Trust Deed. Furthermore, in respect of any actual or alleged
         breach of Clause 8.1 (Representations and Warranties), the Mortgages
         Trustee, any Funding Beneficiary or any Funding Security Trustee shall,
         as applicable:

         (a)      notify the Seller as soon as reasonably practicable following
                  any claim or intimation of claim by any person of or arising
                  from such actual or alleged breach and thereafter keep the
                  Seller informed in relation to such claim or intimation;

         (b)      not settle or compromise any such claim made or intimated or
                  otherwise do anything which may be prejudicial to the position
                  of the Seller in relation thereto having regard to this
                  Agreement, except pursuant to the written directions of the
                  Seller or with the Seller's prior written approval, such
                  directions and approval not to be unreasonably withheld; and

         (c)      comply with the Seller's reasonable directions as to
                  answering, disputing, defending, compromising, settling, or
                  otherwise in relation to the claim made or initiated
                  (including without limitation the instruction of particular
                  legal advisers), and if and to the extent required by the
                  Seller, do such things as the Seller may reasonably require to
                  enable and authorise the Seller or persons nominated by the
                  Seller to answer, dispute, defend, compromise, settle or
                  otherwise deal with any such claim or intimated claim, or
                  mitigate loss or potential loss on behalf of the Mortgages
                  Trustee, subject in each case to the Seller indemnifying the
                  Mortgages Trustee each Funding Beneficiary and each Funding
                  Security Trustee against the consequences of complying with
                  the Seller's directions and requirements.

8.4.     Repurchase: Subject to Clause 8.14 (Repurchase Not Possible), in the
         event of a material breach of any of the Representations or Warranties
         in respect of any Mortgage Loan and/or its Related Security as at the
         Initial Closing Date or, as the case may be, the relevant Assignment
         Date, which could have a material adverse effect on the Mortgage Loan
         and/or its Related Security (having regard to, among other things,
         whether a loss is likely to be incurred in respect of the Mortgage Loan
         to which the breach relates after taking account of the likelihood of
         recoverability or otherwise of any sums under any applicable insurance
         policies), and further provided that:

         (a)      the Mortgages Trustee has, or the Funding Beneficiaries or the
                  Funding Security Trustees have, given the Seller not less than
                  28 days' notice in writing;

         (b)      the Mortgages Trustee has obtained the consent of the Funding
                  Security Trustees; and

         (c)      such breach, where capable of remedy, is not remedied to the
                  satisfaction of the Funding Beneficiaries and the Funding
                  Security Trustees within the 28 day period referred to in (a)
                  (or such longer period as the Funding Beneficiaries and the
                  Funding Security Trustees may direct the Mortgages Trustee),

         then at the direction of the Funding Beneficiaries (with the consent of
         the Funding Security Trustees) or the Funding Security Trustees, the
         Mortgages Trustee may serve upon the Seller a notice in the form of the
         Loan Repurchase Notice whereupon the

                                       21
<PAGE>

         Seller will be required to repurchase (i) the relevant Mortgage Loan
         and its Related Security, (ii) any other Mortgage Loan secured or
         intended to be secured by that Related Security or any part of it and
         (iii) any other Mortgage Loan secured on the same Mortgaged Property as
         the relevant Mortgage Loan to which the breach relates in accordance
         with Clause 8.7 (Completion of Repurchase), provided, however, that the
         Funding Security Trustees shall have no duty to provide any such notice
         to the Seller or consider granting their consent pursuant to this
         Clause 8.4 unless the Funding Security Trustees have been notified by a
         party to a Transaction Document of such material breach of such
         Representation or Warranty which, in the opinion of such party (as
         communicated to the Funding Security Trustees), could have a material
         adverse effect on the related Mortgage Loan and/or its Related
         Security, taking into account the considerations provided in this
         Clause 8.4, and further provided that prior to receipt of such notice
         the Funding Security Trustees shall be entitled to assume that no such
         material breach has occurred.

8.5.     Purchase of Product Switches, Further Advances and purchases relating
         to Personal Secured Loans: In the event of there being at any date in
         respect of any Mortgage Loan assigned to the Mortgages Trustee
         hereunder a PS/FA/PSL Event (other than a Mortgage Loan becoming a
         Re-Fixed Mortgage Loan, such PS/FA/PSL Event being dealt with under
         Clause 8.6 (Repurchase of Fixed Rate Mortgage Loans)), the Seller may
         at any time serve notice in the form of the Loan Repurchase Notice on
         the Mortgages Trustee whereupon the Mortgages Trustee will be required
         to sell and to transfer to the Seller in accordance with Clause 8.7
         (Completion of Repurchase):

         (a)      any Mortgage Loan subject to a PS/FA/PSL Event, together with
                  its Related Security;

         (b)      any other Mortgage Loan secured or intended to be secured by
                  the Related Security referred to in (a) above or any part of
                  it; and

         (c)      any other Mortgage Loan secured on the same Mortgaged Property
                  that secures the Mortgage Loan subject to a PS/FA/PSL Event,
                  together with its Related Security,

         each such Mortgage Loan to be identified in the Loan Repurchase Notice
         (any such Mortgage Loan or Mortgage Loans, a "PS/FA/PSL Mortgage
         Loan"), free from the Mortgages Trust and any right or interest that
         any Funding Security Trustee may have in such PS/FA/PSL Mortgage Loan
         and its Related Security under the Funding Deed of Charge and/or the
         Funding 2 Deed of Charge (as applicable). Any PS/FA/PSL Mortgage Loan
         purchased by the Seller shall be released from the Mortgages Trust and
         shall no longer constitute part of the Mortgage Portfolio and shall be
         released from any right or interest that any Funding Security Trustee
         may have had in such Mortgage Loan and its Related Security under the
         Funding Deed of Charge and/or the Funding 2 Deed of Charge (as
         applicable) prior to such repurchase.

8.6.     Repurchase of Fixed Rate Mortgage Loans:

         (a)      Where a Mortgage Loan bears interest at a fixed rate for a
                  certain period (the "initial fixed rate period"), after the
                  expiry of which the Borrower is entitled to exercise an option
                  for a new fixed rate (whether or not subject to certain

                                       22
<PAGE>

                  conditions), the Mortgages Trustee may by notice in writing to
                  the Seller given at any time not more than 60 days before the
                  expiry of that initial fixed rate period (which for the
                  avoidance of doubt shall exclude any period of extension to
                  which the relevant Borrower is entitled), offer to re-sell to
                  the Seller that Mortgage Loan together with its Related
                  Security if that Mortgage Loan becomes a Re-Fixed Mortgage
                  Loan during the 3-month period immediately following the end
                  of that initial fixed rate period. The offer will be in
                  writing in the form set out in Schedule 9 (Offer under Clause
                  8.6 (Repurchase of Fixed Rate Mortgage Loans)) and will be
                  signed by or on behalf of the Mortgages Trustee.

         (b)      The Seller may accept the offer made in accordance with
                  paragraph (a) above on the date on which that Mortgage Loan
                  becomes a Re-Fixed Mortgage Loan during the 3-month period
                  immediately following the end of the initial fixed rate period
                  relating to it, only by payment to the Mortgages Trustee of
                  the consideration payable for the repurchase of the relevant
                  Mortgage Loan and its Related Security in accordance with
                  Clause 8.7 (Completion of Repurchase).

         (c)      The parties hereto acknowledge that the effect of the payment
                  to the Mortgages Trustee by the Seller of the consideration
                  for the repurchase of the relevant Mortgage Loan and its
                  Related Security in accordance with paragraph (b) above will
                  be the assignment and transfer to the Seller of the beneficial
                  ownership of, and all of the Mortgages Trustee's beneficial
                  right, title, interest and benefit in and to, that Mortgage
                  Loan, and completion of the repurchase shall be effected by
                  the parties in accordance with Clause 8.7 (Completion of
                  Repurchase).

         (d)      The Seller hereby covenants and undertakes that if it does not
                  accept the offer made by the Mortgages Trustee in accordance
                  with paragraph (b) above, then whether or not the Mortgage
                  Loan becomes a Re-Fixed Mortgage Loan, it will set the
                  Existing Borrowers' Re-Fix Rate applicable for the 3-month
                  period immediately after expiry of the initial fixed rate
                  period relating to that Mortgage Loan at a rate not less than
                  that (and on terms not less advantageous to the Mortgages
                  Trustee or the Funding Beneficiaries than those) notified from
                  time to time to the Seller by the Mortgages Trustee, the
                  Funding Beneficiaries or the Administrator as being required
                  by the Mortgages Trustee or any Funding Beneficiary.

8.7.     Completion of Repurchase: Completion of any repurchase or re-transfer
         or purchase or transfer, as applicable, shall take place:

         (a)      in the case of any repurchase or re-transfer pursuant to
                  Clause 8.4 (Repurchase) or any purchase or transfer pursuant
                  to Clause 8.5 (Purchase of Product Switches, Further Advances
                  and purchases relating to Personal Secured Loans) on the first
                  London Business Day immediately following expiry of a period
                  of 10 days following the date of the service upon the Seller
                  of the relevant Loan Repurchase Notice or at the Seller's
                  earlier election; or

         (b)      in the case of any repurchase or re-transfer pursuant to
                  Clause 8.6 (Repurchase of Fixed Rate Mortgage Loans),
                  immediately upon the Mortgage Loan becoming a Re-Fixed
                  Mortgage Loan,

                                       23
<PAGE>

         whereupon, the Seller shall pay to the Mortgages Trustee an amount
         equal to the Current Balance of such Mortgage Loan or Mortgage Loans
         and any Related Security and all Arrears of Interest and Accrued
         Interest relating thereto as at the date of completion of such
         repurchase. The provisions of Clause 8.8 (Transfers), Clause 8.9
         (Documentation) and Clause 8.16 (Scottish Trust) shall apply to any
         such repurchase or re-transfer.

8.8.     Transfers: On the date of completion of any repurchase of a Mortgage
         Loan and its Related Security in accordance with this Clause 8
         (Warranties and Repurchase by the Seller), the Mortgages Trustee and
         each Funding Beneficiary shall at the cost of the Seller execute and
         deliver or cause their respective duly authorised attorneys to execute
         and deliver to the Seller:

         (a)      if perfection of the assignment and assignation to the
                  Mortgages Trustee has occurred in accordance with Clause 6
                  (Perfection of the Assignment):

                  (i)      if the relevant Mortgage is over Registered Land, a
                           transfer of such Mortgage to the Seller in the form
                           of the Registered Transfer; or

                  (ii)     if the relevant Mortgage is over Unregistered Land, a
                           transfer to the Seller in the form of the
                           Unregistered Transfer; or

                  (iii)    if the relevant Mortgage is a Scottish Mortgage, an
                           assignation to the Seller in the applicable form of
                           Scottish Transfer;

         (b)      a re-assignment or retrocession of the rights of the Mortgages
                  Trustee in respect of the relevant Related Security each in a
                  form reasonably acceptable to the Seller (which shall, in the
                  case of the re-assignment of the Insurance Contracts, be
                  substantially in the form of the Assignment of Insurance
                  Contracts set out in Schedule 3 (Assignment of Insurance
                  Contracts); and

         (c)      a notification to the Administrator that all further sums due
                  in respect of such repurchased Mortgage Loan are for the
                  Seller's account.

8.9.     Documentation: Upon any completion of the repurchase of any Mortgage
         Loan and its Related Security in accordance with this Clause 8
         (Warranties and Repurchase by the Seller) the Seller shall cease to be
         under any further obligation to hold any Title Deeds or other documents
         relating to such Mortgage Loan or Mortgage Loans and its Related
         Security to the order of the Mortgages Trustee and any Funding Security
         Trustee and if the Mortgages Trustee or any Funding Security Trustee
         then holds the Title Deeds, the Mortgages Trustee or, as the case may
         be, such Funding Security Trustee shall forthwith return them to the
         Seller. Any such repurchase by the Seller of a Mortgage Loan or
         Mortgage Loans and its or their Related Security shall constitute a
         discharge and release of the Seller from any claims which the Mortgages
         Trustee and/or any Funding Beneficiary and/or any Funding Security
         Trustee may have against the Seller arising from the relevant
         Representation or Warranty in relation to that Mortgage Loan or
         Mortgage Loans and its or their Related Security only, but shall not
         affect any rights arising from a breach of any other express provision
         of this Agreement or any Representation or Warranty in relation to any
         other Mortgage Loan and other Related Security.

                                       24
<PAGE>

8.10.    Notification: For so long as the Seller is the Administrator, forthwith
         after it becomes aware of any event which may reasonably give rise to
         an obligation under this Clause 8 (Warranties and Repurchase by the
         Seller) to repurchase any Mortgage Loan it shall notify the Mortgages
         Trustee, each Funding Beneficiary and each Funding Security Trustee in
         writing thereof as soon as reasonably practicable.

8.11.    No Prejudice: The terms of this Clause 8 (Warranties and Repurchase by
         the Seller) shall not prejudice the rights of the Mortgages Trustee or
         the Beneficiaries under the Mortgages Trust Deed.

8.12.    Claims against Seller: If a breach of a Representation or Warranty
         arises in respect of any Mortgage Loan and (in either case) no
         repurchase requirement arises in respect of the Seller pursuant to this
         Clause 8 (Warranties and Repurchase by the Seller), neither the
         Mortgages Trustee, nor any Funding Beneficiary or any Funding Security
         Trustee shall have any claim against the Seller in respect of, or in
         relation to, such breach of Representation or Warranty in relation to
         that Mortgage but without prejudice to Clause 8.14 (Repurchase Not
         Possible) and Clause 8.15 (Indemnity) of this Agreement and Clause 8.5
         (Adjustments to Trust Property) of the Mortgages Trust Deed. For the
         avoidance of doubt, save as provided for in this Clause 8 (Warranties
         and Repurchase by the Seller), the Seller is not obliged to repurchase
         any other Mortgage Loan or its Related Security.

8.13.    Assignment: If the Seller makes any payment to the Mortgages Trustee
         GIC Account (or as the Mortgages Trustee shall direct) in full
         satisfaction of any claim made by the Mortgages Trustee, any Funding
         Beneficiary or any Funding Security Trustee in relation to any
         Representation or Warranty set out in Schedule 1 (Representations and
         Warranties), the Mortgages Trustee, each Funding Beneficiary and each
         Funding Security Trustee, as the case may be, shall assign to the
         Seller such rights as they have against any third party which relate to
         such claim.

8.14.    Repurchase Not Possible: If a Mortgage Loan has never existed, or has
         ceased to exist, such that it is not outstanding on the date on which
         it is due to be repurchased pursuant to this Clause 8 (Warranties and
         Repurchase by the Seller), the Seller shall not be obliged to
         repurchase the Mortgage Loan and the Related Security but shall instead
         indemnify the Mortgages Trustee, each Funding Beneficiary and each
         Funding Security Trustee against any loss suffered by reason of any
         Representation or Warranty relating to or otherwise affecting that
         Mortgage Loan being untrue or incorrect by reference to the facts
         subsisting at the date on which the relevant Representation or Warranty
         was given, provided that the amount of such indemnity shall not exceed
         the sum of (i) the Current Balance of the Mortgage Loan that would have
         been payable by the Borrower in respect of such Mortgage Loan on and
         after the relevant completion date for the repurchase in relation to
         such Mortgage Loan had the Mortgage Loan existed and complied with each
         of the Representations and Warranties set out Schedule 1
         (Representations and Warranties) as at such date in relation to such
         Mortgage Loan and (ii) interest thereon from such relevant completion
         date at the weighted average yield of the Mortgage Loans.

8.15.    Indemnity: The Seller shall indemnify the Mortgages Trustee against any
         loss suffered as a result of any Borrower exercising a right of set-off
         against the Mortgages Trustee provided that the amount of such
         indemnity in relation to any Mortgage Loan shall not exceed the sum of
         the Current Balance of that Mortgage Loan and interest

                                       25
<PAGE>

         payable by the Borrower under that Mortgage Loan as at the date that
         the Borrower exercises the right of set-off.

8.16.    Scottish Trust: Upon any completion of the repurchase or purchase by
         the Seller of any Scottish Mortgage Loan and its Related Security in
         accordance with this Clause 8 (Warranties and Repurchase by the Seller)
         such Scottish Mortgage Loan and its Related Security shall thereupon be
         released from the Scottish Trust and shall cease to form part of the
         Scottish Trust Property.

9.       Further Assurance

         The parties hereto agree that they will co-operate fully to do all such
         further acts and things and execute any further documents that may be
         necessary or desirable to give full effect to the transactions
         contemplated by this Agreement (but subject always to Clause 6
         (Perfection of the Assignment)).

10.      Consequences of Breach

         Without prejudice to Clause 8 (Warranties and Repurchase by the
         Seller), the Mortgages Trustee, each Funding Beneficiary and each
         Funding Security Trustee severally acknowledges to and agrees with the
         Seller, and each Funding Security Trustee severally acknowledges to and
         agrees with each Funding Beneficiary and the Mortgages Trustee (and
         with each other Funding Security Trustee), that the Seller shall have
         no liability or responsibility (whether, in either case, contractual,
         tortious or delictual, express or implied) for any loss or damage for
         or in respect of any breach of, or any act or omission in respect of,
         any of its obligations hereunder other than loss or damage directly
         (and not indirectly or consequentially) suffered by:

         (a)      the Mortgages Trustee; and/or

         (b)      Funding or the assets comprised in the Funding Security
                  constituted by the Funding Deed of Charge; and/or

         (c)      Funding 2 or the assets comprised in the Funding 2 Security
                  constituted by the Funding 2 Deed of Charge,

         by reason of such breach, act or omission. For this purpose (and
         without limiting the scope of the above exclusion in respect of
         indirect or consequential loss or damage) any loss or damage suffered
         by the Mortgages Trustee and/or any Funding Beneficiary or such assets
         which would not have been suffered by it or such assets had the breach,
         act or omission in question not also been or given rise to an Event of
         Default or enforcement of the security constituted by the Funding Deed
         of Charge or enforcement of the security constituted by the Funding 2
         Deed of Charge shall be treated as indirect or consequential loss or
         damage.

11.      Subordination

         The Seller agrees with the Mortgages Trustee, each Funding Beneficiary
         and each Funding Security Trustee that on the enforcement of any
         Mortgage any sums owed to the Seller by a Borrower secured under such
         Mortgage and the rights and remedies of the Seller in respect of the
         sums owed to the Seller shall at all times be subject and subordinated
         to any sums owed to the Mortgages Trustee by the Borrower and to the

                                       26
<PAGE>

         rights and remedies of the Mortgages Trustee in respect of such sums
         owed to the Mortgages Trustee by the Borrower.

12.      Non-Merger

         Any term of this Agreement to which effect is not given on the Initial
         Closing Date or on any Assignment Date (including in particular, but
         without limitation, the liability of the Seller under the
         Representations and Warranties and the provisions of Clause 4 (Sale and
         Purchase of New Mortgage Portfolios)) shall not merge and shall remain
         in full force and effect notwithstanding the sale and purchase
         contemplated by this Agreement.

13.      No Agency or Partnership

         It is hereby acknowledged and agreed by the parties that nothing in
         this Agreement shall be construed as giving rise to any relationship of
         agency, save as expressly provided herein, or partnership between the
         parties and that in fulfilling its obligations hereunder, each party
         shall be acting entirely for its own account.

14.      Payments

         All payments to be made pursuant to this Agreement shall be made in
         sterling in immediately available funds without exercising or seeking
         to exercise any right of set-off as may otherwise exist and shall be
         deemed to be made when they are received by the payee and shall be
         accounted for accordingly unless failure to receive any payment is due
         to an error by the payee's bank.

15.      Assignment

15.1.    Assignment: Subject always to the provisions of Clause 16 (Funding
         Security Trustees), no party hereto shall be entitled to assign all or
         any part of its rights or obligations hereunder to any other party
         without the prior written consent of each of the other parties hereto
         (which shall not, if requested, be unreasonably withheld) save that:

         (a)      Funding shall be entitled to assign by way of security all or
                  any of its rights under this Agreement without such consent to
                  the Security Trustee pursuant to the Funding Deed of Charge
                  and the Security Trustee may at its sole discretion assign all
                  or any of its rights under or in respect of this Agreement
                  without such consent to any successor Security Trustee under
                  the Funding Deed of Charge and may assign all or any part of
                  the Funding Security upon an enforcement of the Funding
                  Security in accordance with the Funding Deed of Charge; and

         (b)      Funding 2 shall be entitled to assign by way of security all
                  or any of its rights under this Agreement without such consent
                  to the Funding 2 Security Trustee pursuant to the Funding 2
                  Deed of Charge and the Funding 2 Security Trustee may at its
                  sole discretion assign all or any of its rights under or in
                  respect of this Agreement without such consent to any
                  successor Funding 2 Security Trustee under the Funding 2 Deed
                  of Charge and may assign all or any part of

                                       27
<PAGE>

                  the Funding 2 Security upon an enforcement of the Funding 2
                  Security in accordance with the Funding 2 Deed of Charge.

15.2.    Acknowledgement of Security Assignment: The Seller acknowledges that:

         (a)      on the assignment by Funding of its rights under this
                  Agreement to the Security Trustee pursuant to the Funding Deed
                  of Charge, the Security Trustee may enforce such rights in the
                  Security Trustee's own name without joining Funding in any
                  such action (which right the Seller hereby waives) and the
                  Seller hereby waives as against the Security Trustee any
                  rights or equities in its favour arising from any course of
                  dealing between the Seller and Funding; and

         (b)      on the assignment by Funding 2 of its rights under this
                  Agreement to the Funding 2 Security Trustee pursuant to the
                  Funding 2 Deed of Charge, the Funding 2 Security Trustee may
                  enforce such rights in the Funding 2 Security Trustee's own
                  name without joining Funding 2 in any such action (which right
                  the Seller hereby waives) and the Seller hereby waives as
                  against the Funding 2 Security Trustee any rights or equities
                  in its favour arising from any course of dealing between the
                  Seller and Funding 2.

16.      Funding Security Trustees

16.1.    Vesting of Rights: If there is any change in the identity of the
         security trustee in accordance with the Funding Deed of Charge, the
         Seller, the Mortgages Trustee, each Funding Beneficiary and the Funding
         2 Security Trustee shall execute such documents and take such action as
         the successor security trustee and the outgoing security trustee may
         require for the purpose of vesting in the successor security trustee
         the rights and obligations of the outgoing security trustee hereunder
         and releasing the outgoing security trustee from its future obligations
         under this Agreement and the Seller shall give notice thereof to the
         Rating Agencies. If there is any change in the identity of the security
         trustee in accordance with the Funding 2 Deed of Charge, the Seller,
         the Mortgages Trustee, each Funding Beneficiary and the Security
         Trustee shall execute such documents and take such action as the
         successor security trustee and the outgoing security trustee may
         require for the purpose of vesting in the successor security trustee
         the rights and obligations of the outgoing security trustee hereunder
         and releasing the outgoing security trustee from its future obligations
         under this Agreement and the Seller shall give notice thereof to the
         Rating Agencies.

16.2.    No Assumption: It is hereby acknowledged and agreed that by its
         execution of this Agreement no Funding Security Trustee shall assume or
         have any of the obligations or liabilities of the Seller, any Funding
         Beneficiary or the Mortgages Trustee or any other Funding Security
         Trustee hereunder. Furthermore, any liberty or power which may be
         exercised or any determination which may be made hereunder by a Funding
         Security Trustee may be exercised or made in its absolute discretion
         without any obligation to give reasons therefor, but in any event must
         be exercised or made in accordance with the provisions of the Funding
         Deed of Charge or the Funding 2 Deed of Charge (as applicable) and the
         Funding Beneficiary Deed. Without prejudice to the generality of the
         foregoing, all references to any Funding Security Trustee taking action
         in connection with any duty of the Seller shall also be read subject to
         Clause 25 and Schedule 4 of the Administration Agreement.

                                       28
<PAGE>

17.      New Intercompany Loans

         On each occasion that a Funding Beneficiary enters into an Intercompany
         Loan Agreement or is the recipient of a loan advance under an
         Intercompany Loan Agreement, then the Seller, the Mortgages Trustee,
         each Funding Beneficiary and each Funding Security Trustee shall
         execute such documents and take such action as may be required by the
         Rating Agencies for the purpose of including the applicable Issuer in
         the Transaction or taking account of such Intercompany Loan or loan
         advances and or providing for the rights and obligations of such Issuer
         or the relevant Funding Beneficiary, including, without limitation:

         (a)      effecting any necessary changes to Clause 4 (Sale and Purchase
                  of New Mortgage Portfolios);

         (b)      ensuring that any Transaction Document relevant to such Issuer
                  has been executed and delivered prior to the relevant Closing
                  Date;

         (c)      executing and delivering all documents required by Clause 4.4
                  (Closing and Conditions Precedent) in relation to any New
                  Mortgage Portfolio.

18.      Non Petition Covenant; Limited Recourse

18.1.    Non Petition Covenant: Each of the parties hereto (except for, in the
         case of Funding, the Security Trustee and, in the case of Funding 2,
         the Funding 2 Security Trustee) hereby agrees that it shall not
         institute against any Funding Beneficiary or the Mortgages Trustee any
         winding-up, administration, insolvency or similar proceedings so long
         as any sum is outstanding under any Intercompany Loan Agreement of any
         Issuer or for two years plus one day since the last day on which any
         such sum was outstanding.

18.2.    Limited Recourse: Each of the parties hereto agrees that:

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

         (b)      in relation to Funding:

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

                  (ii)     notwithstanding any other provision of this Agreement
                           or any other Transaction Document, no sum due or
                           owing to any party to this Agreement from or by
                           Funding under this Agreement shall be payable by
                           Funding except to the extent that Funding has
                           sufficient funds available therefor or (following
                           enforcement of the Funding Security) the Security
                           Trustee has realised sufficient funds from the
                           Funding Security to pay such sum, in each case,
                           subject to and in accordance

                                       29
<PAGE>

                           with the relevant Funding Priority of Payments and
                           provided that all liabilities of Funding required to
                           be paid in priority thereto or pari passu therewith
                           pursuant to such Funding Priority of Payments have
                           been paid, discharged and/or otherwise provided for
                           in full; and

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

         (c)      in relation to Funding 2:

                  (i)      only the Funding 2 Security Trustee may enforce the
                           security created in favour of the Funding 2 Security
                           Trustee under the Funding 2 Deed of Charge in
                           accordance with the provisions thereof;

                  (ii)     notwithstanding any other provision of this Agreement
                           or any other Transaction Document, no sum due or
                           owing to any party to this Agreement from or by
                           Funding 2 under this Agreement shall be payable by
                           Funding 2 except to the extent that Funding 2 has
                           sufficient funds available therefor or (following
                           enforcement of the Funding 2 Security) the Funding 2
                           Security Trustee has realised sufficient funds from
                           the Funding 2 Security to pay such sum, in each case,
                           subject to and in accordance with the relevant
                           Funding 2 Priority of Payments and provided that all
                           liabilities of Funding 2 required to be paid in
                           priority thereto or pari passu therewith pursuant to
                           such Funding 2 Priority of Payments have been paid,
                           discharged and/or otherwise provided for in full; and

                  (iii)    it shall not take any steps for the purpose of
                           recovering any amount payable by Funding 2 or
                           enforcing any rights arising out of this Agreement
                           against Funding 2 otherwise than in accordance with
                           the Funding 2 Deed of Charge.

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

                                       30
<PAGE>

19.      Amendments and Waiver

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

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

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

20.      Notices

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

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

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

         (c)      in the case of Funding, to Granite Finance Funding Limited, 69
                  Park Lane, Croydon CR9 1TQ, (facsimile number 020 8409 8911)
                  for the attention of the Company Secretary;

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

         (e)      in the case of Funding 2, to Granite Finance Funding 2
                  Limited, Fifth Floor, 100 Wood Street, London, EC2V 7EX
                  (facsimile number 020 7606 0643), for

                                       31
<PAGE>

                  the attention of the Company Secretary (with a copy to the
                  Seller in accordance with (a) above); and

         (f)      in the case of the Funding 2 Security Trustee, to The Bank of
                  New York, 48th Floor, One Canada Square, London E14 5AL
                  (facsimile number 020 7964 6399), for the attention of Global
                  Structured Finance (Corporate Trust);

         or to such other address or facsimile number or for the attention of
         such other person or entity as may from time to time be notified by any
         party to the others by fifteen days prior written notice in accordance
         with the provisions of this Clause 20.

21.      Third Party Rights

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

22.      Execution in Counterparts; Severability

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

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

23.      Governing Law and Submission to Jurisdiction

23.1.    Governing Law: This Agreement is governed by, and shall be construed in
         accordance with, English law (PROVIDED THAT any terms of this Agreement
         which are particular to the law of Scotland shall be construed in
         accordance with Scots law).

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

24.      Process Agent

         The Mortgages Trustee irrevocably and unconditionally appoints Mourant
         & Co. Capital (SPV) Limited at 69 Park Lane, Croydon CR9 1TQ or
         otherwise at its registered office for the time being as its agent for
         service of process in England in respect of any proceedings in respect
         of this Agreement and undertakes that in the event of Mourant & Co.
         Capital (SPV) Limited ceasing so to act it will appoint another person
         with a registered office in London as its agent for service of process.

                                       32
<PAGE>

25.      Appropriate Forum

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

26.      Transaction Documents

         To the extent necessary to comply with the requirements of Section 2
         Law of Property (Miscellaneous Provisions) Act 1989, this Agreement
         incorporates by reference to them the Transaction Documents.

AS WITNESS whereof the parties hereto have executed this Agreement for delivery
on the day and year first before written.

as Seller and a Beneficiary
EXECUTED for and on behalf of     )
NORTHERN ROCK PLC                 )
by                                )

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

Name:

as Mortgages Trustee
EXECUTED for and on behalf of     )
GRANITE FINANCE TRUSTEES LIMITED  )
by                                )

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

Name:

                                       33
<PAGE>

as Beneficiary

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

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

Name:

as Beneficiary
EXECUTED by                                         )
GRANITE FINANCE FUNDING 2 LIMITED                   )
by                                                  )

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

Name:

as Security Trustee and Funding 2 Security Trustee
EXECUTED by                                         )
THE BANK OF NEW YORK                                )
by                                                  )

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

Name:

                                       34
<PAGE>

                                   SCHEDULE 1
                         REPRESENTATIONS AND WARRANTIES

                                     Part 1

1.       The particulars of each Mortgage Loan and its related Mortgage in the
         Initial Mortgage Portfolio set out in Appendix A to this Agreement are
         complete, true and accurate in all material respects.

2.       Immediately prior to a Closing Date or an Assignment Date, as the case
         may be, subject to completion of any registration or recording which
         may be pending at the Land Registry or the Registers of Scotland, the
         Seller was the absolute beneficial and legal owner of the Mortgage
         Loans, the Related Security and the other property to be assigned and
         transferred by the Seller to the Mortgages Trustee under this Agreement
         at such Closing Date or such Assignment Date, as the case may be, and
         the Seller has not assigned (whether by way of absolute assignment or
         by way of security only), transferred, charged, disposed of or dealt
         with the benefit of any of the Mortgage Loans or their related
         Mortgages, any of the other rights relating thereto or any of the
         property, rights, titles, interests or benefits to be sold or assigned
         pursuant to this Agreement other than pursuant to this Agreement.

3.       With the exception of Personal Secured Loans, the Mortgage Conditions
         and the Mortgage Loan Agreement for each Mortgage Loan and its related
         Mortgage and the Related Security constitutes a valid and binding
         obligation of the Borrower enforceable in accordance with its terms
         (save any terms which are not binding by virtue of the Unfair Terms in
         Consumer Contracts Regulations 1994 or the Unfair Terms in Consumer
         Contracts Regulations 1999) and each such related Mortgage and the
         Related Security secures the repayment of all advances, interest, costs
         and expenses payable by the relevant Borrower to the Seller in priority
         to any other charges registered against the relevant Mortgaged
         Property.

4.       At the time that it was made, each Mortgage Loan (other than Personal
         Secured Loans) complied in all respects with applicable laws,
         regulations and rules including, without limitation, consumer
         protection, data protection and contract law.

5.       Subject to completion of any registration which may be pending at the
         Land Registry or the Registers of Scotland, each Mortgage (other than a
         Mortgage in respect of a Regulated Personal Secured Loan) either
         constitutes, or will constitute, following registration at the Land
         Registry (in England and Wales), a first ranking charge by way of legal
         mortgage or following registration or recording at the Registers in
         Scotland, a first ranking standard security over the relevant Mortgaged
         Property.

6.       Each relevant Mortgaged Property is located in England, Wales or
         Scotland.

7.       All steps necessary to perfect the Seller's title to each Mortgage Loan
         and its related Mortgage were duly taken at the appropriate time or are
         in the process of being taken with all due diligence.

8.       No lien or right of set-off or counterclaim (other than a Right of
         Set-off referred to in Clause 8.15 (Indemnity)) has been created or
         arisen between the Seller and any

                                       35
<PAGE>

         Borrower which would entitle such Borrower to reduce the amount of any
         payment otherwise due under the relevant Mortgage Conditions and the
         Mortgage Loan Agreement save in relation to the Unfair Terms in
         Consumer Contracts Regulations 1994 or the Unfair Terms in Consumer
         Contracts Regulations 1999 and save in relation to section 75 of the
         CCA.

9.       Prior to making a Mortgage Loan to a Borrower, the Seller instructed or
         required to be instructed on its behalf solicitors to carry out in
         relation to the relevant Mortgaged Property all investigations,
         searches and other actions that would have been undertaken by the
         Seller acting in accordance with standards consistent with those of a
         reasonable and prudent mortgage lender, lending to Borrowers in England
         and Wales (in respect of English Mortgage Loans) and Scotland (in
         respect of Scottish Mortgage Loans), when advancing money in an amount
         equal to such advance to an individual to be secured on a property of
         the kind permitted under the Lending Criteria and a report on title was
         received by or on behalf of the Seller from such solicitors which,
         either initially or after further investigation revealed no material
         matter which would cause the Seller, acting reasonably, to decline the
         Mortgage Loan having regard to the Lending Criteria.

10.      In relation to each Mortgage the Borrower has a good and marketable
         title to the relevant Mortgaged Property.

11.      Prior to making a Mortgage Loan the relevant property was valued by an
         independent valuer from the panel of valuers from time to time
         appointed by the Seller or by an employee valuer of the Seller, and the
         results of such valuation would be acceptable to a reasonable and
         prudent mortgage lender.

12.      Prior to making a Mortgage Loan, the nature and amount of such Mortgage
         Loan, the circumstances of the relevant Borrower and nature of the
         relevant property satisfied the Lending Criteria in force at that time
         in all material respects.

13.      The exercise of any discretion by the Seller in the making of any
         Mortgage Loan has been consistent with the practice of a reasonable and
         prudent mortgage lender.

14.      Each Mortgage Loan and its related Mortgage has been made on the terms
         of the Standard Mortgage Documentation (so far as applicable) which has
         not been varied in any material respect, save for the making of the
         Base Rate Pledge.

15.      With the exception of agreements for Regulated Personal Secured Loans,
         no agreement for any Mortgage Loan (other than to the extent it relates
         to the funding of buildings insurance premiums) is or has ever been,
         wholly or partly regulated by the CCA (other than by Sections 137 to
         140 of the CCA) or constitutes an extortionate credit bargain under
         Sections 137 to 140 of the CCA or, to the extent it is so regulated or
         partly regulated, all the requirements of the CCA have been met in
         full. No Mortgage Loan is, or has ever been, a linked transaction
         within Section 19 of the CCA.

16.      Interest on each Mortgage Loan: (a) is charged on the capital balance
         of each Mortgage Loan in accordance with the provisions of the
         applicable Mortgage Conditions and the Mortgage Loan Agreement and its
         related Mortgage; (b) is not in any event adjusted by reference to the
         principal amount due thereunder; (c) is payable

                                       36
<PAGE>

         monthly in advance; and (d) is calculated by reference to the Standard
         Variable Rate or the Bank of England Base Rate, subject to any
         applicable caps, discounts and fixed rates and the Base Rate Pledge;
         and (e) subject to (d) above, may be set by the Seller and its
         successors and assigns to that Mortgage Loan.

17.      No payment of interest (or in the case of Repayment Mortgage Loans,
         principal and interest) equivalent to an amount in excess of one
         month's instalment at the applicable rate in respect of a Mortgage Loan
         in the Initial Mortgage Portfolio was at any time during the 12 months
         before the relevant Closing Date or Assignment Date, as the case may
         be, in arrears.

18.      So far as the Seller is aware, no Borrower is in material breach of its
         Mortgage Conditions.

19.      So far as the Seller is aware, the underwriting, origination and
         completion of each Mortgage Loan is not the subject of fraud by any
         person (including, without limitation, the Borrower or any professional
         or third party employed or engaged on behalf of the Seller).

20.      As at the date of this Agreement, the first payment due has been paid
         by the relevant Borrower in respect of each Mortgage Loan and each
         Mortgage Loan was fully performing.

21.      Where any Borrower is or was entitled to repayment of any early
         repayment charge in respect of any mortgage previously held by the
         Borrower with the Seller, that repayment has been or will be made by
         the Seller.

22.      Except where a Mortgaged Property was at completion of the relevant
         Mortgage (or, where appropriate, in the case of self-build properties,
         at the date of completion of the relevant mortgaged property) covered
         by the Block Buildings Policy or a block buildings policy providing
         equivalent cover, the Seller took all reasonable steps to ensure that
         at the date of completion of the relevant Mortgage Loan each Mortgaged
         Property was:

         (a)      insured under a buildings policy either (i) in the joint names
                  of the Borrower and the Seller or (ii) with the interest of
                  the Seller noted thereon;

         (b)      insured under a Block Buildings Policy; or

         (c)      with respect to leasehold properties, insured by the relevant
                  landlord with the Seller's approval,

         and in all cases against risks usually covered by a comprehensive
         buildings policy and to an amount not less than the full reinstatement
         cost of such Mortgaged Property as determined by an independent valuer
         or a valuer employed by the Seller.

23.      The Block Buildings Policy referred to above covers such fire and other
         commercial risks as would be required by the Seller acting in
         accordance with its normal standard for an amount not less than the
         full reinstatement value of the Properties covered by the Block
         Buildings Policy.

                                       37
<PAGE>

24.      The Insurance Contracts are in full force and effect and all premiums
         thereon due on or before the date of this Agreement have been paid in
         full and the Seller is not aware of any circumstances giving the
         insurer under the Insurance Contracts the right to avoid or terminate
         such policy in so far as it relates to the Mortgaged Properties or the
         Mortgage Loans. Where the Lending Criteria then in force required that
         a Mortgage Loan was covered by the Insurance Contract referred to in
         paragraph 1 of Schedule 4 (Insurance Contracts), that Mortgage Loan is
         covered by such Insurance Contract.

25.      To the extent that a Guarantee was required under the Lending Criteria
         in relation to a particular Mortgage Loan, that Guarantee constitutes
         the valid, binding and enforceable obligations of the guarantor
         thereunder (save to the extent that any term of the Guarantee is not
         valid, binding or enforceable by virtue of the Unfair Terms in Consumer
         Contracts Regulations 1994 or the Unfair Terms in Consumer Contracts
         Regulations 1999).

26.      If a Mortgaged Property is leasehold or long leasehold, written notice
         has been given to the landlord of the creation of the Mortgage.

27.      In relation to each English Mortgage, any person who at the date when
         the Mortgage Loan was made has been identified by the Borrower to the
         Seller as residing or about to reside in the relevant Mortgaged
         Property is either named as a joint Borrower or has signed a form of
         consent declaring that he or she agrees that any present or future
         rights or interests as he or she may have or acquire over or in respect
         of the relevant Mortgaged Property shall be postponed and made subject
         to the rights, interests and remedies of the Seller under the relevant
         Mortgage and that he or she shall not claim any such rights or
         interests against the Seller. In relation to each Scottish Mortgage,
         all necessary MHA Documentation has been obtained to as to ensure that
         neither the relevant Mortgage nor the relevant Mortgaged Property is
         subject to or affected by any statutory right of occupancy.

28.      No Borrower was under 18 years of age at the time of completion of the
         relevant Mortgage Loan.

29.      No Mortgage Loan has a final maturity beyond January 2039 or, following
         the redemption in full of all Notes issued by Funding Issuers, January
         2052.

30.      The Seller has procured that full and proper accounts, books and
         records have been kept showing clearly all material transactions,
         payments, receipts and proceedings relating to that Mortgage Loan and
         its Mortgage and all such accounts, books and records are up to date
         and in the possession of the Seller or held to its order (subject to
         the provisions of the Mortgages Trust Deed).

31.      The origination and collection practices employed by the Seller with
         respect to the Mortgage Loans have been, in all respects, legal and
         consistent with the practice of a reasonable and prudent mortgage
         lender.

32.      The Seller has not received written notice of any litigation or claim
         calling into question in any material way its title to any Mortgage
         Loan and its Mortgage or the value of any security. The Seller is not
         engaged in any litigation, and no litigation is pending or threatened
         by the Seller, against any person in connection with any report,
         valuation, opinion, certificate, consent or other statement of fact or
         opinion given in

                                       38
<PAGE>

         connection with any Mortgage Loan received by the Seller in connection
         with the origination of any Mortgage Loan.

33.      In respect of any Mortgaged Property which is subject to a second or
         subsequent mortgage or standard security, the Seller has first priority
         for the full amount of the Mortgage Loan (other than in respect of a
         Regulated Personal Secured Loan) and all costs, fees and expenses
         relative thereto.

34.      Subject to completion of any registration or recording which may be
         pending at the Land Registry or the Registers of Scotland, all Property
         Deeds and Mortgage Loan Files are held by, or to the order of, the
         Seller.

35.      Each Borrower is a natural person, and no Borrower is at present an
         employee or an officer of the Seller.

36.      All Mortgage Loans were originated by or on behalf of the Seller in the
         ordinary course of the Seller's residential secured lending activities.
         No Mortgage Loan was acquired by the Seller subject to any discount and
         no Mortgage Loan has been written down by the Seller in its accounts.

37.      The Mortgage Conditions and the Mortgage Loan Agreement in relation to
         each Mortgage Loan contain no obligations on the part of the Seller to
         make any further advances, and all costs, fees and expenses incurred in
         making, closing or registering the Mortgage Loans and the Related
         Security have been paid in full.

38.      All formal approvals, consents and other steps necessary to permit a
         legal or equitable or beneficial transfer or a transfer of servicing
         away from the Seller of the Mortgage Loans and their related Mortgages
         to be sold under this Agreement whenever required under the Transaction
         Documents have been obtained or taken and there is no requirement in
         order for the transfer to be effective to notify the Borrower before,
         on or after any equitable or beneficial transfer of the Mortgage Loans
         and their related Mortgages.

39.      So far as the Seller is aware, none of the terms in any Mortgage
         Conditions and the Mortgage Loan Agreement in relation to each Mortgage
         Loan and its related Mortgage are unfair terms within the meaning of
         the Unfair Terms in Consumer Contracts Regulations 1994 or the Unfair
         Terms in Consumer Contracts Regulations 1999 in any material respect
         save those which impose Early Repayment Charges.

40.      The Seller has confirmed to all relevant Borrowers that where any
         Mortgage Conditions and the Mortgage Loan Agreement relating to any
         Mortgage Loan provide that where any Early Repayment Charge is payable
         at any time when the interest rate payable under that Mortgage Loan is
         equal to or set by reference to the Standard Variable Rate (including
         without limitation where the Mortgage Conditions and the Mortgage Loan
         Agreement relating to the Mortgage Loan provide for a capped or
         discounted rate), the interest rate payable under that Mortgage Loan
         will be no more than 1.99 per cent. above the Bank of England's base
         rate.

                                       39
<PAGE>

41.      In relation to a Right to Buy Mortgage Loan:

         (a)      in the case of each English Mortgage Loan the Seller was at
                  the time of origination of that Mortgage Loan an approved
                  lending institution within the meaning given to that
                  expression in the Housing Act 1985;

         (b)      the original advance was made to the person exercising the
                  right to buy; and

         (c)      the original advance was made for the purposes of enabling the
                  recipient thereof to purchase the relevant Mortgaged Property.

         For the purpose of this paragraph 41, "Right to Buy Mortgage Loan"
         means (i) in relation to an English Mortgage Loan, a Mortgage Loan in
         respect of which the "right to buy" provisions of the Housing Act 1985
         apply (other than any Mortgage Loan in respect of which the period
         during which the statutory charge referred to in section 156 of that
         Act would have existed, had the relevant circumstances applied, has
         expired) and (ii) in relation to a Scottish Mortgage Loan, a Mortgage
         Loan in respect of which the "right to buy" provisions of the Housing
         (Scotland) Act 1987 apply (other than any Mortgage Loan in respect of
         which the period during which the seller's standard security referred
         to in section 72 of that Act remains in effect has expired).

42.      The loyalty discount applicable to certain Mortgage Loans after seven
         years will not apply to any such Mortgage Loans during any period when
         the interest rate is fixed.

43.      The Seller has paid to the relevant Borrower the full amount of the
         cashback payment in relation to any Cashback Mortgage Loan, either upon
         completion of the relevant Mortgage Loan or, if subsequent to
         completion, prior to the assignment of such Mortgage Loan to the
         Mortgages Trustee.

44.      No Mortgage Loan has a Current Balance of more than (GBP)500,000.

45.      Each English Mortgage Loan and its Related Security in the Mortgage
         Portfolio was made not earlier than 1 July 1995 and each Scottish
         Mortgage Loan and its Related Security in the Mortgage Portfolio was
         made not earlier than 1 July 2001.

46.      Each Mortgage Loan was originated by the Seller in pounds sterling and
         is denominated in pounds sterling (or originated and denominated in
         euro at any time when the euro has been adopted as the lawful currency
         of the United Kingdom) and is currently repayable in pounds sterling.

47.      The Seller's Lending Criteria are consistent with the criteria that
         would be used by a reasonable and prudent mortgage lender.

48.      The Seller is not aware of any material claim outstanding under any of
         the Buildings Policies relating to a Mortgaged Property.

49.      No Mortgage Loan has an LTV greater than 95 per cent. In relation to
         Personal Secured Loans, the combined LTV of the maximum amount of
         credit provided under that Personal Secured Loan and the other Mortgage
         Loan Agreements secured on the same property is not greater than 95 per
         cent.

                                       40
<PAGE>

50.      Each Mortgage Loan (other than a Personal Secured Loan) has been made
         for one of the following purposes:

         (a) the purchase of land; or

         (b)      the provision of dwellings or business premises on any land;
                  or

         (c)      the alteration, enlarging, repair or improvement of a dwelling
                  or business premises on any land provided that such land is
                  also the subject of either (i) an agreement by which the
                  relevant Borrower is provided with credit by the Seller for
                  any of the purposes in (a) or (b) above or (ii) an agreement
                  refinancing an agreement under which the relevant Borrower is
                  provided with credit by the Seller for any of the purposes in
                  (a) or (b) above; or

         (d)      to refinance any existing indebtedness of the relevant
                  Borrower, whether to the Seller or another person, under any
                  agreement by which the relevant Borrower was provided with
                  credit for any of the purposes in (a), (b) and (c) above.

                                       41
<PAGE>

                                     Part 2

1.       In respect of each of the Preliminary Prospectus as of its date (except
         insofar as the information contained therein has been amended,
         supplemented or deleted in the Prospectus) and the Prospectus as at the
         date thereof:

         (a)      each of them contained all information with respect to the
                  Seller, the Cut-Off Date Mortgage Portfolio and to the Notes
                  which was material in the context of the issue and offering of
                  the Notes (including all information required by English law);

         (b)      the statements contained in each of them relating to the
                  Seller and the Cut-Off Date Mortgage Portfolio were in every
                  material particular true and accurate and not misleading;

         (c)      the opinions and intentions expressed in each of them with
                  regard to the Seller and the Initial Mortgage Portfolio were
                  honestly held, were reached after considering all relevant
                  circumstances and were based on reasonable assumptions;

         (d)      there were no other facts in relation to the Seller, the
                  Cut-Off Date Mortgage Portfolio or the Notes the omission of
                  which would, in the context of the issue and offering of the
                  Notes, make any statement in either of them misleading; and

         (e)      all reasonable enquiries had been made by the Seller to
                  ascertain such facts and to verify the accuracy of all such
                  information and statements.

2.       The Seller has not acquired or owned or possessed any rights in the
         Mortgages Trustee or any Funding Beneficiary such that it would
         "control" the Mortgages Trustee or any Funding Beneficiary within the
         meaning of section 416 ICTA 1988.

         There is not any "connection" (within the meaning of section 87 Finance
         Act 1996) between either the Mortgages Trustee or any Funding
         Beneficiary, respectively, and any Borrower.

                                       42
<PAGE>

                                     Part 3

The Seller makes the following representations and warranties to the Mortgages
Trustee, each Funding Beneficiary and each Funding Security Trustee:

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

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

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

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

         (a)      result in the existence or imposition of, nor oblige it to
                  create, any Security Interest in favour of any person over all
                  or any of its present or future revenues or assets save for
                  any which are created under or pursuant to the Transaction
                  Documents;

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

         (c)      conflict with its constitutional documents; or

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

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

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

                                       43
<PAGE>

                                   SCHEDULE 2
              FORMS OF TRANSFERS: REGISTERED AND UNREGISTERED LAND
                             AND SCOTTISH TRANSFERS

                                       44
<PAGE>

                                     Part 1

             FORM OF TRANSFER (REGISTERED LAND - ENGLAND AND WALES)

                    In the form of the Land Registry Form TR4

                                       45
<PAGE>

                                     Part 2

            FORM OF TRANSFER (UNREGISTERED LAND - ENGLAND AND WALES)

This Transfer of Mortgages is made on [ ] between NORTHERN ROCK PLC (registered
number 3273685) whose registered office is at Northern Rock House, Gosforth,
Newcastle upon Tyne NE3 4PL (hereinafter called the "Transferor") of the one
part and GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) whose
registered office is at 22 Grenville Street, St. Helier, Jersey JE4 8PX, Channel
Islands (hereinafter called the "Transferee") of the other part.

WHEREAS:

(A)      By the charges by way of legal mortgage ("Mortgages") brief particulars
         of which are set out in the Annexure hereto the properties brief
         particulars of which are similarly set out ("Properties") became
         security for the repayment of the moneys therein mentioned.

(B)      By a mortgage sale agreement dated 26 March 2001 made between, amongst
         others, the Transferor and the Transferee (as amended, restated,
         varied, supplemented or novated from time to time), the Transferor has
         agreed to sell and the Transferee has agreed to buy all right, title,
         interest and benefit (both present and future) in and under the
         Mortgages for the consideration hereinafter mentioned.

NOW THIS DEED WITNESSETH as follows:

1.       In consideration of the sums payable and the other consideration under
         the Agreement by the Transferee (receipt of which is hereby
         acknowledged) the Transferor with full title guarantee hereby transfers
         unto the Transferee all right, title, interest and benefit (both
         present and future) in and under the Mortgages including for the
         avoidance of doubt:

         (i)      the right to demand, sue for, recover, receive and give
                  receipts for all principal moneys payable or to become payable
                  under the Mortgages or the unpaid part thereof and the
                  interest due or to become due thereon; and

         (ii)     the benefit of all securities for such principal moneys and
                  interest, the benefit of all consents to mortgage signed by
                  occupiers of the Properties, and the benefit of and the right
                  to sue on all covenants with the Transferor in each Mortgage
                  and the right to exercise all powers of the Transferor in
                  relation to each Mortgage; and

         (iii)    all the estate and interest in the Properties vested in the
                  Transferor subject to redemption or cesser; and

         (iv)     all causes of action of the Transferor against any person in
                  connection with any report, valuation, opinion, certificate or
                  other statement of fact or opinion or consent to mortgage
                  given in connection with any Mortgage or affecting the
                  Transferor's decision to make the relevant advance.

IN WITNESS of which NORTHERN ROCK PLC has caused this Transfer to be executed
and delivered as a deed on the date which appears first above.

                                       46
<PAGE>

EXECUTED under THE COMMON SEAL of           )
NORTHERN ROCK PLC                           )
affixed by order of the Board of Directors  )
in the presence of:                         )

--------------------------
Authorised Signatory

Name:

Title:

--------------------------
Authorised Signatory

Name:

Title:

[Alternative methods of executing as a deed will be acceptable if effective]

                                       47
<PAGE>

                                     Part 3

                   FORM OF TRANSFER (LAND REGISTER - SCOTLAND)

We, NORTHERN ROCK PLC, incorporated under the Companies Acts in England
(Registered Number 3273685) and having our Registered Office at Northern Rock
House, Gosforth, Newcastle upon Tyne NE3 4PL (the Transferor) CONSIDERING THAT
in terms of a Mortgage Sale Agreement among us the Transferor, GRANITE FINANCE
TRUSTEES LIMITED, incorporated under the law of Jersey (Registered Number 79309)
and having its Registered Office at 22 Grenville Street, St Helier, Jersey JE4
8PX, Channel Islands (the Transferee) and others dated 26 March 2001 (as
amended, restated, varied, supplemented or novated from time to time, the
Mortgage Sale Agreement) we have sold our whole right, title and interest in and
to the Standard Securities and others hereinafter mentioned to the Transferee
NOW THEREFORE we the Transferor IN CONSIDERATION of the sums payable in terms of
and in implement pro tanto of the Mortgage Sale Agreement HEREBY ASSIGN to the
Transferee as trustee under and in terms of the Mortgages Trust Deed among us,
the Transferor, the Transferee and others dated 26 March 2001 (as amended,
restated, varied, supplemented or novated from time to time, the Mortgages Trust
Deed) and its successor or successors as trustee or trustees under and in terms
of the Mortgages Trust Deed:

1        the Standard Securities granted by the respective parties whose names
         are specified in Column 3 of the Schedule annexed and executed as
         relative hereto in favour of us the Transferor for all sums due and to
         become due, to the extent of all sums now due and which may at any time
         or times hereafter become due under the said Standard Securities,
         registered said Standard Securities in the Land Register under the
         Title Number specified in the relative entry in Column 4 of the said
         Schedule on the date specified in the relative entry in Column 5 of the
         said Schedule; and

2        the whole rights and interest of us the Transferor in and under all and
         any personal bonds, credit agreements or agreements for loan (however
         constituted) secured by the said Standard Securities and granted by or
         entered into with the said respective parties whose names are specified
         in Column 3 of the said Schedule, together with all sums, present and
         future, due thereunder and all other rights, interests and benefits
         pertaining thereto:

With interest from and also arrears and accumulations of interest due and unpaid
as at [ ]: And we grant warrandice: IN WITNESS WHEREOF these presents
typewritten on this [and the preceding] page are together with the Schedule
annexed hereto executed at [ ] on the [ ] day of [ ] as follows:

SUBSCRIBED for and on behalf of the said
NORTHERN ROCK PLC

by       .............................      .................................

and      .............................      .................................

                                       48
<PAGE>

              Schedule referred to in the foregoing Assignation by

                                Northern Rock plc

                  in favour of GRANITE FINANCE TRUSTEES LIMITED

1            2          3                  4                5
Account No.  Address    Borrowers Full     Title Number     Registration Date
                        Names

                                       49
<PAGE>

                                     Part 4

                  FORM OF TRANSFER (SASINE REGISTER - SCOTLAND)

We, NORTHERN ROCK PLC, incorporated under the Companies Acts in England
(Registered Number 3273685) and having our Registered Office at Northern Rock
House, Gosforth, Newcastle upon Tyne NE3 4PL (the Transferor) CONSIDERING THAT
in terms of a Mortgage Sale Agreement among us the Transferor, GRANITE FINANCE
TRUSTEES LIMITED, incorporated under the law of Jersey (Registered Number 79309)
and having its Registered Office at 22 Grenville Street, St Helier, Jersey JE4
8PX, Channel Islands (the Transferee) and others dated 26 March 2001 (as
amended, restated, varied, supplemented or novated from time to time, the
Mortgage Sale Agreement) we have sold our whole right, title and interest in and
to the Standard Securities and others hereinafter mentioned to the Transferee
NOW THEREFORE we the Transferor IN CONSIDERATION of the sums payable in terms of
and in implement pro tanto of the Mortgage Sale Agreement HEREBY ASSIGN to the
Transferee as trustee under and in terms of the Mortgages Trust Deed among us
the Transferor, the Transferee and others dated 26 March 2001 (as amended,
restated, varied, supplemented or novated from time to time, the Mortgages Trust
Deed) and its successor or successors as trustee or trustees under and in terms
of the Mortgages Trust Deed:

1        the Standard Securities granted by the respective parties whose names
         are specified in Column 3 of the Schedule annexed and executed as
         relative hereto in favour of us the Transferor for all sums due and to
         become due, to the extent of all sums now due and which may at any time
         or times hereafter become due under the said Standard Securities,
         recorded said Standard Securities in the Register for the County
         specified in the relative entry in Column 4 of the said Schedule on the
         date specified in the relative entry in Column 5 of the said Schedule;
         and

2        the whole rights and interest of us the Transferor in and under all and
         any personal bonds, credit agreements or agreements for loan (however
         constituted) secured by the said Standard Securities and granted by or
         entered into with the said respective parties whose names are specified
         in Column 3 of the said Schedule, together with all sums, present and
         future, due thereunder and all other rights, interests and benefits
         pertaining thereto:

With interest from and also arrears and accumulations of interest due and unpaid
as at [ ]: And we grant warrandice: IN WITNESS WHEREOF these presents
typewritten on this [and the preceding] page are together with the Schedule
annexed hereto executed at [ ] on the [ ] day of [ ] as follows:

SUBSCRIBED for and on behalf of the said
NORTHERN ROCK PLC

by       .............................      .................................

and      .............................      .................................

                                       50
<PAGE>

              Schedule referred to in the foregoing Assignation by
                                Northern Rock plc
                  in favour of Granite Finance Trustees Limited

1               2             3                   4             5
Account No.     Address       Borrowers Full      County        Recording Date
                              Names

                                       51
<PAGE>

                                   SCHEDULE 3

                        ASSIGNMENT OF INSURANCE CONTRACTS

THIS ASSIGNMENT is made by way of deed on [            ]

BETWEEN

NORTHERN ROCK PLC (registered number 3273685) whose registered office is at
Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL ("Northern Rock");
and

GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) whose registered
office is at 22 Grenville Street, St. Helier, Jersey JE4 8PX, Channel Islands
(the "Mortgages Trustee")

WHEREAS

(A)      By a mortgage sale agreement dated 26 March 2001 (as amended, varied,
         supplemented or novated from time to time "Mortgage Sale Agreement")
         and made between, amongst others, Northern Rock as Seller and the
         Mortgages Trustee, certain mortgages and standard securities (the
         "Mortgages") and the loans secured thereby were agreed to be
         transferred to the Mortgages Trustee.

(B)      Northern Rock has the benefit of the Insurance Contracts, as defined in
         the Master Definitions Schedule dated 26 March 2001 (as amended,
         varied, supplemented or novated from time to time) which relate to the
         Mortgages and the mortgaged properties upon which they are secured (the
         "Mortgaged Properties") as well as to certain mortgages and properties
         in which the Mortgages Trustee has no interest.

(C)      This Assignment is supplemental to the Mortgage Sale Agreement.

NOW THIS DEED WITNESSETH as follows:

In further consideration of the sums and the other consideration referred to in
the Mortgage Sale Agreement, Northern Rock with full title guarantee hereby
assigns unto the Mortgages Trustee absolutely all the estate and interest in the
Insurance Contracts including the rights to receive the proceeds of any claim to
the extent only that such estate, interest, and rights relate to the Mortgaged
Properties and/or the Mortgages, to hold the same unto the Mortgages Trustee
absolutely.

IN WITNESS of which NORTHERN ROCK PLC has caused this Assignment to be executed
and delivered as a Deed or the date which first appears above.

EXECUTED under THE COMMON SEAL of              )
NORTHERN ROCK PLC                              )
affixed by order of the Board of Directors     )
in the presence of:                            )

------------------------------
Authorised Signatory

Name:

Title:

------------------------------
Authorised Signatory

                                       52
<PAGE>

Name:

Title:

                                       53
<PAGE>

                                   SCHEDULE 4
                              INSURANCE CONTRACTS
<TABLE>
<CAPTION>

     Policy number                 Insurer                       Policy name/type          Date of Policy
     <S>                           <C>                           <C>                       <C>
     1. NR 9501                    Northern Rock Mortgage        Mortgage Indemnity        18.07.1996
                                   Indemnity Company Limited

     2.(a)BL-HHS                   AXA General Insurance         Supercover Buildings      01.01.1997
                                   Limited                       and Contents

     (b)DR-FHH                     AXA General Insurance         Superchoice Buildings     01.01.1997
                                   Limited                       and Contents

     (c)DR-SGD                     AXA General Insurance         Supercover Gold           01.11.1999
                                   Limited                       Buildings and Contents

     (d)AG112/Z1413248             AXA General Insurance         Contingency Insurance     23.04.2003
                                   Limited

     (e)AG112/Z1413256             AXA General Insurance         Properties in Possession  18.10.1999
                                   Limited

     (f)BL-BBR                     AXA General Insurance         Cover Me Buildings and    18.12.2000
                                   Limited                       Contents
</TABLE>

                                       54
<PAGE>

                                   SCHEDULE 5

                                     Part 1

                            ASSIGNMENT OF GUARANTEES

THIS ASSIGNMENT is made by way of deed on [               ]

BETWEEN:

NORTHERN ROCK PLC (registered number 3273685) whose registered office is at
Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL ("Northern Rock");
and

GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) whose registered
office is at 22 Grenville Street, St. Helier, Jersey JE4 8PX, Channel Islands
(the "Mortgages Trustee")

WHEREAS:

(A)      By a mortgage sale agreement dated 26 March 2001 (as amended, varied,
         supplemented or novated from time to time the "Mortgage Sale
         Agreement") and made between, amongst others, Northern Rock and the
         Mortgages Trustee, certain mortgages (the "Mortgages") were agreed to
         be transferred and assigned to the Mortgages Trustee.

(B)      Northern Rock has the benefit of the Guarantees as defined in the
         Master Definitions Agreement dated 26 March 2001 (as amended, varied,
         supplemented or novated from time to time) which relate to certain of
         the Mortgages.

(C)      This Assignment is made pursuant to the Mortgage Sale Agreement.

NOW THIS DEED WITNESSETH as follows:

In further consideration of the sums and the other consideration referred to in
the Mortgage Sale Agreement, Northern Rock with full title guarantee hereby
assigns unto the Mortgages Trustee all its right, title, interest and benefit
(both present and future) in the Guarantees relating to the Mortgages the
subject of a Transfer of even date herewith including for the avoidance of
doubt:

(i)      the benefit of and the right to sue on all covenants with and
         undertakings to Northern Rock in each Guarantee and the right to
         exercise all powers of Northern Rock in relation to each Guarantee; and

(ii)     all the estate and interest in the Guarantees vested in Northern Rock;

to hold the same unto the Mortgages Trustee absolutely.

                                       55
<PAGE>

IN WITNESS of which NORTHERN ROCK PLC has caused this Assignment to be executed
and delivered as a deed on the date which first appears above.

EXECUTED under THE COMMON SEAL of               )
NORTHERN ROCK PLC                               )
affixed by order of the Board of Directors      )
in the presence of:                             )

---------------------------
Authorised Signatory

Name:

Title:

---------------------------
Authorised Signatory

Name:

Title:

[Alternative methods of executing as a deed will be acceptable if effective]

                                       56
<PAGE>

                                     Part 2

                            ASSIGNATION OF GUARANTEES

ASSIGNATION

by

NORTHERN ROCK PLC, incorporated in England (Registered Number 3273685) whose
Registered Office is at Northern Rock House, Gosforth, Newcastle upon Tyne NE3
4PL (Northern Rock);

in favour of

GRANITE FINANCE TRUSTEES LIMITED, incorporated in Jersey (Registered Number
79309) whose Registered Office is at 22 Grenville Street, St Helier, Jersey JE4
8PX, Channel Islands (the "Mortgages Trustee")

WHEREAS:

(A)      By a mortgage sale agreement dated 26 March 2001 (as amended, varied,
         supplemented or novated from time to time, the "Mortgage Sale
         Agreement") and made between, amongst others, Northern Rock and the
         Mortgages Trustee, certain mortgage loans and their related security
         (the "Mortgages") were agreed to be transferred and assigned to the
         Mortgages Trustee;

(B)      Northern Rock has the benefit of the Guarantees as defined in the
         Master Definitions Agreement dated 26 March 2001 (as amended, varied,
         supplemented or novated from time to time) which relate to certain of
         the Mortgages;

(C)      This Assignation is made pursuant to the Mortgage Sale Agreement;

NOW THEREFORE the parties hereby AGREE as follows:

1        Assignation

         Northern Rock hereby assigns to the Mortgages Trustee with absolute
         warrandice its whole right, title, benefit and interest, present and
         future, in and to the Guarantees governed by Scots law and detailed in
         the Schedule hereto (the "Scottish Guarantees") relating to the
         Mortgages including for the avoidance of doubt the benefit of and the
         right to sue on all obligations and undertakings to Northern Rock in
         each Scottish Guarantee and the right to exercise all powers of
         Northern Rock in relation to each Scottish Guarantee.

2        Intimation

         Northern Rock hereby undertakes to the Mortgages Trustee that it will,
         within fourteen days of the execution of this deed, serve a notice of
         assignation by recorded delivery post in such form as the Mortgages
         Trustee shall approve upon each of the Guarantors pursuant to each
         Scottish Guarantee.

                                       57
<PAGE>

3        Governing Law

         This deed shall be governed by Scots law and the parties hereto submit
         to the non-exclusive jurisdiction of the Scottish courts.

IN WITNESS WHEREOF these presents consisting of this and the preceding page
together with the Schedule annexed hereto are executed as follows:

SUBSCRIBED for and on behalf of the said
NORTHERN ROCK PLC

at       ................................        .............................

on       ................................        .............................

by       ................................

and      ................................

SUBSCRIBED for and on behalf of the said
GRANITE FINANCE TRUSTEES LIMITED

at       ................................        .............................

on       ................................        .............................

by       ................................

and      ................................

                                       58
<PAGE>

Schedule referred to in the foregoing Assignation of Guarantees by Northern Rock
PLC in favour of Granite Finance Trustees Limited

                             [Details of Guarantees]

                                       59
<PAGE>

                                   SCHEDULE 6
                          NEW MORTGAGE PORTFOLIO NOTICE

                                                                       Dated [ ]

1.       It is hereby agreed for the purpose of this notice the "Principal
         Agreement" shall mean the Mortgage Sale Agreement dated 26 March 2001
         made between, amongst others, (1) NORTHERN ROCK PLC (the "Seller") and
         (2) GRANITE FINANCE TRUSTEES LIMITED (the "Mortgages Trustee"), as the
         same may be amended, varied, supplemented or novated from time to time.

2.       Save where the context otherwise requires, words and expressions in
         this notice shall have the same meanings respectively as when used in
         the Principal Agreement.

3.       In accordance with and subject to Clause 4.1 (Agreement to Assign) of
         the Principal Agreement, upon receipt by the Seller of the duplicate of
         this notice signed by the Mortgages Trustee, there shall exist between
         the Seller and the Mortgages Trustee an agreement (the "Agreement for
         Sale") for the sale and assignment by the Seller to the Mortgages
         Trustee of the New Mortgage Loans and the Related Security more
         particularly described in the Schedule hereto (other than any New
         Mortgage Loans and their Related Security which have been redeemed in
         full prior to the next following Assignment Date). Completion of such
         sale shall take place, subject to the provisions of the Principal
         Agreement, on [ ] (the "Assignment Date").

4.       The Seller hereby confirms that the conditions required to be fulfilled
         pursuant to Clause 4.2 (Conditions to Effecting an Assignment of New
         Mortgage Loans) of the Principal Agreement have been fulfilled [/save
         for conditions ( ) ( ) and ( )]

5.       The Agreement for Sale shall incorporate, mutatis mutandis, the
         relevant provisions of the Principal Agreement.

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

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

                                       60
<PAGE>

[On duplicate

We hereby acknowledge receipt of the New Mortgage Portfolio Notice dated [ ],
and confirm [that the conditions set out in paragraph ( ) ( ) and ( ) of Clause
4.2 (Conditions to Effecting an Assignment of New Mortgage Loans) have been
waived and] the sale and assignment of the New Mortgage Loans as set out in that
notice.

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

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

                                       61
<PAGE>

                                    Schedule

        1               2                    3             4
        Account No.     Property Address     Name(s)       Date of Mortgage
                                                           Completion

                                       62
<PAGE>

                                   SCHEDULE 7

                             LOAN REPURCHASE NOTICE

                                                                       Dated [ ]

1.       We refer to the Mortgage Sale Agreement dated 26 March 2001 (as
         amended, varied, supplemented or novated from time to time the
         "Principal Agreement") made between, amongst others, (1) NORTHERN ROCK
         PLC (the "Seller") and (2) GRANITE FINANCE TRUSTEES LIMITED (the
         "Mortgages Trustee").

2.       Save where the context otherwise requires, words and expressions in
         this notice shall have the same meanings respectively as when used in
         the Principal Agreement.

3.       We hereby send this notice pursuant to and in accordance with Clause
         [8.4 (Repurchase)/8.5 (Purchase of Product Switches, Further Advances
         and purchases relating to Personal Secured Loans)]* of the Principal
         Agreement, upon receipt of which you as [the Seller/the Mortgages
         Trustee]* will be required to [repurchase from us/re-sell to
         us/purchase from us/sell to us]* the Mortgage Loan(s) and Related
         Security set out in the attached schedule in accordance with the terms
         of Clause 8 (Repurchase) of the Principal Agreement on [insert date].

Signed for and on behalf of   )
[GRANITE FINANCE TRUSTEES     )
LIMITED/NORTHERN ROCK PLC]    )
by:                           )

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

* Delete as appropriate

                                       63
<PAGE>

                                    Schedule

        1              2                   3             4
        Account No.    Property Address    Name(s)       Date of  Mortgage
                                                         Completion

                                       64
<PAGE>

                                   SCHEDULE 8
                        FORM OF NOTIFICATION TO BORROWERS

[To:     Borrower]

Dear Sirs,

Northern Rock

Account No.[                  ]

We hereby notify you that on [ ], Northern Rock agreed to sell your mortgage to
Granite Finance Trustees Limited.

[Additional text will be allowed with the consent of the Mortgages Trustee and
the Funding Security Trustees]

Yours faithfully,

Northern Rock plc

                                       65
<PAGE>

                                   SCHEDULE 9

        OFFER UNDER CLAUSE 8.6 (REPURCHASE OF FIXED RATE MORTGAGE LOANS)

To:      Northern Rock plc
         Northern Rock House
         Gosforth
         Newcastle upon Tyne
         NE3 4PL

From:    Granite Finance Trustees Limited
         22 Grenville Street
         St Helier
         Jersey
         Channel Islands
         JE4 8PX

Date:    [                  ]

Pursuant to Clause 8.6 (Repurchase of Fixed Rate Mortgage Loans) of the mortgage
sale agreement dated 26 March 2001 made between, amongst others, (1) Northern
Rock plc and (2) Granite Finance Trustees Limited (as amended, varied,
supplemented or novated from time to time the "Agreement") we hereby offer to
re-sell to you the Mortgage Loan(s) together with their Related Security,
details of which are set out in the attached print out, if such Mortgage Loan(s)
become Re-Fixed Mortgage Loans within 3 months of the expiry of the relevant
initial fixed rate periods applicable to that/those Mortgage Loans. If you wish
to do so, please accept this offer by payment to us of the consideration for the
repurchase of the relevant Mortgage Loan(s) and Related Security in accordance
with Clause 8.6 (Repurchase of Fixed Rate Mortgage Loans) of the Agreement if
such Mortgage Loan(s) become Re-Fixed Mortgage Loans within 3 months of the
expiry of the relevant initial fixed rate periods applicable to that/those
Mortgage Loans. Capitalised terms used in this notice and not defined herein
have the meanings given to them in the Agreement.

Signed for and on behalf of                 )
GRANITE FINANCE TRUSTEES                    )
LIMITED                                     )
as Seller                                   )
[acting as its attorney NORTHERN ROCK PLC:] )

                                       66
<PAGE>

                                   SCHEDULE 10

                                     Part 1

                         POWER OF ATTORNEY IN FAVOUR OF
             THE MORTGAGES TRUSTEE, FUNDING AND THE SECURITY TRUSTEE

THIS DEED OF POWER OF ATTORNEY is made on the [o] by:

(1)      NORTHERN ROCK PLC whose registered office is at Northern Rock House,
         Gosforth, Newcastle upon Tyne NE3 4PL (registered number 3273685) in
         its capacity as Seller,

in favour of each of:

(2)      GRANITE FINANCE TRUSTEES LIMITED whose registered office is at 22
         Grenville Street, St. Helier, Jersey JE4 8PX, Channel Islands
         (registered number 79309) in its capacity as Mortgages Trustee;

(3)      GRANITE FINANCE FUNDING LIMITED, acting out of its branch office
         established in England (registered overseas company number FC022999 and
         branch number BR005916) at 69 Park Lane, Croydon CR9 1TQ and

(4)      THE BANK OF NEW YORK a New York Banking Corporation whose London branch
         address is at 48th Floor, One Canada Square, London E14 5AL in its
         capacity as Security Trustee.

WHEREAS:

(A)      By virtue of a mortgage sale agreement (the "Mortgage Sale Agreement")
         dated 26 March 2001 and as subsequently amended, and made between (1)
         the Seller, (2) the Mortgages Trustee (3) Funding and (4) the Security
         Trustee, provision was made for the execution by the Seller of this
         Power of Attorney.

NOW THIS DEED WITNESSETH:

1.       The provisions of the Programme Master Definitions Schedule signed for
         the purposes of identification by Sidley Austin Brown & Wood and Allen
         & Overy LLP on [o] (as the same have been and may be amended, varied or
         supplemented from time to time with the consent of the parties hereto)
         are expressly and specifically incorporated into and shall apply to
         this Deed.

2.       The Seller irrevocably and by way of security for the performance of
         the covenants, conditions and undertakings on the part of the Seller
         contained in the Mortgage Sale Agreement and the Administration
         Agreement HEREBY APPOINTS each of Funding, the Mortgages Trustee and
         the Security Trustee (each an "Attorney") and any receiver and/or
         administrator appointed from time to time in respect of Funding and/or
         the Mortgages Trustee or their assets severally to be its true and
         lawful attorney for the Seller and in the Seller's name or otherwise to
         do any act, matter or thing which any Attorney considers necessary for
         the protection or preservation of

                                       67
<PAGE>

         that Attorney's interest in the Mortgage Loans, the Mortgages, the
         Mortgage Deeds and their Related Security or which ought to be done
         under the covenants, undertakings and provisions contained in the
         Mortgage Sale Agreement including (without limitation) any or all of
         the following that is to say:

         (a)      to exercise its rights, powers and discretions under the
                  Mortgage Loans, the Mortgages, the Mortgage Deeds and the
                  Related Security including the right to fix the rate or rates
                  of interest payable under the Mortgage Loans in accordance
                  with the terms thereof (including whilst such Mortgage Loans
                  subsist and subject to the consent of the Mortgages Trustee
                  being given to the setting of such rates), setting the
                  Standard Variable Rate of the Seller, such other discretionary
                  rates and margins applicable to the Mortgage Loans and (other
                  than in respect of the Security Trustee) the rate of (and
                  terms relating to) the Existing Borrowers' Re-Fix Rate in the
                  circumstances referred to in Clause 4 (Interest Rates) of the
                  Administration Agreement provided that nothing in this Clause
                  shall prevent the Seller (or any of its attorneys from time to
                  time) from setting higher rates (and in the case of the
                  Existing Borrowers' Re-Fix Rate, imposing terms more
                  advantageous to the Mortgages Trustee) than those set or to be
                  set or required or to be required by the Mortgages Trustee or
                  Funding under this power of attorney;

         (b)      to exercise all the powers exercisable by the Seller by reason
                  of its remaining for the time being the registered owner at
                  the Land Registry or registered or recorded heritable creditor
                  in the Registers of Scotland of any of the Mortgage Loans, the
                  Mortgages, the Mortgage Deeds and the Related Security and in
                  particular, but without prejudice to the generality of the
                  foregoing, to make Further Advances to Borrowers;

         (c)      to demand, sue for and receive all moneys due or payable under
                  the Mortgage Loans, the Mortgages, the Mortgage Deeds and the
                  Related Security or any such collateral security or related
                  rights;

         (d)      to execute, sign, seal and deliver (using the company seal of
                  the Seller where appropriate) a conveyance, assignation or
                  transfer of the Mortgage Loans, the Mortgages, the Mortgage
                  Deeds and the Related Security or any of them to the Mortgages
                  Trustee and its successors in title or other person or persons
                  entitled to the benefit thereof;

         (e)      to execute, sign, seal and deliver (using the company seal of
                  the Seller where appropriate) a conveyance, assignment,
                  assignation or transfer of the Related Security or any item
                  comprised therein (to the extent only that such item or items
                  relate to the Mortgage Loans) to the Mortgages Trustee and its
                  successors in title or other person or persons entitled to the
                  benefit thereof or entitled to be registered or recorded at
                  the Land Registry or the Registers of Scotland as proprietor
                  or heritable creditor thereof (as the case may be);

         (f)      to discharge the Mortgages or the Related Security or any of
                  them and to sign, seal, deliver and execute such receipts,
                  releases, surrenders, instruments and deeds as may be required
                  or advisable in order to discharge the relevant Mortgaged
                  Property or Properties from the Mortgages or any of them; and

                                       68
<PAGE>

         (g)      to do every other act or thing which the Seller is obliged to
                  do under the Mortgage Sale Agreement or which that Attorney
                  may otherwise consider to be necessary proper or expedient for
                  fully and effectually vesting or transferring the interests
                  sold thereunder in the Mortgage Loans, the Mortgages, the
                  Mortgage Deeds and their Related Security or any or each of
                  them and/or the Seller's estate right and title therein or
                  thereto in the Mortgages Trustee and its successors in title
                  or other person or persons entitled to the benefit thereof (as
                  the case may be) in the same manner and as fully and
                  effectually in all respects as the Seller could have done.

3.       Each Attorney shall have the power by writing under its hand by an
         officer of the Attorney from time to time to appoint a substitute who
         shall have power to act on behalf of the Seller as if that substitute
         shall have been originally appointed Attorney by this deed (including,
         without limitation, the power of further substitution) and/or to revoke
         any such appointment at any time without assigning any reason therefor.

4.       The laws of England shall apply to this deed and the interpretation
         thereof and to all acts of the Attorney carried out or purported to be
         carried out under the terms hereof.

5.       The Seller hereby agrees at all times hereafter to ratify and confirm
         whatsoever the said Attorney or its attorneys shall lawfully do or
         cause to be done in and concerning the Mortgage Loans, the Mortgages or
         the Mortgage Deeds or their Related Security by virtue of this deed.

IN WITNESS whereof the Seller has executed this document as a deed the day and
year first before written.

EXECUTED under THE COMMON SEAL of  )
NORTHERN ROCK PLC                  )
affixed in the presence of:        )

-------------------------
Authorised Signatory

Name:

Title:

-------------------------
Authorised Signatory

Name:

Title:

                                       69
<PAGE>

                                   SCHEDULE 10

                                     Part 2

                         POWER OF ATTORNEY IN FAVOUR OF
            THE MORTGAGES TRUSTEE, EACH FUNDING BENEFICIARY AND EACH
                            FUNDING SECURITY TRUSTEE

THIS DEED OF POWER OF ATTORNEY is made on the [o] by:

(1)      NORTHERN ROCK PLC whose registered office is at Northern Rock House,
         Gosforth, Newcastle upon Tyne NE3 4PL (registered number 3273685) in
         its capacity as Seller,

in favour of each of:

(2)      GRANITE FINANCE TRUSTEES LIMITED whose registered office is at 22
         Grenville Street, St. Helier, Jersey JE4 8PX, Channel Islands
         (registered number 79309) in its capacity as Mortgages Trustee;

(3)      GRANITE FINANCE FUNDING LIMITED, acting out of its branch office
         established in England (registered overseas company number FC022999 and
         branch number BR005916) at 69 Park Lane, Croydon CR9 1TQ

(4)      GRANITE FINANCE FUNDING 2 LIMITED whose registered office is at Fifth
         Floor, 100 Wood Street, London EC2V 7EX; and

(5)      THE BANK OF NEW YORK a New York Banking Corporation whose London branch
         address is at 48th Floor, One Canada Square, London E14 5AL in its
         capacities as Security Trustee and as Funding 2 Security Trustee.

WHEREAS:

(A)      By virtue of a mortgage sale agreement (the "Mortgage Sale Agreement")
         dated 26 March 2001 and made between (1) the Seller, (2) the Mortgages
         Trustee (3) Funding and (4) the Security Trustee and as subsequently
         amended to, amongst other things, include Funding 2 and the Funding 2
         Security Trustee as parties thereto, provision was made for the
         execution by the Seller of this Power of Attorney.

(B)      NOW THIS DEED WITNESSETH:

1.       The provisions of the Programme Master Definitions Schedule signed for
         the purposes of identification by Sidley Austin Brown & Wood and Allen
         & Overy LLP on 19 January (as the same have been and may be amended,
         varied or supplemented from time to time with the consent of the
         parties hereto) are expressly and specifically incorporated into and
         shall apply to this Deed.

2.       The Seller irrevocably and by way of security for the performance of
         the covenants, conditions and undertakings on the part of the Seller
         contained in the Mortgage Sale Agreement and the Administration
         Agreement HEREBY APPOINTS each of Funding, Funding 2, the Mortgages
         Trustee, the Security Trustee and the Funding 2 Security Trustee (each
         an "Attorney") and any receiver and/or administrator

                                       70
<PAGE>

         appointed from time to time in respect of Funding, Funding 2 and/or the
         Mortgages Trustee or their assets severally to be its true and lawful
         attorney for the Seller and in the Seller's name or otherwise to do any
         act, matter or thing which any Attorney considers necessary for the
         protection or preservation of that Attorney's interest in the Mortgage
         Loans, the Mortgages, the Mortgage Deeds and their Related Security or
         which ought to be done under the covenants, undertakings and provisions
         contained in the Mortgage Sale Agreement including (without limitation)
         any or all of the following that is to say:

         (a)      to exercise its rights, powers and discretions under the
                  Mortgage Loans, the Mortgages, the Mortgage Deeds and the
                  Related Security including the right to fix the rate or rates
                  of interest payable under the Mortgage Loans in accordance
                  with the terms thereof (including whilst such Mortgage Loans
                  subsist and subject to the consent of the Mortgages Trustee
                  being given to the setting of such rates), setting the
                  Standard Variable Rate of the Seller, such other discretionary
                  rates and margins applicable to the Mortgage Loans and (other
                  than in respect of the Funding Security Trustees) the rate of
                  (and terms relating to) the Existing Borrowers' Re-Fix Rate in
                  the circumstances referred to in Clause 4 (Interest Rates) of
                  the Administration Agreement provided that nothing in this
                  Clause shall prevent the Seller (or any of its attorneys from
                  time to time) from setting higher rates (and in the case of
                  the Existing Borrowers' Re-Fix Rate, imposing terms more
                  advantageous to the Mortgages Trustee) than those set or to be
                  set or required or to be required by the Mortgages Trustee,
                  Funding or Funding 2 (and their respective Funding Security
                  Trustee) under this power of attorney;

         (b)      to exercise all the powers exercisable by the Seller by reason
                  of its remaining for the time being the registered owner at
                  the Land Registry or registered or recorded heritable creditor
                  in the Registers of Scotland of any of the Mortgage Loans, the
                  Mortgages, the Mortgage Deeds and the Related Security and in
                  particular, but without prejudice to the generality of the
                  foregoing, to make Further Advances to Borrowers;

         (c)      to demand, sue for and receive all moneys due or payable under
                  the Mortgage Loans, the Mortgages, the Mortgage Deeds and the
                  Related Security or any such collateral security or related
                  rights;

         (d)      to execute, sign, seal and deliver (using the company seal of
                  the Seller where appropriate) a conveyance, assignation or
                  transfer of the Mortgage Loans, the Mortgages, the Mortgage
                  Deeds and the Related Security or any of them to the Mortgages
                  Trustee and its successors in title or other person or persons
                  entitled to the benefit thereof;

         (e)      to execute, sign, seal and deliver (using the company seal of
                  the Seller where appropriate) a conveyance, assignment,
                  assignation or transfer of the Related Security or any item
                  comprised therein (to the extent only that such item or items
                  relate to the Mortgage Loans) to the Mortgages Trustee and its
                  successors in title or other person or persons entitled to the
                  benefit thereof or entitled to be registered or recorded at
                  the Land Registry or the Registers of Scotland as proprietor
                  or heritable creditor thereof (as the case may be);

                                       71
<PAGE>

         (f)      to discharge the Mortgages or the Related Security or any of
                  them and to sign, seal, deliver and execute such receipts,
                  releases, surrenders, instruments and deeds as may be required
                  or advisable in order to discharge the relevant Mortgaged
                  Property or Properties from the Mortgages or any of them; and

         (g)      to do every other act or thing which the Seller is obliged to
                  do under the Mortgage Sale Agreement or which that Attorney
                  may otherwise consider to be necessary proper or expedient for
                  fully and effectually vesting or transferring the interests
                  sold thereunder in the Mortgage Loans, the Mortgages, the
                  Mortgage Deeds and their Related Security or any or each of
                  them and/or the Seller's estate right and title therein or
                  thereto in the Mortgages Trustee and its successors in title
                  or other person or persons entitled to the benefit thereof (as
                  the case may be) in the same manner and as fully and
                  effectually in all respects as the Seller could have done.

3.       Each Attorney shall have the power by writing under its hand by an
         officer of the Attorney from time to time to appoint a substitute who
         shall have power to act on behalf of the Seller as if that substitute
         shall have been originally appointed Attorney by this deed (including,
         without limitation, the power of further substitution) and/or to revoke
         any such appointment at any time without assigning any reason therefor.

4.       The laws of England shall apply to this deed and the interpretation
         thereof and to all acts of the Attorney carried out or purported to be
         carried out under the terms hereof.

5.       The Seller hereby agrees at all times hereafter to ratify and confirm
         whatsoever the said Attorney or its attorneys shall lawfully do or
         cause to be done in and concerning the Mortgage Loans, the Mortgages or
         the Mortgage Deeds or their Related Security by virtue of this deed.

IN WITNESS whereof the Seller has executed this document as a deed the day and
year first before written.

EXECUTED under THE COMMON SEAL of  )
NORTHERN ROCK PLC                  )
affixed in the presence of:        )

-----------------------------
Authorised Signatory

Name:

Title:

-----------------------------
Authorised Signatory

Name:

Title:

                                       72
<PAGE>

                                   SCHEDULE 11
                           FORM OF SCOTTISH TRUST DEED

DECLARATION OF TRUST

among

NORTHERN ROCK PLC, incorporated under the Companies Acts in England (registered
number 3273685), having its registered office at Northern Rock House, Gosforth,
Newcastle upon Tyne NE3 4PL (in its capacity as seller of the Mortgage Loans,
the "Seller" and, in its capacity as a beneficiary of the Mortgages Trust, the
"Seller Beneficiary");

GRANITE FINANCE TRUSTEES LIMITED, incorporated under the laws of Jersey
(registered number 79309), and having its registered office at 22 Grenville
Street, St. Helier, Jersey, JE4 8PX, Channel Islands (the "Mortgages Trustee");

GRANITE FINANCE FUNDING LIMITED, incorporated under the laws of Jersey
(registered number 79308), but acting out of its branch office established in
England (registered overseas company number FC022999 and branch number BR005916)
at 69 Park Lane, Croydon CR9 1TQ ("Funding"); and

GRANITE FINANCE FUNDING 2 LIMITED, incorporated under the laws of England and
Wales (registered number 5249387) and having its registered office at Fifth
Floor, 100 Wood Street, London EC2V 7EX ("Funding 2" and, together with Funding,
each in its capacity as a beneficiary of the Mortgages Trust, the "Funding
Beneficiaries" and, together with the Seller Beneficiary, the "Beneficiaries"
and each a "Beneficiary").

WHEREAS:

(A)      Title to the Scottish Trust Property referred to below is held by and
         vested in the Seller;

(B)      In terms of the Mortgages Trust Deed entered into among the Seller,
         Funding and the Mortgages Trustee dated 26 March 2001 (as amended,
         restated, varied, supplemented or novated from time to time, the
         "Mortgages Trust Deed") and the Mortgages Trust constituted in terms
         thereof the Mortgages Trustee holds the Trust Property on trust for the
         Beneficiaries;

(C)      In terms of the Mortgage Sale Agreement entered into among the Seller,
         the Mortgages Trustee, Funding and the Security Trustee dated 26 March
         2001 (as amended, restated, varied, supplemented or novated from time
         to time, the "Mortgage Sale Agreement") the Seller has agreed to sell
         and assign the Scottish Trust Property to the Mortgages Trustee to be
         held thereafter by the Mortgages Trustee under and in terms of the
         Mortgages Trust; and

(D)      In implementation of Clause 4.4 of the Mortgage Sale Agreement and
         pending the taking of legal title to the Scottish Trust Property by the
         Mortgages Trustee, the Seller has undertaken to grant this deed;

                                       73
<PAGE>

NOW THEREFORE the parties HEREBY AGREE and DECLARE as follows:

1        Interpretation

In this deed:-

1.1      The provisions of the Programme Master Definitions Schedule signed for
         the purposes of identification by Sidley Austin Brown & Wood and Allen
         & Overy LLP on [o], 2005 (as the same have been and may be amended,
         varied or supplemented from time to time with the consent of the
         parties hereto) are expressly and specifically incorporated into and
         shall apply to this deed, including the recitals hereto; and

1.2      "Scottish Trust Property" shall mean the Scottish Mortgage Loans and
         the Scottish Mortgages and other Related Security relative thereto
         brief particulars of which are detailed in the schedule annexed and
         executed as relative hereto, together with:

         a)       all principal sums (including all Further Advances, Further
                  Draws and Re-Draws), interest and expenses, present or future,
                  comprised therein and secured thereby and the right to demand,
                  recover, receive and give receipts for the same;

         b)       the Seller's whole right and interest in the Mortgaged
                  Properties secured by the said Scottish Mortgages;

         c)       all rights of action of the Seller against any person in
                  connection with any report, valuation, opinion, certificate,
                  consent or other statement of fact or opinion given in
                  connection with any of the said Scottish Mortgage Loans and
                  their Related Security;

         d)       all powers and remedies for enforcing the said Scottish
                  Mortgage Loans and their Related Security and all proceeds
                  resulting therefrom; and

         e)       all other monies, rights, interests, benefits and others
                  pertaining thereto or deriving therefrom, including the
                  benefit and proceeds of any insurance policy pertaining
                  thereto.

2        Declaration of Trust

         The Seller hereby DECLARES that from and after the date hereof it holds
         and, subject to Clause 9 (Termination of Trust) hereof, shall
         henceforth hold the Scottish Trust Property and its whole rights,
         title, benefit and interest, present and future, therein and thereto in
         trust absolutely for the Mortgages Trustee and its assignees (whether
         absolutely or in security) whomsoever.

3        Intimation

         The Seller hereby intimates to the Mortgages Trustee the coming into
         effect of the trust hereby declared and created and the Mortgages
         Trustee by its execution hereof immediately subsequent to the execution
         of this Deed by the Seller acknowledges such intimation.

                                       74
<PAGE>

4        Dealings with Trust Property and Negative Pledge

         The Seller warrants and undertakes to the Mortgages Trustee that:

         4.1      as at the date hereof, it holds (subject to any pending
                  registration or recording in the Registers of Scotland) legal
                  title to the Scottish Trust Property unencumbered by any fixed
                  or floating charge or other Security Interest;

         4.2      it shall not create or agree to create any fixed or floating
                  charge or other Security Interest over or which may attach to
                  or affect the whole or any part of the Scottish Trust Property
                  or otherwise dispose of the same at any time when such
                  property or part thereof remains subject to the trust hereby
                  created; and

         4.3      it shall deal with the Scottish Trust Property (including
                  without limitation the calculation and setting of any interest
                  rate applicable thereto) in accordance with the provisions of
                  the Transaction Documents and the specific written
                  instructions (if any) of the Mortgages Trustee or its
                  foresaids and shall take, subject to Clause 9 (Termination of
                  Trust) hereof, any such action as may be necessary (including
                  without limitation the raising or defending of any proceedings
                  in any court of law whether in Scotland or elsewhere) to
                  secure or protect the title to the Scottish Trust Property but
                  only in accordance with the specific written instructions (if
                  any) of the Mortgages Trustee or its foresaids.

5        Change of Trustee

         Except with the prior written consent of the Mortgages Trustee or its
         foresaids and (for so long as each retains any right or interest in the
         Scottish Trust Property) the Funding Beneficiaries and the Funding
         Security Trustees, the Seller shall not be entitled to resign office as
         a trustee or assume a new trustee or trustees under this Deed.

6        Power of Beneficiary

         6.1      The Mortgages Trustee, as beneficiary hereunder, shall have
                  the right in the circumstances stated in Clause 6 (Perfection
                  of the Assignment) of the Mortgage Sale Agreement to complete
                  its title to the Scottish Trust Property or any part thereof
                  or to call upon the Seller to execute and deliver to the
                  Mortgages Trustee or its foresaids valid assignations and
                  transfers (including where applicable Scottish Transfers) of
                  the Scottish Trust Property or any part thereof, and that
                  notwithstanding the winding-up of the Seller or the
                  administration of the Seller, or the appointment of any
                  receiver to all or any part of the Scottish Trust Property.

         6.2      Without prejudice to the generality of Clause 6.1, the Seller
                  undertakes to the Mortgages Trustee and binds and obliges
                  itself that, upon the occurrence of any one of the events
                  specified in Clause 6.1(a) to (f) of the Mortgage Sale
                  Agreement, it will within five London Business Days of such
                  occurrence provide such information as is necessary to enable
                  the Mortgages Trustee to complete Scottish Transfers
                  (including all schedules and annexures thereto) in relation to
                  the whole of the Scottish Mortgages comprised within the
                  Scottish Trust Property.

                                       75
<PAGE>

         6.3      For further assuring the said rights and powers specified in
                  this Clause 6, the Seller has granted a power of attorney in
                  favour of the Mortgages Trustee, each Funding Beneficiary and
                  each Funding Security Trustee substantially in the form set
                  out in Schedule 10 to the Mortgage Sale Agreement.

7        Mortgages Trustee Declaration of Trust

         7.1      The Mortgages Trustee by its said execution of this Deed
                  hereby DECLARES that its whole right, title and beneficial
                  interest in and to the Scottish Trust Property in terms of
                  this Deed are and shall be held (to the extent not already so
                  held) by the Mortgages Trustee under and in terms of the
                  Mortgages Trust and all monies received or held by the
                  Mortgages Trustee relating thereto or deriving therefrom have
                  been and shall be comprised in the Trust Property as defined
                  in the Mortgages Trust Deed and shall be subject to and
                  administered by the whole terms and conditions of the
                  Mortgages Trust Deed and the Administration Agreement.

         7.2      Each of the Seller and the Beneficiaries hereby acknowledge,
                  accept and agree to the declaration constituted by and the
                  whole other terms and conditions of the foregoing Clause 7.1.

8        Mortgages Trust Intimation

         The Mortgages Trustee hereby intimates to the Beneficiaries of the
         Mortgages Trust, the declaration of trust made in terms of Clause 7
         (Mortgages Trustee Declaration of Trust) hereof and the Beneficiaries
         of the Mortgages Trust by their respective executions of this Deed
         acknowledge such intimation.

9        Termination of Trust

         If at any time during the subsistence of the trust hereby declared and
created:

         9.1      full legal title to any part or parts of the Scottish Trust
                  Property is taken by the Mortgages Trustee or its foresaids in
                  accordance with the provisions of Clause 6 (Perfection of the
                  Assignment) of the Mortgage Sale Agreement (which in the case
                  of any Scottish Mortgage shall be constituted by the
                  registration or recording of the title thereto in the
                  Registers of Scotland); or

         9.2      any Scottish Mortgage Loan and Related Security comprised
                  within the Scottish Trust Property has been repurchased by the
                  Seller pursuant to Clauses 8.4 to 8.6 (inclusive) of the
                  Mortgage Sale Agreement; or

         9.3      any such Scottish Mortgage Loan and Related Security has been
                  redeemed in full and therefore no longer forms part of the
                  Mortgage Portfolio; then

         the trust hereby declared and created shall (but only when the relevant
         events or transaction have been completed irrevocably, validly and
         full) ipso facto fall and cease to be of effect in respect of such part
         or parts of the Scottish Trust Property but shall continue in full
         force and effect in respect of the whole remainder (if any) of the
         Scottish Trust Property.

                                       76
<PAGE>

10       Variation

         This Deed and the trust hereby declared and created shall not be varied
         in any respect without the consent in writing of the Mortgages Trustee
         or its foresaids and (for so long as each retains any right or interest
         in the Scottish Trust Property) each Funding Beneficiary and each
         Funding Security Trustee.

11       Governing Law

         11.1     This Deed shall be governed by, and construed in accordance
                  with, Scots law, other than Clause 7 (Mortgages Trustee
                  Declaration of Trust) hereof which shall be governed by, and
                  construed in accordance with, English law.

         11.2     The parties hereto submit to the non-exclusive jurisdiction of
                  the Scottish courts so far as not already subject thereto and
                  waive any right or plea of forum non conveniens in respect of
                  such jurisdiction.

12       Registration

         The parties consent to the registration of this deed for preservation.

IN WITNESS WHEREOF these presents consisting of this and the preceding [four]
pages together with the Schedule hereto are subscribed by the Seller, the
Mortgages Trustee, Funding and Funding 2 as follows:

As Seller and as Seller Beneficiary:

SUBSCRIBED by
NORTHERN ROCK PLC
acting by:

.......................... Director ......................... Director
        (Print Full Name)               (Signature)
.......................... Director/ ......................... Director/
(Print Full Name)         Secretary     (Signature)           Secretary

all together at
on

                                       77
<PAGE>

As Mortgages Trustee:

SUBSCRIBED by
GRANITE FINANCE TRUSTEES LIMITED
acting by:

.......................... Director ......................... Director
        (Print Full Name)               (Signature)
.......................... Director/ ......................... Director/
(Print Full Name)         Secretary     (Signature)           Secretary

all together at
on

As Funding and as a Funding Beneficiary:

SUBSCRIBED by
GRANITE FINANCE FUNDING LIMITED
acting by:

.......................... Director ......................... Director
        (Print Full Name)               (Signature)
.......................... Director/ ......................... Director/
(Print Full Name)         Secretary     (Signature)           Secretary

all together at
on

As Funding 2 and as a Funding Beneficiary:

SUBSCRIBED by
GRANITE FINANCE FUNDING 2 LIMITED
acting by:

.......................... Director ......................... Director
        (Print Full Name)               (Signature)
.......................... Director/ ......................... Director/
(Print Full Name)         Secretary     (Signature)           Secretary

                                       78
<PAGE>

This is the Schedule to the foregoing Scottish Trust Deed between Northern Rock
PLC, Granite Finance Trustees Limited, Granite
Finance Funding Limited and Granite Finance Funding 2 Limited

                  Scottish Mortgage Loans and Related Security

        1              2                    3              4
        Account No.    Property Address     Name(s)        Date of Mortgage
                                                           Completion

                                       79
<PAGE>

                                   SCHEDULE 12
                              LENDING CRITERIA (1)

General

To proceed with obtaining a Mortgage Loan, each prospective Borrower completes
an application form which includes information with respect to the applicant's
income from all sources, current employment details, bank account information
(where the Borrower has a bank account), current mortgage information (if
applicable) and certain other personal information. A credit reference agency
search is made against each Borrower at their current address and, if necessary,
former addresses, in all cases which will give details of any public information
which includes county court judgements and details of any bankruptcy.

Employment details

The Seller operates the following policy in respect of the verification of
Borrower income details. Under this policy, Borrowers are categorised as either
"employed" or "self-employed" by the Seller.

Proof of income for employed prospective Borrowers applying for Mortgage Loans
in an amount less than (GBP)500,000 may be established by:

(a)      the last three monthly bank statements and/or three monthly payslips
         from the six month period prior to the application; or

(b)      Form P60 or accountant's certificate certifying the Borrower's income.

Proof of income for self-employed prospective Borrowers may be established by:

(a)      a letter from the Borrower's accountant in acceptable form; or

(b)      acceptable confirmation of self-employment which might include any of a
         tax return, accountant's letter or a trade invoice, together with a
         certificate from the Borrower as to income.

For certain Mortgage Loan products, particularly those that may involve larger
maximum loan amounts or higher loan to value ("LTV") ratios, the Seller
generally will require an acceptable accountant's letter or audited accounts.

Income Capacity

The following maximum income multiples are applied in determining the amount of
the Mortgage Loan:

(a)      Single applicant- 3.50 times gross income for all Mortgage Loans (other
         than Together Mortgage Loans); 3.80 times gross income for Together
         Mortgage Loans.

(b)      Joint applicants - a sum equal to: (1) the higher of 2.75 times the
         joint gross income of the applicants (3.00 times joint gross income for
         Together Mortgage Loans), or 3.50

------------------
1 These Lending Criteria aply to Mortgage Loans other than Personal Secured
  Loans.

                                       80
<PAGE>

         times the highest earning applicant's gross income (3.80 times the
         highest joint gross income for Together Mortgage Loans) plus (2) the
         gross income of the other applicant.

Valuation

The Seller requires that a valuation of the Mortgaged Property be obtained
either from its in-house valuation department or from an independent firm of
professional valuers selected from a panel of approved valuers. Details of
professional indemnity insurance held by panel valuers are kept by the Seller.
All valuations of Properties are reviewed by the person underwriting the
Mortgage Loan and/or the valuation team.

Property Types

The Seller applies the criteria set out below in determining the eligibility of
Properties to serve as security for Mortgage Loans. Under these criteria,
eligible property types include freehold, heritable and leasehold houses,
leasehold and heritable flats and mixed commercial and residential use
properties where there is a separate entrance for the residential part of the
Mortgaged Property. In the case of a Mortgage Loan secured by a leasehold
property, the Seller requires that the unexpired term of the lease be at least
30 years from the end of the agreed mortgage term, with a minimum remaining term
of 50 years from the beginning of the mortgage term.

Certain property types falling outside the criteria may be considered on a case
by case basis. However, certain property types will not be considered for the
purposes of providing security for a Mortgage Loan. The types of property
falling within this category comprise freehold flats (in England and Wales),
shared ownership or shared equity schemes and properties of non-standard
construction of a type considered to be defective.

Loan Amount

Generally, the maximum loan amount is (GBP)1,000,000, but this varies according
to the application in question. In exceptional cases, this limit may be
exceeded.

Term

Each Mortgage Loan must have an initial term of between 7 and 30 years (in the
case of a Together Mortgage Loan, a Together Connections Mortgage Loan and a
Connections Mortgage Loan) or between 7 and 35 years in the case of all other
Mortgage Loans.

Age of applicant

All Borrowers in respect of non-Together Mortgage Loans must be aged 18 or over.
The first named Borrower in respect of Together Mortgage Loans must be aged 21
or over. There are no maximum age limits.

Discretion to lend outside Lending Criteria

On a case-by-case basis, and within approved limits as detailed in the Seller's
lending policy, the Seller may have determined that, based upon compensating
factors, a prospective Borrower who did not strictly qualify under its lending
criteria warranted an underwriting

                                       81
<PAGE>

exception. Compensating factors may include, but are not limited to, a low LTV
ratio, stable employment and time in residence at the applicant's current
residence.

Maximum Loan To Value

For a Mortgage Loan secured by a Mortgaged Property valued up to (GBP)250,000,
the maximum LTV ratio permitted is 95 per cent. of the lower of the purchase
price and the current market value of the Mortgaged Property determined by the
valuation. For a Mortgage Loan secured by a Mortgaged Property valued up to
(GBP)1,000,000 the maximum LTV ratio permitted is 90 per cent. of the lower of
the purchase price and the current market value of the Mortgaged Property
determined by relevant valuation. For a Mortgage Loan secured by a Mortgaged
Property valued over (GBP)1,000,000 the maximum LTV ratio permitted is 85 per
cent. of the lower of the purchase price and the current market value of the
Mortgaged Property determined by valuation.

                                       82
<PAGE>

                                   SCHEDULE 13
                             STANDARD DOCUMENTATION

<TABLE>
<CAPTION>

Document Description                                      Northern Rock       Period of Use
                                                          Document ID
---------------------------------                         ---------           -----------------
<S>                                                       <C>                 <C>
Mortgage Offer General Conditions
Mortgage Offer General Conditions                         ADV6/0695           01/06/95-01/07/95
Mortgage Offer General Conditions                         ADV6/0795           01/07/95-31/12/95
Mortgage Offer General Conditions                         ADV6/0196           01/01/96-30/11/96
Mortgage Offer General Conditions                         ADV6/1296           12/96
Mortgage Offer General Conditions                         ADV6B/1296          01/12/96-30/09/97
Mortgage Offer General Conditions                         ADV6/1097           01/10/97-31/12/97
Mortgage Offer General Conditions                         ADV6B/1297          01/12/97-31/12/97
Mortgage Offer General Conditions                         ADV6B/0198          01/01/98-31/05/98
Mortgage Offer General Conditions                         ADV6B/0698          01/06/98-31/12/98
Mortgage Offer General Conditions                         ADV6B/0199          01/01/99-31/08/99
Mortgage Offer General Conditions                         ADV6B/0999          01/09/99-29/02/00
Mortgage Offer General Conditions                         ADV6B/0300          01/03/00-31/08/00
Mortgage Offer General Conditions                         OBA1/0900           01/09/00-31/12/00
Mortgage Offer General Conditions                         OBS1/0900           01/09/00-31/12/00
Mortgage Offer General Conditions                         OBA1/0101           01/01/01-30/06/01
Mortgage Offer General Conditions                         OBS1/0101           01/01/01-30/06/01
Mortgage Offer General Conditions                         ADV282/JULY2001     01/07/01-31/10/04
Mortgage Offer General Conditions                         LEG5 11/2004        01/11/04-present

Mortgage Conditions
Northern Rock Building Society Rules                      GEN128/1.94         28/04/92-30/09/97
Northern Rock Building Society Mortgage Conditions        ADV72 06/95         01/06/95-31/07/97
Northern Rock plc Mortgage Conditions                     ADV72 08/97         01/08/97-30/06/01

                                       83
<PAGE>

Northern Rock plc Mortgage Conditions 2001                ADV276/LEG3         01/07/01-present
                                                          07/2001
Connections Conditions                                    MAR631 27.11.02     29/11/02-present
Together Connections Conditions                           MAR422 1.5.01       01/05/01-present
Together Connections Conditions                           MAR422 7.8.02       07/08/02-present
Northern Rock Scottish Mortgage Conditions 1995           SEC33/0296          01/02/96-30/09/97
Northern Rock Scottish Mortgage Conditions 1997           SEC33/1097          01/10/97-31/10/00
Northern Rock Scottish Mortgage Conditions 1997           SEC33/11.00         01/11/00-31/12/00
Northern Rock plc Scottish Mortgage Conditions 2001       SEC 72/01.2001      01/01/01-30/06/01
Northern Rock plc Scottish Mortgage Conditions 2001       SEC 72/07.01        01/07/01-present
                                                          LEG4 07/2001
Together Connections Current Account Terms and            N/A                 Undated
Conditions

Special Conditions
Variable Mortgage Special Conditions                      Various             Various
Fixed Rate Mortgage Special Conditions                    Various             Various
Capped Rate Mortgage Special Conditions                   Various             Various
Discount Rate Mortgage Special Conditions                 Various             Various
Tracker Rate Mortgage Special Conditions                  Various             Various
CAT Mortgage Special Conditions                           Various             Various
Cashback Mortgage Special Conditions                      Various             Various
Connections Mortgage Special Conditions                   Various             Various
Together Mortgage Special Conditions                      Various             Various
Together Connections Mortgage Special Conditions          Various             Various

                                       84
<PAGE>

Miscellaneous Special Conditions                          Various             Various

Mortgage Deeds
Mortgage Deed                                             SEC 8/06.95         01/06/95-31/07/97
Mortgage Deed (Transitional)                              SEC 8T/08.97        01/08/97-30/09/97
Mortgage Deed                                             SEC 8/10.97         01/10/97-30/06/01
Mortgage Deed                                             SEC 070 07/01       01/07/01-30/09/04
Mortgage Deed                                             SOL 11 07/01        01/07/01-30/09/04
Mortgage Deed (Flexible Mortgages)                        LEG10 1.10.04       01/10/04-present
Mortgage Deed (Standard)                                  LEG11               01/10/04-present
Mortgage Deed (Together)                                  SOL 1               01/10/99-31/07/00
Mortgage Deed (Together)                                  SOL 1 08/00         01/08/00-31/01/01
Mortgage Deed (Together)                                  MD542Q              01/02/99-31/01/01
Mortgage Deed (Together)                                  SOL 1 02/01         01/02/01-present
Standard Security                                         ADV58. 09/95        01/09/95-30/09/97
Standard Security                                         SEC 53 10/97        01/10/97-31/05/01
Standard Security                                         ADV278. 06/01       01/06/01-01/10/04
Standard Security                                         LEG13 1.10.04       01/10/04-present
Standard Security (Together)                              SOL02 2000          Undated

Personal Secured Loans Terms and Conditions

Credit Agreement Regulated by the CCA 1974 (Personal      ADV13506/95         01/06/95-
Secured Loans) (with Terms and Conditions attached)
Loan Agreement (Flexible Plan) (with Terms and            ADVCR2              01/07/95-
Conditions attachd)
Credit Agreement Regulated by the Consumer Credit Act     ADV 138 09/95       01/09/95-
1974 (Personal Secured Loan)
Credit Agreement Regulated by the CCA 1974 (Flexible      ACR1 07/96          01/07/96-
Plan) with Terms and Conditions attached
Credit Agreement Regulated by the Consumer Credit Act     ACR1/1097           01/10/97-
1974 - Flexible Plan
Loan Agreement - Flexible Plan                            ACR2/1097           01/10/97-

                                       85
<PAGE>

Credit Agreement Regulated by the Consumer Credit Act     ADV135 10/97        01/10/97-
1974 - Personal Secured Loan
Credit Agreement Regulated by the Consumer Credit Act     ADV138.10.97        01/10/97-
1974 (Personal Secured Loan)
Credit Agreement Regulated by the Consumer Credit Act     MAR 127 01/06/98    01/06/98-
1974 (Personal Secured Loan)
Credit Agreement Regulated by the Consumer Credit Act     MAR 126 6/98        01/06/98-
1974 - Fixed Rate
Credit Agreement Regulated by the Consumer Credit Act     SEC54/04.98         01/04/98-
1974 (Omiga PSL Base)
Credit Agreement Regulated by the Consumer Credit Act     SEC54/04.98         01/04/98-
1974 (Omiga PSL Fixed)
Credit Agreement Regulated by the Consumer Credit Act     MAR 126 4/00        01/04/00-
1974 - Fixed Rate
Credit Agreement Regulated by the Consumer Credit Act     MD1/0900            01/09/00-
1974 (Omiga Flexible Plan)
Credit Agreement Regulated by the Consumer Credit Act     CA135A/0900         01/09/00-
1974 - Variable Rate
Credit Agreement Regulated by the Consumer Credit Act     CA126A/0900         01/09/00-
1974 - Variable Rate
Credit Agreement regulated by the Consumer Credit Act     CA127/0900          01/09/00-
1974 - Original + 2 Copies
Credit Agreement Regulated by the Consumer Credit Act     CA138/0900          01/09/00-
1974
Credit Agreement Regulated by the Consumer Credit Act     ACR1/1000           01/10/00-
1974 - Flexible Plan
Loan Agreement - Flexible Plan                            ACR2/1000           01/10/00-
Credit Agreement Regulated by the Consumer Credit Act     CA125/0102          01/01/02-
1974 -
Credit Agreement Regulated by the Consumer Credit Act     CA126/0103          01/01/03-
1974
Loan Agreement (Flexible Plan)                            ACR1/0103           01/01/03-
Credit Agreement Regulated by the Consumer Credit Act     ACR2/0103           01/01/03-
1974 (Flexible Plan)
Credit Agreement Regulated by Consumer Credit Act 1974    ACR3/0103           01/01/03-
Loan Agreement (Flexible Plan - Scotland)                 ACR4/0103           01/01/03-
Credit Agreement Regulated by the Consumer Credit Act     CA127 01/03         01/01/03-
1974
Credit Agreement Regulated by the Consumer                Flexible Plan       01/07/95-
                                                          (Scotland) -

                                       86
<PAGE>

Credit Act 1974 (Scotland)                                ADVCR3 07/95
Loan Agreement - Flexible Plan (Scotland)                 ADVCR4 07/95        01/07/95-
Credit Agreement Regulated by the Consumer Credit Act     ADR3A-C/0796        01/07/96-
1974 - Flexible Plan (Scotland)
Credit Agreement Regulated by the Consumer Credit Act     ADR3A-C/1097        01/10/97-
1974 - Flexible Plan (Scotland)
Loan Agreement - Flexible Plan (Scotland)                 ACR4A-C/1097        01/10/97-
Loan Agreement - Flexible Plan (Scotland)                 ACR4A-C/0298        01/02/98-
Credit Agreement Regulated by the Consumer Credit Act     ACR3A-C/0798        01/07/98-
1974 - Flexible Plan (Scotland)
Credit Agreement Regulated by the Consumer Credit Act     ACR3A-C/1000        01/10/00-
1974 - Flexible Plan (Scotland)
Loan Agreement - Flexible Plan (Scotland)                 ACR4A-C/1000        01/10/00-

Personal Secured Loans - Mortgage Deeds
Mortgage Deed (HMLR filing ref MD 144 G)                  SEC 54/06/95        01/06/95-
Northern Rock Building Society
[Used for Flexible Plan - Non-CCA Loans]
Mortgage Deed (relating to a Regulated Agreement under    SEC 52/06/95        01/06/95-
the Consumer Credit Act 1974)
(HMLR filing ref MD 144 H)
Northern Rock Building Society
[Used for Flexible Plan CCA Loans]
Mortgage Deed (HMLR filing ref MD 144 J)                  SEC 44/06/95        01/06/95-
Northern Rock Building Society
[Used for Flexible Plan - Non-CCA Loans]
Mortgage Deed (relating to a Regulated Agreement under    SEC 52. 10/97       01/10/97-
the Consumer Credit Act 1974)
(HMLR filing ref MD 542 M)
Northern Rock plc
[Used for Flexible Plan CCA Loans]
Mortgage Deed (HMLR filing ref MD 542 L)                  SEC 44. 10/97       01/10/97-
Northern Rock plc
[Used for Flexible Plan - Non-CCA Loans]
Mortgage Deed (HMLR filing ref 542 N)                     SEC 54. 10/97       01/10/97-
Northern Rock plc
[Used for Flexible Plan - Non-CCA Loans]
Mortgage Deed (HMLR filing ref MD542 N)                   SEC 54. 04.98       01/04/98-
Northern Rock plc
[Used for Flexible Plan - Non-CCA Loans]
Mortgage Deed (relating to a Regulated Agreement under    SEC 52. 03/00       01/03/00-
the Consumer Credit Act

                                       87
<PAGE>

1974)
(HMLR filing ref MD 542 M)
Northern Rock plc
[Used for Flexible Plan CCA Loans]
Mortgage Deed (HMLR filing ref MD 542L)                   MD2/0900 on cover   01/09/00-
Northern Rock plc                                         and MD2B/0900 on
[Used for Flexible Plan - Non-CCA Loans]                  reverse
Mortgage Deed (relating to a Regulated Agreement under    MD1/0900 on cover   01/09/00-
the Consumer Credit Act 1974)                             and MD1B/0900 on
(HMLR filing ref MD 542 M)                                reverse
Northern Rock plc
[Used for Flexible Plan CCA Loans]
Mortgage Deed (HMLR filing ref MD 542 N)                  MD3/0900            01/09/00-
Northern Rock plc
[Used for Flexible Plan - Non-CCA Loans]

Together Credit/Loan Agreements
Credit Agreement Regulated by the Consumer Credit Act     DDL/0299            01/02/99-
1974 - Drawdown Loan
[Used for Together Flexible Loans up to (GBP)25,000]
Credit Agreement Regulated by the Consumer Credit Act     TFCA/1099           01/02/99-
1974 - Drawdown Loan
[Used for Together Flexible Loans up to (GBP)25,000]
Credit Agreement Regulated by the Consumer Credit Act     TFIX/0200           01/02/00-
1974 - Together Fixed
Credit Agreement Regulated by the Consumer Credit Act     TVCA/0200           01/02/00-
1974 - Together Variable
Credit Agreement Regulated by the Consumer Credit Act     CATC/0502           01/05/02-
1974 - Drawdown Loan
[Used for Together Flexible Loans up to (GBP)25,000]
Credit Agreement Regulated by the Consumer Credit Act     ABTC/0802           01/08/02-
1974 - Together Fixed
Credit Agreement Regulated by the Consumer Credit Act     TVCAB/0902          01/90/02-
1974 - Together Variable
Credit Agreement Regulated by the Consumer Credit Act     03/02               01/03/02-
1974                                                      CATC/0502
"MPU" Drawdown Loan Agreement

Credit Agreement Regulated by the Consumer Credit Act     ?                   01/08/02-
1974 - Together Variable
"MPU" Unsecured Loan Agreement
Credit Agreement Regulated by the Consumer Credit Act     TFWT/0703           01/07/03-
1974 - Together Fixed with Tracker

                                       88
<PAGE>

Deeds of Variation
Deed of Variation of Mortgage and Receipt for Further     SEC 40. 10/97       01/10/97-
Advance (HMLR filing ref MD 542 P)
Northern Rock plc
Deed of Variation of Mortgage and Receipt for Further     SOL005 09/00        01/09/00-
Advance (HMLR filing ref MD 542 X)
Northern Rock plc
Deed of Variation of Mortgage and Receipt for Further     SOL008 09/00        01/0901-
Advance (HMLR filing ref MD 542 Y)
Northern Rock plc
Deed of Variation of Mortgage and Receipt for Further     SEC071 July 2001    01/07/01-
Loan (HMLR filing ref MD 691 B)
Northern Rock plc
Deed of Variation of Mortgage and Receipt for Further     SOL012/ July 2001   01/07/01-
Loan (With Guarantor) (HMLR filing ref MD 691 C)
Northern Rock plc
Deed of  Variation  of Mortgage  and Receipt for Further  MD691N              10/11/04-present
Loan (Scotland)
Deed of Variation of Security and Receipt for Further     ADV152./10.97       01/10/97-
Advance (Scotland)
Deed of Variation of Security and Receipt for Further     ADV152. 01/94       01/01/94-
Advance (Scotland)
Deed of Variation of Security and Receipt for Further     ADV152. 09/95       01/09/95-
Advance (Scotland)
Deed of Variation of Security and Receipt for Further     ADV152. 10/97       01/10/97-
Advance (Scotland)
Deed of Variation of Security and Receipt for Further     ADV281/05.01        01/05/01-
Advance (Scotland)
Deed of Variation of Security and Receipt for Further     ADV279 06/01        01/06/01-
Advance (with Guarantor) (Scotland)

Deeds of Guarantee/Guarantors Confirmations
Guarantors Confirmation (Existing Borrowers)            ADV 266.7/97          01/07/97-
Northern Rock Building Society
Guarantors Confirmation (Existing Borrowers)            ADV 266.10/97         01/10/97-
Northern Rock Building Society
Guarantors Confirmation                                 ADV 265.10/97         01/10/97-
Northern Rock plc
Guarantors Confirmation                                 ADV 265.06/00         01/06/00-
Northern Rock plc
Deed of Guarantee                                       SOL013 / July 2001    01/07/01- present
Northern Rock plc
Guarantors Confirmation                                 NRDGC 05/02           01/05/02-
Northern Rock plc
Deed of Guarantee (Scotland)                            ADV277                01/06/01-present

                                       89
<PAGE>

                                                        06/2001
Occupiers Consents
Agreement and Undertaking                               scjh0404/stand        Undated

Agreement and Undertaking                               (LIF)LIFE30           01/08/97-

Agreement and Undertaking                               st/peps               01/10/97-

Agreement and Undertaking                               JAGO3/0500            01/05/00-

Agreement and Undertaking                               UNDERTAKE June 2000   01/06/00-

Affidavit (re: Matrimonial Home/Occupancy Rights)       ADV 77/1/87
(Scotland)
Consent by Non-Entitled Spouse (Scotland)               ADV 64. /09.95        01/09/95-
Consent by Non-Entitled Spouse (Scotland)               ADV64.10/97           01/10/97-
Affidavit (re: Matrimonial Home/Occupancy Rights)       ADV77/10.97           01/10/97-
(Scotland)
Affidavit (re: Matrimonial Home/Occupancy Rights)       ADV77 /07.00          01/07/00-
(Scotland)
Consent by Non-Entitled Spouse (Pre 09/95) (Scotland)   ADV 64                Undated
Form re. Certificate of Consent (Scotland)              (PLN)/PERS41          Undated

Re-Advance/Further Advance Receipts
Re-advance/Further Advance Receipt                      SEC 37/11/93
Re-Advance/Further Advance Receipt                      SEC 37 /10.97         01/10/97-
Northern Rock plc
Receipt for Further Advance                             ADV60./10.97          01/10/97-
Re-Advance/Further Advance Receipt                      SEC37/07.01           01/97/01-

Deeds of Postponement
Deed of Postponement (relating to a Flexible Plan       FLEX06- 1995          1995-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement (relating to a Flexible Plan       FLEX07- 1995          1995-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement (relating to a Personal Secured    PERS09- 1995          1995-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement (relating to a Personal Secured    PERS10- 1995          1995-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement                                    PERS20- 1995          1995-

                                       90
<PAGE>

Deed of Postponement                                    PERS21- 1995          1995-
Postponed Standard Security                             SEC 53. 09/95         01/09/95-
Deed of Postponement (relating to a Flexible Plan       (PLN)/FLEX07 -        01/10/95-
Loan regulated by the Consumer Credit Act 1974)         01/10/1995
Deed of Postponement (relating to a Personal Secured    (PLN)/PERS09-01/10/19901/10/97-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement (relating to a Personal Secured    (PLN)/PERS10-01/10/97 01/10/97-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement                                    (PLN)/PERS21-01/10/19901/10/97-
Postponed Standard Security                             SEC53.10/97           01/10/97
Deed of Postponement                                    (PLN)/PERS20 -        01/10/99-
                                                        01/10/1999
Deed of Postponement (relating to a Personal Secured    (PLN)/PERS10A - 2000  2000-
Loan regulated by the Consumer Credit Act 1974)
Deed of Postponement                                    (PLN)/PERS21A - 2000  2000-
Deed of Postponement (relating to a Flexible Plan       (PLN)/FLEX07A - 2000  2000-
Loan regulated by the Consumer Credit Act 1974)

</TABLE>

                                       91
<PAGE>

                                   APPENDIX A
                       THE INITIAL MORTGAGE LOAN PORTFOLIO

Account No    Property     Name of         Date of        Current
              Address      Borrower(s)     Mortgage       Balance
                                           Completion

                                       92

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