Document:

<PAGE>

                                                                     EXHIBIT 4.1

                     MERRILL LYNCH MORTGAGE INVESTORS, INC.
                                    Depositor

                                       and

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION
                                     Trustee

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

                                 TRUST AGREEMENT

                            Dated as of June 1, 2003

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

                     MERRILL LYNCH MORTGAGE INVESTORS TRUST
                               SERIES MLCC 2003-C

<PAGE>

                                Table of Contents

<TABLE>
<CAPTION>
                                                                                                                   Page
<S>                                                                                                                <C>
ARTICLE I             DEFINITIONS..............................................................................     28

         Section 1.01          Definitions.....................................................................     28

         Section 1.02          Calculations Respecting Mortgage Loans..........................................     66

ARTICLE II            DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES...........................................     66

         Section 2.01          Creation and Declaration of Trust Fund; Conveyance of Mortgage Loans............     66

         Section 2.02          Acceptance of Trust Fund by Trustee; Review of Documentation for Trust
                               Fund............................................................................     68

         Section 2.03          Representations and Warranties of the Depositor.................................     69

         Section 2.04          Discovery of Breach; Repurchase or Substitution of Mortgage Loans...............     71

         Section 2.05          Grant Clause....................................................................     74

         Section 2.06          Representation and Warranty of the Seller.......................................     75

ARTICLE III           THE CERTIFICATES.........................................................................     76

         Section 3.01          The Certificates................................................................     76

         Section 3.02          Registration....................................................................     76

         Section 3.03          Transfer and Exchange of Certificates...........................................     77

         Section 3.04          Cancellation of Certificates....................................................     80

         Section 3.05          Replacement of Certificates.....................................................     80

         Section 3.06          Persons Deemed Owners...........................................................     81

         Section 3.07          Temporary Certificates..........................................................     81

         Section 3.08          Appointment of Paying Agent.....................................................     82

         Section 3.09          Book-Entry Certificates.........................................................     82

ARTICLE IV            ADMINISTRATION OF THE TRUST FUND.........................................................     83

         Section 4.01          Custodial Accounts; Distribution Account........................................     83

         Section 4.02          Reports to Trustee and Certificateholders.......................................     85

ARTICLE V             DISTRIBUTIONS TO HOLDERS OF CERTIFICATES.................................................     87

         Section 5.01          Distributions Generally.........................................................     87

         Section 5.02          Distributions from the Certificate Account......................................     88

         Section 5.03          Allocation of Losses............................................................     92

         Section 5.04          Advances........................................................................     93
</TABLE>

                                        i

<PAGE>

<TABLE>
<CAPTION>
<S>                                                                                                                <C>
         Section 5.05          [RESERVED]......................................................................     93

         Section 5.06          [RESERVED]......................................................................     93

ARTICLE VI            CONCERNING THE TRUSTEE; EVENTS OF DEFAULT................................................     93

         Section 6.01          Duties of Trustee...............................................................     93

         Section 6.02          Certain Matters Affecting the Trustee...........................................     95

         Section 6.03          Trustee Not Liable for Certificates.............................................     97

         Section 6.04          Trustee May Own Certificates....................................................     97

         Section 6.05          Eligibility Requirements for Trustee............................................     97

         Section 6.06          Resignation and Removal of Trustee..............................................     98

         Section 6.07          Successor Trustee...............................................................     99

         Section 6.08          Merger or Consolidation of Trustee..............................................     99

         Section 6.09          Appointment of Co-Trustee, Separate Trustee or Custodian........................     99

         Section 6.10          Authenticating Agents...........................................................    101

         Section 6.11          Indemnification of Trustee......................................................    102

         Section 6.12          Fees and Expenses of the Trustee................................................    102

         Section 6.13          Collection of Monies............................................................    103

         Section 6.14          Events of Default; Trustee To Act; Appointment of Successor.....................    103

         Section 6.15          Additional Remedies of Trustee Upon Event of Default............................    104

         Section 6.16          Waiver of Defaults..............................................................    105

         Section 6.17          Notification to Holders.........................................................    105

         Section 6.18          Directions by Certificateholders and Duties of Trustee During Event of
                               Default.........................................................................    105

         Section 6.19          Preparation of Tax Returns and Other Reports....................................    106

         Section 6.20          Annual Certificate by Trustee...................................................    106

ARTICLE VII           PURCHASE OF MORTGAGE LOANS AND TERMINATION OF THE TRUST FUND.............................    107

         Section 7.01          Purchase of Mortgage Loans; Termination of Trust Fund Upon Purchase or
                               Liquidation of All Mortgage Loans...............................................    107

         Section 7.02          Procedure Upon Redemption or Termination of Trust Fund..........................    108

         Section 7.03          Additional Trust Fund Termination Requirements..................................    109

         Section 7.04          [RESERVED]......................................................................    109

ARTICLE VIII          RIGHTS OF CERTIFICATEHOLDERS.............................................................    110

         Section 8.01          Limitation on Rights of Holders.................................................    110
</TABLE>

                                       ii

<PAGE>

<TABLE>
<CAPTION>
<S>                                                                                                                <C>
         Section 8.02          Access to List of Holders.......................................................    110

         Section 8.03          Acts of Holders of Certificates.................................................    111

ARTICLE IX            [RESERVED]...............................................................................    112

ARTICLE X             REMIC ADMINISTRATION.....................................................................    112

         Section 10.01         REMIC Administration............................................................    112

         Section 10.02         Prohibited Transactions and Activities..........................................    116

         Section 10.03         Indemnification with Respect to Prohibited Transactions or Loss of REMIC
                               Status..........................................................................    116

         Section 10.04         REO Property....................................................................    116

ARTICLE XI            MISCELLANEOUS PROVISIONS.................................................................    117

         Section 11.01         Binding Nature of Agreement; Assignment.........................................    117

         Section 11.02         Entire Agreement................................................................    117

         Section 11.03         Amendment.......................................................................    118

         Section 11.04         Voting Rights...................................................................    119

         Section 11.05         Provision of Information........................................................    119

         Section 11.06         Governing Law...................................................................    119

         Section 11.07         Notices.........................................................................    120

         Section 11.08         Severability of Provisions......................................................    120

         Section 11.09         Indulgences; No Waivers.........................................................    120

         Section 11.10         Headings Not To Affect Interpretation...........................................    120

         Section 11.11         Benefits of Agreement...........................................................    121

         Section 11.12         Special Notices to the Rating Agencies..........................................    121

         Section 11.13         Conflicts.......................................................................    122

         Section 11.14         Counterparts....................................................................    122

         Section 11.15  No Petitions...........................................................................    122
</TABLE>

                                       iii

<PAGE>

ATTACHMENTS

Exhibit A                  Forms of Certificates
Exhibit B                  Form of Residual Certificate Transfer Affidavit
                           (Transferee)
Exhibit C                  Form of Residual Certificate Transfer Affidavit
                           (Transferor)
Exhibit D                  Mortgage Loan Servicing Agreement
Exhibit E                  Master Mortgage Loan Purchase Agreement
Exhibit F                  List of Limited Purpose Surety Bonds
Exhibit G                  Form of Rule 144A Transfer Certificate
Exhibit H                  Form of Purchaser's Letter for Institutional
                           Accredited Investors
Exhibit I                  Form of ERISA Transfer Affidavit
Exhibit J                  Form of Letter of Representations with the
                           Depository Trust Company
Exhibit K                  Form of Initial Certification
Exhibit L                  Form of Final Certification
Exhibit M                  List of Servicing Officers
Exhibit N                  Form of Request for Release
Exhibit O                  Custody Agreement (without Exhibits)
Exhibit P                  Amendment No. 1 to Custodial Agreement (without
                           Exhibits)
Exhibit Q                  Officer's Certificate - Trustee

Schedule A                 Mortgage Loan Schedule
Schedule B                 Mortgage Loan Representations and Warranties of the
                           Originator

                                       iv

<PAGE>

         This TRUST AGREEMENT, dated as of June 1, 2003 (the "Agreement"), by
and among MERRILL LYNCH MORTGAGE INVESTORS, INC., a Delaware corporation, as
depositor (the "Depositor"), and WELLS FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee (the "Trustee"), and acknowledged by MERRILL LYNCH
CREDIT CORPORATION a Delaware corporation, as originator (the "Originator"), for
purposes of Section 2.04.

                              PRELIMINARY STATEMENT

         The Depositor has acquired the Mortgage Loans originated by the
Originator from Sequoia Residential Funding Inc., which acquired the Mortgage
Loans from the Seller and at the Closing Date is the owner of the Mortgage Loans
and the other property being conveyed by the Depositor to the Trustee hereunder
for inclusion in the Trust Fund. On the Closing Date, the Depositor will acquire
the Certificates from the Trustee as consideration for the Depositor's transfer
to the Trust Fund of the Mortgage Loans and the other property constituting the
Trust Fund. The Depositor has duly authorized the execution and delivery of this
Agreement to provide for the conveyance to the Trustee of the Mortgage Loans and
the other property constituting the Trust Fund. All covenants and agreements
made by the Originator in the Mortgage Loan Purchase and Sale Agreement and in
this Agreement and by the Depositor and the Trustee herein with respect to the
Mortgage Loans and the other property constituting the Trust Fund are for the
benefit of the Holders from time to time of the Certificates. The Depositor and
the Trustee are entering into this Agreement, and the Trustee is accepting the
Trust Fund created hereby, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged.

         As provided herein, the Trustee shall elect that the Trust Fund be
treated for federal income tax purposes as comprising five real estate mortgage
investment conduits (each a "REMIC" or, in the alternative, "REMIC 1," "REMIC
2," "REMIC 3," "REMIC 4" and the "Upper Tier REMIC," respectively) in a tiered
structure. The Certificates, other than the Class A-R Certificate, shall
represent ownership of regular interests in the Upper Tier REMIC. In addition to
representing ownership of a REMIC regular interest, (i) each of the Class A-1
Certificates represents the right to receive payments in respect of interest
accruals on the Class A-1 Certificates at rates in excess of the Pool 1 Adjusted
Net WAC, including all payments in respect of Basis Risk Shortfalls and Unpaid
Basis Risk Shortfalls, (ii) each of the Class A-2 Certificates represents the
right to receive payments in respect of interest accruals on the Class A-2
Certificates at rates in excess of the Pool 2 Adjusted Net WAC, including all
payments in respect of Basis Risk Shortfalls and Unpaid Basis Risk Shortfalls,
and (iii) each of the Class B-1, Class B-2 and Class B-3 Certificates represents
the right to receive payments in respect of Basis Risk Shortfalls and Unpaid
Basis Risk Shortfalls as provided in Section 5.06. The Class A-R Certificate
represents the sole class of residual interest in each of REMIC 1, REMIC 2,
REMIC 3, REMIC 4 and the Upper Tier REMIC.

         The Upper Tier REMIC shall hold as its assets the several classes of
uncertificated REMIC 4 Regular Interests and the uncertificated REMIC 3 IO
Classes. REMIC 4 shall hold as its assets the several classes of uncertificated
REMIC 3 Regular Interests other than the REMIC 3 IO Classes. REMIC 3 shall hold
as its assets the several classes of uncertificated REMIC 2 Regular Interests.
REMIC 2 shall hold as its assets the several uncertificated classes of REMIC

<PAGE>

1 Regular Interests. REMIC 1 shall hold as its assets the property of the Trust
Fund other than the REMIC 1 Interests, the REMIC 2 Interests, the REMIC 3
Interests and the REMIC 4 Interests. Each Upper Tier REMIC Regular Interest is
hereby designated as a regular interest in the Upper Tier REMIC for purposes of
the REMIC Provisions. Each REMIC 4 Regular Interest is hereby designated as a
regular interest in REMIC 4 for purposes of the REMIC provisions. Each REMIC 3
Regular Interest is hereby designated as a regular interest in REMIC 3 for
purposes of the REMIC provisions. Each REMIC 2 Regular Interest is hereby
designated as a regular interest in REMIC 2 for purposes of the REMIC
provisions. Each REMIC 1 Regular Interest is hereby designated as a regular
interest in REMIC 1 for purposes of the REMIC Provisions. The Class LT1-R
Interest is hereby designated as the sole class of residual interest in REMIC 1
for purposes of the REMIC Provisions. The Class LT2-R Interest is hereby
designated as the sole class of residual interest in REMIC 2 for purposes of the
REMIC provisions. The Class LT3-R Interest is hereby designated as the sole
class of residual interest in REMIC 3 for purposes of the REMIC Provisions. The
Class LT4-R Interest is hereby designated as the sole class of residual interest
in REMIC 4 for purposes of the REMIC Provisions. The Class A-R Certificate,
other than the portion thereof representing the right to receive payments in
respect of the Class LT1-R Interest, the Class LT2-R Interest, the Class LT3-R
Interest or the Class LT4-R Interest, is hereby designated as the sole class of
residual interest in the Upper Tier REMIC for purposes of the REMIC provisions
and will also represent the Class LT1-R Interest, the LT2-R Interest, the Class
LT3-R Interest and the Class LT4-R Interest.

THE REMIC 1 INTERESTS

         The following table sets forth (or describes) the class designation,
interest rate, initial principal amount, and related pool of Mortgage Loans for
each class of REMIC 1 Interests:

<TABLE>
<CAPTION>
                                                             Interest    Related Mortgage Pool or
Class Designation                Principal Amount              Rate               Pools
-----------------                ----------------              ----               -----
<S>                            <C>                           <C>         <C>
LT11A                          $     247,551.3074               (2)             Pool 1
LT11B                          $   7,985,502.3074               (3)             Pool 1
LT12A                          $      64,007.9224               (2)             Pool 2
LT12B                          $   2,064,023.9224               (4)             Pool 2
LT1Z                           $ 994,591,537.5204               (2)             Pool 1 and Pool 2
LT1-R                                          (1)              (1)             N/A
</TABLE>

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

(1) The Class LT1-R Interest represents the sole class of residual interest in
    REMIC 1 and has neither a principal amount nor an interest rate. The Class
    LT1-R Interest shall be represented by the Class A-R Certificate.

(2) The Class LT11A Interest, the Class LT12A Interest and the Class LT1Z
    Interest shall have an interest rate for each Distribution Date (and the
    related accrual period) equal to the Net WAC.

(3) The Class LT11B Interest shall have an interest rate for any Distribution
    Date (and the related accrual period) equal to the Pool 1 Net WAC.

(4) The Class LT12B Interest shall have an interest rate for any Distribution
    Date (and the related accrual period) equal to the Pool 2 Net WAC.

                                       2
<PAGE>

         On each Distribution Date, the Trustee shall first pay or charge as an
expense of REMIC 1 all expenses of the Trust for such Distribution Date.

Principal distributions shall be deemed to be made on the REMIC 1 Interests
first, so as to keep the uncertificated principal balance of each REMIC 1
Interest ending with the designation "A" equal to 1% of the excess of (x) the
aggregate Principal Balance of the Mortgage Loans in the related Mortgage Pool
over (y) the aggregate class principal amounts of the Certificates in the
Certificate Group related to such Mortgage Pool (except that if 1% of any such
excess is greater than the principal amount of the corresponding REMIC 1
Interest ending with the designation "A", the least amount of principal shall be
distributed to such REMIC 1 Interests such that the REMIC 1 Subordinated Balance
Ratio is maintained); second, to each REMIC 1 Interest ending with the
designation "B" so as to keep the uncertificated principal balance of each such
REMIC 1 Interest equal to 1% of the aggregate Principal Balance of the Mortgage
Loans in the related Mortgage Pool and finally, all remaining principal amounts
shall be distributed in respect of the Class LT1Z Interest. Realized Losses with
respect to principal shall be allocated among the REMIC 1 Interests first, so as
to keep the uncertificated principal balance of each REMIC 1 Interest ending
with the designation "A" equal to 1% of the excess of (x) the aggregate
Principal Balance of the Mortgage Loans in the related Mortgage Pool over (y)
the aggregate class principal amounts of the Certificates in the Certificate
Group related to such Mortgage Pool (except that if 1% of any such excess is
greater than the principal amount of the corresponding REMIC 1 Interest ending
with the designation "A", the least amount of losses shall be allocated to such
REMIC 1 Interests such that the REMIC 1 Subordinated Balance Ratio is
maintained); second, to each REMIC 1 Interest ending with the designation "B" so
as to keep the uncertificated principal balance of each such REMIC 1 Interest
equal to 1% of the aggregate Principal Balance of the Mortgage Loans in the
related Mortgage Pool and finally, all remaining Realized Losses with respect to
principal shall be distributed in respect of the Class LT1Z Interest.

         All computations with respect to the REMIC 1 Interests shall be
computed to eight decimal places.

THE REMIC 2 INTERESTS

         The following table sets forth (or describes) the class designation,
interest rate, and initial principal amount for each class of REMIC 2 Interests:

<TABLE>
<CAPTION>
                                                        Interest
Class Designation            Principal Amount             Rate
-----------------            ----------------             ----
<S>                          <C>                        <C>
LT21A1                       $ 28,159,000.00              (2)
LT21A2                       $ 27,165,000.00              (2)
LT21A3                       $ 26,208,000.00              (2)
LT21A4                       $ 25,283,000.00              (2)
LT21A5                       $ 24,392,000.00              (2)
LT21A6                       $ 23,532,000.00              (2)
LT21A7                       $ 22,702,000.00              (2)
LT21A8                       $ 21,901,000.00              (2)
</TABLE>

                                       3

<PAGE>

<TABLE>
<S>                          <C>                          <C>
LT21A9                       $ 21,130,000.00              (2)
LT21A10                      $ 20,384,000.00              (2)
LT21A11                      $ 19,665,000.00              (2)
LT21A12                      $ 18,972,000.00              (2)
LT21A13                      $ 18,303,000.00              (2)
LT21A14                      $ 17,658,000.00              (2)
LT21A15                      $ 17,034,000.00              (2)
LT21A16                      $ 16,435,000.00              (2)
LT21A17                      $ 15,854,000.00              (2)
LT21A18                      $ 15,296,000.00              (2)
LT21A19                      $ 14,756,000.00              (2)
LT21A20                      $ 14,236,000.00              (2)
LT21A21                      $ 13,298,000.00              (2)
LT21A22                      $ 12,821,000.00              (2)
LT21A23                      $ 12,361,000.00              (2)
LT21A24                      $ 11,918,000.00              (2)
LT21A25                      $ 11,490,000.00              (2)
LT21A26                      $ 11,078,000.00              (2)
LT21A27                      $ 10,681,000.00              (2)
LT21A28                      $ 10,297,000.00              (2)
LT21A29                      $  9,927,000.00              (2)
LT21A30                      $  9,570,000.00              (2)
LT21A31                      $  9,226,000.00              (2)
LT21A32                      $  8,895,000.00              (2)
LT21A33                      $  8,574,000.00              (2)
LT21A34                      $  8,266,000.00              (2)
LT21A35                      $  7,969,000.00              (2)
LT21A36                      $  7,681,000.00              (2)
LT21A37                      $  7,076,000.00              (2)
LT21A38                      $  6,827,000.00              (2)
LT21A39                      $  6,586,000.00              (2)
LT21A40                      $  6,354,000.00              (2)
LT21A41                      $  6,129,000.00              (2)
LT21A42                      $  5,914,000.00              (2)
LT21A43                      $  5,705,000.00              (2)
LT21A44                      $  5,504,000.00              (2)
LT21A45                      $  5,310,000.00              (2)
LT21A46                      $  5,122,000.00              (2)
LT21A47                      $  4,942,000.00              (2)
LT21A48                      $135,209,000.00              (2)
LT21AR                       $        100.00              (2)
</TABLE>

                                       4

<PAGE>

<TABLE>
<S>                          <C>                          <C>
LT22A1                       $  7,278,600.00              (3)
LT22A2                       $  7,022,000.00              (3)
LT22A3                       $  6,773,000.00              (3)
LT22A4                       $  6,535,000.00              (3)
LT22A5                       $  6,305,000.00              (3)
LT22A6                       $  6,082,000.00              (3)
LT22A7                       $  5,868,000.00              (3)
LT22A8                       $  5,661,000.00              (3)
LT22A9                       $  5,461,000.00              (3)
LT22A10                      $  5,269,000.00              (3)
LT22A11                      $  5,083,000.00              (3)
LT22A12                      $  4,904,000.00              (3)
LT22A13                      $  4,731,000.00              (3)
LT22A14                      $  4,563,000.00              (3)
LT22A15                      $  4,404,000.00              (3)
LT22A16                      $  4,247,000.00              (3)
LT22A17                      $  4,098,000.00              (3)
LT22A18                      $  3,954,000.00              (3)
LT22A19                      $  3,814,000.00              (3)
LT22A20                      $  3,679,000.00              (3)
LT22A21                      $  3,437,000.00              (3)
LT22A22                      $  3,314,000.00              (3)
LT22A23                      $  3,195,000.00              (3)
LT22A24                      $  3,081,000.00              (3)
LT22A25                      $  2,970,000.00              (3)
LT22A26                      $  2,863,000.00              (3)
LT22A27                      $  2,761,000.00              (3)
LT22A28                      $  2,661,000.00              (3)
LT22A29                      $  2,566,000.00              (3)
LT22A30                      $  2,474,000.00              (3)
LT22A31                      $  2,384,000.00              (3)
LT22A32                      $  2,299,000.00              (3)
LT22A33                      $  2,217,000.00              (3)
LT22A34                      $  2,136,000.00              (3)
LT22A35                      $  2,060,000.00              (3)
LT22A36                      $  1,985,000.00              (3)
LT22A37                      $  1,829,000.00              (3)
LT22A38                      $  1,765,000.00              (3)
LT22A39                      $  1,702,000.00              (3)
LT22A40                      $  1,642,000.00              (3)
LT22A41                      $  1,585,000.00              (3)
</TABLE>

                                       5

<PAGE>

<TABLE>
<S>                          <C>                          <C>
LT22A42                      $  1,528,000.00              (3)
LT22A43                      $  1,475,000.00              (3)
LT22A44                      $  1,422,000.00              (3)
LT22A45                      $  1,373,000.00              (3)
LT22A46                      $  1,324,000.00              (3)
LT22A47                      $  1,277,000.00              (3)
LT22A48                      $ 34,945,000.00              (3)
LT2B                         $ 31,155,922.98              (4)
LT2-R                                     (1)             (1)
</TABLE>

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

(1) The Class LT2-R interest represents the sole class of residual interest in
    REMIC 2 and has neither a principal amount nor an interest rate. The Class
    LT2-R Interest shall be represented by the Class A-R Certificate.

(2) The interest rate for each of the Class LT21A1 Interest through the Class
    LT21A48 Interest and the Class LT21AR Interest for any Distribution Date
    (and the related Accrual Period) is a per annum rate equal to the Pool 1 Net
    WAC.

(3) The interest rate for each of the Class LT22A1 Interest through the Class
    LT22A48 Interest for any Distribution Date (and the related Accrual Period)
    is a per annum rate equal to the Pool 2 Net WAC.

(4) The interest rate for the Class LT2B Interest for any Distribution Date (and
    the related Accrual Period) is a per annum rate equal to the Subordinate Net
    WAC, which is the numerical equivalent of the weighted average of the
    interest rates on the Class LT11A Interest and the Class LT12A (treating,
    for purposes of computing this weighted average, the Class LT11A Interest as
    subject to a cap and a floor equal to the interest rate on the Class LT11B
    Interest and the Class LT12A Interest as subject to a cap and a floor equal
    to the interest rate on the Class LT12B Interest).

         On each Distribution Date principal payments will be deemed made and
Realized Losses with respect to principal will be allocated among the REMIC 2
Regular Interests as follows: (i) an amount equal to the total principal
distributed in respect of the Class B-1, Class B-2, Class B-3, Class B-4, Class
B-5 and Class B-6 Certificates will be treated as having been distributed in
respect of the Class LT2B Interest in reduction of its principal amount
(treating the initial Class Principal Amount of the Class B-6 Certificates, for
purposes of this clause (i), as being $3,518,922.98 and treating the first $.98
of payments to the Class A-R Certificate under Section 5.01(a)(vi) from
principal payments on the Mortgage Loans as paid in respect of the Class B-6
Certificates), (ii) the amount of all Realized Losses in respect of principal
allocated to the Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class
B-6 Certificates will be allocated to the Class LT2B Interest in reduction of
its principal amount (treating the initial Class Principal Amount of the Class
B-6 Certificates, for purposes of this clause (ii), as being $3,518,922.98 and
disregarding Section 5.03(c) hereof), (iii) an amount equal to the total
principal distributed in respect of the Class A-R Certificates will be treated
as having been distributed in respect of the Class LT21AR Interest in reduction
of its principal amount, (iv) the amount of all Realized Losses in respect of
principal allocated to the Class A-R Certificates will be allocated to the Class
LT21AR Interest in reduction of its principal amount, (v) an amount equal to the
total principal distributed in respect of the Class A-1 Certificates will be
treated as having been distributed in the aggregate in respect of the Class
LT21A1 Interest through the

                                       6

<PAGE>

Class LT21A48 Interest in reduction of their principal amount, (vi) the amount
of all Realized Losses in respect of principal allocated to the Class A-1
Certificates will be allocated in the aggregate to the Class LT21A1 Interest
through the Class LT21A48 Interest in reduction of their principal amount, (vii)
an amount equal to the total principal distributed in respect of the Class A-2
Certificates will be treated as having been distributed in the aggregate in
respect of the Class LT22A1 Interest through the Class LT22A48 Interest in
reduction of their principal amount and (viii) the amount of all Realized Losses
in respect of principal allocated to the Class A-2 Certificates will be
allocated in the aggregate to the Class LT22A1 Interest through the Class
LT22A48 Interest in reduction of their principal amount. All principal deemed
paid and Realized Losses allocated to the Class LT21A1 Interest through the
Class LT21A48 Interest shall be deemed paid or allocated first to the Class
LT21A1 Interest until its principal balance has been reduced to zero and to such
other REMIC 1 Regular Interests in numerical order until the principal balance
of each in turn has been reduced to zero. All principal deemed paid and Realized
Losses allocated to the Class LT22A1 Interest through the Class LT22A48 Interest
shall be deemed paid or allocated first to the Class LT22A1 Interest until its
principal balance has been reduced to zero and to such other REMIC 1 Regular
Interests in numerical order until the principal balance of each in turn has
been reduced to zero.

THE REMIC 3 INTERESTS

         The following table sets forth (or describes) the class designation,
interest rate and initial principal amount for each class of REMIC 3 Interests:

<TABLE>
<CAPTION>
                                                        Interest
Class Designation            Principal Amount             Rate
-----------------            ----------------             ----
<S>                          <C>                        <C>
LT31A1                       $ 28,159,000.00               (4)
LT31A2                       $ 27,165,000.00               (4)
LT31A3                       $ 26,208,000.00               (4)
LT31A4                       $ 25,283,000.00               (4)
LT31A5                       $ 24,392,000.00               (4)
LT31A6                       $ 23,532,000.00               (4)
LT31A7                       $ 22,702,000.00               (4)
LT31A8                       $ 21,901,000.00               (4)
LT31A9                       $ 21,130,000.00               (4)
LT31A10                      $ 20,384,000.00               (4)
LT31A11                      $ 19,665,000.00               (4)
LT31A12                      $ 18,972,000.00               (4)
LT31A13                      $ 18,303,000.00               (4)
LT31A14                      $ 17,658,000.00               (4)
LT31A15                      $ 17,034,000.00               (4)
LT31A16                      $ 16,435,000.00               (4)
LT31A17                      $ 15,854,000.00               (4)
LT31A18                      $ 15,296,000.00               (4)
LT31A19                      $ 14,756,000.00               (4)
</TABLE>

                                       7

<PAGE>

<TABLE>
<S>                          <C>                           <C>
LT31A20                      $ 14,236,000.00               (4)
LT31A21                      $ 13,298,000.00               (4)
LT31A22                      $ 12,821,000.00               (4)
LT31A23                      $ 12,361,000.00               (4)
LT31A24                      $ 11,918,000.00               (4)
LT31A25                      $ 11,490,000.00               (4)
LT31A26                      $ 11,078,000.00               (4)
LT31A27                      $ 10,681,000.00               (4)
LT31A28                      $ 10,297,000.00               (4)
LT31A29                      $  9,927,000.00               (4)
LT31A30                      $  9,570,000.00               (4)
LT31A31                      $  9,226,000.00               (4)
LT31A32                      $  8,895,000.00               (4)
LT31A33                      $  8,574,000.00               (4)
LT31A34                      $  8,266,000.00               (4)
LT31A35                      $  7,969,000.00               (4)
LT31A36                      $  7,681,000.00               (4)
LT31A37                      $  7,076,000.00               (4)
LT31A38                      $  6,827,000.00               (4)
LT31A39                      $  6,586,000.00               (4)
LT31A40                      $  6,354,000.00               (4)
LT31A41                      $  6,129,000.00               (4)
LT31A42                      $  5,914,000.00               (4)
LT31A43                      $  5,705,000.00               (4)
LT31A44                      $  5,504,000.00               (4)
LT31A45                      $  5,310,000.00               (4)
LT31A46                      $  5,122,000.00               (4)
LT31A47                      $  4,942,000.00               (4)
LT31A48                      $135,209,000.00               (4)
LT31IO11                                  (1)              (5)
LT31IO12                                  (1)              (5)
LT31IO21                                  (1)              (5)
LT31IO22                                  (1)              (5)
LT31IO31                                  (1)              (5)
LT31IO32                                  (1)              (5)
LT31IO41                                  (1)              (5)
LT31IO42                                  (1)              (5)
LT31IO51                                  (1)              (5)
LT31IO52                                  (1)              (5)
LT31IO61                                  (1)              (5)
LT31IO62                                  (1)              (5)
</TABLE>

                                       8

<PAGE>

<TABLE>
<S>                                       <C>              <C>
LT31IO71                                  (1)              (5)
LT31IO72                                  (1)              (5)
LT31IO81                                  (1)              (5)
LT31IO82                                  (1)              (5)
LT31IO91                                  (1)              (5)
LT31IO92                                  (1)              (5)
LT31IO101                                 (1)              (5)
LT31IO102                                 (1)              (5)
LT31IO111                                 (1)              (5)
LT31IO112                                 (1)              (5)
LT31IO121                                 (1)              (5)
LT31IO122                                 (1)              (5)
LT31IO131                                 (1)              (5)
LT31IO132                                 (1)              (5)
LT31IO141                                 (1)              (5)
LT31IO142                                 (1)              (5)
LT31IO151                                 (1)              (5)
LT31IO152                                 (1)              (5)
LT31IO161                                 (1)              (5)
LT31IO162                                 (1)              (5)
LT31IO171                                 (1)              (5)
LT31IO172                                 (1)              (5)
LT31IO181                                 (1)              (5)
LT31IO182                                 (1)              (5)
LT31IO191                                 (1)              (5)
LT31IO192                                 (1)              (5)
LT31IO201                                 (1)              (5)
LT31IO202                                 (1)              (5)
LT31IO211                                 (1)              (5)
LT31IO212                                 (1)              (5)
LT31IO221                                 (1)              (5)
LT31IO222                                 (1)              (5)
LT31IO231                                 (1)              (5)
LT31IO232                                 (1)              (5)
LT31IO241                                 (1)              (5)
LT31IO242                                 (1)              (5)
LT31IO251                                 (1)              (5)
LT31IO252                                 (1)              (5)
LT31IO261                                 (1)              (5)
LT31IO262                                 (1)              (5)
LT31IO271                                 (1)              (5)
</TABLE>

                                       9

<PAGE>

<TABLE>
<S>                                       <C>              <C>
LT31IO272                                 (1)              (5)
LT31IO281                                 (1)              (5)
LT31IO282                                 (1)              (5)
LT31IO291                                 (1)              (5)
LT31IO292                                 (1)              (5)
LT31IO301                                 (1)              (5)
LT31IO302                                 (1)              (5)
LT31IO311                                 (1)              (5)
LT31IO312                                 (1)              (5)
LT31IO321                                 (1)              (5)
LT31IO322                                 (1)              (5)
LT31IO331                                 (1)              (5)
LT31IO332                                 (1)              (5)
LT31IO341                                 (1)              (5)
LT31IO342                                 (1)              (5)
LT31IO351                                 (1)              (5)
LT31IO352                                 (1)              (5)
LT31IO361                                 (1)              (5)
LT31IO362                                 (1)              (5)
LT31IO371                                 (1)              (5)
LT31IO372                                 (1)              (5)
LT31IO381                                 (1)              (5)
LT31IO382                                 (1)              (5)
LT31IO391                                 (1)              (5)
LT31IO392                                 (1)              (5)
LT31IO401                                 (1)              (5)
LT31IO402                                 (1)              (5)
LT31IO411                                 (1)              (5)
LT31IO412                                 (1)              (5)
LT31IO421                                 (1)              (5)
LT31IO422                                 (1)              (5)
LT31IO431                                 (1)              (5)
LT31IO432                                 (1)              (5)
LT31IO441                                 (1)              (5)
LT31IO442                                 (1)              (5)
LT31IO451                                 (1)              (5)
LT31IO452                                 (1)              (5)
LT31IO461                                 (1)              (5)
LT31IO462                                 (1)              (5)
LT31IO471                                 (1)              (5)
LT31IO472                                 (1)              (5)
</TABLE>

                                       10

<PAGE>

<TABLE>
<S>                          <C>                           <C>
LT31IO481                                 (1)              (5)
LT31IO482                                 (1)              (5)
LT31AR                       $        100.00               (6)
LT32A1                       $  7,278,600.00               (7)
LT32A2                       $  7,022,000.00               (7)
LT32A3                       $  6,773,000.00               (7)
LT32A4                       $  6,535,000.00               (7)
LT32A5                       $  6,305,000.00               (7)
LT32A6                       $  6,082,000.00               (7)
LT32A7                       $  5,868,000.00               (7)
LT32A8                       $  5,661,000.00               (7)
LT32A9                       $  5,461,000.00               (7)
LT32A10                      $  5,269,000.00               (7)
LT32A11                      $  5,083,000.00               (7)
LT32A12                      $  4,904,000.00               (7)
LT32A13                      $  4,731,000.00               (7)
LT32A14                      $  4,563,000.00               (7)
LT32A15                      $  4,404,000.00               (7)
LT32A16                      $  4,247,000.00               (7)
LT32A17                      $  4,098,000.00               (7)
LT32A18                      $  3,954,000.00               (7)
LT32A19                      $  3,814,000.00               (7)
LT32A20                      $  3,679,000.00               (7)
LT32A21                      $  3,437,000.00               (7)
LT32A22                      $  3,314,000.00               (7)
LT32A23                      $  3,195,000.00               (7)
LT32A24                      $  3,081,000.00               (7)
LT32A25                      $  2,970,000.00               (7)
LT32A26                      $  2,863,000.00               (7)
LT32A27                      $  2,761,000.00               (7)
LT32A28                      $  2,661,000.00               (7)
LT32A29                      $  2,566,000.00               (7)
LT32A30                      $  2,474,000.00               (7)
LT32A31                      $  2,384,000.00               (7)
LT32A32                      $  2,299,000.00               (7)
LT32A33                      $  2,217,000.00               (7)
LT32A34                      $  2,136,000.00               (7)
LT32A35                      $  2,060,000.00               (7)
LT32A36                      $  1,985,000.00               (7)
LT32A37                      $  1,829,000.00               (7)
LT32A38                      $  1,765,000.00               (7)
</TABLE>

                                       11

<PAGE>

<TABLE>
<S>                          <C>                           <C>
LT32A39                      $  1,702,000.00               (7)
LT32A40                      $  1,642,000.00               (7)
LT32A41                      $  1,585,000.00               (7)
LT32A42                      $  1,528,000.00               (7)
LT32A43                      $  1,475,000.00               (7)
LT32A44                      $  1,422,000.00               (7)
LT32A45                      $  1,373,000.00               (7)
LT32A46                      $  1,324,000.00               (7)
LT32A47                      $  1,277,000.00               (7)
LT32A48                      $ 34,945,000.00               (7)
LT32IO11                                  (2)              (8)
LT32IO12                                  (2)              (8)
LT32IO21                                  (2)              (8)
LT32IO22                                  (2)              (8)
LT32IO31                                  (2)              (8)
LT32IO32                                  (2)              (8)
LT32IO41                                  (2)              (8)
LT32IO42                                  (2)              (8)
LT32IO51                                  (2)              (8)
LT32IO52                                  (2)              (8)
LT32IO61                                  (2)              (8)
LT32IO62                                  (2)              (8)
LT32IO71                                  (2)              (8)
LT32IO72                                  (2)              (8)
LT32IO81                                  (2)              (8)
LT32IO82                                  (2)              (8)
LT32IO91                                  (2)              (8)
LT32IO92                                  (2)              (8)
LT32IO101                                 (2)              (8)
LT32IO102                                 (2)              (8)
LT32IO111                                 (2)              (8)
LT32IO112                                 (2)              (8)
LT32IO121                                 (2)              (8)
LT32IO122                                 (2)              (8)
LT32IO131                                 (2)              (8)
LT32IO132                                 (2)              (8)
LT32IO141                                 (2)              (8)
LT32IO142                                 (2)              (8)
LT32IO151                                 (2)              (8)
LT32IO152                                 (2)              (8)
LT32IO161                                 (2)              (8)
</TABLE>

                                       12

<PAGE>

<TABLE>
<S>                                       <C>              <C>
LT32IO162                                 (2)              (8)
LT32IO171                                 (2)              (8)
LT32IO172                                 (2)              (8)
LT32IO181                                 (2)              (8)
LT32IO182                                 (2)              (8)
LT32IO191                                 (2)              (8)
LT32IO192                                 (2)              (8)
LT32IO201                                 (2)              (8)
LT32IO202                                 (2)              (8)
LT32IO211                                 (2)              (8)
LT32IO212                                 (2)              (8)
LT32IO221                                 (2)              (8)
LT32IO222                                 (2)              (8)
LT32IO231                                 (2)              (8)
LT32IO232                                 (2)              (8)
LT32IO241                                 (2)              (8)
LT32IO242                                 (2)              (8)
LT32IO251                                 (2)              (8)
LT32IO252                                 (2)              (8)
LT32IO261                                 (2)              (8)
LT32IO262                                 (2)              (8)
LT32IO271                                 (2)              (8)
LT32IO272                                 (2)              (8)
LT32IO281                                 (2)              (8)
LT32IO282                                 (2)              (8)
LT32IO291                                 (2)              (8)
LT32IO292                                 (2)              (8)
LT32IO301                                 (2)              (8)
LT32IO302                                 (2)              (8)
LT32IO311                                 (2)              (8)
LT32IO312                                 (2)              (8)
LT32IO321                                 (2)              (8)
LT32IO322                                 (2)              (8)
LT32IO331                                 (2)              (8)
LT32IO332                                 (2)              (8)
LT32IO341                                 (2)              (8)
LT32IO342                                 (2)              (8)
LT32IO351                                 (2)              (8)
LT32IO352                                 (2)              (8)
LT32IO361                                 (2)              (8)
LT32IO362                                 (2)              (8)
</TABLE>

                                       13

<PAGE>

<TABLE>
<S>                          <C>                           <C>
LT32IO371                                 (2)              (8)
LT32IO372                                 (2)              (8)
LT32IO381                                 (2)              (8)
LT32IO382                                 (2)              (8)
LT32IO391                                 (2)              (8)
LT32IO392                                 (2)              (8)
LT32IO401                                 (2)              (8)
LT32IO402                                 (2)              (8)
LT32IO411                                 (2)              (8)
LT32IO412                                 (2)              (8)
LT32IO421                                 (2)              (8)
LT32IO422                                 (2)              (8)
LT32IO431                                 (2)              (8)
LT32IO432                                 (2)              (8)
LT32IO441                                 (2)              (8)
LT32IO442                                 (2)              (8)
LT32IO451                                 (2)              (8)
LT32IO452                                 (2)              (8)
LT32IO461                                 (2)              (8)
LT32IO462                                 (2)              (8)
LT32IO471                                 (2)              (8)
LT32IO472                                 (2)              (8)
LT32IO481                                 (2)              (8)
LT32IO482                                 (2)              (8)
LT3B1                        $ 10,552,500.00               (9)
LT3B2                        $  8,040,000.00               (9)
LT3B3                        $  4,522,500.00               (9)
LT3B4                        $  2,512,500.00               (9)
LT3B5                        $  2,010,000.00               (9)
LT3B6                        $  3,518,422.98               (9)
LT3-R                                     (3)              (3)
</TABLE>

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

(1) Each of the REMIC 3 IO Classes shall be an "interest-only" interest that has
    no principal balance. The notional balance of the Class LT31IO11 Interest
    and Class LT31IO12 Interest as of any Distribution Date on or prior to the
    Distribution Date in July, 2003 shall equal the principal balance of the
    Class LT21A1 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO21 Interest and Class LT31IO22 Interest as of any Distribution
    Date on or prior to the Distribution Date in August, 2003 shall equal the
    principal balance of the Class LT21A2 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO31 Interest and Class LT31IO32 Interest
    as of any Distribution Date on or prior to the Distribution Date in
    September, 2003 shall equal the principal balance of the Class LT21A3
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO41 Interest and Class LT31IO42 Interest as

                                       14

<PAGE>

    of any Distribution Date on or prior to the Distribution Date in October,
    2003 shall equal the principal balance of the Class LT21A4 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO51 Interest
    and Class LT31IO52 Interest as of any Distribution Date on or prior to the
    Distribution Date in November, 2003 shall equal the principal balance of the
    Class LT21A5 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO61 Interest and Class LT31IO62 Interest as of any Distribution
    Date on or prior to the Distribution Date in December, 2003 shall equal the
    principal balance of the Class LT21A6 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO71 Interest and Class LT31IO72 Interest
    as of any Distribution Date on or prior to the Distribution Date in January,
    2004 shall equal the principal balance of the Class LT21A7 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO81 Interest
    and Class LT31IO82 Interest as of any Distribution Date on or prior to the
    Distribution Date in February, 2004 shall equal the principal balance of the
    Class LT21A8 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO91 Interest and Class LT31IO92 Interest as of any Distribution
    Date on or prior to the Distribution Date in March, 2004 shall equal the
    principal balance of the Class LT21A9 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO101 Interest and Class LT31IO102
    Interest as of any Distribution Date on or prior to the Distribution Date in
    April, 2004 shall equal the principal balance of the Class LT21A10 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO111 Interest
    and Class LT31IO112 Interest as of any Distribution Date on or prior to the
    Distribution Date in May, 2004 shall equal the principal balance of the
    Class LT21A11 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO121 Interest and Class LT31IO122 Interest as of any Distribution
    Date on or prior to the Distribution Date in June, 2004 shall equal the
    principal balance of the Class LT21A12 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO131 Interest and Class LT31IO132
    Interest as of any Distribution Date on or prior to the Distribution Date in
    July, 2004 shall equal the principal balance of the Class LT21A13 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO141 Interest
    and Class LT31IO142 Interest as of any Distribution Date on or prior to the
    Distribution Date in August, 2004 shall equal the principal balance of the
    Class LT21A14 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO151 Interest and Class LT31IO152 Interest as of any Distribution
    Date on or prior to the Distribution Date in September, 2004 shall equal the
    principal balance of the Class LT21A15 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO161 Interest and Class LT31IO162
    Interest as of any Distribution Date on or prior to the Distribution Date in
    October, 2004 shall equal the principal balance of the Class LT21A16
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO171 Interest and Class LT31IO172 Interest as of any Distribution Date
    on or prior to the Distribution Date in November, 2004 shall equal the
    principal balance of the Class LT21A17 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO181 Interest and Class LT31IO182
    Interest as of any Distribution Date on or prior to the Distribution Date in
    December, 2004 shall equal the principal balance of the Class LT21A18
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO191 Interest and Class LT31IO192 Interest as of any Distribution Date
    on or prior to the Distribution Date in January, 2005 shall equal the
    principal balance of the Class LT21A19 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO201 Interest and Class LT31IO202
    Interest as of any Distribution Date on or prior to the Distribution Date in
    February, 2005 shall equal the principal balance of the Class LT21A20
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO211 Interest and Class LT31IO212 Interest as of any Distribution Date
    on or prior to the Distribution Date in March, 2005 shall equal the
    principal balance of the Class LT21A21 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO221 Interest and Class

                                       15

<PAGE>

    LT31IO222 Interest as of any Distribution Date on or prior to the
    Distribution Date in April, 2005 shall equal the principal balance of the
    Class LT21A22 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO231 Interest and Class LT31IO232 Interest as of any Distribution
    Date on or prior to the Distribution Date in May, 2005 shall equal the
    principal balance of the Class LT21A23 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO241 Interest and Class LT31IO242
    Interest as of any Distribution Date on or prior to the Distribution Date in
    June, 2005 shall equal the principal balance of the Class LT21A24 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO251 Interest
    and Class LT31IO252 Interest as of any Distribution Date on or prior to the
    Distribution Date in July, 2005 shall equal the principal balance of the
    Class LT21A25 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO261 Interest and Class LT31IO262 Interest as of any Distribution
    Date on or prior to the Distribution Date in August, 2005 shall equal the
    principal balance of the Class LT21A26 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO271 Interest and Class LT31IO272
    Interest as of any Distribution Date on or prior to the Distribution Date in
    September, 2005 shall equal the principal balance of the Class LT21A27
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO281 Interest and Class LT31IO282 Interest as of any Distribution Date
    on or prior to the Distribution Date in October, 2005 shall equal the
    principal balance of the Class LT21A28 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO291 Interest and Class LT31IO292
    Interest as of any Distribution Date on or prior to the Distribution Date in
    November, 2005 shall equal the principal balance of the Class LT21A29
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO301 Interest and Class LT31IO302 Interest as of any Distribution Date
    on or prior to the Distribution Date in December, 2005 shall equal the
    principal balance of the Class LT21A30 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO311 Interest and Class LT31IO312
    Interest as of any Distribution Date on or prior to the Distribution Date in
    January, 2006 shall equal the principal balance of the Class LT21A31
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO321 Interest and Class LT31IO322 Interest as of any Distribution Date
    on or prior to the Distribution Date in February, 2006 shall equal the
    principal balance of the Class LT21A32 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO331 Interest and Class LT31IO332
    Interest as of any Distribution Date on or prior to the Distribution Date in
    March, 2006 shall equal the principal balance of the Class LT21A33 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO341 Interest
    and Class LT31IO342 Interest as of any Distribution Date on or prior to the
    Distribution Date in April, 2006 shall equal the principal balance of the
    Class LT21A34 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO351 Interest and Class LT31IO352 Interest as of any Distribution
    Date on or prior to the Distribution Date in May, 2006 shall equal the
    principal balance of the Class LT21A35 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO361 Interest and Class LT31IO362
    Interest as of any Distribution Date on or prior to the Distribution Date in
    June, 2006 shall equal the principal balance of the Class LT21A36 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO371 Interest
    and Class LT31IO372 Interest as of any Distribution Date on or prior to the
    Distribution Date in July, 2006 shall equal the principal balance of the
    Class LT21A37 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IOI381 Interest and Class LT31IO382 Interest as of any
    Distribution Date on or prior to the Distribution Date in August, 2006 shall
    equal the principal balance of the Class LT21A38 Interest immediately prior
    to such Distribution Date and for subsequent Distribution Dates shall equal
    $0. The notional balance of the Class LT31IO391 Interest and Class LT31IO392
    Interest as of any Distribution Date on or prior to the Distribution Date in
    September, 2006 shall equal the principal balance of the Class LT21A39
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The

                                       16

<PAGE>

    notional balance of the Class LT31IO401 Interest and Class LT31IO402
    Interest as of any Distribution Date on or prior to the Distribution Date in
    October, 2006 shall equal the principal balance of the Class LT21A40
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO411 Interest and Class LT31IO412 Interest as of any Distribution Date
    on or prior to the Distribution Date in November, 2006 shall equal the
    principal balance of the Class LT21A41 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO421 Interest and Class LT31IO422
    Interest as of any Distribution Date on or prior to the Distribution Date in
    December, 2006 shall equal the principal balance of the Class LT21A42
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO431 Interest and Class LT31IO432 Interest as of any Distribution Date
    on or prior to the Distribution Date in January, 2007 shall equal the
    principal balance of the Class LT21A43 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO441 Interest and Class LT31IO442
    Interest as of any Distribution Date on or prior to the Distribution Date in
    February, 2007 shall equal the principal balance of the Class LT21A44
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT31IO451 Interest and Class LT31IO452 Interest as of any Distribution Date
    on or prior to the Distribution Date in March, 2007 shall equal the
    principal balance of the Class LT21A45 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT31IO461 Interest and Class LT31IO462
    Interest as of any Distribution Date on or prior to the Distribution Date in
    April, 2007 shall equal the principal balance of the Class LT21A46 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT31IO471 Interest
    and Class LT31IO472 Interest as of any Distribution Date on or prior to the
    Distribution Date in May, 2007 shall equal the principal balance of the
    Class LT21A47 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT31IO481 Interest and Class LT31IO482 Interest as of any Distribution
    Date on or prior to the Distribution Date in June, 2007 shall equal the
    principal balance of the Class LT21A48 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0.

(2) Each of the REMIC 3 IO Classes shall be an "interest-only" interest that has
    no principal balance. The notional balance of the Class LT32IO11 Interest
    and Class LT32IO12 Interest as of any Distribution Date on or prior to the
    Distribution Date in July, 2003 shall equal the principal balance of the
    Class LT22A1 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO21 Interest and Class LT32IO22 Interest as of any Distribution
    Date on or prior to the Distribution Date in August, 2003 shall equal the
    principal balance of the Class LT22A2 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO31 Interest and Class LT32IO32 Interest
    as of any Distribution Date on or prior to the Distribution Date in
    September, 2003 shall equal the principal balance of the Class LT22A3
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO41 Interest and Class LT32IO42 Interest as of any Distribution Date on
    or prior to the Distribution Date in October, 2003 shall equal the principal
    balance of the Class LT22A4 Interest immediately prior to such Distribution
    Date and for subsequent Distribution Dates shall equal $0. The notional
    balance of the Class LT32IO51 Interest and Class LT32IO52 Interest as of any
    Distribution Date on or prior to the Distribution Date in November, 2003
    shall equal the principal balance of the Class LT22A5 Interest immediately
    prior to such Distribution Date and for subsequent Distribution Dates shall
    equal $0. The notional balance of the Class LT32IO61 Interest and Class
    LT32IO62 Interest as of any Distribution Date on or prior to the
    Distribution Date in December, 2003 shall equal the principal balance of the
    Class LT22A6 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO71 Interest and Class LT32IO72 Interest as of any Distribution
    Date on or prior to the Distribution Date in January, 2004 shall equal the
    principal balance of the Class LT22A7 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO81 Interest and Class LT32IO82 Interest
    as of any Distribution Date on or prior to the Distribution Date in
    February, 2004 shall equal the principal balance of the Class LT22A8
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class

                                       17

<PAGE>

    LT32IO91 Interest and Class LT32IO92 Interest as of any Distribution Date on
    or prior to the Distribution Date in March, 2004 shall equal the principal
    balance of the Class LT22A9 Interest immediately prior to such Distribution
    Date and for subsequent Distribution Dates shall equal $0. The notional
    balance of the Class LT32IO101 Interest and Class LT32IO102 Interest as of
    any Distribution Date on or prior to the Distribution Date in April, 2004
    shall equal the principal balance of the Class LT22A10 Interest immediately
    prior to such Distribution Date and for subsequent Distribution Dates shall
    equal $0. The notional balance of the Class LT32IO111 Interest and Class
    LT32IO112 Interest as of any Distribution Date on or prior to the
    Distribution Date in May, 2004 shall equal the principal balance of the
    Class LT22A11 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO121 Interest and Class LT32IO122 Interest as of any Distribution
    Date on or prior to the Distribution Date in June, 2004 shall equal the
    principal balance of the Class LT22A12 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO131 Interest and Class LT32IO132
    Interest as of any Distribution Date on or prior to the Distribution Date in
    July, 2004 shall equal the principal balance of the Class LT22A13 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT32IO141 Interest
    and Class LT32IO142 Interest as of any Distribution Date on or prior to the
    Distribution Date in August, 2004 shall equal the principal balance of the
    Class LT22A14 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO151 Interest and Class LT32IO152 Interest as of any Distribution
    Date on or prior to the Distribution Date in September, 2004 shall equal the
    principal balance of the Class LT22A15 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO161 Interest and Class LT32IO162
    Interest as of any Distribution Date on or prior to the Distribution Date in
    October, 2004 shall equal the principal balance of the Class LT22A16
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO171 Interest and Class LT32IO172 Interest as of any Distribution Date
    on or prior to the Distribution Date in November, 2004 shall equal the
    principal balance of the Class LT22A17 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO181 Interest and Class LT32IO182
    Interest as of any Distribution Date on or prior to the Distribution Date in
    December, 2004 shall equal the principal balance of the Class LT22A18
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO191 Interest and Class LT32IO192 Interest as of any Distribution Date
    on or prior to the Distribution Date in January, 2005 shall equal the
    principal balance of the Class LT22A19 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO201 Interest and Class LT32IO202
    Interest as of any Distribution Date on or prior to the Distribution Date in
    February, 2005 shall equal the principal balance of the Class LT22A20
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO211 Interest and Class LT32IO212 Interest as of any Distribution Date
    on or prior to the Distribution Date in March, 2005 shall equal the
    principal balance of the Class LT22A21 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO221 Interest and Class LT32IO222
    Interest as of any Distribution Date on or prior to the Distribution Date in
    April, 2005 shall equal the principal balance of the Class LT22A22 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT32IO231 Interest
    and Class LT32IO232 Interest as of any Distribution Date on or prior to the
    Distribution Date in May, 2005 shall equal the principal balance of the
    Class LT22A23 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO241 Interest and Class LT32IO242 Interest as of any Distribution
    Date on or prior to the Distribution Date in June, 2005 shall equal the
    principal balance of the Class LT22A24 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO251 Interest and Class LT32IO252
    Interest as of any Distribution Date on or prior to the Distribution Date in
    July, 2005 shall equal the principal balance of the Class LT22A25 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT32IO261 Interest
    and Class LT32IO262 Interest as of any Distribution Date on or prior to the
    Distribution Date in August, 2005 shall equal the principal balance of the
    Class LT22A26 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall

                                       18

<PAGE>

    equal $0. The notional balance of the Class LT32IO271 Interest and Class
    LT32IO272 Interest as of any Distribution Date on or prior to the
    Distribution Date in September, 2005 shall equal the principal balance of
    the Class LT22A27 Interest immediately prior to such Distribution Date and
    for subsequent Distribution Dates shall equal $0. The notional balance of
    the Class LT32IO281 Interest and Class LT32IO282 Interest as of any
    Distribution Date on or prior to the Distribution Date in October, 2005
    shall equal the principal balance of the Class LT22A28 Interest immediately
    prior to such Distribution Date and for subsequent Distribution Dates shall
    equal $0. The notional balance of the Class LT32IO291 Interest and Class
    LT32IO292 Interest as of any Distribution Date on or prior to the
    Distribution Date in November, 2005 shall equal the principal balance of the
    Class LT22A29 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO301 Interest and Class LT32IO302 Interest as of any Distribution
    Date on or prior to the Distribution Date in December, 2005 shall equal the
    principal balance of the Class LT22A30 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO311 Interest and Class LT32IO312
    Interest as of any Distribution Date on or prior to the Distribution Date in
    January, 2006 shall equal the principal balance of the Class LT22A31
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO321 Interest and Class LT32IO322 Interest as of any Distribution Date
    on or prior to the Distribution Date in February, 2006 shall equal the
    principal balance of the Class LT22A32 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO331 Interest and Class LT32IO332
    Interest as of any Distribution Date on or prior to the Distribution Date in
    March, 2006 shall equal the principal balance of the Class LT22A33 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT32IO341 Interest
    and Class LT32IO342 Interest as of any Distribution Date on or prior to the
    Distribution Date in April, 2006 shall equal the principal balance of the
    Class LT22A34 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO351 Interest and Class LT32IO352 Interest as of any Distribution
    Date on or prior to the Distribution Date in May, 2006 shall equal the
    principal balance of the Class LT22A35 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO361 Interest and Class LT32IO362
    Interest as of any Distribution Date on or prior to the Distribution Date in
    June, 2006 shall equal the principal balance of the Class LT22A36 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT32IO371 Interest
    and Class LT32IO372 Interest as of any Distribution Date on or prior to the
    Distribution Date in July, 2006 shall equal the principal balance of the
    Class LT22A37 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IOI381 Interest and Class LT32IO382 Interest as of any
    Distribution Date on or prior to the Distribution Date in August, 2006 shall
    equal the principal balance of the Class LT22A38 Interest immediately prior
    to such Distribution Date and for subsequent Distribution Dates shall equal
    $0. The notional balance of the Class LT32IO391 Interest and Class LT32IO392
    Interest as of any Distribution Date on or prior to the Distribution Date in
    September, 2006 shall equal the principal balance of the Class LT22A39
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO401 Interest and Class LT32IO402 Interest as of any Distribution Date
    on or prior to the Distribution Date in October, 2006 shall equal the
    principal balance of the Class LT22A40 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO411 Interest and Class LT32IO412
    Interest as of any Distribution Date on or prior to the Distribution Date in
    November, 2006 shall equal the principal balance of the Class LT22A41
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO421 Interest and Class LT32IO422 Interest as of any Distribution Date
    on or prior to the Distribution Date in December, 2006 shall equal the
    principal balance of the Class LT22A42 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0. The
    notional balance of the Class LT32IO431 Interest and Class LT32IO432
    Interest as of any Distribution Date on or prior to the Distribution Date in
    January, 2007 shall equal the principal balance of the Class LT22A43
    Interest immediately prior to such Distribution Date and for subsequent
    Distribution Dates shall equal $0. The notional balance of the Class
    LT32IO441 Interest and Class LT32IO442 Interest as of any Distribution Date
    on or prior to the Distribution Date in February, 2007 shall equal the
    principal balance of the Class LT22A44 Interest immediately prior to such
    Distribution Date

                                       19

<PAGE>

    and for subsequent Distribution Dates shall equal $0. The notional balance
    of the Class LT32IO451 Interest and Class LT32IO452 Interest as of any
    Distribution Date on or prior to the Distribution Date in March, 2007 shall
    equal the principal balance of the Class LT22A45 Interest immediately prior
    to such Distribution Date and for subsequent Distribution Dates shall equal
    $0. The notional balance of the Class LT32IO461 Interest and Class LT32IO462
    Interest as of any Distribution Date on or prior to the Distribution Date in
    April, 2007 shall equal the principal balance of the Class LT22A46 Interest
    immediately prior to such Distribution Date and for subsequent Distribution
    Dates shall equal $0. The notional balance of the Class LT32IO471 Interest
    and Class LT32IO472 Interest as of any Distribution Date on or prior to the
    Distribution Date in May, 2007 shall equal the principal balance of the
    Class LT22A47 Interest immediately prior to such Distribution Date and for
    subsequent Distribution Dates shall equal $0. The notional balance of the
    Class LT32IO481 Interest and Class LT32IO482 Interest as of any Distribution
    Date on or prior to the Distribution Date in June, 2007 shall equal the
    principal balance of the Class LT22A48 Interest immediately prior to such
    Distribution Date and for subsequent Distribution Dates shall equal $0.

(3) The Class LT3-R interest represents the sole class of residual interest in
    REMIC 3 and has neither a principal amount nor an interest rate. The Class
    LT3-R Interest shall be represented by the Class A-R Certificate.

(4) For Distribution Dates on or prior to the Distribution Date in July of 2003,
    the interest rate on the Class LT31A1 Interest shall be the Pool 1 Net WAC
    minus 100 basis points and for subsequent Distribution Dates shall be the
    Pool 1 Net WAC. For Distribution Dates on or prior to the Distribution Date
    in August of 2003, the interest rate on the Class LT31A2 Interest shall be
    the Pool 1 Net WAC minus 100 basis points and for subsequent Distribution
    Dates shall be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in September of 2003, the interest rate on the Class
    LT31A3 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in October of 2003, the interest
    rate on the Class LT31A4 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in November
    of 2003, the interest rate on the Class LT31A5 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in December of 2003, the interest rate on the Class LT31A6
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in January of 2004, the interest
    rate on the Class LT31A7 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in February
    of 2004, the interest rate on the Class LT31A8 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in March of 2004, the interest rate on the Class LT31A9
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in April of 2004, the interest
    rate on the Class LT31A10 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in May of
    2004, the interest rate on the Class LT31A11 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in June of 2004, the interest rate on the Class LT31A12
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in July of 2004, the interest
    rate on the Class LT31A13 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in August
    of 2004, the interest rate on the Class LT31A14 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in September of 2004, the interest rate on the Class
    LT31A15 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in October of 2004, the interest
    rate on the Class LT31A16 Interest shall be the Pool 1 Net WAC minus 100
    basis
                                       20

<PAGE>

    points and for subsequent Distribution Dates shall be the Pool 1 Net WAC.
    For Distribution Dates on or prior to the Distribution Date in November of
    2004, the interest rate on the Class LT31A17 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in December of 2004, the interest rate on the Class
    LT31A18 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in January of 2005, the interest
    rate on the Class LT31A19 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in February
    of 2005, the interest rate on the Class LT31A20 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in March of 2005, the interest rate on the Class LT31A21
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in April of 2005, the interest
    rate on the Class LT31A22 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in May of
    2005, the interest rate on the Class LT31A23 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in June of 2005, the interest rate on the Class LT31A24
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in July of 2005, the interest
    rate on the Class LT31A25 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in August
    of 2005, the interest rate on the Class LT31A26 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in September of 2005, the interest rate on the Class
    LT31A27 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in October of 2005, the interest
    rate on the Class LT31A28 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in November
    of 2005, the interest rate on the Class LT31A29 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in December of 2005, the interest rate on the Class
    LT31A30 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in January of 2006, the interest
    rate on the Class LT31A31 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in February
    of 2006, the interest rate on the Class LT31A32 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in March of 2006, the interest rate on the Class LT31A33
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in April of 2006, the interest
    rate on the Class LT31A34 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in May of
    2006, the interest rate on the Class LT31A35 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in June of 2006, the interest rate on the Class LT31A36
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in July of 2006, the interest
    rate on the Class LT31A37 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in August
    of 2006, the interest rate on the Class LT31A38 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in September of 2006, the interest rate on the Class
    LT31A39 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in October of 2006, the interest
    rate on the Class LT31A40 Interest shall be the Pool 1 Net WAC minus 100

                                       21

<PAGE>

    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in November
    of 2006, the interest rate on the Class LT31A41 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in December of 2006, the interest rate on the Class
    LT31A42 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in January of 2007, the interest
    rate on the Class LT31A43 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in February
    of 2007, the interest rate on the Class LT31A44 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in March of 2007, the interest rate on the Class LT31A45
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in April of 2007, the interest
    rate on the Class LT31A46 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in May of
    2007, the interest rate on the Class LT31A47 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in June of 2007, the interest rate on the Class LT31A48
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC.

(5) For each Distribution Date, the interest rate on the REMIC 3 IO Interests
    will equal .50%.

(6) For each Distribution Date, the interest rate on the Class LT3AR Interest
    shall equal the Pool 1 Net WAC.

(7) For Distribution Dates on or prior to the Distribution Date in July of 2003,
    the interest rate on the Class LT32A1 Interest shall be the Pool 1 Net WAC
    minus 100 basis points and for subsequent Distribution Dates shall be the
    Pool 1 Net WAC. For Distribution Dates on or prior to the Distribution Date
    in August of 2003, the interest rate on the Class LT32A2 Interest shall be
    the Pool 1 Net WAC minus 100 basis points and for subsequent Distribution
    Dates shall be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in September of 2003, the interest rate on the Class
    LT32A3 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in October of 2003, the interest
    rate on the Class LT32A4 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in November
    of 2003, the interest rate on the Class LT32A5 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in December of 2003, the interest rate on the Class LT32A6
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in January of 2004, the interest
    rate on the Class LT32A7 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in February
    of 2004, the interest rate on the Class LT32A8 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in March of 2004, the interest rate on the Class LT32A9
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in April of 2004, the interest
    rate on the Class LT32A10 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in May of
    2004, the interest rate on the Class LT32A11 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in June of 2004, the interest rate on the Class LT32A12
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in July of 2004, the interest
    rate on the Class LT32A13 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to

                                       22

<PAGE>

    the Distribution Date in August of 2004, the interest rate on the Class
    LT32A14 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in September of 2004, the
    interest rate on the Class LT32A15 Interest shall be the Pool 1 Net WAC
    minus 100 basis points and for subsequent Distribution Dates shall be the
    Pool 1 Net WAC. For Distribution Dates on or prior to the Distribution Date
    in October of 2004, the interest rate on the Class LT32A16 Interest shall be
    the Pool 1 Net WAC minus 100 basis points and for subsequent Distribution
    Dates shall be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in November of 2004, the interest rate on the Class
    LT32A17 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in December of 2004, the interest
    rate on the Class LT32A18 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in January
    of 2005, the interest rate on the Class LT32A19 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in February of 2005, the interest rate on the Class
    LT32A20 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in March of 2005, the interest
    rate on the Class LT32A21 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in April of
    2005, the interest rate on the Class LT32A22 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in May of 2005, the interest rate on the Class LT32A23
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in June of 2005, the interest
    rate on the Class LT32A24 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in July of
    2005, the interest rate on the Class LT32A25 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in August of 2005, the interest rate on the Class LT32A26
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in September of 2005, the
    interest rate on the Class LT32A27 Interest shall be the Pool 1 Net WAC
    minus 100 basis points and for subsequent Distribution Dates shall be the
    Pool 1 Net WAC. For Distribution Dates on or prior to the Distribution Date
    in October of 2005, the interest rate on the Class LT32A28 Interest shall be
    the Pool 1 Net WAC minus 100 basis points and for subsequent Distribution
    Dates shall be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in November of 2005, the interest rate on the Class
    LT32A29 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in December of 2005, the interest
    rate on the Class LT32A30 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in January
    of 2006, the interest rate on the Class LT32A31 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in February of 2006, the interest rate on the Class
    LT32A32 Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in March of 2006, the interest
    rate on the Class LT32A33 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in April of
    2006, the interest rate on the Class LT32A34 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in May of 2006, the interest rate on the Class LT32A35
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in June of 2006, the interest
    rate on the Class LT32A36 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in July of
    2006, the interest rate on the Class LT32A37 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on

                                       23

<PAGE>

    or prior to the Distribution Date in August of 2006, the interest rate on
    the Class LT32A38 Interest shall be the Pool 1 Net WAC minus 100 basis
    points and for subsequent Distribution Dates shall be the Pool 1 Net WAC.
    For Distribution Dates on or prior to the Distribution Date in September of
    2006, the interest rate on the Class LT32A39 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in October of 2006, the interest rate on the Class LT32A40
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in November of 2006, the interest
    rate on the Class LT32A41 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in December
    of 2006, the interest rate on the Class LT32A42 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in January of 2007, the interest rate on the Class LT32A43
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in February of 2007, the interest
    rate on the Class LT32A44 Interest shall be the Pool 1 Net WAC minus 100
    basis points and for subsequent Distribution Dates shall be the Pool 1 Net
    WAC. For Distribution Dates on or prior to the Distribution Date in March of
    2007, the interest rate on the Class LT32A45 Interest shall be the Pool 1
    Net WAC minus 100 basis points and for subsequent Distribution Dates shall
    be the Pool 1 Net WAC. For Distribution Dates on or prior to the
    Distribution Date in April of 2007, the interest rate on the Class LT32A46
    Interest shall be the Pool 1 Net WAC minus 100 basis points and for
    subsequent Distribution Dates shall be the Pool 1 Net WAC. For Distribution
    Dates on or prior to the Distribution Date in May of 2007, the interest rate
    on the Class LT32A47 Interest shall be the Pool 1 Net WAC minus 100 basis
    points and for subsequent Distribution Dates shall be the Pool 1 Net WAC.
    For Distribution Dates on or prior to the Distribution Date in June of 2007,
    the interest rate on the Class LT31A48 Interest shall be the Pool 1 Net WAC
    minus 100 basis points and for subsequent Distribution Dates shall be the
    Pool 1 Net WAC.

(8) For each Distribution Date, the interest rate on the REMIC 3 IO Interests
    will equal .50%.

(9) For each Distribution Date, the interest rate on each of the REMIC 3 Class B
    Interests will equal the Subordinate Net WAC

         On each Distribution Date principal payments will be deemed made and
Realized Losses with respect to principal will be allocated among the REMIC 3
Regular Interests as follows: (i) an amount equal to the principal distributed
in respect of the Class B-1 Certificates, Class B-2 Certificates, Class B-3
Certificates, Class B-4 Certificates, Class B-5 Certificates and Class B-6
Certificates will be treated as having been distributed in respect of the Class
LT3B1 Interest, the Class LT3B2 Interest, the Class LT3B3 Interest, the Class
LT3B4 Interest, the Class LT3B5 Interest and the Class LT3B6 Interest,
respectively, in reduction of their principal amounts (treating the initial
Class Principal Amount of the Class B-6 Certificates, for purposes of this
clause (i), as being $3,518,922.98 and treating the firs $.98 distributed to the
A-R under Section 5.02(a)(vi) from principal payments on the Mortgage Loans as
distributed to the Class B-6 Certificates), (ii) the amount of all Realized
Losses in respect of principal allocated to the Class B-1 Certificates, Class
B-2 Certificates, Class B-3 Certificates, Class B-4 Certificates, Class B-5
Certificates and Class B-6 Certificates will be allocated to the Class LT3B1
Interest, Class LT3B2 Interest, Class LT3B3 Interest, Class LT3B4 Interest,
Class LT3B5 Interest and Class LT3B6 Interest, respectively, in reduction of
their principal amounts (treating the initial Class Principal Amount of the
Class B-6 Certificates, for purposes of this clause (ii), as being $3,518,922.98
and disregarding Section 5.03(c) hereof), (iii) an amount equal to the total
principal distributed in respect of the Class A-R Certificates will be treated
as having been distributed in respect of the Class LT31AR Interest in reduction
of its principal amount, (iv) the amount of all Realized Losses in respect of
principal allocated to the Class A-R Certificates will

                                       24

<PAGE>

be allocated to the Class LT31AR Interest in reduction of its principal amount,
(v) an amount equal to the total principal distributed in respect of the Class
A-1 Certificates will be treated as having been distributed in the aggregate in
respect of the Class LT31A1 Interest through the Class LT31A48 Interest in
reduction of their principal amount, (vi) the amount of all Realized Losses in
respect of principal allocated to the Class A-1 Certificates will be allocated
in the aggregate to the Class LT31A1 Interest through the Class LT31A48 Interest
in reduction of their principal amount, (vii) an amount equal to the total
principal distributed in respect of the Class A-2 Certificates will be treated
as having been distributed in the aggregate in respect of the Class LT32A1
Interest through the Class LT32A48 Interest in reduction of their principal
amount and (viii) the amount of all Realized Losses in respect of principal
allocated to the Class A-2 Certificates will be allocated in the aggregate to
the Class LT32A1 Interest through the Class LT32A48 Interest in reduction of
their principal amount. All principal deemed paid and Realized Losses allocated
to the Class LT31A1 Interest through the Class LT31A48 Interest shall be deemed
paid or allocated first to the Class LT31A1 Interest until its principal balance
has been reduced to zero and to such other REMIC 1 Regular Interests in
numerical order until the principal balance of each in turn has been reduced to
zero. All principal deemed paid and Realized Losses allocated to the Class
LT32A1 Interest through the Class LT32A48 Interest shall be deemed paid or
allocated first to the Class LT32A1 Interest until its principal balance has
been reduced to zero and to such other REMIC 1 Regular Interests in numerical
order until the principal balance of each in turn has been reduced to zero.

THE REMIC 4 INTERESTS

         The following table sets forth (or describes) the class designation,
interest rate, initial principal amount, and corresponding class of certificates
or components for each class of REMIC 4 Interests:

<TABLE>
<CAPTION>
                                                       Interest          Corresponding Class of
Class Designation              Principal Amount          Rate                 Certificates
-----------------              ----------------          ----                 ------------
<S>                            <C>                     <C>               <C>
     LT4A1                     $773,795,000.00           (2)                    Class A-1
     LT4A2                     $200,001,600.00           (3)                    Class A-2
     LT4B1                     $ 10,552,500.00           (4)                    Class B-1
     LT4B2                     $  8,040,000.00           (4)                    Class B-2
     LT4B3                     $  4,522,500.00           (4)                    Class B-3
     LT4B4                     $  2,512,500.00           (4)                    Class B-4
     LT4B5                     $  2,010,000.00           (4)                    Class B-5
     LT4B6                     $  3,518,422.98           (4)                    Class B-6
     LT4AR                     $        100.00           (5)                    Class A-R
     LT4-R                                  (1)          (1)                    N/A
</TABLE>

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

(1) The Class LT4-R Interest represents the sole class of residual interest in
    REMIC 4 and has neither a principal amount nor an interest rate. The Class
    LT4-R Interest shall be represented by the Class A-R Certificate.

(2) The Class LT4A1 Interest shall have an interest rate for each Distribution
    Date (and the related accrual period) equal to the weighted average of the
    interest rates on the Class LT31A1 Interest, the Class LT31A2

                                       25

<PAGE>

    Interest, the Class LT31A3 Interest, the Class LT31A4 Interest, the Class
    LT31A5 Interest, the Class LT31A6 Interest, the Class LT31A7 Interest, the
    Class LT31A8 Interest, the Class LT31A9 Interest, the Class LT31A10
    Interest, the Class LT31A11 Interest, the Class LT31A12 Interest, the Class
    LT31A13 Interest, the Class LT31A14 Interest, the Class LT31A15 Interest,
    the Class LT31A16 Interest, the Class LT31A17 Interest, the Class LT31A18
    Interest, the Class LT31A19 Interest, the Class LT31A20 Interest, the Class
    LT31A21 Interest, the Class LT31A22 Interest, the Class LT31A23 Interest,
    the Class LT31A24 Interest, the Class LT31A25 Interest, the Class LT31A26
    Interest, the Class LT31A27 Interest, the Class LT31A28 Interest, the Class
    LT31A29 Interest, the Class LT31A30 Interest, the Class LT31A31 Interest,
    the Class LT31A32 Interest, the Class LT31A33 Interest, the Class LT31A34
    Interest, the Class LT31A35 Interest, the Class LT31A36 Interest, the Class
    LT31A37 Interest, the Class LT31A38 Interest, the Class LT31A39 Interest,
    the Class LT31A40 Interest, the Class LT31A41 Interest, the Class LT31A42
    Interest, the Class LT31A43 Interest, the Class LT31A44 Interest, the Class
    LT31A45 Interest, the Class LT31A46 Interest, the Class LT31A47 Interest and
    the Class LT31A48 Interest, weighted on the basis of their principal amounts
    immediately prior to such Distribution Date.

(3) The Class LT4A2 Interest shall have an interest rate for each Distribution
    Date (and the related accrual period) equal to the weighted average of the
    interest rates on the Class LT32A1 Interest, the Class LT32A2 Interest, the
    Class LT32A3 Interest, the Class LT32A4 Interest, the Class LT32A5 Interest,
    the Class LT32A6 Interest, the Class LT32A7 Interest, the Class LT32A8
    Interest, the Class LT32A9 Interest, the Class LT32A10 Interest, the Class
    LT32A11 Interest, the Class LT32A12 Interest, the Class LT32A13 Interest,
    the Class LT32A14 Interest, the Class LT32A15 Interest, the Class LT32A16
    Interest, the Class LT32A17 Interest, the Class LT32A18 Interest, the Class
    LT32A19 Interest, the Class LT32A20 Interest, the Class LT32A21 Interest,
    the Class LT32A22 Interest, the Class LT32A23 Interest, the Class LT32A24
    Interest, the Class LT32A25 Interest, the Class LT32A26 Interest, the Class
    LT32A27 Interest, the Class LT32A28 Interest, the Class LT32A29 Interest,
    the Class LT32A30 Interest, the Class LT32A31 Interest, the Class LT32A32
    Interest, the Class LT32A33 Interest, the Class LT32A34 Interest, the Class
    LT32A35 Interest, the Class LT32A36 Interest, the Class LT32A37 Interest,
    the Class LT32A38 Interest, the Class LT32A39 Interest, the Class LT32A40
    Interest, the Class LT32A41 Interest, the Class LT32A42 Interest, the Class
    LT32A43 Interest, the Class LT32A44 Interest, the Class LT32A45 Interest,
    the Class LT32A46 Interest, the Class LT32A47 Interest and the Class LT32A48
    Interest, weighted on the basis of their principal amounts immediately prior
    to such Distribution Date.

(4) Each of the Class LT4B1 Interest, the Class LT4B2 Interest, the Class LT4B3
    Interest, the Class LT4B4 Interest, the Class LT4B5 Interest and the Class
    LT4B6 Interest shall have an interest rate for each Distribution Date (and
    the related accrual period) equal to the Subordinate Net WAC.

(4) The Class LT4AR Interest shall have an interest rate for each Distribution
    Date (and the related accrual period) equal to the Pool 1 Net WAC.

         Principal payments shall be deemed made and Realized Losses with
respect to principal shall be allocated among the REMIC 4 Interests in the same
manner as such payments are made or such Realized Losses are allocated among the
Corresponding Classes of Certificates (treating the initial Class Principal
Amount of the Class B-6 Certificates, for purposes of this sentence, as being
$3,518,922.98, treating the first $.98 of distributions to the Class A-R
Certificate under Section 5.02(a)(vi) from principal payments on the Mortgage
Loans as distributed to the Class B-6 Certificates and disregarding Section
5.03(c)).

                                       26

<PAGE>

THE CERTIFICATES

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

<TABLE>
<CAPTION>
                                                            Initial Class
                                                         Principal Amount or            Minimum
   Class                    Certificate Interest            Class Notional          Denominations or
Designation                         Rate                        Amount             Percentage Interest
-----------                 --------------------         -------------------       -------------------
<S>                         <C>                          <C>                       <C>
Class A-1                           (1)                      $773,795,000              $  25,000.00
Class A-2                           (2)                      $200,001,600              $  25,000.00
Class X-A-1                         (3)                                (3)                      100%
Class X-A-2                         (4)                                (4)                      100%
Class X-A-3                         (5)                                (5)                      100%
Class X-B                           (6)                                (6)                      100%
Class A-R                           (7)                      $        100                       100%
Class B-1                           (8)                      $ 10,522,500              $  25,000.00
Class B-2                           (9)                      $  8,040,000              $  25,000.00
Class B-3                          (10)                      $  4,522,000              $  25,000.00
Class B-4                          (11)                      $  2,512,500              $ 100,000.00
Class B-5                          (11)                      $  2,010,000              $ 100,000.00
Class B-6                          (11)                      $  3,517,500              $ 100,000.00
</TABLE>

-------------------
(1) The Certificate Interest Rate with respect to any Distribution Date (and the
    related Accrual Period) for the Class A-1 Certificates will be the least of
    (i) LIBOR plus 0.33%; (ii) the Pool 1 Net WAC and (iii) 11.75%; provided,
    however, if the Mortgage Loans and related property are not purchased
    pursuant to Section 7.01(b) on the Initial Optional Purchase Date, then with
    respect to each subsequent Distribution Date the per annum rate calculated
    pursuant to clause (i) above with respect to the Class A-1 Certificates will
    be LIBOR plus 0.66%.

(2) The Certificate Interest Rate with respect to any Distribution Date (and the
    related Accrual Period) for the Class A-2 Certificates will be the least of
    (i) LIBOR plus 0.35%; (ii) the Pool 2 Net WAC and (iii) 11.75%; provided,
    however, if the Mortgage Loans and related property are not purchased
    pursuant to Section 7.01(b) on the Initial Optional Purchase Date, then with
    respect to each subsequent Distribution Date the per annum rate calculated
    pursuant to clause (i) above with respect to the Class A-2 Certificates will
    be LIBOR plus 0.70%.

(3) The Class X-A-1 Certificates will represent a 50% interest in each of the
    Pool 1 Component and the Pool 2 Component.

(4) The Class X-A-2 Certificates will represent a 50% interest in the Pool 1 NAS
    IO Subcomponent of the Pool 1 Component and a 50% interest in the Pool 2 NAS
    IO Subcomponent of the Pool 2 Component.

(5) The Class X-A-3 Certificates will represent a 50% interest in the Pool 1
    Companion IO Subcomponent of the Pool 1 Component and a 50% interest in the
    Pool 2 Companion IO Subcomponent of the Pool 2 Component.

(6) The Class X-B Certificates will represent a 100% interest in each of
    Component X-B1, Component X-B2 and Component X-B3.

                                       27

<PAGE>

(7) The Certificate Interest Rate with respect to any Distribution Date (and the
    related Accrual Period) for the Class A-R Certificate will equal the Pool 1
    Net WAC.

(8) The Certificate Interest Rate with respect to any Distribution Date (and the
    related Accrual Period) for the Class B-1 Certificates will be the least of
    (i) LIBOR plus 0.65%; (ii) the Subordinate Net WAC and (iii) 11.75%;
    provided, however, if the Mortgage Loans and related property are not
    purchased pursuant to Section 7.01(b) on the Initial Optional Purchase Date,
    then with respect to each subsequent Distribution Date the per annum rate
    calculated pursuant to clause (i) above with respect to the Class B-1
    Certificates will be LIBOR plus 0.975%.

(9) The Certificate Interest Rate with respect to any Distribution Date (and the
    related Accrual Period) for the Class B-2 Certificates will be the least of
    (i) LIBOR plus 1.50%; (ii) the Subordinate Net WAC and (iii) 11.75%;
    provided, however, if the Mortgage Loans and related property are not
    purchased pursuant to Section 7.01(b) on the Initial Optional Purchase Date,
    then with respect to each subsequent Distribution Date the per annum rate
    calculated pursuant to clause (i) above with respect to the Class B-2
    Certificates will be LIBOR plus 2.25%.

(10) The Certificate Interest Rate with respect to any Distribution Date (and
    the related Accrual Period) for the Class B-3 Certificates will be the least
    of (i) LIBOR plus 1.50%; (ii) the Subordinate Net WAC and (iii) 11.75%;
    provided, however, if the Mortgage Loans and related property are not
    purchased pursuant to Section 7.01(b) on the Initial Optional Purchase Date,
    then with respect to each subsequent Distribution Date the per annum rate
    calculated pursuant to clause (i) above with respect to the Class B-3
    Certificates will be LIBOR plus 2.25%.

(11) The Certificate Interest Rates with respect to any Distribution Date (and
    the related Accrual Period) for the, Class B-4, Class B-5 and Class B-6
    Certificates will be equal to the Subordinate Net WAC.

         As of the Cut-off Date, the Mortgage Loans had an aggregate Scheduled
Principal Balance of $1,004,952,622.98.

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

                                    ARTICLE I

                                   DEFINITIONS

         Section 1.01      Definitions.

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

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

         Accrual Period: With respect to any Distribution Date and any Class of
LIBOR Certificates and each Component, the period commencing on the 25th day of
the month preceding the month in which the Distribution Date occurs and ending
on the 24th day of the month in which the Distribution Date occurs; provided,
however, that the first Accrual Period with respect to the LIBOR Certificates
and each Component shall be the period beginning on the Closing

                                       28

<PAGE>

Date and ending on July 24, 2003. The Accrual Period applicable to the Class
A-R, Class B-4, Class B-5, Class B-6 Certificates and each Class of Lower Tier
REMIC Interests shall be the calendar month immediately preceding the month in
which the related Distribution Date occurs. Interest shall accrue on all Classes
of Certificates, all Components and on all Lower Tier REMIC Interests on the
basis of a 360-day year consisting of twelve 30-day months.

         Acknowledgements: The Assignment, Assumption and Recognition
Agreements, each dated June 26, 2003, among the Seller, Sequoia Residential
Funding, Inc., the Depositor, the Trustee and the Originator or the Servicer
assigning rights under the Purchase Agreement and the Servicing Agreements from
the Seller to Sequoia Residential Funding, Inc., and from Sequoia Residential
Funding, Inc. to the Depositor, and from the Depositor to the Trustee for the
benefit of the Certificateholers.

         Act:  The Securities Act of 1933, as amended.

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

         Additional Collateral Mortgage Loan: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule.

         Additional Collateral Servicing Agreement: The Additional Collateral
Servicing Agreement, dated as of August 1, 2002, among Cendant, the Seller and
Redwood Trust, Inc., as amended to date and modified by the related
Acknowledgements, a copy of which is attached as Exhibit D.

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

         Advance: With respect to a Mortgage Loan, the payments required to be
made by the Trustee solely in its capacity as successor Servicer or the Servicer
with respect to any Distribution Date pursuant to this Agreement or the
Portfolio Servicing Agreement, as applicable, the amount of any such payment
being equal to the aggregate of the payments of principal and interest (net of
the applicable Servicing Fee and net of any net income in the case of any REO
Property) on the Mortgage Loans that were due on the related Due Date and not
received as of the close of business on the related Determination Date, less the
aggregate amount of any such delinquent payment that either the Trustee or the
Servicer has determined would constitute Nonrecoverable Advances if advanced.

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

         Aggregate Senior Percentage: As to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate of
the Class Principal Amounts of the Class A-

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<PAGE>

1, Class A-2 and Class A-R Certificates and the denominator of which is the
Aggregate Stated Principal Balance, but in no event greater than 100%.

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

         Aggregate Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances for all Mortgage Loans (and when such
term is used with respect to a particular Mortgage Pool, the aggregate of the
Stated Principal Balances of the Mortgage Loans in such Mortgage Pool) which
were outstanding on the Due Date in the month preceding the month of such
Distribution Date.

         Aggregate Voting Interests: The aggregate of the Voting Interests of
all the Certificates under this Agreement.

         Agreement: This Trust Agreement and all amendments and supplements
hereto.

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

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

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

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

         Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
the sale of the Mortgage to the Trustee, which assignment, notice of transfer or
equivalent instrument may be in the form of one or more blanket assignments
covering the Mortgage Loans secured by Mortgaged Properties located in

                                       30

<PAGE>

the same jurisdiction, if permitted by law; provided, however, that the Trustee
shall not be responsible for determining whether any such assignment is in
recordable form.

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

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

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

                  (A)      all related fees, charges and amounts payable or
                  reimbursable to the Trustee under this Agreement, to the
                  extent that, if paid by the Trust Fund, such fees, charges or
                  other amounts would constitute "unanticipated expenses"
                  (within the meaning of Treasury Regulations Section
                  1.860G-1(b)(3)(ii)) of any of the REMICs provided for herein
                  and up to an aggregate maximum amount equal to the product of
                  (i) the applicable Pool Percentage and (ii) $300,000 annually
                  such aggregate maximum amount not to include any Servicing
                  Transfer Costs, or to the Servicer under the Servicing
                  Agreement;

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

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

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

         Bankruptcy: As to any Person, the making of an assignment for the
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry

                                       31

<PAGE>

of an order for relief in a bankruptcy or insolvency proceeding, the seeking of
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief, or seeking, consenting to or acquiescing in the appointment
of a trustee, receiver or liquidator, dissolution, or termination, as the case
may be, of such Person pursuant to the provisions of either the Bankruptcy Code
or any other similar state laws.

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

         Bankruptcy Loss: With respect to any Mortgage Loan, losses that are
incurred as a result of a Deficient Valuation or Debt Service Reduction as
reported by the Servicer to the Trustee.

         Bankruptcy Loss Coverage Amount: As of any Distribution Date, the
Initial Bankruptcy Loss Coverage Amount as reduced by the aggregate amount of
Bankruptcy Losses allocated to the Certificates since the Cut-off Date;
provided, however, that the Bankruptcy Loss Coverage Amount may also be reduced
pursuant to a letter from each Rating Agency to the Trustee to the effect that
any such reduction shall not result in a downgrading of the then current ratings
assigned by such Rating Agency to the Senior Certificates.

         Bankruptcy Loss Coverage Termination Date: The date on which the
Bankruptcy Loss Coverage Amount is reduced to zero.

         Basis Risk Shortfall: With respect to any Distribution Date and any
Class of LIBOR Certificates, the excess, if any, of (i) the amount of Current
Interest that would have been payable on such Class for such Distribution Date
if the Certificate Interest Rate for such Class as set forth in the Preliminary
Statement hereto were determined without regard to clause (ii) in the definition
thereof, over (ii) the actual Current Interest payable on such Class for such
Distribution Date.

         BBA: The British Banker's Association.

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

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

         Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in New York, New York or, if other than New
York, the city in which the

                                       32

<PAGE>

Corporate Trust Office of the Trustee is located, or the States of Maryland or
Minnesota, are authorized or obligated by law or executive order to be closed.

         Cendant: Cendant Mortgage Corporation or its successors in interest.

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

         Certificate Group: Each of the Group 1 Certificates and the Group 2
Certificates.

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

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

         Certificate Principal Amount: With respect to any Certificate (other
than a Notional Certificate), at the time of determination, the maximum
specified dollar amount of principal to which the Holder thereof is then
entitled hereunder, such amount being equal to the initial principal amount set
forth on the face of such Certificate, less (i) the amount of all principal
distributions previously made with respect to such Certificate; (ii) all
Realized Losses allocated to such Certificate; and (iii) in the case of a
Subordinate Certificate, any Subordinate Certificate Writedown Amount allocated
to such Certificates. For purposes of Article V hereof, unless specifically
provided to the contrary, Certificate Principal Amounts shall be determined as
of the close of business of the immediately preceding Distribution Date, after
giving effect to all distributions made on such date. Notional Certificates are
issued without Certificate Principal Amounts.

         Certificate Register and Certificate Registrar: The register maintained
and the registrar appointed pursuant to Section 3.02.

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

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

         Class: Collectively, Certificates bearing the same class designation.
In the case of the REMIC 1, REMIC 2, REMIC 3 and REMIC 4, the term "Class"
refers to all Lower Tier REMIC Interests having the same alphanumeric
designation.

         Class Notional Amount: With respect to any Class of Notional
Certificates, the applicable class notional amount calculated as provided in the
Preliminary Statement hereto.

         Class Principal Amount: With respect to each Class of Certificates
(other than a Notional Certificate) the aggregate of the Certificate Principal
Amounts of all Certificates of such Class at the date of determination.

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<PAGE>

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

         Class A-R Certificate: The Class A-R Certificate executed by the
Trustee, and authenticated and delivered by the Authenticating Agent,
substantially in the form annexed hereto as Exhibit A, and evidencing the
ownership of the residual interest in the Upper Tier REMIC, the Class LT1-R
Interest, the Class LT2-R Interest, the Class LT3-R Interest and the Class LT4-R
Interest.

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

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

         Closing Date: June 26, 2003.

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

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

         Component Interest Rate: With respect to Component XB1 and any
Distribution Date, the interest rate specified in the definition of Component
XB1. With respect to Component XB2 and any Distribution Date, the interest rate
specified in the definition of Component XB2. With respect to Component XB3 and
any Distribution Date, the interest rate specified in the definition of
Component XB3. With respect to the Pool 1 Component and any Distribution Date,
the interest rate specified in the definition of Pool 1 Component. With respect
to the Pool 2 Component and any Distribution Date, the interest rate specified
in the definition of Pool 2 Component.

         Component Notional Amount: With respect to Component XB1 and any
Distribution Date, the notional amount specified in the definition of Component
XB1. With respect to Component XB2 and any Distribution Date, the notional
amount specified in the definition of Component XB2. With respect to Component
XB3 and any Distribution Date, the notional amount specified in the definition
of Component XB3. With respect to the Pool 1 Component and any Distribution
Date, the notional amount specified in the definition of Pool 1 Component. With
respect to the Pool 2 Component and any Distribution Date, the notional amount
specified in the definition of Pool 2 Component.

         Component XB1: A regular interest in the Upper Tier REMIC having a
notional amount equal to the Class Principal Amount of the Class B-1
Certificates immediately before the related

                                       34

<PAGE>

Distribution Date and having an interest rate with respect to any Distribution
Date (and the related Accrual Period) equal to the excess of the Subordinate Net
WAC over the Certificate Interest Rate on the Class B-1 Certificates.

         Component XB2: A regular interest in the Upper Tier REMIC having a
notional amount equal to the Class Principal Amount of the Class B-2
Certificates immediately before the related Distribution Date and having an
interest rate with respect to any Distribution Date (and the related Accrual
Period) equal to the excess of the Subordinate Net WAC over the Certificate
Interest Rate on the Class B-2 Certificates.

         Component XB3: A regular interest in the Upper Tier REMIC having a
notional amount equal to the Class Principal Amount of the Class B-3
Certificates immediately before the related Distribution Date and having an
interest rate with respect to any Distribution Date (and the related Accrual
Period) equal to the excess of the Subordinate Net WAC over the Certificate
Interest Rate on the Class B-3 Certificates.

         Components: Each of the Pool 1 Component, the Pool 2 Component,
Component XB1, Component XB2 and Component XB3.

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

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

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

         Cooperative Shares: Shares issued by a Cooperative Corporation.

         Corporate Trust Office: With respect to the presentment of Certificates
for registration of transfer, exchange or final payment, Wells Fargo Bank
Minnesota, National Association, 6th Street and Marquette Avenue, Minneapolis,
Minnesota 55479, Attention: Merrill Lynch Mortgage Investors Trust Series MLCC
2003-C and for all other purposes, Wells Fargo Bank Minnesota, National
Association, 9062 Old Annapolis Road, Columbia, Maryland 21045, or such other
address as the Trustee may designate from time to time by notice to the
Certificateholders.

         Corresponding Classes of Certificates or Components: With respect to
each Lower Tier REMIC Interest, the Class or Classes of Certificates or
Components appearing opposite such Lower Tier REMIC Interest as described in the
Preliminary Statement.

         Credit Support Depletion Date: The first Distribution Date, if any, on
which the aggregate Certificate Principal Amounts of the Subordinate
Certificates have been reduced to zero.

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<PAGE>

         Current Interest: With respect to each Class of Certificates and each
Component on each Distribution Date, the aggregate amount of interest accrued at
the applicable Certificate Interest Rate or Component Interest Rate during the
related Accrual Period on the Class Principal Amount or Component Notional
Amount of such Class or Component, or, in the case of the Notional Certificates,
the Notional Amount of the Component related to such Class.

         Custodial Accounts: Each custodial account (other than an Escrow
Account) established and maintained by the Servicer pursuant to the Servicing
Agreement.

         Custody Agreement: The Custodial Agreement, dated as of December 15,
2000, between Merrill Lynch Credit Corporation and Wells Fargo Bank Minnesota,
N.A., as custodian, as amended by Amendment No. 1, dated as of January 16, 2002
a copy of which (excluding all exhibits thereto) is attached hereto as Exhibit
O.

         Cut-off Date: June 1, 2003.

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

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

         Defective Mortgage Loan: The meaning specified in Section 2.04(a).

         Deficient Valuation: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an amount
less than the then outstanding indebtedness under the Mortgage Loan, or any
reduction in the amount of principal to be paid in connection with any Scheduled
Payment that results in a permanent forgiveness of principal, which valuation or
reduction results from an order of such court which is final and non-appealable
in a proceeding under the Bankruptcy Code.

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

         Deleted Mortgage Loan: As defined in Section 2.04(a).

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

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

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

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<PAGE>

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

         Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 4.01 in the name of the Trustee
for the benefit of the Certificateholders and designated "Wells Fargo Bank
Minnesota, National Association, in trust for registered holders of Merrill
Lynch Mortgage Investors Trust Series MLCC 2003-C, Mortgage Pass-Through
Certificates." Funds in the Distribution Account (exclusive of any earnings on
investments made with funds deposited in the Distribution Account) shall be held
in trust for the Trustee and the Certificateholders for the uses and purposes
set forth in this Agreement.

         Distribution Account Deposit Date: The 18th day of each calendar month
after the initial issuance of the Certificates or, if such 18th day is not a
Business Day, the immediately preceding Business Day, commencing in July 2003.

         Distribution Date: The 25th day of each month or, if such 25th day is
not a Business Day, the next succeeding Business Day, commencing in July 2003.

         Due Date: With respect to any Mortgage Loan, the date on which a
Scheduled Payment is due under the related Mortgage Note as indicated in the
Mortgage Note.

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

         Effective Loan-to-Value Ratio: A fraction, expressed as a percentage,
the numerator of which is the original Stated Principal Balance of the Mortgage
Loan, less the amount of Additional Collateral required to secure such Mortgage
Loan at the time of origination, if any, and the denominator of which is the
Appraised Value of the related Mortgage Property at such date.

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

                                       37

<PAGE>

Agency. Eligible Accounts may bear interest, and may include, if otherwise
qualified under this definition, accounts maintained with the Trustee, any
Paying Agent, or the Servicer.

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

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

         ERISA-Restricted Certificate: The Class A-R, Class B-4, Class B-5 or
Class B-6 Certificates.

         Escrow Account: As defined in the Servicing Agreement.

         Event of Default: The failure of the Servicer to perform any of its
obligations under the Servicing Agreement.

         Excess Loss: With respect to any Mortgage Loan, the amount of any (i)
Fraud Loss realized after the Fraud Loss Coverage Termination Date, (ii) Special
Hazard Loss realized after the Special Hazard Loss Coverage Termination Date or
(iii) Bankruptcy Loss realized after the Bankruptcy Loss Coverage Termination
Date.

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

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

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

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

         Fitch Ratings: Fitch, Inc., or any successor in interest.

         Fraud Loss Coverage Amount: As of the Closing Date, $20,099,052.46,
subject to reduction from time to time by the amount of any Fraud Losses
allocated to the Certificates. In addition, on each anniversary of the Cut-Off
Date, the Fraud Loss Coverage Amount shall be reduced as follows: (a) on the
first anniversary of the Cut-Off Date, to an amount equal to the lesser of (i)
2.00% of the then current Aggregate Stated Principal Balance and (ii) the excess
of the Fraud Loss Coverage Amount as of the Cut-Off Date over the cumulative
amount of Fraud Losses allocated to the Certificates since the Cut-Off Date; (b)
on the second, third and fourth anniversaries of the Cut-Off Date, to an amount
equal to the lesser of (i) 1.00% of the then current Aggregate Stated Principal
Balance and (ii) the excess of the Fraud Loss Coverage Amount as of the
immediately preceding anniversary of the Cut-Off Date, over the cumulative

                                       38

<PAGE>

amount of Fraud Losses allocated to the Certificates since such preceding
anniversary; and (c) on the fifth anniversary of the Cut-Off Date, to zero;
provided, however, that the Fraud Loss Coverage Amount may also be reduced
pursuant to a letter from each Rating Agency to the Trustee to the effect that
any such reduction shall not result in the downgrading of the then current
ratings assigned by such Rating Agency to the Classes of Senior Certificates.

         Fraud Loss Coverage Termination Date: The date on which the Fraud Loss
Coverage Amount is reduced to zero.

         Fraud Losses: Realized Losses on any Mortgage Loan sustained by reason
of a default arising from fraud, dishonesty or misrepresentation on the part of
the Mortgagor in connection with that Mortgage Loan, as reported by the Servicer
to the Trustee.

         Global Securities: The global certificates representing the Book-Entry
Certificates.

         Group 1: All of the Group 1 Certificates.

         Group 1 Certificate: Any Class A-1 or Class A-R Certificate.

         Group 2: All of the Group 2 Certificates.

         Group 2 Certificate: Any Class A-2 Certificate.

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

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

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

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

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<PAGE>

         Initial Bankruptcy Loss Coverage Amount: $100,000.

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

         Initial LIBOR Rate: 1.02750% with respect to the LIBOR Certificates.

         Initial Optional Purchase Date: The first Distribution Date following
the date on which the Aggregate Stated Principal Balance is less than 10.00% of
the Cut-off Date Balance.

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

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

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

         Interest Distribution Amount: For each Class of Certificates or
Component, on any Distribution Date, the Current Interest for such Class, as
reduced by such Class's share of Net Prepayment Interest Shortfalls, Relief Act
Reductions and the interest portion of Excess Losses. Any such shortfalls and
losses shall be allocated among (i) all Classes of Certificates (other than the
Interest Only Certificates) of the related Certificates Group from such Mortgage
Pool and (ii) the Pool 1 Component or the Pool 2 Component, as the case may be,
proportionately on the basis of (1) in the case of the Senior Certificates
(other than the Class X Certificates), Current Interest otherwise distributable
thereon on such Distribution Date; (2) in the case of the Pool 1 Component and
the Pool 2 Component, Current Interest otherwise distributable in respect
thereof on such Distribution Date and (3) in the case of Subordinate
Certificates, interest accrued at the Net WAC of the applicable Mortgage Pool on
their Apportioned Principal Balance before taking into account any reductions in
such amounts from Net Interest Shortfalls for that Distribution Date.

         Interest-Only Certificates: Any of the Class X-A-1, Class X-A-2 , Class
X-A-3 and Class X-B Certificates.

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

                                       40

<PAGE>

         Interest Transfer Amount: For any Distribution Date and for any
Undercollateralized Group, an amount equal to one month's interest on the
applicable Principal Transfer Amount at the weighted average Certificate
Interest Rate of the applicable Undercollateralized Group, plus any interest
accrued on such Undercollateralized Group remaining unpaid from prior
Distribution Dates.

         Intervening Assignments: The original intervening assignments of the
Mortgage, notices of transfer or equivalent instrument.

         Latest Possible Maturity Date: The Distribution Date in July 2028.

         LIBOR: With respect to the first Accrual Period, the Initial LIBOR
Rate. With respect to each subsequent Accrual Period, a per annum rate
determined on the LIBOR Determination Date in the following manner by the
Trustee on the basis of the "Interest Settlement Rate" set by the BBA for
one-month (or six-month with respect to the Class A-2 Certificates) United
States dollar deposits, as such rates appear on the Telerate Page 3750, as of
11:00 a.m. (London time) on such LIBOR Determination Date.

         (a)      If on such a LIBOR Determination Date, the BBA's Interest
Settlement Rate does not appear on the Telerate Page 3750 as of 11:00 a.m.
(London time), or if the Telerate Page 3750 is not available on such date, the
Trustee will obtain such rate from Reuters' "page LIBOR 01" or Bloomberg's page
"BBAM." If such rate is not published for such LIBOR Determination Date, LIBOR
for such date will be the most recently published Interest Settlement Rate. In
the event that the BBA no longer sets an Interest Settlement Rate, the Trustee
will designate an alternative index that has performed, or that the Trustee
expects to perform, in a manner substantially similar to the BBA's Interest
Settlement Rate. The Trustee will select a particular index as the alternative
index only if it receives an Opinion of Counsel, which opinion shall be an
expense reimbursed from the Distribution Account, that the selection of such
index will not cause any of the REMICs to lose their classification as REMICs
for federal income tax purposes.

         (b)      The establishment of LIBOR by the Trustee and the Trustee's
subsequent calculation of the Certificate Interest Rate applicable to the LIBOR
Certificates for the relevant Accrual Period, in the absence of manifest error,
will be final and binding.

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

         LIBOR Certificate: Any Class A-1, Class A-2, Class B-1, Class B-2 and
Class B-3 Certificate.

         LIBOR Determination Date: With respect to any LIBOR Certificates other
than the Class A-2 Certificates, the second LIBOR Business Day immediately
preceding the commencement of each Accrual Period and with respect to the Class
A-2 Certificates, the second LIBOR Business Day immediately preceding every
sixth Accrual Period beginning with the Accrual Period commencing during
December 2003.

         Limited Purpose Surety Bond: Any Limited Purpose Surety Bond listed in
Exhibit F.

                                       41

<PAGE>

         Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
Servicer has certified (in accordance with the Servicing Agreement) that it has
received all amounts it expects to receive in connection with the liquidation of
such Mortgage Loan including the final disposition of an REO Property.

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

         Loan-To-Value Ratio: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator of
which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator of which is the Appraised Value of the related
Mortgaged Property.

         Lower Tier REMIC Interests: Any of the REMIC 1 Interests, the REMIC 2
Interests, the REMIC 3 Interests or the REMIC 4 Interests.

         Lower Tier Regular Interests: Any of the REMIC 1 Regular Interests, the
REMIC 2 Regular Interests, the REMIC 3 Regular Interests or the REMIC 4 Regular
Interests.

         Margin: As to each Mortgage Loan, the percentage amount set forth on
the related Mortgage Note added to the Index in calculating the Mortgage Rate
thereon.

         Master Mortgage Loan Purchase Agreement: The Master Mortgage Loan
Purchase Agreement, dated as of April 1, 1998, between RWT Holdings, Inc. and
Merrill Lynch Credit Corporation, as amended to date and modified by the related
Acknowledgements, a copy of which is attached hereto as Exhibit E.

         Material Defect: As defined in Section 2.02(b).

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

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

         Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.02.

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

         Mortgage Documents: With respect to each Mortgage Loan, the mortgage
documents required to be delivered to the Trustee pursuant to the Trust
Agreement.

                                       42

<PAGE>

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

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

         Mortgage Loan Servicing Agreement: The Mortgage Loan Flow Purchase,
Sale and Servicing Agreement, dated as of August 1, 2002, between the Seller,
Cendant, Bishop's Gate Residential Mortgage Trust and Redwood Trust, Inc., as
amended to date and modified by the related Acknowledgements, a copy of which is
attached as Exhibit D.

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

         Mortgage Pools: Each of Pool 1 and Pool 2.

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

         Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase Agreement,
dated as of June 1, 2003, by and among the Seller, Sequoia Residential Trust,
Inc. and the Depositor with respect to the sale and purchase of the Mortgage
Loans.

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

         Mortgagor: The obligor on a Mortgage Note.

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

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

                                       43

<PAGE>

         Net Prepayment Interest Shortfall: With respect to any Mortgage Loan
and any Distribution Date, the amount by which any Prepayment Interest Shortfall
for such date exceeds the amount payable by the Servicer in respect of such
shortfall.

         Net WAC: As to any Distribution Date, the weighted average of the Net
Mortgage Rates of the Mortgage Loans as of the Due Date of the month preceding
the month of such Distribution Date, weighted on the basis of their outstanding
Stated Principal Balances (after giving effect to the Scheduled Payments due on
or before such Due Date and Principal Prepayments received prior to such Due
Date) at such time. When the term "Net WAC" is used herein with reference to
only the One-Month LIBOR Loans or only the Six-Month LIBOR Loans, such weighted
average shall be computed with reference solely to the Mortgage Loans in the
relevant group.

         Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
Certificate.

         Non-permitted Foreign Holder: As defined in Section 3.03(f).

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

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

         Notional Amount: With respect to any Notional Certificate and any
Distribution Date, such Certificate's Percentage Interest of the Class Notional
Amount of such Class of Certificates for such Distribution Date.

         Notional Certificate: None.

         Offering Document: The Prospectus.

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

         Officer's Certificate of the Servicer: A certificate (i) signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a Managing
Director, a Vice President (however denominated), an Assistant Vice President,
the Treasurer, the Secretary, or one of the Assistant Treasurers or Assistant
Secretaries of the Servicer, or (ii) if provided for herein, signed by a
Servicing Officer, as the case may be, and delivered to the Trustee.

                                       44

<PAGE>

         One-Month LIBOR Loan: Each Mortgage Loan bearing a Mortgage Rate that
adjusts in accordance with LIBOR for one-month U.S. dollar deposits.

         Opinion of Counsel: A written opinion of counsel, reasonably acceptable
in form and substance to the Trustee and who may be in-house or outside counsel
to the Depositor or the Trustee but which must be Independent outside counsel
with respect to any such opinion of counsel concerning the transfer of any
Residual Certificate or concerning certain matters with respect to ERISA, or the
taxation, or the federal income tax status, of each REMIC.

         Original Applicable Credit Support Percentage: With respect to each
Class of Subordinate Certificates, the corresponding percentage set forth
opposite its Class designation: Class B-1 - 3.10%; Class B-2 - 2.05%; Class B-3
- 1.25%; Class B-4 - 0.80%; Class B-5 - 0.55%; and Class B-6 - 0.35%.

         Original Subordinate Principal Amount: The aggregate of the initial
Class Principal Amounts of the Classes of Subordinated Certificates.

         Originator: Merrill Lynch Credit Corporation, a Delaware corporation.

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

         Parent Power(R)Guaranty and Security Agreement: With respect to any
Additional Collateral Loan, as defined in the Master Mortgage Loan Purchase
Agreement.

         Paying Agent: Any paying agent appointed by the Trustee pursuant to
Section 3.08.

         Percentage Interest: With respect to any Certificate, its percentage
interest in the undivided beneficial ownership interest in the Trust Fund
evidenced by all Certificates of the same Class as such Certificate. With
respect to any Certificate other than a Notional Certificate or the Class A-R
Certificate, the Percentage Interest evidenced thereby shall equal the initial
Certificate Principal Amount thereof divided by the initial Class Principal
Amount of all Certificates of the same Class. With respect to the Class A-R
Certificate, the Percentage Interest evidenced thereby shall be as specified on
the face thereof, or otherwise, be equal to 100%. With respect to any Notional
Certificate, the Percentage Interest evidenced thereby shall equal its initial
Notional Amount as set forth on the face thereof divided by the initial Class
Notional Amount of such Class.

         Permitted Investments: At any time, any one or more of the following
obligations and securities:

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

                  (ii)     general obligations of or obligations guaranteed by
         any state of the United States or the District of Columbia receiving
         the highest long-term debt rating of each Rating Agency, or such lower
         rating as shall not result in the downgrading or withdrawal

                                       45

<PAGE>

         of the ratings then assigned to the Certificates by the Rating
         Agencies, as evidenced by a signed writing delivered by each Rating
         Agency;

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

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

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

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

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

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

                                       46

<PAGE>

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

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

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

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

         Plan Asset Regulations: The U.S. Department of Labor regulations set
forth in 29 C.F.R. 2510.3-101.

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

         Pool 1 Adjusted Net WAC: For each Distribution Date, the interest rate
on the Class LT4A1 Interest.

         Pool 1 Companion IO REMIC Component: An uncertificated "interest-only"
regular interest in the Upper Tier REMIC that, on each Distribution Date, has a
notional principal amount equal to the Class Principal Amount of the Class A-1
Certificates immediately prior to such Distribution Date and bears interest at a
rate equal to the excess of the Pool 1 Adjusted Net WAC over the Certificate
Interest Rate on the Class A-1 Certificates on such Distribution Date. For
federal income tax purposes, the Class X-A-1 Certificates represent a 50%
interest in the Pool 1 Companion IO REMIC Component and the Class X-A-3
Certificates represent a 50% interest in the Pool 1 Companion IO REMIC
Component.

         Pool 1 Companion IO Subcomponent: An interest in the Pool 1 Component
that is entitled to all amounts payable in respect of the Pool 1 Component after
all payments of Pool 1 NAS IO Subcomponent Current Interest and Pool 1 NAS IO
Subcomponent Interest Shortfalls have been paid to the holders of the Class
X-A-1 and Class X-A-2 Certificates in respect of the Pool 1 NAS IO Subcomponent.
The Class X-A-1 Certificates represent a 50% interest in the

                                       47

<PAGE>

Pool 1 Companion IO Subcomponent and the Class X-A-3 Certificates represent a
50% interest in the Pool 1 Companion IO Subcomponent.

         Pool 1 Component: An interest-only Component with a notional principal
amount, as of each Distribution Date, equal to the Class Principal Amount of the
Class A-1 Certificates immediately prior to such Distribution Date and bearing
interest at a rate equal to the excess of the Pool 1 Net WAC over the
Certificate Interest Rate on the Class A-1 Certificates for such Distribution
Date. The Class X-A-1 Certificates represent a 50% interest in the Pool 1
Component. The Class X-A-2 Certificates and the Class X-A-3 Certificates
together represent a 50% interest in the Pool 1 Component.

         Pool 1 NAS IO REMIC Component: An uncertificated "interest-only"
regular interest in the Upper Tier REMIC that is entitled to 100% of the amounts
payable in respect of the REMIC 3 Pool 1 IO Interests. For federal income tax
purposes, the Class X-A-1 Certificates represent a 50% interest in the Pool 1
NAS IO REMIC Component and the Class X-A-2 Certificates represent a 50% interest
in the Pool 1 NAS IO REMIC Component.

         Pool 1 NAS IO Subcomponent: An interest in the Pool 1 Component that is
entitled, solely from amounts payable in respect of the Pool 1 Component, to
Pool 1 NAS IO Subcomponent Current Interest and Pool 1 NAS IO Subcomponent
Interest Shortfalls. The Class X-A-1 Certificates represent a 50% interest in
the Pool 1 NAS IO Subcomponent and the Class X-A-2 Certificates represent a 50%
interest in the Pool 1 NAS IO Subcomponent.

         Pool 1 NAS IO Subcomponent Current Interest: For each Distribution
Date, the accrual during the related accrual period on the Pool 1 NAS IO
Subcomponent Notional Principal Amount at a 1% interest rate.

         Pool 1 NAS IO Subcomponent Interest Shortfalls: The excess of (i) the
aggregate amounts of Pool 1 NAS IO Subcomponent Current Interest for each
preceding Distribution Date over (ii) the aggregate amounts paid in respect of
the Pool 1 NAS IO Subcomponent on preceding Distribition Dates.

         Pool 1 NAS IO Subcomponent Notional Principal Amount: For each
Distribution Date, the lesser of (i) the outstanding Class Principal Amount of
the Class A-1 Certificates immediately prior to such Distribution Date and (ii)
the amount specified below for such Distribution Date:

<TABLE>
<CAPTION>
                                       POOL 1 NAS IO
                                        SUBCOMPONENT
                                     NOTIONAL PRINCIPAL
DISTRIBUTION DATE                          AMOUNT
-------------------------------------------------------
<S>                                  <C>
July 25, 2003                         $773,795,000.00
August 25, 2003                       $745,636,000.00
September 25, 2003                    $718,471,000.00
October 25, 2003                      $692,263,000.00
November 25, 2003                     $666,980,000.00
December 25, 2003                     $642,588,000.00
January 25, 2004                      $619,056,000.00
February 25, 2004                     $596,354,000.00
</TABLE>

                                       48

<PAGE>

<TABLE>
<S>                                   <C>
March 25, 2004                        $574,453,000.00
April 25, 2004                        $553,323,000.00
May 25, 2004                          $532,939,000.00
June 25, 2004                         $513,274,000.00
July 25, 2004                         $494,302,000.00
August 25, 2004                       $475,999,000.00
September 25, 2004                    $458,341,000.00
October 25, 2004                      $441,307,000.00
November 25, 2004                     $424,872,000.00
December 25, 2004                     $409,018,000.00
January 25, 2005                      $393,722,000.00
February 25, 2005                     $378,966,000.00
March 25, 05                          $364,730,000.00
April 25, 2005                        $351,432,000.00
May 25, 2005                          $338,611,000.00
June 25, 2005                         $326,250,000.00
July 25, 2005                         $314,332,000.00
August 25, 2005                       $302,842,000.00
September 25, 2005                    $291,764,000.00
October 25, 2005                      $281,083,000.00
November 25, 2005                     $270,786,000.00
December 25, 2005                     $260,859,000.00
January 25, 2006                      $251,289,000.00
February 25, 2006                     $242,063,000.00
March 25, 2006                        $233,168,000.00
April 25, 2006                        $224,594,000.00
May 25, 2006                          $216,328,000.00
June 25, 2006                         $208,359,000.00
July 25, 2006                         $200,678,000.00
August 25, 2006                       $193,602,000.00
September 25, 2006                    $186,775,000.00
October 25, 2006                      $180,189,000.00
November 25, 2006                     $173,835,000.00
December 25, 2006                     $167,706,000.00
January 25, 2007                      $161,792,000.00
February 25, 2007                     $156,087,000.00
March 25, 2007                        $150,583,000.00
April 25, 2007                        $145,273,000.00
May 25, 2007                          $140,151,000.00
June 25, 2007                         $135,209,000.00
July 25, 2007 and thereafter          $          0.00
</TABLE>

         Pool 1 Mortgage Loans: Any Mortgage Loan in Pool 1.

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

                                       49

<PAGE>

         Pool 1 Subordinate Amount: For any Distribution Date, the excess of (a)
the Aggregate Stated Principal Balances of the Pool 1 Mortgage Loans and over
(b) the sum of the Class Principal Amounts of the Class A-1 and Class A-R
Certificates immediately before such Distribution Date.

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

         Pool 2 Adjusted Net WAC: For each Distribution Date, the interest rate
on the Class LT4A2 Interest.

         Pool 2 Companion IO REMIC Component: An uncertificated "interest-only"
regular interest in the Upper Tier REMIC that, on each Distribution Date, has a
notional principal amount equal to the Class Principal Amount of the Class A-2
Certificates immediately prior to such Distribution Date and bears interest at a
rate equal to the excess of the Pool 2 Adjusted Net WAC over the Certificate
Interest Rate on the Class A-2 Certificates on such Distribution Date. For
federal income tax purposes, the Class X-A-1 Certificates represent a 50%
interest in the Pool 2 Companion IO REMIC Component and the Class X-A-3
Certificates represent a 50% interest in the Pool 2 Companion IO REMIC
Component.

         Pool 2 Companion IO Subcomponent: An interest in the Pool 2 Component
that is entitled to all amounts payable in respect of the Pool 2 Component after
all payments of Pool 2 NAS IO Subcomponent Current Interest and Pool 2 NAS IO
Subcomponent Interest Shortfalls have been paid to the holders of the Class
X-A-1 and Class X-A-2 Certificates in respect of the Pool 2 NAS IO Subcomponent.
The Class X-A-1 Certificates represent a 50% interest in the Pool 2 Companion IO
Subcomponent and the Class X-A-3 Certificates represent a 50% interest in the
Pool 2 Companion IO Subcomponent.

         Pool 2 Component: An interest-only Component with a notional principal
amount, as of each Distribution Date, equal to the Class Principal Amount of the
Class A-2 Certificates immediately prior to such Distribution Date and bearing
interest at a rate equal to the excess of the Pool 2 Net WAC over the
Certificate Interest Rate on the Class A-2 Certificates for such Distribution
Date. The Class X-A-1 Certificates represent a 50% interest in the Pool 2
Component. The Class X-A-2 Certificates and the Class X-A-3 Certificates
together represent a 50% interest in the Pool 2 Component.

         Pool 2 NAS IO REMIC Component: An uncertificated "interest-only"
regular interest in the Upper Tier REMIC that is entitled to 100% of the amounts
payable in respect of the REMIC 3 Pool 2 IO Interests. For federal income tax
purposes, the Class X-A-1 Certificates represent a 50% interest in the Pool 2
NAS IO REMIC Component and the Class X-A-2 Certificates represent a 50% interest
in the Pool 2 NAS IO REMIC Component.

         Pool 2 NAS IO Subcomponent: An interest in the Pool 2 Component that is
entitled, solely from amounts payable in respect of the Pool 2 Component, to
Pool 2 NAS IO Subcomponent Current Interest and Pool 2 NAS IO Subcomponent
Interest Shortfalls. The Class X-A-1 Certificates represent a 50% interest in
the Pool 2 NAS IO Subcomponent and the Class X-A-2 Certificates represent a 50%
interest in the Pool 2 NAS IO Subcomponent.

                                       50

<PAGE>

         Pool 2 NAS IO Subcomponent Current Interest: For each Distribution
Date, the accrual during the related accrual period on the Pool 2 NAS IO
Subcomponent Notional Principal Amount at a 1% interest rate.

         Pool 2 NAS IO Subcomponent Interest Shortfalls: The excess of (i) the
aggregate amounts of Pool 2 NAS IO Subcomponent Current Interest for each
preceding Distribution Date over (ii) the aggregate amounts paid in respect of
the Pool 2 NAS IO Subcomponent on preceding Distribution Dates.

         Pool 2 NAS IO Subcomponent Notional Principal Amount: For each
Distribution Date, the lesser of (i) the outstanding Class Principal Amount of
the Class A-2 Certificates immediately prior to such Distribution Date and (ii)
the amount specified below for such Distribution Date:

<TABLE>
<CAPTION>
                                       POOL 2 NAS IO
                                        SUBCOMPONENT
                                     NOTIONAL PRINCIPAL
DISTRIBUTION DATE                          AMOUNT
-------------------------------------------------------
<S>                                  <C>
July 25, 2003                         $200,001,600.00
August 25, 2003                       $192,723,000.00
September 25, 2003                    $185,701,000.00
October 25, 2003                      $178,928,000.00
November 25, 2003                     $172,393,000.00
December 25, 2003                     $166,088,000.00
January 25, 2004                      $160,006,000.00
February 25, 2004                     $154,138,000.00
March 25, 2004                        $148,477,000.00
April 25, 2004                        $143,016,000.00
May 25, 2004                          $137,747,000.00
June 25, 2004                         $132,664,000.00
July 25, 2004                         $127,760,000.00
August 25, 2004                       $123,029,000.00
September 25, 2004                    $118,466,000.00
October 25, 2004                      $114,062,000.00
November 25, 2004                     $109,815,000.00
December 25, 2004                     $105,717,000.00
January 25, 2005                      $101,763,000.00
February 25, 2005                     $ 97,949,000.00
March 25, 05                          $ 94,270,000.00
April 25, 2005                        $ 90,833,000.00
May 25, 2005                          $ 87,519,000.00
June 25, 2005                         $ 84,324,000.00
July 25, 2005                         $ 81,243,000.00
August 25, 2005                       $ 78,273,000.00
September 25, 2005                    $ 75,410,000.00
October 25, 2005                      $ 72,649,000.00
November 25, 2005                     $ 69,988,000.00
December 25, 2005                     $ 67,422,000.00
January 25, 2006                      $ 64,948,000.00
February 25, 2006                     $ 62,564,000.00
March 25, 2006                        $ 60,265,000.00
</TABLE>

                                       51

<PAGE>

<TABLE>
<S>                                   <C>
April 25, 2006                        $ 58,048,000.00
May 25, 2006                          $ 55,912,000.00
June 25, 2006                         $ 53,852,000.00
July 25, 2006                         $ 51,867,000.00
August 25, 2006                       $ 50,038,000.00
September 25, 2006                    $ 48,273,000.00
October 25, 2006                      $ 46,571,000.00
November 25, 2006                     $ 44,929,000.00
December 25, 2006                     $ 43,344,000.00
January 25, 2007                      $ 41,816,000.00
February 25, 2007                     $ 40,341,000.00
March 25, 2007                        $ 38,919,000.00
April 25, 2007                        $ 37,546,000.00
May 25, 2007                          $ 36,222,000.00
June 25, 2007                         $ 34,945,000.00
July 25, 2007 and thereafter          $          0.00
</TABLE>

         Pool 2 Mortgage Loans: Any Mortgage Loan in Pool 2.

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

         Pool 2 Subordinate Amount: For any Distribution Date, the excess of (a)
the Aggregate Stated Principal Balance of the Pool 2 Mortgage Loans over (b) the
Class Principal Amount of the Class A-2 Certificates immediately before such
Distribution Date.

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

         Pool Subordinate Amount: Either of the Pool 1 Subordinate Amount or the
Pool 2 Subordinate Amount.

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

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

         Primary Mortgage Insurance Policy: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.

                                       52

<PAGE>

         Principal Distribution Amount: With respect to any Mortgage Pool and
any Distribution Date, the sum of (a) each Scheduled Payment of principal
collected or advanced on the related Mortgage Loans (before taking into account
any Deficient Valuations or Debt Service Reductions) and due during the related
Due Period, (b) that portion of the Purchase Price representing principal of any
Mortgage Loans in such Mortgage Pool purchased in accordance with Section 2.04
hereof and received during the related Prepayment Period, (c) the principal
portion of any related Substitution Amount received during the related
Prepayment Period, (d) the principal portion of all Insurance Proceeds received
during the related Prepayment Period with respect to Mortgage Loans in such
Mortgage Pool that are not yet Liquidated Mortgage Loans, (e) the principal
portion of all Net Liquidation Proceeds received during the related Prepayment
Period with respect to Liquidated Mortgage Loans in such Mortgage Pool, (f) the
principal portion of the proceeds of any Additional Collateral with respect to
the Mortgage Loans in such Mortgage Pool, (g) the principal portion of all
partial and full principal prepayments of Mortgage Loans in such Mortgage Pool
applied by the Servicer during the related Prepayment Period and (h) on the
Distribution Date on which the Trust Fund is to be terminated pursuant to
Article X hereof, that portion of the Redemption Price in respect of principal
for such Mortgage Pool.

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

         Principal Prepayment In Full: Any Principal Prepayment of the entire
principal balance of the Mortgage Loans.

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

         Pro Rata Senior Percentage: With respect to each Distribution Date and
each Mortgage Pool, the percentage equivalent of a fraction the numerator of
which is the aggregate Class Principal Amount of the Class or Classes of the
Related Certificate Group immediately prior to such Distribution Date and the
denominator of which is the Aggregate Stated Principal Balance of the related
Mortgage Pool for such Distribution Date.

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

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

         Prospectus: The prospectus supplement dated June 23, 2003, together
with the accompanying prospectus dated May 27, 2003, and the supplement to the
prospectus supplement, dated July 1, 2003, relating to the initial sale of the
Class A-1, Class A-2, Class A-R, Class X-A-1, Class X-B, Class B-1, Class B-2
and Class B-3 Certificates.

                                       53

<PAGE>

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

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

         Rating Agency:  Each of Moody's, S&P and Fitch Ratings.

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

         Record Date: As to any Distribution Date (i) with respect to the LIBOR
Certificates, the last Business Day preceding such Distribution Date (or the
Closing Date, in the case of the first Distribution Date) unless such
Certificates shall no longer be Book-Entry Certificates, in which case the
Record Date shall be the last Business Day of the month preceding the month of
such Distribution Date and (ii) in the case of all other Certificates (including
LIBOR Certificates that are subsequently reissued as Definitive Certificates),
the last Business Day of the month preceding the month of each Distribution
Date.

         Redemption Date: Any Distribution Date on which Certificates may be
redeemed.

         Redemption Price: With respect to any Class of Certificates to be
redeemed, an amount equal to 100% of the related Class Principal Amount of the
Certificates to be so redeemed, together with interest on such amount at the
applicable Certificate Interest Rate through the related Accrual Period (as
increased by any Interest Shortfalls but excluding any Unpaid Basis

                                       54

<PAGE>

Risk Shortfalls), and including, in the case of the Redemption Price payable in
connection with the redemption and retirement of all of the Certificates, the
payment of all amounts (including, without limitation, all previously
unreimbursed Advances and Servicing Advances and accrued and unpaid Servicing
Fees) payable or reimbursable to the Trustee.

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

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

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

         REMIC: Each pool of assets in the Trust Fund designated as a REMIC as
described in the Preliminary Statement.

         REMIC Components: Each of the Pool 1 NAS IO REMIC Component, the Pool 2
NAS IO REMIC Component, the Pool 1 Companion IO REMIC Component, the Pool 2
Companion IO REMIC Component, Component XB1, Component XB2 and Component XB3.

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

         REMIC 1: As described in the Preliminary Statement.

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

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

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

         REMIC 2: As described in the Preliminary Statement.

                                       55

<PAGE>

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

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

         REMIC 3: As described in the Preliminary Statement.

         REMIC 3 Interest: Each class of interest in REMIC 3 as described in the
Preliminary Statement.

         REMIC 3 IO Interests: Each class of interest in REMIC 3 that has the
letters "IO" in its class designation.

         REMIC 3 Pool 1 IO Interests: Each of the Class LT31IO11 Interest, Class
LT31IO12 Interest, Class LT31IO21 Interest, Class LT31IO22 Interest, Class
LT31IO31 Interest, Class LT31IO32 Interest, Class LT31IO41 Interest, Class
LT31IO42 Interest, Class LT31IO51 Interest, Class LT31IO52 Interest, Class
LT31IO61 Interest, Class LT31IO62 Interest, Class LT31IO71 Interest, Class
LT31IO72 Interest, Class LT31IO81 Interest, Class LT31IO82 Interest, Class
LT31IO91 Interest, Class LT31IO92 Interest, Class LT31IO101 Interest, Class
LT31IO102 Interest, Class LT31IO111 Interest, Class LT31IO112 Interest, Class
LT31IO121 Interest, Class LT31IO122 Interest, Class LT31IO131 Interest, Class
LT31IO132 Interest, Class LT31IO141 Interest, Class LT31IO142 Interest, Class
LT31IO151 Interest, Class LT31IO152 Interest, Class LT31IO161 Interest, Class
LT31IO162 Interest, Class LT31IO171 Interest, Class LT31IO172 Interest, Class
LT31IO181 Interest, Class LT31IO182 Interest, Class LT31IO191 Interest, Class
LT31IO192 Interest, Class LT31IO201 Interest, Class LT31IO202 Interest, Class
LT31IO211 Interest, Class LT31IO212 Interest, Class LT31IO221 Interest, Class
LT31IO222 Interest, Class LT31IO231 Interest, Class LT31IO232 Interest, Class
LT31IO241 Interest, Class LT31IO242 Interest, Class LT31IO251 Interest, Class
LT31IO252 Interest, Class LT31IO261 Interest, Class LT31IO262 Interest, Class
LT31IO271 Interest, Class LT31IO272 Interest, Class LT31IO281 Interest, Class
LT31IO282 Interest, Class LT31IO291 Interest, Class LT31IO292 Interest, Class
LT31IO301 Interest, Class LT31IO302 Interest, Class LT31IO311 Interest, Class
LT31IO312 Interest, Class LT31IO321 Interest, Class LT31IO322 Interest, Class
LT31IO331 Interest, Class LT31IO332 Interest, Class LT31IO341 Interest, Class
LT31IO342 Interest, Class LT31IO351 Interest, Class LT31IO352 Interest, Class
LT31IO361 Interest, Class LT31IO362 Interest, Class LT31IO371 Interest, Class
LT31IO372 Interest, Class LT31IO381 Interest, Class LT31IO382 Interest, Class
LT31IO391 Interest, Class LT31IO392 Interest, Class LT31IO401 Interest, Class
LT31IO402 Interest, Class LT31IO411 Interest, Class LT31IO412 Interest, Class
LT31IO421 Interest, Class LT31IO422 Interest, Class LT31IO431 Interest, Class
LT31IO432 Interest, Class LT31IO441 Interest, Class LT31IO442 Interest, Class
LT31IO451 Interest, Class LT31IO452 Interest, Class LT31IO461 Interest, Class
LT31IO462 Interest, Class LT31IO471 Interest, Class LT31IO472 Interest, Class
LT31IO481 Interest and Class LT31IO482 Interest.

         REMIC 3 Pool 2 IO Interests: Each of the Class LT32IO11 Interest, Class
LT32IO12 Interest, Class LT32IO21 Interest, Class LT32IO22 Interest, Class
LT32IO31 Interest, Class LT32IO32 Interest, Class LT32IO41 Interest, Class
LT32IO42 Interest, Class LT32IO51 Interest, Class LT32IO52 Interest, Class
LT32IO61 Interest, Class LT32IO62 Interest, Class

                                       56

<PAGE>

LT32IO71 Interest, Class LT32IO72 Interest, Class LT32IO81 Interest, Class
LT32IO82 Interest, Class LT32IO91 Interest, Class LT32IO92 Interest, Class
LT32IO101 Interest, Class LT32IO102 Interest, Class LT32IO111 Interest, Class
LT32IO112 Interest, Class LT32IO121 Interest, Class LT32IO122 Interest, Class
LT32IO131 Interest, Class LT32IO132 Interest, Class LT32IO141 Interest, Class
LT32IO142 Interest, Class LT32IO151 Interest, Class LT32IO152 Interest, Class
LT32IO161 Interest, Class LT32IO162 Interest, Class LT32IO171 Interest, Class
LT32IO172 Interest, Class LT32IO181 Interest, Class LT32IO182 Interest, Class
LT32IO191 Interest, Class LT32IO192 Interest, Class LT32IO201 Interest, Class
LT32IO202 Interest, Class LT32IO211 Interest, Class LT32IO212 Interest, Class
LT32IO221 Interest, Class LT32IO222 Interest, Class LT32IO231 Interest, Class
LT32IO232 Interest, Class LT32IO241 Interest, Class LT32IO242 Interest, Class
LT32IO251 Interest, Class LT32IO252 Interest, Class LT32IO261 Interest, Class
LT32IO262 Interest, Class LT32IO271 Interest, Class LT32IO272 Interest, Class
LT32IO281 Interest, Class LT32IO282 Interest, Class LT32IO291 Interest, Class
LT32IO292 Interest, Class LT32IO301 Interest, Class LT32IO302 Interest, Class
LT32IO311 Interest, Class LT32IO312 Interest, Class LT32IO321 Interest, Class
LT32IO322 Interest, Class LT32IO331 Interest, Class LT32IO332 Interest, Class
LT32IO341 Interest, Class LT32IO342 Interest, Class LT32IO351 Interest, Class
LT32IO352 Interest, Class LT32IO361 Interest, Class LT32IO362 Interest, Class
LT32IO371 Interest, Class LT32IO372 Interest, Class LT32IO381 Interest, Class
LT32IO382 Interest, Class LT32IO391 Interest, Class LT32IO392 Interest, Class
LT32IO401 Interest, Class LT32IO402 Interest, Class LT32IO411 Interest, Class
LT32IO412 Interest, Class LT32IO421 Interest, Class LT32IO422 Interest, Class
LT32IO431 Interest, Class LT32IO432 Interest, Class LT32IO441 Interest, Class
LT32IO442 Interest, Class LT32IO451 Interest, Class LT32IO452 Interest, Class
LT32IO461 Interest, Class LT32IO462 Interest, Class LT32IO471 Interest, Class
LT32IO472 Interest, Class LT32IO481 Interest and Class LT32IO482 Interest.

         REMIC 3 Regular Interest: Each of the REMIC 3 Interests other than the
Class LT3-R Interest.

         REMIC 4: As described in the Preliminary Statement.

         REMIC 4 Interest: Each class of interest in REMIC 4 as described in the
Preliminary Statement.

         REMIC 4 Regular Interest: Each of the REMIC 4 Interests other than the
Class LT4-R Interest.

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

         Replacement Mortgage Loan: A mortgage loan substituted by the Seller
for a Deleted Mortgage Loan which must, on the date of such substitution, as
confirmed in a Request for Release, substantially in the form attached to the
Trust Agreement, (i) have a Stated Principal Balance, after deduction of the
principal portion of the Scheduled Payment due in the month of substitution, not
in excess of, and not more than 10% less than, the Stated Principal Balance of
the Deleted Mortgage Loan; (ii) have a Maximum Rate not less than (and not more
than two percentage points greater than) the Maximum Rate of the Deleted
Mortgage Loan; (iii) have a

                                       57

<PAGE>

gross margin not less than that of the Deleted Mortgage Loan and, if Mortgage
Loans equal to 1% or more of the balance of the related Mortgage Pool as of the
Cut-off Date have become Deleted Mortgage Loans, not more than two percentage
points more than that of the Deleted Mortgage Loan; (iv) have an Effective
Loan-to-Value Ratio no higher than that of the Deleted Mortgage Loan; (v) have
Adjustment Dates that are no more or less frequent than the Deleted Mortgage
Loan; (vi) have a remaining term to maturity no greater than (and not more than
one year less than that of) the Deleted Mortgage Loan; (vii) not permit
conversion of the related Mortgage Rate to a permanent fixed Mortgage Rate;
(viii) not be a Cooperative Loan unless the Deleted Mortgage Loan was a
Cooperative Loan; (ix) have the same or better FICO credit score; (x) have an
initial interest adjustment date no earlier than five months before (and no
later than five months after) the initial adjustment date of the Deleted
Mortgage Loan, (xi) comply with each representation and warranty set forth in
Schedule B of this Agreement; and (xii) shall be accompanied by an Opinion of
Counsel that such Replacement Mortgage Loan would not adversely affect the REMIC
status of the Trust Estate or would not otherwise be prohibited by this
Indenture.

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

         Residual Certificate: The Class A-R Certificate.

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

         Restricted Certificate: Any Class B-4, Class B-5 or Class B-6
Certificate.

         Restricted Global Security: As defined in Section 3.01(c).

         S&P: Standard & Poor's Rating Services, A Division of The McGraw-Hill
Companies, Inc., or any successor in interest.

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

         Schedule of Exceptions: As defined in Section 2.02(a) of the Trust
Agreement.

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

         Seller: RWT Holdings, Inc., a Delaware corporation.

                                       58

<PAGE>

         Senior Certificate: Any one of the Class A-1, Class A-2, Class X-A-1,
Class X-A-2, Class X-A-3, Class X-B or Class A-R Certificates.

         Senior Percentage: Except as provided in this definition, for each
Mortgage Pool with respect to any Distribution Date before July 2013, 100%. The
Senior Percentage for each Mortgage Pool for any Distribution Date occurring (i)
before the Distribution Date in July 2013 but in or after July 2006 on which the
Two Times Test is satisfied, or (ii) in or after July 2013, is the related Pro
Rata Senior Percentage. If the Two Times Test is satisfied with respect to any
Distribution Date prior to the Distribution Date in July 2006, the Senior
Percentage for such Mortgage Pool is the Pro Rata Senior Percentage plus 50% of
an amount equal to 100% minus the related Pro Rata Senior Percentage. With
respect to any Distribution Date after the Senior Termination Date, the Senior
Percentage for such Mortgage Pool will equal zero. If on any Distribution Date
the allocation to the Senior Certificates of the related Certificate Group then
entitled to distributions of principal of full and partial principal prepayments
and other amounts in the percentage required above would reduce the sum of the
Class Principal Amounts of those Certificates to below zero, the Senior
Percentage for such Distribution Date shall be limited to the percentage
necessary to reduce such Class Principal Amounts to zero.

         Senior Prepayment Percentage: With respect to any Distribution Date,
during the ten years beginning on the first Distribution Date, 100%. Except as
provided herein, the related Senior Prepayment Percentage for each Mortgage Pool
and any Distribution Date occurring on or after the tenth anniversary of the
first Distribution Date shall be as follows: (i) from July 2013 through June
2014, the Senior Percentage plus 70% of the Subordinate Percentage for that
Distribution Date; (ii) from July 2014 through June 2015, the Senior Percentage
plus 60% of the Subordinate Percentage for that Distribution Date; (iii) from
July 2015 through June 2016, the Senior Percentage plus 40% of the Subordinate
Percentage for that Distribution Date; (iv) from July 2016 through June 2017,
the related Senior Percentage plus 20% of the Subordinate Percentage for that
Distribution Date; and (v) from and after July 2017, the Senior Percentage for
that Distribution Date; provided, however, that there shall be no reduction in
the Senior Prepayment Percentage for a Mortgage Pool unless both Step Down
Conditions are satisfied; and provided, further, that if on any such
Distribution Date the Pro Rata Senior Percentage exceeds the initial Pro Rata
Senior Percentage, the Senior Prepayment Percentage for a Mortgage Pool for that
Distribution Date shall again equal 100%.

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

                                       59

<PAGE>

         Senior Principal Distribution Amount: With respect to any Mortgage Pool
and Distribution Date, the sum of:

                  (1)      the related Senior Percentage of all amounts
         described in clauses (a) through (d) of the definition of "Principal
         Distribution Amount" for that Distribution Date;

                  (2)      with respect to each Mortgage Loan in the related
         Mortgage Pool which became a Liquidated Mortgage Loan during the
         related Prepayment Period, the lesser of

                           (x)      the related Senior Percentage of the Stated
                  Principal Balance of that Mortgage Loan and

                           (y)      the related Senior Prepayment Percentage of
                  the amount of the Net Liquidation Proceeds allocable to
                  principal received with respect to that Mortgage Loan; and

                  (3)      the related Senior Prepayment Percentage of the
         amounts described in clause (g) of the definition of "Principal
         Distribution Amount";

provided, however, that if a Bankruptcy Loss that is an Excess Loss is sustained
with respect to any Mortgage Loan in the related Mortgage Pool that is not a
Liquidated Mortgage Loan, such Senior Principal Distribution Amount shall be
reduced on such Distribution Date by the related Senior Percentage of the
principal portion of such Bankruptcy Loss.

         Senior Termination Date: For each Certificate Group, the Distribution
Date when the aggregate of the Class Certificate Principal Balances of that
Group has been reduced to zero.

         Servicer: Cendant and its successors and assigns.

         Servicer Advance: A "Servicing Advance" as defined in the Servicing
Agreement.

         Servicing Agreement: Collectively, the Mortgage Loan Servicing
Agreement and the Additional Collateral Servicing Agreement.

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

         Servicing Fee Rate: With respect to each Mortgage Loan and any
Distribution Date, 0.25% per annum.

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

         Servicing Transfer Costs: As defined in Section 6.14(b).

                                       60

<PAGE>

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

         Special Hazard Loss: Any Realized Loss suffered by a Mortgaged Property
on account of direct physical loss, as reported by the Servicer to the Trustee,
but not including (i) any loss of a type covered by a hazard insurance policy or
a flood insurance policy required to be maintained with respect to such
Mortgaged Property to the extent of the amount of such loss covered thereby, or
(ii) any loss caused by or resulting from:

         (a)      normal wear and tear;

         (b)      fraud, conversion or other dishonest act on the part of the
                  Trustee, the Servicer or any of their agents or employees
                  (without regard to any portion of the loss not covered by any
                  errors and omissions policy);

         (c)      errors in design, faulty workmanship or faulty materials,
                  unless the collapse of the property or a part thereof ensues
                  and then only for the ensuing loss;

         (d)      nuclear or chemical reaction or nuclear radiation or
                  radioactive or chemical contamination, all whether controlled
                  or uncontrolled, and whether such loss be direct or indirect,
                  proximate or remote or be in whole or in part caused by,
                  contributed to or aggravated by a peril covered by the
                  definition of the term "Special Hazard Loss";

         (e)      hostile or warlike action in time of peace and war, including
                  action in hindering, combating or defending against an actual,
                  impending or expected attack:

                  1.       by any government or sovereign power, de jure or de
                           facto, or by any authority maintaining or using
                           military, naval or air forces; or

                  2.       by military, naval or air forces; or

                  3.       by an agent of any such government, power, authority
                           or forces;

         (f)      any weapon of war employing nuclear fission, fusion or other
                  radioactive force, whether in time of peace or war;

         (g)      insurrection, rebellion, revolution, civil war, usurped power
                  or action taken by governmental authority in hindering,
                  combating or defending against such an occurrence, seizure or
                  destruction under quarantine or customs regulations,
                  confiscation by order of any government or public authority or
                  risks of contraband or illegal transportation or trade; or

         (h)      acts of terrorism.

         Special Hazard Loss Coverage Amount: With respect to the first
Distribution Date, $10,900,000. With respect to any Distribution Date after the
first Distribution Date, the lesser of (a) the greatest of (i) 1.00% of the
Aggregate Stated Principal Balance, (ii) twice the Stated

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Principal Balance of the largest Mortgage Loan and (iii) the aggregate of the
Stated Principal Balances of the Mortgage Loans secured by Mortgaged Properties
located in the single five-digit ZIP code area in the State of California having
the highest aggregate Stated Principal Balance of any such ZIP code area and (b)
the Special Hazard Loss Coverage Amount as of the Closing Date less the amount,
if any, of Special Hazard Losses allocated to the Certificates since the Closing
Date; provided, however, that the Special Hazard Loss Coverage Amount may also
be reduced pursuant to a letter from each Rating Agency to the Trustee to the
effect that any such reduction shall not result in the downgrading of the then
current ratings assigned by such Rating Agency to the Classes of Senior
Certificates. All Stated Principal Balances for the purpose of the definition
will be calculated as of the first day of the calendar month preceding the month
of such Distribution Date after giving effect to Scheduled Payments on the
Mortgage Loans then due, whether paid or not.

         Special Hazard Loss Coverage Termination Date: The date on which the
Special Hazard Loss Coverage Amount is reduced to zero.

         Startup Day: The day designated as such pursuant to Section 10.01(b)
hereof.

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

         Step Down Conditions: As of the first Distribution Date as to which any
decrease in any Senior Prepayment Percentage applies, (i) the outstanding Stated
Principal Balance of all Mortgage Loans 60 days or more Delinquent (including
Mortgage Loans in REO and foreclosure) (averaged over the preceding six month
period), as a percentage of the aggregate of the Class Principal Amounts of the
Classes of Subordinate Certificates on such Distribution Date, does not equal or
exceed 50% and (ii) cumulative Realized Losses with respect to the Mortgage
Loans do not exceed (a) with respect to each Distribution Date from July 2013
through June 2014, 30% of the Original Subordinate Principal Amount, (b) with
respect to each Distribution Date from July 2014 through June 2015, 35% of the
Original Subordinate Principal Amount, (c) with respect to each Distribution
Date from July 2015 through June 2016, 40% of the Original Subordinate Principal
Amount, (d) with respect to each Distribution Date from July 2016 through June
2017, 45% of the Original Subordinate Principal Amount and (e) with respect to
each Distribution Date from and after July 2017, 50% of the Original Subordinate
Principal Amount.

         Subordinate Certificate: Any of the Class B-1, Class B-2, Class B-3,
Class B-4, Class B-5 or Class B-6 Certificates.

         Subordinate Certificate Writedown Amount: The amount described in
Section 5.03(b)(iii).

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         Subordinate Class Percentage: As to any Distribution Date and any Class
of Subordinate Certificates, a fraction, expressed as a percentage, the
numerator of which is the Class Principal Amount of such Class on such date, and
the denominator of which is the aggregate Class Principal Amount of all Classes
of Subordinate Certificates on such date.

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

         Subordinate Percentage: With respect to each Mortgage Pool and any
Distribution Date, the difference between 100% and the related Senior Percentage
for such Mortgage Pool for such Distribution Date.

         Subordinate Prepayment Percentage: With respect to any Distribution
Date and for any Mortgage Pool, the difference between 100% and the related
Senior Prepayment Percentage for such Mortgage Pool for that Distribution Date.

         Subordinate Principal Distribution Amount: With respect to any
Distribution Date and each Mortgage Pool, an amount equal to the sum of:

                           (1)      the related Subordinate Percentage of all
                  amounts described in clauses (a) through (d) of the definition
                  of "Principal Distribution Amount" for that Distribution Date;

                           (2)      with respect to each Mortgage Loan in the
                  related Mortgage Pool that became a Liquidated Mortgage Loan
                  during the related Prepayment Period the amount of the Net
                  Liquidation Proceeds allocated to principal received with
                  respect thereto remaining after application thereof pursuant
                  to clause (2) of the definition of "Senior Principal
                  Distribution Amount" for that Distribution Date, up to the
                  Subordinate Percentage of the Stated Principal Balance of such
                  Mortgage Loan; and

                           (3)      the related Subordinate Prepayment
                  Percentage of all amounts described in clause (g) of the
                  definition of "Principal Distribution Amount" for that
                  Mortgage Pool and that Distribution Date;

                           minus the sum of:

                           any Principal Transfer Amount paid from the Available
                  Distribution Amount of the Related Certificate Group to an
                  Undercollateralized Group; and

                           the amount of principal distributions made to the
                  Senior Certificates pursuant to Section 5.02(h);

provided, however, that if a Bankruptcy Loss that is an Excess Loss is sustained
with respect to any Mortgage Loan that is not a Liquidated Mortgage Loan
Payment, such related Subordinate

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Principal Distribution Amount shall be reduced on such Distribution Date by the
related Subordinate Percentage of the principal portion of such Bankruptcy Loss.

         Substitution Amount: As defined in the second paragraph of Section
2.04(b).

         Tax Matters Person: The "tax matters person" as specified in the REMIC
Provisions which shall initially be the Holder of the Class A-R Certificate.

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

         Terminator:  As defined in Section 7.01(b) hereof.

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

         Trustee: Wells Fargo Bank Minnesota, National Association and any
Person succeeding the Trustee hereunder, or if any successor trustee or any
co-trustee shall be appointed as herein provided, then such successor trustee
and such co-trustee, as the case may be.

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

         Two Times Test: As to any Distribution Date, (i) the Aggregate
Subordinate Percentage is at least two times the Aggregate Subordinate
Percentage as of the Closing Date; (ii) the aggregate of the Stated Principal
Balances of all Mortgage Loans Delinquent 60 days or more (including Mortgage
Loans in REO and foreclosure) (averaged over the preceding six-month period), as
a percentage of the aggregate of the Class Principal Amount of the Subordinate
Certificates on such Distribution Date, does not equal or exceed 50%; and (iii)
cumulative

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Realized Losses with respect to the Mortgage Loans do not exceed 20% of the
Original Subordinate Principal Amount.

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

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

         Underwriters: Merrill Lynch, Pierce, Fenner & Smith Incorporated, Bear,
Stearns & Co. and Greenwich Capital Markets Inc.

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

         Underwriting Agreement: The underwriting agreement, dated February 28,
2003 and the terms agreement, dated June 20, 2003, each between the Depositor
and the Underwriters, referred to collectively.

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

         Unpaid Basis Risk Shortfall: With respect to any Distribution Date and
any Class of LIBOR Certificates, the aggregate of all Basis Risk Shortfalls with
respect to such Certificate remaining unpaid from previous Distribution Dates,
plus interest accrued thereon at the applicable Certificate Interest Rate
determined without regard to clause (ii) of the definition therefor to the
extent not paid on prior Distribution Dates.

         Upper Tier REMIC: As described in the Preliminary Statement.

         Upper Tier REMIC Class A-1 Interest: An uncertificated interest in the
Upper Tier REMIC having the same characteristics as the Class A-1 Certificates,
but without the right to receive payments in respect of Basis Risk Shortfalls
and Unpaid Basis Risk Shortfalls and with an interest rate cap equal to the Pool
1 Adjusted Net WAC.

         Upper Tier REMIC Class A-2 Interest: An uncertificated interest in the
Upper Tier REMIC having the same characteristics as the Class A-2 Certificates,
but without the right to receive payments in respect of Basis Risk Shortfalls
and Unpaid Basis Risk Shortfalls and with an interest rate cap equal to the Pool
2 Adjusted Net WAC.

         Upper Tier REMIC Class B-1 Interest: An uncertificated interest in the
Upper Tier REMIC having the same characteristics as the Class B-1 Certificates,
but without the right to receive payments in respect of Basis Risk Shortfalls
and Unpaid Basis Risk Shortfalls.

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<PAGE>

         Upper Tier REMIC Class B-2 Interest: An uncertificated interest in the
Upper Tier REMIC having the same characteristics as the Class B-2 Certificates,
but without the right to receive payments in respect of Basis Risk Shortfalls
and Unpaid Basis Risk Shortfalls.

         Upper Tier REMIC Class B-3 Interest: An uncertificated interest in the
Upper Tier REMIC having the same characteristics as the Class B-3 Certificates,
but without the right to receive payments in respect of Basis Risk Shortfalls
and Unpaid Basis Risk Shortfalls.

         Upper Tier REMIC Regular Interest: Each of the REMIC Components, the
Upper Tier REMIC Class A-1 Interest, the Upper Tier REMIC Class A-2 Interest,
the Upper-Tier REMIC Class B-1 Interest, the Upper-Tier Class B-2 Interest, the
Upper Tier REMIC Class B-3 Interest, the Class B-4 Certificates, the Class B-5
Certificates and the Class B-6 Certificates.

         Voting Interests: The portion of the voting rights of all the
Certificates that is allocated to any Certificate for purposes of the voting
provisions of this Agreement. At all times during the term of this Agreement,
98.00% of all Voting Interests shall be allocated to the Class A-1, Class A-2,
Class A-R, Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class B-6
Certificates. Voting Interests shall be allocated among such Certificates (other
than the Class A-R Certificates) based on the product of (i) 98.00% and (ii) the
fraction, expressed as a percentage, the numerator of which is the aggregate
Class Principal Amounts for each Class then outstanding and the denominator of
which is the Aggregate Stated Principal Balance outstanding, and the remainder
of such percentage of Voting Interests shall be allocated to the Class A-R
Certificates. At all times during the term of this Agreement, 2.00% of all
Voting Interests shall be allocated among the Class X-A-1, Class X-A-2, Class
X-A-3 and Class X-B Certificates, while they remain outstanding, in proportion
to their relative Class Notional Amounts. Voting Interests shall be allocated
among the Certificates within each such Class in proportion to their Certificate
Principal Amounts or Percentage Interests.

         Section 1.02      Calculations Respecting Mortgage Loans.

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

                                   ARTICLE II

                              DECLARATION OF TRUST;
                            ISSUANCE OF CERTIFICATES

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

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

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

         The foregoing sale, transfer, assignment, set-over, deposit and
conveyance does not and is not intended to result in the creation or assumption
by the Trustee of any obligation of the Depositor, the Originator, the Seller or
any other Person in connection with the Mortgage Loans or any other agreement or
instrument relating thereto except as specifically set forth therein.

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

         (b)      The Depositor shall cause the Mortgage Notes with respect to
each Mortgage Loan to be completed either (A) in blank, without recourse, or (B)
endorsed to "Wells Fargo Bank Minnesota, National Association, as Trustee of the
Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C, Mortgage Pass-Through
Certificates, without recourse" and the Depositor shall cause Assignments of
Mortgage with respect to each Mortgage Loan other than a Cooperative Mortgage
Loan to be completed either (A) in blank or (B) to "Wells Fargo Bank Minnesota,
National Association, as Trustee of the Merrill Lynch Mortgage Investors Trust
Series MLCC 2003-C, Mortgage Pass-Through Certificates," within 30 days of the
Closing Date

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<PAGE>

for purpose of their recording; provided, however, that such Assignments of
Mortgage need not be recorded unless required in writing by the Rating Agencies.

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

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

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

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

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

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

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

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

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

         Section 2.03      Representations and Warranties of the Depositor.

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

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

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<PAGE>

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

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

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

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

                  (vi)     immediately prior to the transfer and assignment of
         the Mortgage Loans to the Trustee, the Depositor was the sole owner of
         record and holder of each Mortgage Loan, and the Depositor had good and
         marketable title thereto, and had full right to transfer and sell each
         Mortgage Loan to the Trustee free and clear, subject only to (1) liens
         of current real property taxes and assessments not yet due and payable
         and, if the related Mortgaged Property is a condominium unit, any lien
         for common charges permitted by statute, (2) covenants, conditions and
         restrictions, rights of way, easements and other matters of public
         record as of the date of recording of such Mortgage acceptable to
         mortgage lending institutions in the area in which the related
         Mortgaged Property is located and specifically referred to in the
         lender's title insurance policy or attorney's opinion of title and
         abstract of title delivered to the originator of such Mortgage Loan,
         and (3) such other matters to which like properties are commonly
         subject which do not, individually or in the aggregate, materially
         interfere with the benefits of the security intended to be provided by
         the Mortgage, of any encumbrance, equity, participation interest, lien,
         pledge, charge, claim or security interest, and had full right

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<PAGE>

         and authority, subject to no interest or participation of, or agreement
         with, any other party, to sell and assign each Mortgage Loan pursuant
         to this Agreement;

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

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

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

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

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

                  (xii)    Each Mortgage Loan is a "qualified mortgage" within
         the meaning of Section 860G(a)(3) of the Code (without regard to
         Treasury Regulations Section 1.860G-2(f)) or any similar rule that
         provides that a defective obligation is a qualified mortgage for a
         temporary period;

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

                  (xiv)    No Mortgage is the subject of pending or final
         foreclosure proceedings; and

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

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

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

         (a)      Pursuant to Sections 5(a) and 5(b) of the Master Mortgage Loan
Purchase Agreement, the Originator has made certain representations and
warranties as to the characteristics of the Mortgage Loans (such representations
and warranties are set out in full in Schedule B of this Agreement) as of the
Closing Date and the conveyance thereof from the Originator to the Seller and
then to the Depositor, for the benefit of the Trustee and the
Certificateholders, and the Originator has agreed to comply with the provisions
of this Section 2.04 in respect of a breach of any of such representations and
warranties.

         It is understood and agreed that (i) the representations and warranties
of the Depositor set forth in Section 2.03 and (ii) the representations and
warranties of the Originator set forth in Sections 5(a) and 5(b) of the Master
Mortgage Loan Purchase Agreement shall survive delivery of the Trustee Mortgage
Files and the Assignment of Mortgage of each Mortgage Loan to the Trustee and
shall continue throughout the term of this Agreement. Upon discovery (i) by the
Depositor, the Seller, the Originator or the Trustee of a breach of any
representation or warranty made by Depositor under Section 2.03 which materially
adversely affects the value of a Mortgage Loan or the interest therein of the
Certificateholder (a "Defective Mortgage Loan") or (ii) by the Depositor, the
Originator or the Seller of the breach by the Originator of any representation
or warranty under the Master Mortgage Loan Purchase Agreement in respect of any
Mortgage Loan, which breach results in the Mortgage Loan being a "Defective
Mortgage Loan" (each of such parties hereby agreeing to give written notice of
such breach to the Trustee and the other of such parties), the Trustee, or its
designee, shall promptly notify the Depositor in writing of such breach and
request that the Depositor cure or cause the cure of such breach within 90 days
from the date that the Depositor discovered or was notified of such breach, and
if the Depositor does not cure such breach in all material respects during such
period, the Trustee shall (i) in the case of an uncured breach under Section
2.03, cause the Depositor to repurchase such Defective Mortgage Loan at the
Purchase Price and (ii) in the case of an uncured breach by the Originator under
the Master Mortgage Loan Purchase Agreement, cause the Depositor to enforce the
Originator's obligation under the Master Mortgage Loan Purchase Agreement and
cause the Originator to repurchase that Defective Mortgage Loan from the Trust
Fund at the Purchase Price, in each case on or prior to the Determination Date
following the expiration of such 90-day period (subject to Section 2.04(b)
below); provided, however, that, in connection with any such breach under clause
(ii) above that could not reasonably have been cured within such 90-day period,
if the Originator shall have commenced to cure such breach within such 90-day
period, the Originator shall be permitted to proceed thereafter diligently and
expeditiously to cure the same within an additional 90-day period. The Purchase
Price for the repurchased Defective Mortgage Loan shall be deposited in the
related Distribution Account, and the Trustee, or its designee, upon receipt of
such deposit and two copies of a Request for Release with respect to such
Defective Mortgage Loan, shall release to the Originator, the related Trustee
Mortgage File and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, representation or warranties, as
either party shall furnish to it and as shall be necessary to vest in such party
any Defective Mortgage Loan released pursuant hereto and the Trustee, or its
designee, shall have no further responsibility with regard to such Trustee
Mortgage File (it being understood that the Trustee shall have no responsibility
for determining the sufficiency of such assignment for its intended purpose). In
lieu of repurchasing any such Defective Mortgage Loan as provided above, the
Originator may cause such Defective Mortgage

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Loan to be removed from the Trust Fund (in which case it shall become a Deleted
Mortgage Loan) and substitute one or more Replacement Mortgage Loans in the
manner and subject to the limitations set forth in Section 2.04(b) below. It is
understood and agreed that the obligation of the Originator to cure or to
repurchase (or to substitute for) any Mortgage Loan as to which a breach has
occurred and is continuing shall constitute the sole remedy against the
Originator respecting such breach available to the Trustee on behalf of the
Certificateholders. With respect to the representations and warranties described
in Schedule B which are made to the best of the Originator's knowledge, if it is
discovered by any of the Depositor, the Originator or the Trustee that the
substance of such representation and warranty is inaccurate and such inaccuracy
materially and adversely affects the value of the relate Mortgage Loan, then
notwithstanding the Originator's lack of knowledge with respect to the substance
of such representation and warranty, such inaccuracy shall be deemed a breach of
the applicable representation or warranty.

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

         For any month in which the Originator substitutes one or more
Replacement Mortgage Loans for one or more Deleted Mortgage Loans, the Trustee,
based upon information provided by the Servicer, shall determine the excess
(each, a "Substitution Amount"), if any, by which the aggregate Purchase Price
of all such Deleted Mortgage Loans exceeds the aggregate Stated Principal
Balance of the Replacement Mortgage Loans replacing such Deleted Mortgage Loans,
together with one month's interest on such excess amount at the applicable Net
Mortgage Rate. On the date of such substitution, the Originator shall deliver or
cause to be delivered to the

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Servicer for deposit in the Custodial Account an amount equal to the related
Substitution Amount, if any, and the Trustee, upon receipt of the related
Replacement Mortgage Loan or Loans and two copies of a Request for Release with
respect to the Deleted Mortgage Loan or Loans, shall release to the Originator
the related Trustee Mortgage File or Files and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
Originator shall deliver to it and as shall be necessary to vest therein any
Deleted Mortgage Loan released pursuant hereto.

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

         (c)      Upon discovery by the Originator, the Seller, the Depositor or
the Trustee that any Mortgage Loan does not constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the party discovering such
fact shall within two Business Days give written notice thereof to the other
parties. In connection therewith, the Originator or Depositor, as applicable,
shall repurchase or, subject to the limitations set forth in Section 2.04(b),
substitute one or more Replacement Mortgage Loans for the affected Mortgage Loan
within 90 days of the earlier of discovery or receipt of such notice with
respect to such affected Mortgage Loan. Any such repurchase or substitution
shall be made in the same manner as set forth in Section 2.04(a) above, if made
by the Originator. The Trustee shall re-convey to the Originator the Mortgage
Loan to be released pursuant hereto in the same manner, and on the same terms
and conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.

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

         Section 2.05      Grant Clause.

         (a)      It is intended that the conveyance of the Depositor's right,
title and interest in and to property constituting the Trust Fund pursuant to
this Agreement shall constitute, and shall be construed as, a sale of such
property and not a grant of a security interest to secure a loan. However, if
such conveyance is deemed to be in respect of a loan, it is intended that: (1)
the

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rights and obligations of the parties shall be established pursuant to the terms
of this Agreement; (2) the Depositor hereby grants to the Trustee for the
benefit of the Holders of the Certificates a first priority security interest in
all of the Depositor's right, title and interest in, to and under, whether now
owned or hereafter acquired, the Trust Fund and all proceeds of any and all
property constituting the Trust Fund to secure payment of the Certificates; and
(3) this Agreement shall constitute a security agreement under applicable law.
If such conveyance is deemed to be in respect of a loan and the trust created by
this Agreement terminates prior to the satisfaction of the claims of any Person
holding any Certificate, the security interest created hereby shall continue in
full force and effect and the Trustee shall be deemed to be the collateral agent
for the benefit of such Person, and all proceeds shall be distributed as herein
provided.

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

         Section 2.06 Representation and Warranty of the Seller. The Seller
hereby represents and warrants to the Trustee, for the benefit of the
Certificateholders as of the Closing Date that:

                  (i)      it purchased the Mortgage Loans from the Originator
         pursuant to the Master Mortgage Loan Purchase Agreement and it is the
         owner, as of the Closing Date, of all right, title and interest in and
         to the Mortgage Loans; and

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                  (ii)     on the Closing Date, it has sold the Mortgage Loans
         and has assigned its rights under the Master Mortgage Loan Purchase
         Agreement to Sequoia Residential Funding Inc.

                                   ARTICLE III

                                THE CERTIFICATES

         Section 3.01      The Certificates.

         (a)      The Certificates shall be issuable in registered form only and
shall be securities governed by Article 8 of the New York Uniform Commercial
Code. The Book-Entry Certificates will be evidenced by one or more certificates,
beneficial ownership of which will be held in the dollar denominations in
Certificate Principal Amount, or Notional Amount, as applicable, or in the
Percentage Interests, specified herein. Each Class of Book-Entry Certificates
will be issued in the minimum denominations in Certificate Principal Amount (or
Notional Amount) specified in the Preliminary Statement hereto and in integral
multiples of $1 in excess thereof. Each Class of Non-Book-Entry Certificates
other than the Residual Certificates shall be issued in definitive, fully
registered form in the minimum denominations in Certificate Principal Amount
specified in the Preliminary Statement hereto and in integral multiples of $1 in
excess thereof. The Residual Certificates shall be issued as single Certificates
and maintained in definitive, fully registered form in a denomination equal to
100% of the Percentage Interest of each such Class. The Class X-A-1, Class
X-A-2, Class X-A-3, and Class X-B Certificates shall each be issued as single
Certificates in a denomination equal to 100% of the Percentage Interest of each
such Class.

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

         (c)      The Class B-4, Class B-5, Class B-6, Class X-A-1 and Class
X-A-2 Certificates offered and sold in reliance on the exemption from
registration under Rule 144A under the Act shall be issued initially in the form
of one or more permanent global Certificates in definitive, fully registered
form without interest coupons with the applicable legends set forth in Exhibit A
added to the forms of such Certificates (each, a "Restricted Global Security").

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         Section 3.02      Registration.

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

         Section 3.03      Transfer and Exchange of Certificates.

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

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

         (c)      By acceptance of a Restricted Certificate, whether upon
original issuance or subsequent transfer, each Holder of such a Certificate
acknowledges the restrictions on the

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transfer of such Certificate set forth thereon and agrees that it will transfer
such a Certificate only as provided herein.

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

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

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

         (d)      No transfer of an ERISA-Restricted Certificate in the form of
a Definitive Certificate shall be made to any Person unless the Certificate
Registrar has received (A) a certificate substantially in the form of Exhibit I
hereto from such transferee or (B) an Opinion of Counsel satisfactory to the
Certificate Registrar to the effect that the purchase and holding of such a
Certificate will not constitute or result in the assets of the Trust Fund being
deemed to be "plan assets" subject to the prohibited transactions provisions of
ERISA, Section 4975 of the Code, or any provisions of applicable federal, state
or local law substantially similar to the foregoing provisions of ERISA or the
Code ("Similar Law"), and will not subject the Trustee, the Certificate
Registrar or the Depositor to any obligation in addition to those undertaken in
the Agreement; provided, however, that the Certificate Registrar will not
require such certificate or opinion in the event that, as a result of a change
of law or otherwise, counsel satisfactory to the Certificate Registrar has
rendered an opinion to the effect that the purchase and holding of an
ERISA-Restricted Certificate by a Plan or a Person that is purchasing or holding
such a Certificate with the assets of a Plan will not constitute or result in a
prohibited transaction under ERISA, Section 4975 of the Code or Similar Law. The
preparation and delivery of the certificates and opinions referred to above
shall not be an expense of the Trust Fund, the Trustee, the Certificate
Registrar or the Depositor.

         Notwithstanding the foregoing, no Opinion of Counsel or certificate
shall be required for the initial issuance of the ERISA-Restricted Certificates.
Notwithstanding anything to the contrary herein, any purported transfer of an
ERISA-Restricted Certificate to or on behalf of an employee benefit plan subject
to Title I of ERISA or a plan subject to Section 4975 of the Code or a plan
subject to Similar Law without the delivery to the Certificate Registrar of a
certificate substantially in the form of Exhibit I hereto or an Opinion of
Counsel satisfactory to the Certificate Registrar as described above shall be
void and of no effect. The Trustee, the Certificate Registrar and the Depositor
shall be under no liability to any Person for any registration of transfer of
any ERISA-Restricted Certificate that is in fact not permitted by this

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Section 3.03(d) or for the Paying Agent making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Certificate Registrar in accordance with the foregoing
requirements. The last preceding Holder of such Certificate that is not a plan
or a Person acting on behalf of a plan shall be entitled to recover from any
purported Holder of any ERISA-Restricted Certificate that was in fact an
employee benefit plan subject to Title I of ERISA or a plan subject to Section
4975 of the Code or a plan subject to Similar Law or a Person acting on behalf
of any such plan at the time it became a Holder or, at such subsequent time as
it became such a plan or Person acting on behalf of such a plan, all payments
made on such ERISA-Restricted Certificate at and after either such time;
provided that none of the Depositor, the Certificate Registrar or the Trustee
shall be responsible for such recovery if they otherwise made a good faith
effort to comply with this Section 3.03(d).

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

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

         Prior to and as a condition of the registration of any transfer, sale
or other disposition of a Residual Certificate or a beneficial interest therein,
the proposed transferee shall deliver to the Trustee and the Certificate
Registrar an affidavit in substantially the form attached hereto as Exhibit B
representing and warranting, among other things, that such transferee is neither
a Disqualified Organization, an agent or nominee acting on behalf of a
Disqualified Organization, nor a Non-permitted Foreign Holder (any such
transferee, a "Permitted Transferee"), and the proposed transferor shall deliver
to the Trustee and the Certificate Registrar an affidavit in substantially the
form attached hereto as Exhibit C. In addition, the Trustee or the Certificate
Registrar may (but shall have no obligation to) require, prior to and as a
condition of any such transfer, the delivery by the proposed transferee of an
Opinion of Counsel, addressed to the Trustee and the Certificate Registrar, that
such proposed transferee or, if the proposed transferee is an agent or nominee,
the proposed beneficial owner, is not a Disqualified Organization, agent or
nominee thereof, or a Non-permitted Foreign Holder. Notwithstanding the
registration in the Certificate Register of any transfer, sale, or other
disposition of a Residual Certificate to a Disqualified Organization, an agent
or nominee thereof, or Non-permitted Foreign Holder, such registration shall be
deemed to be of no legal force or effect whatsoever and such Disqualified

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Organization, agent or nominee thereof, or Non-permitted Foreign Holder shall
not be deemed to be a Certificateholder for any purpose hereunder, including,
but not limited to, the receipt of distributions on such Residual Certificate.
The Depositor, the Certificate Registrar and the Trustee shall be under no
liability to any Person for any registration or transfer of a Residual
Certificate to a Disqualified Organization, agent or nominee thereof or
Non-permitted Foreign Holder or for the Paying Agent making any payments due on
such Residual Certificate to the Holder thereof or for taking any other action
with respect to such Holder under the provisions of the Agreement, so long as
the transfer was effected in accordance with this Section 3.03(f), unless the
Certificate Registrar shall have actual knowledge at the time of such transfer
or the time of such payment or other action that the transferee is a
Disqualified Organization, or an agent or nominee thereof, or Non-permitted
Foreign Holder. The Certificate Registrar shall be entitled to recover from any
Holder of a Residual Certificate that was a Disqualified Organization, agent or
nominee thereof, or Non-permitted Foreign Holder at the time it became a Holder
or any subsequent time it became a Disqualified Organization, agent or nominee
thereof, or Non-permitted Foreign Holder, all payments made on such Residual
Certificate at and after either such times (and all costs and expenses,
including but not limited to attorneys' fees, incurred in connection therewith).
Any payment (not including any such costs and expenses) so recovered by the
Certificate Registrar shall be paid and delivered to the last preceding Holder
of such Residual Certificate.

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

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

         Section 3.04      Cancellation of Certificates.

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

         Section 3.05      Replacement of Certificates.

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

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

         Section 3.06      Persons Deemed Owners.

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

         Section 3.07      Temporary Certificates.

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

         (b)      If temporary Certificates are issued, the Depositor will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon

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surrender of the temporary Certificates at the office or agency of the
Certificate Registrar without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Certificates, the Trustee shall
execute and the Authenticating Agent shall authenticate and deliver in exchange
therefor a like aggregate Certificate Principal Amount (or Notional Amount) of
definitive Certificates of the same Class in the authorized denominations. Until
so exchanged, the temporary Certificates shall in all respects be entitled to
the same benefits under this Agreement as definitive Certificates of the same
Class.

         Section 3.08      Appointment of Paying Agent.

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

         Section 3.09      Book-Entry Certificates.

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

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

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

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

                  (iv)     the rights of Certificate Owners shall be exercised
         only through the Clearing Agency and the Clearing Agency Participants
         and shall be limited to those

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

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

         (c)      If (i) (A) the Clearing Agency or the Depositor advises the
Paying Agent in writing that the Clearing Agency is no longer willing or able to
discharge properly its responsibilities with respect to the Book-Entry
Certificates, and (B) the Depositor is unable to locate a qualified successor
satisfactory to the Depositor and the Paying Agent, (ii) the Depositor, at its
option, advises the Paying Agent in writing that it elects to terminate the
book-entry system through the Clearing Agency or (iii) after the occurrence of
an Event of Default, Certificate Owners representing beneficial interests
aggregating not less than 50% of the Class Principal Amount (or Class Notional
Amount) of a Class of Book-Entry Certificates advise the Paying Agent and the
Clearing Agency through the Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in
the best interests of the Certificate Owners of a Class of Book-Entry
Certificates, the Certificate Registrar shall notify the Clearing Agency to
effect notification to all Certificate Owners, through the Clearing Agency, of
the occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners requesting the same. Upon surrender to the
Certificate Registrar of the Book-Entry Certificates by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency for
registration, the Certificate Registrar shall issue the Definitive Certificates.
Neither the Depositor, the Certificate Registrar nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates all references herein to obligations imposed upon or to
be performed by the Clearing Agency shall be deemed to be imposed upon and
performed by the Certificate Registrar, to the extent applicable, with respect
to such Definitive Certificates and the Certificate Registrar shall recognize
the holders of the Definitive Certificates as Certificateholders hereunder.
Notwithstanding the foregoing, the Certificate Registrar, upon the instruction
of the Depositor, shall have the right to issue Definitive Certificates on the
Closing Date in connection with credit enhancement programs.

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                                   ARTICLE IV

                        ADMINISTRATION OF THE TRUST FUND

         Section 4.01      Custodial Accounts; Distribution Account.

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

         (b)      The Trustee, shall establish and maintain an Eligible Account
entitled "Distribution Account of Wells Fargo Bank Minnesota, National
Association, as Trustee, for the benefit of Merrill Lynch Mortgage Investors
Trust Series MLCC 2003-C Holders of Mortgage Pass-Through Certificates." The
Trustee shall, promptly upon receipt from the Servicer on each Distribution
Account Deposit Date, deposit into the Distribution Account and retain on
deposit until the related Distribution Date the following amounts:

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

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

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

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

         (e)      Funds in the Distribution Account may be invested in Permitted
Investments selected by the Trustee, which shall mature not later than one
Business Day prior to the Distribution Date (except that if such Permitted
Investment is an obligation of the Trustee or is managed or advised by the
Trustee or its affiliates, then such Permitted Investment shall mature not later
than such applicable Distribution Date) and any such Permitted Investment shall
not be sold or disposed of prior to its maturity. All such Permitted Investments
shall be made in the

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name of the Trustee (in its capacity as such) or its nominee. All income and
gain realized from any Permitted Investment shall be for the benefit of the
Trustee and shall be subject to its withdrawal or order from time to time, and
shall not be part of the Trust Fund. The amount of any losses incurred in
respect of any such investments shall be deposited in such Distribution Account
by the Trustee out of its own funds, without any right of reimbursement
therefor, immediately as realized.

         Section 4.02      Reports to Trustee and Certificateholders.

         On each Distribution Date, the Trustee shall have prepared and shall
make available to each Certificateholder and other interested parties a written
report setting forth the following information (on the basis of Mortgage Loan
level information obtained from the Servicer).

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

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

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

         (d)      the amount of any unpaid Interest Shortfall, Basis Risk
Shortfall or Unpaid Basis Risk Shortfall (if applicable) and the related accrued
interest thereon, with respect to each Class of Certificates;

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

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

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

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

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

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

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

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

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

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

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

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

         (q)      the aggregate amount of Special Hazard Losses, Bankruptcy
Losses and Fraud Losses incurred during the preceding calendar month;

         (r)      the cumulative amount of Special Hazard Losses, Bankruptcy
Losses and Fraud Losses incurred since the Closing Date;

         (s)      the Special Hazard Loss Coverage Amount, the Fraud Loss
Coverage Amount and the Bankruptcy Loss Coverage Amount, in each case as of the
related Determination Date;

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

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

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

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

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

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

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

                                    ARTICLE V

                    DISTRIBUTIONS TO HOLDERS OF CERTIFICATES

         Section 5.01      Distributions Generally.

         (a)      Subject to Section 7.01 respecting the final distribution on
the Certificates, on each Distribution Date the Trustee or the Paying Agent
shall make distributions in accordance with this Article V. Such distributions
shall be made by check mailed to each Certificateholder's address as it appears
on the Certificate Register of the Certificate Registrar or, upon written
request made to the Trustee at least five Business Days prior to the related
Record Date by any Certificateholder owning an aggregate initial Certificate
Principal Amount of at least $1,000,000, or in the case of a Class of
Interest-Only Certificates or Residual Certificate, a Percentage Interest of not
less than 100%, by wire transfer in immediately available funds to an account
specified in the request and at the expense of such Certificateholder; provided,
however, that the

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final distribution in respect of any Certificate shall be made only upon
presentation and surrender of such Certificate at the Certificate Registrar's
Corporate Trust Office; provided, further, that the foregoing provisions shall
not apply to any Class of Certificates as long as such Certificate remains a
Book-Entry Certificate in which case all payments made shall be made through the
Clearing Agency and its Clearing Agency Participants. Wire transfers will be
made at the expense of the Holder requesting such wire transfer by deducting a
wire transfer fee from the related distribution. Notwithstanding such final
payment of principal of any of the Certificates, each Residual Certificate will
remain outstanding until the termination of each REMIC and the payment in full
of all other amounts due with respect to the Residual Certificates and at such
time such final payment in retirement of any Residual Certificate will be made
only upon presentation and surrender of such Certificate at the Certificate
Registrar's Corporate Trust Office. If any payment required to be made on the
Certificates is to be made on a day that is not a Business Day, then such
payment will be made on the next succeeding Business Day.

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

         Section 5.02      Distributions from the Certificate Account.

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

                  (i)      Concurrently, to the payment of the Interest
         Distribution Amount and any accrued but unpaid Interest Shortfalls with
         respect to each class of Senior Certificates (other than the Class X
         Certificates) and the Components, with, subject to the proviso set
         forth below, (x) all amounts payable in respect of Component XB1,
         Component XB2 and Component XB3 being payable to the Class X-B
         Certificates and (y) all amounts payable in respect of the Pool 1
         Component and the Pool 2 Component being payable to the Class X-A-1,
         Class X-A-2 and Class X-A-3 Certificates in accordance with their
         respective interests in the Pool 1 NAS IO Subcomponent, the Pool 1
         Companion IO Subcomponent, the Pool 2 NAS IO Subcomponent and the Pool
         2 Companion IO Subcomponent; provided, however, that on each
         Distribution Date, amounts that would otherwise be payable to the Class
         X-A-1, Class X-A-2, Class X-A-3 or Class X-B Certificates under this
         clause (a)(i) will (i) in the case of amounts otherwise payable to the
         Class X-A-1, Class X-A-2 and Class X-A-3 Certificates in respect of the
         Pool 1 Component, be paid to the Class A-1 Certificates to the extent
         of any Basis Risk Shortfalls and Unpaid Basis Risk Shortfalls for the
         Class A-1 Certificates as of such Distribution Date, (ii) in the case
         of amounts otherwise payable to the Class X-A-1, Class X-A-2 and Class
         X-A-3 Certificates in respect of the Pool 2 Component, be paid to the
         Class A-2 Certificates to the extent of any Basis Risk Shortfalls and
         Unpaid Basis Risk Shortfalls for the Class A-2 Certificates as of such
         Distribution Date and (iii) in the case of amounts otherwise

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         payable to the Class X-B Certificates, be paid to the Class B-1, Class
         B-2 and Class B-3 Certificates to the extent of any Basis Risk
         Shortfalls and Unpaid Basis Risk Shortfalls for the Class B-1, Class
         B-2 and Class B-3 Certificates, respectively, as of such Distribution
         Date;

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

                           (a)      sequentially to the Class A-R and Class A-1
                                    Certificates, in that order, the Senior
                                    Principal Distribution Amount for Pool 1,
                                    until their respective Class Principal
                                    Amounts have been reduced to zero; and

                           (b)      to the Class A-2 Certificates, the Senior
                                    Principal Distribution Amount for Pool 2,
                                    until its Class Principal Amounts has been
                                    reduced to zero:

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

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

                  (v)      From the remaining Available Distribution Amount from
         the Mortgage Pools in the aggregate remaining after application of
         amounts pursuant to clauses (i) through (iv) in the following order of
         priority:

                  (A)      to the Class B-4 Certificates, the payment of its
         Interest Distribution Amount and any outstanding Interest Shortfalls;

                  (B)      to the Class B-4 Certificates, such Class'
         Subordinate Class Percentage of the Subordinate Principal Distribution
         Amount for each Mortgage Pool, until its Class Principal Amount has
         been reduced to zero;

                  (C)      to the Class B-5 Certificates, the payment of its
         Interest Distribution Amount and any outstanding Interest Shortfalls;

                  (D)      to the Class B-5 Certificates, such Class'
         Subordinate Class Percentage of the Subordinate Principal Distribution
         Amount for each Mortgage Pool, until its Class Principal Amount has
         been reduced to zero;

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                  (E)      to the Class B-6 Certificates, the payment of its
         Interest Distribution Amount and any outstanding Interest Shortfalls;
         and

                  (F)      to the Class B-6 Certificates, such Class'
         Subordinate Class Percentage of the Subordinate Principal Distribution
         Amount for each Mortgage Pool, until its Class Principal Amount has
         been reduced to zero;

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

Amounts paid to the Class A-1 Certificates on any Distribution Date pursuant to
the proviso in clause (a)(i) above shall reduce amounts otherwise payable on
such Distribution Date in respect of the Pool 1 Companion IO Subcomponent before
reducing any amounts otherwise payable to the Pool 1 NAS IO Subcomponent.
Amounts paid to the Class A-2 Certificates on any Distribution Date pursuant to
the proviso in clause (a)(i) above shall reduce amounts otherwise payable on
such Distribution Date in respect of the Pool 2 Companion IO Subcomponent before
reducing any amounts otherwise payable to the Pool 2 NAS IO Subcomponent.
Amounts that would have been distributed in respect of the Class X-B
Certificates, the Pool 1 Component or the Pool 2 Component but for the proviso
set forth in clause (a)(i) above shall be treated as having been distributed to
the Class X-B Certificates, the Pool 1 Component or the Pool 2 Component, as the
case may be, for purposes of determining subsequent Interest Shortfalls with
respect to the Class X-B Certificates, the Pool 1 Component and the Pool 2
Component.

         (b) On each Distribution Date on and after the Credit Support Depletion
Date, the Available Distribution Amount for each Mortgage Pool shall be
distributed to the remaining Classes of Certificates of a Certificate Group and
in respect of the Pool 1 Component or the Pool 2 Component, as the case may be,
on a pro rata basis, first, to pay the Interest Distribution Amount and any
accrued but unpaid Interest Shortfalls; with, subject to the proviso set forth
below, all amounts payable in respect of the Pool 1 Component and the Pool 2
Component being payable to the Class X-A-1, Class X-A-2 and Class X-A-3
Certificates in accordance with their respective interests in the Pool 1 NAS IO
Subcomponent, the Pool 1 Companion IO Subcomponent, the Pool 2 NAS IO
Subcomponent and the Pool 2 Companion IO Subcomponent; provided, however, that
on each such Distribution Date, amounts that would otherwise be payable to the
Class X-A-1, Class X-A-2, Class X-A-3 under this clause (b) will (i) in the case
of amounts otherwise payable to the Class X-A-1, Class X-A-2 and Class X-A-3
Certificates in respect of the Pool 1 Component, be paid to the Class A-1
Certificates to the extent of any Basis Risk Shortfalls and Unpaid Basis Risk
Shortfalls for the Class A-1 Certificates as of such Distribution Date and (ii)
in the case of amounts otherwise payable to the Class X-A-1, Class X-A-2 and
Class X-A-3 Certificates in respect of the Pool 2 Component, be paid to the
Class A-2 Certificates to the extent of any Basis Risk Shortfalls and Unpaid
Basis Risk Shortfalls for the Class A-2 Certificates as of such Distribution
Dates; second, to pay the Senior Principal Distribution Amount for such Mortgage
Pool; and third, to the Class A-R Certificate, any remaining Available
Distribution Amount from such Mortgage Pool.

Amounts paid to the Class A-1 Certificates on any Distribution Date pursuant to
the proviso in this clause (b) shall reduce amounts otherwise payable on such
Distribution Date in respect of

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the Pool 1 Companion IO Subcomponent before reducing any amounts otherwise
payable to the Pool 1 NAS IO Subcomponent. Amounts paid to the Class A-2
Certificates on any Distribution Date pursuant to the provisio in this clause
(b) shall reduce amounts otherwise payable on such Distribution Date in respect
of the Pool 2 Companion IO Subcomponent before reducing any amounts otherwise
payable to the Pool 2 NAS IO Subcomponent. Amounts that would have been
distributed in respect of the Pool 1 Component or the Pool 2 Component but for
the proviso set forth in this Section 5.02(b) shall be treated as having been
distributed to the Pool 1 Component or the Pool 2 Component, as the case may be,
for purposes of determining subsequent Interest Shortfalls with respect to the
Pool 1 Component and the Pool 2 Component.

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

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

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

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

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

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

         Section 5.03      Allocation of Losses.

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

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

                  (i)      Realized Losses, Bankruptcy Losses, Fraud Losses and
         Special Hazard Losses (other than Excess Losses) shall be allocated in
         the following order:

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

                           second, to each Class of Senior Certificates relating
                  to the Mortgage Pool which sustained such loss (allocated, in
                  the case of Pool among the related Senior Classes on a pro
                  rata basis), in each case, until the Class Principal Amount of
                  each Class of Senior Certificates is reduced to zero;

                  (ii)     the principal portion of any Excess Losses in respect
         of a Mortgage Pool shall be allocated proportionately on a pro rata
         basis to (A) the Classes of Senior Certificates of the related Mortgage
         Pool on the basis of their Class Certificate Principal Amounts; and (B)
         to the Classes of Subordinate Certificates on the basis of their
         Apportioned Principal Balances.

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

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

         (c)      Notwithstanding the other provisions of Section 5.03, the
first $.98 of Realized Losses shall not be allocated to any Class of
Certificates.

         Section 5.04      Advances.

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

         Section 5.05      [RESERVED].

         Section 5.06      [RESERVED].

                                   ARTICLE VI

                    CONCERNING THE TRUSTEE; EVENTS OF DEFAULT

         Section 6.01      Duties of Trustee.

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

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

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

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

                  (i)      The Trustee shall not be personally liable with
         respect to any action taken, suffered or omitted to be taken by it in
         good faith in accordance with the direction of Holders of Certificates
         as provided in Section 6.18 hereof;

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

                  (iii)    No provision of this Agreement shall require the
         Trustee to expend or risk its own funds or otherwise incur any
         financial liability in the performance of any of its duties hereunder,
         or in the exercise of any of its rights or powers, if it shall have
         reasonable grounds for believing that repayment of such funds or
         adequate indemnity against such risk or liability is not reasonably
         assured to it; and none of the provisions contained in this Agreement
         shall in any event require the Trustee to perform, or be responsible
         for the manner of performance of, any of the obligations of the
         Servicer under the Servicing Agreement;

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

         (d)      The Trustee shall have no duty hereunder with respect to any
complaint, claim, demand, notice or other document it may receive or which may
be alleged to have been delivered to or served upon it by the parties as a
consequence of the assignment of any Mortgage Loan hereunder; provided, however,
that the Trustee shall promptly remit to the Servicer upon receipt any such
complaint, claim, demand, notice or other document (i) which is delivered to the
Corporate Trust Office of the Trustee, (ii) of which a Responsible Officer has
actual knowledge,

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and (iii) which contains information sufficient to permit the Trustee to make a
determination that the real property to which such document relates is a
Mortgaged Property.

         (e)      The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Certificateholders of any Class holding Certificates
which evidence, as to such Class, Percentage Interests aggregating not less than
25% as to the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred upon the
Trustee under this Agreement.

         (f)      The Trustee shall not be required to perform services under
this Agreement, or to expend or risk its own funds or otherwise incur financial
liability for the performance of any of its duties hereunder or the exercise of
any of its rights or powers if there is reasonable ground for believing that the
timely payment of its fees and expenses or the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it, and none of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Servicer under the Servicing Agreement except
during such time, if any, as the Trustee shall be the successor to, and be
vested with the rights, duties, powers and privileges of, the Servicer in
accordance with the terms of the Servicing Agreement.

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

         (h)      Except as otherwise provided herein, the Trustee shall not
have any duty (A) to see to any recording, filing, or depositing of this
Agreement or any agreement referred to herein or any financing statement or
continuation statement evidencing a security interest, or to see to the
maintenance of any such recording or filing or depositing or to any rerecording,
refiling or redepositing of any thereof, (B) to see to any insurance, (C) to see
to the payment or discharge of any tax, assessment, or other governmental charge
or any lien or encumbrance of any kind owing with respect to, assessed or levied
against, any part of the Trust Fund other than from funds available in the
Distribution Account, or (D) to confirm or verify the contents of any reports or
certificates of the Servicer delivered to the Trustee pursuant to the Servicing
Agreement believed by the Trustee to be genuine and to have been signed or
presented by the proper party or parties.

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

         (j)      Notwithstanding anything in this Agreement to the contrary,
Trustee shall not be liable for special, indirect or consequential losses or
damages of any kind whatsoever (including, but not limited to, lost profits),
even if the Trustee has been advised of the likelihood of such loss or damage
and regardless of the form of action.

         Section 6.02      Certain Matters Affecting the Trustee.

         Except as otherwise provided in Section 6.01:

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

                  (ii)     The Trustee may consult with counsel and any advice
         of its counsel or Opinion of Counsel shall be full and complete
         authorization and protection in respect of any action taken or suffered
         or omitted by it hereunder in good faith and in accordance with such
         advice or Opinion of Counsel;

                  (iii)    The Trustee shall not be personally liable for any
         action taken, suffered or omitted by it in good faith and reasonably
         believed by it to be authorized or within the discretion or rights or
         powers conferred upon it by this Agreement;

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

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

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

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

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

         Section 6.03      Trustee Not Liable for Certificates.

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

         Section 6.04      Trustee May Own Certificates.

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

         Section 6.05      Eligibility Requirements for Trustee.

         The Trustee hereunder shall at all times (i) be an institution insured
by the FDIC, (ii) a corporation or national banking association, organized and
doing business under the laws of any State or the United States of America,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by federal or state authority and (iii) not be an Affiliate of the
Servicer. If such corporation or national banking association publishes reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then, for the purposes of this
Section, the combined capital and surplus of such corporation or national
banking association shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. In case at any
time the

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Trustee shall cease to be eligible in accordance with provisions of this
Section, the Trustee shall resign immediately in the manner and with the effect
specified in Section 6.06.

         Section 6.06      Resignation and Removal of Trustee.

         (a)      The Trustee may at any time resign and be discharged from the
trust hereby created by giving written notice thereof to the Depositor and the
Servicer. Upon receiving such notice of resignation, the Depositor will promptly
appoint a successor trustee by written instrument, one copy of which instrument
shall be delivered to the resigning Trustee, one copy to the successor trustee
and one copy to the Servicer. If no successor trustee shall have been so
appointed and shall have accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor trustee.

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

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

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

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         Section 6.07      Successor Trustee.

         (a)      Any successor trustee appointed as provided in Section 6.06
shall execute, acknowledge and deliver to the Depositor and to its predecessor
trustee, an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and
such successor trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as trustee. The
predecessor trustee shall deliver to the successor trustee all Trustee Mortgage
Files and documents and statements related to each Trustee Mortgage File held by
it hereunder, and shall duly assign, transfer, deliver and pay over to the
successor trustee the entire Trust Fund, together with all necessary instruments
of transfer and assignment or other documents properly executed necessary to
effect such transfer and such of the records or copies thereof maintained by the
predecessor trustee in the administration hereof as may be requested by the
successor trustee and shall thereupon be discharged from all duties and
responsibilities under this Agreement. In addition, the Depositor and the
predecessor trustee shall execute and deliver such other instruments and do such
other things as may reasonably be required to more fully and certainly vest and
confirm in the successor trustee all such rights, powers, duties and
obligations.

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

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

         Section 6.08      Merger or Consolidation of Trustee.

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

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

         (a)      Notwithstanding any other provisions hereof, at any time, the
Trustee, the Depositor or the Certificateholders evidencing more than 50% of the
Class Principal Amount (or Percentage Interest) of every Class of Certificates
shall have the power from time to time to appoint one or more Persons, approved
by the Trustee, to act either as co-trustees jointly with the Trustee, or as
separate trustees, or as custodians, for the purpose of holding title to,
foreclosing or otherwise taking action with respect to any Mortgage Loan outside
the state where the Trustee has its principal place of business where such
separate trustee or co-trustee is necessary or advisable (or the Trustee has
been advised by the Servicer that such separate trustee or co-trustee

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is necessary or advisable) under the laws of any state in which a property
securing a Mortgage Loan is located or for the purpose of otherwise conforming
to any legal requirement, restriction or condition in any state in which a
property securing a Mortgage Loan is located or in any state in which any
portion of the Trust Fund is located. The separate Trustees, co-trustees, or
custodians so appointed shall be trustees or custodians for the benefit of all
the Certificateholders and shall have such powers, rights and remedies as shall
be specified in the instrument of appointment; provided, however, that no such
appointment shall, or shall be deemed to, constitute the appointee an agent of
the Trustee. The obligation of the Trustee to make Advances pursuant to Section
5.04 hereof shall not be affected or assigned by the appointment of a
co-trustee.

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

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

                  (ii)     all other rights, powers, duties and obligations
         conferred or imposed upon the Trustee shall be conferred or imposed
         upon and exercised or performed by the Trustee and such separate
         trustee, co-trustee, or custodian jointly, except to the extent that
         under any law of any jurisdiction in which any particular act or acts
         are to be performed the Trustee shall be incompetent or unqualified to
         perform such act or acts, in which event such rights, powers, duties
         and obligations, including the holding of title to the Trust Fund or
         any portion thereof in any such jurisdiction, shall be exercised and
         performed by such separate trustee, co-trustee, or custodian;

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

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

         (c)      Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee, co-trustee or custodian shall refer to this
Agreement and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject to
all the provisions of this Agreement, specifically including every provision of
this Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the Trustee. Every such instrument shall be filed with
the Trustee and a copy given to the Servicer.

         (d)      Any separate trustee, co-trustee or custodian may, at any
time, constitute the Trustee its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by

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law, to do any lawful act under or in respect of this Agreement on its behalf
and in its name. If any separate trustee, co-trustee or custodian shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.

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

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

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

         Section 6.10      Authenticating Agents.

         (a)      The Trustee may appoint one or more Authenticating Agents
which shall be authorized to act on behalf of the Trustee in authenticating
Certificates. If such an agent is so appointed by the Trustee, wherever
reference is made in this Agreement to the authentication of Certificates by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication on behalf of the Trustee by an Authenticating
Agent and a certificate of authentication executed on behalf of the Trustee by
an Authenticating Agent. Each Authenticating Agent must be a corporation
organized and doing business under the laws of the United States of America or
of any state, having a combined capital and surplus of at least $15,000,000,
authorized under such laws to do a trust business and subject to supervision or
examination by federal or state authorities.

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

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

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eligible under the provisions of this Section 6.10. No Authenticating Agent
shall have responsibility or liability for any action taken by it as such at the
direction of the Trustee.

         Section 6.11      Indemnification of Trustee.

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

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

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

                  (iii)    notwithstanding anything to the contrary in this
         Section 6.11, the Trust Fund shall not be liable for settlement of any
         such claim by the Trustee entered into without the prior consent of the
         Depositor, which consent shall not be unreasonably withheld; and

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

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

         Section 6.12      Fees and Expenses of the Trustee.

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

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         Section 6.13      Collection of Monies.

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

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

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

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

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

         The Trustee shall be entitled to be reimbursed by the Depositor and the
Trust Fund (pursuant to Section 6.11 but without regard to any annual limitation
thereunder), in the event

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that the Servicer does not reimburse the Trustee under the Servicing Agreement,
for all costs associated with the transfer of servicing from the predecessor
Servicer, including, without limitation, any costs or expenses associated with
the termination of the predecessor Servicer, the appointment of a successor
servicer, the complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
Trustee or any successor servicer to correct any errors or insufficiencies in
the servicing data or otherwise to enable the Trustee or successor servicer to
service the Mortgage Loans property and effectively (such costs, "Servicing
Transfer Costs").

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

         Section 6.15      Additional Remedies of Trustee Upon Event of Default.

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

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any other remedy, and no delay or omission to exercise any right or remedy shall
impair any such right or remedy or shall be deemed to be a waiver of any Event
of Default.

         Section 6.16      Waiver of Defaults.

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

         Section 6.17      Notification to Holders.

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

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

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

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         Section 6.19      Preparation of Tax Returns and Other Reports.

         (a)      The Trustee shall prepare or cause to be prepared on behalf of
the Trust Fund, based upon information calculated in accordance with this
Agreement pursuant to instructions given by the Depositor, and the Trustee shall
file federal tax returns, all in accordance with Article X hereof. The Trustee
shall prepare and file such state income tax returns and such other returns as
may be required by applicable law relating to the Trust Fund, and, if required
by state law, and shall file any other documents to the extent required by
applicable state tax law (to the extent such documents are in the Trustee's
possession). The Trustee shall forward copies to the Depositor of all such
returns and Form 1099 supplemental tax information and such other information
within the control of the Trustee as the Depositor may reasonably request in
writing, and shall distribute to each Certificateholder such forms and furnish
such information within the control of the Trustee as are required by the Code
and the REMIC Provisions to be furnished to them, and will prepare and
distribute to Certificateholders Form 1099 (supplemental tax information) (or
otherwise furnish information within the control of the Trustee) to the extent
required by applicable law. The Trustee shall prepare and provide to such
Persons as may be required by applicable law all information returns required
with respect to payments made from the Basis Risk Reserve Fund.

         (b)      The Trustee shall prepare and file with the Internal Revenue
Service ("IRS"), on behalf of each of REMIC 1, REMIC 2, REMIC 3, REMIC 4 and the
Upper Tier REMIC, an application on IRS Form SS-4 or shall obtain a Taxpayer
Identification Number for each of REMIC 1, REMIC 2, REMIC 3, REMIC 4 and the
Upper Tier REMIC using another reasonable method. If the application is filed on
Form SS-4, the Trustee, upon receipt from the IRS of the Notice of Taxpayer
Identification Number Assigned for each REMIC, shall promptly forward copies of
such notices to the Depositor, upon request. The Trustee will file an IRS Form
8811.

         (c)      The Depositor shall prepare or cause to be prepared the
initial current report on Form 8-K. Thereafter, within 15 days after each
Distribution Date, the Trustee shall, in accordance with industry standards,
file with the Securities and Exchange Commission (the "Commission") via the
Electronic Data Gathering and Retrieval System (EDGAR), a Form 8-K with a copy
of the statement to the Certificateholders for such Distribution Date as an
exhibit thereto. Prior to January 31, 2004, the Trustee shall, in accordance
with industry standards, file a Form 15 Suspension Notification with respect to
the Trust Fund, if applicable. Prior to March 31, 2004, the Trustee shall file a
Form 10-K executed by the Depositor, in substance conforming to industry
standards, with respect to the Trust Fund. The Depositor shall be responsible
for preparing all filings and certificates required by the Sarbanes-Oxley Act of
2002. The Trustee agrees to promptly furnish to the Depositor, from time to time
upon request, such further information, reports, and financial statements within
its control related to this Agreement and the Mortgage Loans as the Depositor
reasonably deems appropriate to prepare and file all necessary reports with the
Commission.

         Section 6.20      Annual Certificate by Trustee.

         (a)      By March 15th of each year for which a Form 10-K is to be
filed with a certification by the Depositor, an officer of the Trustee shall
execute and deliver an Officer's Certificate, signed by the senior officer in
charge of the Trustee or any officer to whom that

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officer reports, to the Depositor for the benefit of such Depositor and its
officers, directors and affiliates, certifying as to the matters described in
the Officer's Certificate attached hereto as Exhibit P.

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

                                  ARTICLE VII

                         PURCHASE OF MORTGAGE LOANS AND
                          TERMINATION OF THE TRUST FUND

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

         (a)      The respective obligations and responsibilities of the Trustee
created hereby (other than the obligation of the Trustee to make payments to
Certificateholders as set forth in Section 7.02), shall terminate on the
earliest of (i) the final payment or other liquidation of the last Mortgage Loan
remaining in the Trust Fund and the disposition of all REO Property, (ii) the
sale of the property held by the Trust Fund in accordance with Section 7.01(b)
and (iii) the Latest Possible Maturity Date; provided, however, that in no event
shall the Trust Fund created hereby continue beyond the expiration of 21 years
from the death of the last survivor of the descendants of Joseph P. Kennedy, the
late Ambassador of the United States to the Court of St. James's, living on the
date hereof. Any termination of the Trust Fund shall be carried out in such a
manner so that the termination of each REMIC included therein shall qualify as a
"qualified liquidation" under the REMIC Provisions.

         (b)      On any Distribution Date occurring on or after the Initial
Optional Purchase Date, the majority Holder of the most subordinate Class of
Subordinate Certificates then outstanding (the "Terminator") has the option to
cause the Trust Fund to adopt a plan of complete liquidation pursuant to Section
7.03(a)(i) hereof to sell all of its property. If the Terminator elects to
exercise such option, it shall no later than 30 days prior to the Distribution
Date selected for purchase of the assets of the Trust Fund (the "Purchase Date")
deliver notices to the Trustee and either (a) deposit in the Distribution
Account the Redemption Price or (b) state in such notice

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that the Redemption Price shall be deposited in the Distribution Account not
later than 10:00 a.m., New York City time on the applicable Purchase Date. Upon
exercise of such option, the property of the Trust Fund shall be sold to the
Servicer at a price equal to the Redemption Price.

         (c)      The Depositor, the Servicer and the Trustee shall be
reimbursed from the Redemption Price for any Advances, Servicer Advances,
accrual and unpaid Servicing Fees or other amounts with respect to the Mortgage
Loans that are reimbursable to such parties under this Agreement or the
Servicing Agreement.

         Section 7.02      Procedure Upon Redemption or Termination of Trust
                           Fund.

         (a)      Notice of any redemption termination pursuant to the
provisions of Section 7.01, specifying the Distribution Date upon which the
final distribution shall be made or the Redemption Date of the Certificates,
shall be given promptly by the Trustee by first class mail to Certificateholders
mailed in the case of a redemption of the Certificate, no less than the first
day of the month in which the Distribution Date selected for redemption of the
Certificates occurs or upon (x) the sale of all of the property of the Trust
Fund by the Trustee or in the case of a sale of assets of the Trust Fund, or (y)
upon the final payment or other liquidation of the last Mortgage Loan or REO
Property in the Trust Fund. Such notice shall specify (A) the Redemption Date,
Distribution Date upon which final distribution on the Certificates of all
amounts required to be distributed to Certificateholders pursuant to Section
5.02 will be made upon presentation and surrender of the Certificates at the
Certificate Registrar's Corporate Trust Office, and (B) that the Record Date
otherwise applicable to such Distribution Date is not applicable, distribution
being made only upon presentation and surrender of the Certificates at the
office or agency of the Trustee therein specified. The Trustee shall give such
notice to the Certificate Registrar at the time such notice is given to Holders
of the Certificates. Upon any such termination, the duties of the Trustee and
the Certificate Registrar with respect to the Certificates shall terminate and
the Trustee shall terminate the Distribution Account and any other account or
fund maintained with respect to the Certificates, subject to the Trustee's
obligation hereunder to hold all amounts payable to Certificateholders in trust
without interest pending such payment.

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

         (c)      Any reasonable expenses incurred by the Trustee, to the extent
that such expenses, if paid or reimbursed by the Trust Fund, would constitute
"unanticipated expenses"

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within the meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii), in
connection with any redemption or termination or liquidation of the Trust Fund
shall be reimbursed from proceeds received from the liquidation of the Trust
Fund.

         Section 7.03      Additional Trust Fund Termination Requirements.

         (a)      Any termination of the Trust Fund shall be effected in
accordance with the following additional requirements, unless the Trustee seeks
(at the request of the party exercising the option to purchase all of the
Mortgage Loans pursuant to Section 7.01(b)), and subsequently receives, an
Opinion of Counsel (at the expense of such requesting party), addressed to the
Trustee to the effect that the failure of the Trust Fund to comply with the
requirements of this Section 7.03 will not (I) result in the imposition of taxes
on any REMIC under the REMIC Provisions or (II) cause any REMIC established
hereunder to fail to qualify as a REMIC at any time that any Certificates are
outstanding:

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

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

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

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

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

         Section 7.04      [RESERVED].

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                                  ARTICLE VIII

                          RIGHTS OF CERTIFICATEHOLDERS

         Section 8.01      Limitation on Rights of Holders.

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

         (b)      No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of an Event
of Default and of the continuance thereof, as hereinbefore provided, and unless
also the Holders of Certificates evidencing not less than 25% of the Class
Principal Amount or Class Notional Amount (or Percentage Interest) of
Certificates of each Class affected thereby shall have made written request upon
the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the cost, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for sixty days after its receipt
of such notice, request and offer of indemnity, shall have neglected or refused
to institute any such action, suit or proceeding and no direction inconsistent
with such written request has been given such Trustee during such sixty-day
period by such Certificateholders; it being understood and intended, and being
expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the benefit
of all Certificateholders. For the protection and enforcement of the provisions
of this Section, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.

         Section 8.02      Access to List of Holders.

         (a)      If the Trustee is not acting as Certificate Registrar, the
Certificate Registrar will furnish or cause to be furnished to the Trustee,
within fifteen days after receipt by the Certificate Registrar of a request by
the Trustee in writing, a list, in such form as the Trustee may

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reasonably require, of the names and addresses of the Certificateholders of each
Class as of the most recent Record Date.

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

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

         Section 8.03      Acts of Holders of Certificates.

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

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

         (c)      The ownership of Certificates (whether or not such
Certificates shall be overdue and notwithstanding any notation of ownership or
other writing thereon made by anyone other

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than the Trustee) shall be proved by the Certificate Register, and neither the
Trustee nor the Depositor shall be affected by any notice to the contrary.

         (d)      Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Certificate shall bind
every future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by the
Trustee in reliance thereon, whether or not notation of such action is made upon
such Certificate.

                                   ARTICLE IX

                                   [RESERVED]

                                    ARTICLE X

                              REMIC ADMINISTRATION

         Section 10.01     REMIC Administration.

         (a)      REMIC elections as set forth in the Preliminary Statement
shall be made on Forms 1066 or other appropriate federal tax or information
return for the taxable year ending on the last day of the calendar year in which
the Certificates are issued. The regular interests and residual interest in each
REMIC shall be as designated in the Preliminary Statement and Section 1.01.

         (b)      The Closing Date is hereby designated as the "Startup Day" of
each REMIC within the meaning of section 860G(a)(9) of the Code. The latest
possible maturity date for purposes of Treasury Regulation 1.860G-1(a)(4) will
be the Latest Possible Maturity Date.

         (c)      The Trustee shall represent the Trust Fund in any
administrative or judicial proceeding relating to an examination or audit by any
governmental taxing authority with respect thereto. The Trustee shall pay any
and all tax related expenses (not including taxes) of each REMIC, including but
not limited to any professional fees or expenses related to audits or any
administrative or judicial proceedings with respect to such REMIC that involve
the Internal Revenue Service or state tax authorities, but only to the extent
that (i) such expenses are ordinary or routine expenses, including expenses of a
routine audit but not expenses of litigation (except as described in (ii)); or
(ii) such expenses or liabilities (including taxes and penalties) are
attributable to the negligence or willful misconduct of the Trustee in
fulfilling its duties hereunder (including its duties as tax return preparer).
The Trustee shall be entitled to reimbursement of expenses to the extent
provided in clause (i) above from the Distribution Account, provided, however,
the Trustee shall not be entitled to reimbursement for expenses incurred in
connection with the preparation of tax returns and other reports as required by
Section 6.19 and this Section.

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

         (e)      The Trustee or its designee shall perform on behalf of each
REMIC all reporting and other tax compliance duties that are the responsibility
of such REMIC under the Code, the REMIC Provisions, or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing authority.
Among its other duties, if required by the Code, the REMIC Provisions, or other
such guidance, the Trustee shall provide, upon receipt of additional reasonable
compensation, to the Treasury or other governmental authority such information
as is necessary for the application of any tax relating to the transfer of a
Residual Certificate to any disqualified person or organization pursuant to
Treasury Regulation 1.860E-2(a)(5) and any person designated in Section
860E(e)(3) of the Code.

         (f)      The Trustee and the Holders of Certificates shall take any
action or cause any REMIC to take any action necessary to create or maintain the
status of any REMIC as a REMIC under the REMIC Provisions and shall assist each
other as necessary to create or maintain such status. Neither the Trustee nor
the Holder of any Residual Certificate shall knowingly take any action, cause
any REMIC to take any action or fail to take (or fail to cause to be taken) any
action that, under the REMIC Provisions, if taken or not taken, as the case may
be, could (i) endanger the status of any REMIC as a REMIC or (ii) result in the
imposition of a tax upon any REMIC (including but not limited to the tax on
prohibited transactions as defined in Code Section 860F(a)(2) and the tax on
prohibited contributions set forth on Section 860G(d) of the Code) (either such
event, an "Adverse REMIC Event") unless the Trustee has received an Opinion of
Counsel (at the expense of the party seeking to take such action) to the effect
that the contemplated action will not endanger such status or result in the
imposition of such a tax. In addition, prior to taking any action with respect
to any REMIC or the assets therein, or causing any REMIC to take any action,
which is not expressly permitted under the terms of this Agreement, any Holder
of a Residual Certificate will consult with the Trustee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur with
respect to any REMIC, and no such Person shall take any such action or cause any
REMIC to take any such action as to which the Trustee has advised it in writing
that an Adverse REMIC Event could occur; provided, however, that if no Adverse
REMIC Event would occur but such action could result in the imposition of
additional taxes on the Residual Certificateholders, no such Person shall take
any such action, or cause any REMIC to take any such action without the written
consent of the Residual Certificateholders.

         (g)      Each Holder of a Residual Certificate shall pay when due any
and all taxes imposed on the related REMIC by federal or state governmental
authorities. To the extent that such taxes are not paid by a Residual
Certificateholder, the Trustee or the Paying Agent shall pay any remaining REMIC
taxes out of current or future amounts otherwise distributable to the Holder of
the Residual Certificate in any such REMIC or, if no such amounts are available,
out of other amounts held in the Collection Account, and shall reduce amounts
otherwise payable to holders of regular interests in any such REMIC, as the case
may be.

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

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

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

         (k)      (i) The Trustee shall treat the Class A-1 Certificates as
representing ownership, through a grantor trust, of the Upper Tier REMIC Class
A-1 Interest. The Trustee shall treat the rights of the Holders of the Class A-1
Certificates to receive distributions attributable to accruals of interest at
rates in excess of the Pool 1 Adjusted Net WAC, including all payments in
respect of Basis Risk Shortfalls and Unpaid Basis Risk Shortfalls, as interests
in interest rate cap contracts written by the Holders of each of the Class
X-A-1, Class X-A-2 and Class X-A-3 Certificates (as holders of interests in the
Pool 1 NAS IO REMIC Component or the Pool 1 Companion IO REMIC Component) in
favor of the Holders of the Class A-1 Certificates. Thus, each Class A-1
Certificate shall be treated as representing not only ownership of a regular
interest in the Upper Tier REMIC, but also ownership, through a grantor trust,
of an interest in (I) an interest rate cap contract written by the holders of
the Class X-A-1 Certificates and the Class X-A-2 Certificates (as holders of
interests in the Pool 1 NAS IO REMIC Component) and (II) an interest rate cap
contract written by the holders of the Class X-A-1 Certificates and the Class
X-A-3 Certificates (as holders of interests in the Pool 1 Companion IO REMIC
Component). Amounts otherwise payable with respect to the Pool 1 Companion IO
REMIC Component will be treated as used to make payments in respect of the
interest rate cap contracts written in favor of the holders of the Class A-1
Certificates before amounts payable with respect to the Pool 1 NAS IO REMIC
Component are so treated. (ii) The Trustee shall treat the Class A-2
Certificates as representing ownership, through a grantor trust, of the Upper
Tier REMIC Class A-2 Interest. The Trustee shall treat the rights of the Holders
of the Class A-2 Certificates to receive distributions attributable to accruals
of interest at rates in excess of the Pool 2 Adjusted Net WAC, including all
payments in respect of Basis Risk Shortfalls and Unpaid Basis Risk Shortfalls,
as interests in interest rate cap contracts written by the Holders of each of
the Class X-A-1, Class X-A-2 and Class X-A-3 Certificates (as holders of
interests in the Pool 2 NAS IO REMIC Component or the Pool 2 Companion IO REMIC
Component) in favor of the Holders of the Class A-2 Certificates. Thus, each
Class A-2 Certificate shall be treated as representing not only ownership of a
regular interest in the Upper Tier REMIC, but also ownership, through a grantor
trust, of an interest in (I) an interest rate cap contract written by the
holders of the Class X-A-1 Certificates and the Class X-A-2 Certificates (as
holders of interests in the Pool 2 NAS IO REMIC Component) and (II) an interest
rate cap contract written by the holders of the Class X-A-1 Certificates and the
Class X-A-3 Certificates (as holders of interests in the Pool 2 Companion IO
REMIC Component). Amounts otherwise payable with respect to the Pool 2 Companion
IO REMIC Component will be treated as used to make payments in respect of the
interest rate cap contracts written in favor of the holders of the Class A-2
Certificates before amounts payable with respect to the Pool 2 NAS IO REMIC
Component are so treated. (iii) The Trustee shall treat the Class X-A-1
Certificates as representing, through separate grantor trusts, a 50% interest in
each of the Pool 1 NAS IO REMIC Component, the Pool 1 Companion IO REMIC
Component, the Pool 2 NAS IO REMIC Component and the Pool 2 Companion IO REMIC
Component. The Trustee shall treat the Class X-A-2 Certificates as representing
a 50% interest in the Pool 1 NAS IO REMIC Component and in the Pool 2 NAS IO
REMIC Component. The Trustee shall treat the Class X-A-3 Certificates as
representing a 50% interest

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in the Pool 1 Companion IO REMIC Component and the Pool 2 Companion IO
Component. The Trustee will treat all amounts distributed in respect of the Pool
1 NAS IO Subcomponent that either (x) reverse the effect of the provisos of
Section 5.02(a)(i) or 5.02(b) on the amount of prior distributions in respect of
the Pool 1 NAS IO Subcomponent or (y) would have been payable in respect of the
Pool 1 Companion IO Subcomponent but for the Certificate Interest Rate on the
Class A-1 Certificates exceeding or having exceeded the Pool 1 Adjusted Net WAC
for the current or a prior Distribution Date as amounts paid under an interest
rate cap agreement written by the holders of Certificates representing an
interest in the Pool 1 Companion IO Subcomponent in favor of the holders of
Certificates representing interests in the Pool 1 NAS IO Subcomponent. The
Trustee will treat all amounts distributed in respect of the Pool 2 NAS IO
Subcomponent that either (x) reverse the effect of the provisos of Section
5.02(a)(i) or 5.02(b) on the amount of prior distributions in respect of the
Pool 2 NAS IO Subcomponent or (y) would have been payable in respect of the Pool
2 Companion IO Subcomponent but for the Certificate Interest rate on the Class
A-2 Certificates exceeding or having exceeded the Pool 2 Adjusted Net WAC on the
current or a prior Distribution Date as amounts paid under an interest rate cap
agreement written by the holders of Certificates representing an interest in the
Pool 2 Companion IO Subcomponent in favor of the holders of Certificates
representing interests in the Pool 2 NAS IO Subcomponent. (iv) The Trustee shall
treat each of the Class B-1, B-2 and Class B-3 Certificates as representing
ownership, through grantor trusts, of the Upper Tier REMIC Class B-1 Interest,
Upper Tier REMIC Class B-2 Interest and Upper Tier REMIC Class B-3 Interest,
respectively. The Trustee shall treat the rights of the Holders of the Class
B-1, Class B-2 and Class B-3 Certificates to receive payments in respect of
Basis Risk Shortfalls and Unpaid Basis Risk Shortfalls as interests in cap
contracts written by the Holders of the Class X-B Certificate in favor of the
Holders of the Class B-1, Class B-2 and Class B-3 Certificates. (v) For purposes
of determining the issue prices of the REMIC regular interests or portions
thereof represented by the Certificates, the interest rate cap contracts
described in this Section 10.01(k) shall be assumed to have a zero value unless
and until required otherwise by an applicable taxing authority. (vi) Each Holder
or beneficial owner of a Class A-1, Class A-2, Class X-A-1, Class X-A-2, Class
X-A-3, Class X-B, Class B-1, Class B-2 or Class B-3 Certificate agrees, by its
acceptance of such Certificate or a beneficial interest therein, to treat, for
tax purposes, such Certificate in a manner consistent with the treatment
described in this Section 10.01(k). (vii) For federal income tax purposes, the
Trustee shall treat distributions from the Trust Fund as occurring as required
by the terms of the Upper-Tier REMIC Interests, with any difference between such
and actual distributions being treated as resulting from payments in respect of
the interest rate cap agreements described in this Section 10.01(k).

         (l)      The Class A-R Holder shall act as "tax matters person" with
respect to each REMIC and irrevocably appoints the Trustee to act as its agent
in such roles.

         (m)      Neither the Trustee nor the Depositor, as assignees under the
Servicing Agreement, shall provide any consent pursuant to the Servicing
Agreement or knowingly take any action under such Servicing Agreement that would
conflict with or violate the provisions of this Article X.

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         Section 10.02     Prohibited Transactions and Activities.

         Neither the Depositor nor the Trustee shall sell, dispose of, or
substitute for any of the Mortgage Loans, except in a disposition pursuant to
(i) the foreclosure of a Mortgage Loan, (ii) the bankruptcy of the Trust Fund,
(iii) the termination of each REMIC pursuant to Article VII of this Agreement,
(iv) a substitution pursuant to Article II of this Agreement or (v) a repurchase
of Mortgage Loans pursuant to Article II of this Agreement, nor acquire any
assets for any REMIC, nor sell or dispose of any investments in the Distribution
Account for gain, nor accept any contributions to any REMIC after the Closing
Date, unless it has received an Opinion of Counsel (at the expense of the party
causing such sale, disposition, or substitution) that such disposition,
acquisition, substitution, or acceptance will not (a) affect adversely the
status of any such REMIC as a REMIC or of the interests therein other than the
Residual Certificate as the regular interests therein, (b) affect the
distribution of interest or principal on the Certificates, (c) result in the
encumbrance of the assets transferred or assigned to the Trust Fund (except
pursuant to the provisions of this Agreement) or (d) cause any such REMIC to be
subject to any tax including a tax on prohibited transactions or prohibited
contributions pursuant to the REMIC Provisions.

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

         In the event that a REMIC fails to qualify as a REMIC, loses its status
as a REMIC, or incurs federal, state or local taxes as a result of a prohibited
transaction or prohibited contribution under the REMIC Provisions due to the
negligent performance by the Trustee of its duties and obligations set forth
herein, the Trustee shall indemnify the Certificateholders of the related
Residual Certificate against any and all losses, claims, damages, liabilities or
expenses ("Losses") resulting from such negligence; provided, however, that the
Trustee shall not be liable for any such Losses attributable to the action or
inaction of the Depositor or the Holder of the Residual Certificate, nor for any
such Losses resulting from misinformation provided by any of the foregoing
parties on which the Trustee has relied. Notwithstanding the foregoing, however,
in no event shall the Trustee have any liability (1) for any action or omission
that is taken in accordance with and in compliance with the express terms of, or
which is expressly permitted by the terms of, this Agreement, the Master
Mortgage Loan Purchase Agreement or the Servicing Agreement, (2) for any Losses
other than arising out of malfeasance, willful misconduct or negligent
performance by the Trustee of its duties and obligations set forth herein, and
(3) for any special or consequential damages to Certificateholders of the
related Residual Certificate (in addition to payment of principal and interest
on the Certificates).

         Section 10.04     REO Property.

         (a)      Notwithstanding any other provision of this Agreement, the
Trustee, shall not, except to the extent provided in the Servicing Agreement,
knowingly permit any Servicer to, rent, lease, or otherwise earn income on
behalf of any REMIC with respect to any REO Property which might cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
section 860G(a)(8) of the Code or result in the receipt by any REMIC of any
"income from non-permitted assets" within the meaning of section 860F(a)(2) of
the Code or any "net income from foreclosure property" which is subject to tax
under the REMIC Provisions unless the Servicer has provided to the Trustee an
Opinion of Counsel concluding that, under the

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REMIC Provisions, such action would not adversely affect the status of any REMIC
as a REMIC and any income generated for any REMIC by the REO Property would not
result in the imposition of a tax upon such REMIC.

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

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

         Section 11.01     Binding Nature of Agreement; Assignment.

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

         Section 11.02     Entire Agreement.

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

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         Section 11.03     Amendment.

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

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

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

         (d)      It shall not be necessary for the consent of Holders under
this Section 11.03 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent

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shall approve the substance thereof. The manner of obtaining such consents and
of evidencing the authorization of the execution thereof by Holders shall be
subject to such reasonable regulations as the Trustee may prescribe.

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

         (f)      Neither the Seller not the Trustee shall consent to the
assignment by the Servicer of the Servicer's rights and obligations under the
Servicing Agreement without the prior written consent of the Depositor, which
consent shall not be unreasonably withheld.

         Section 11.04     Voting Rights.

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

         Section 11.05     Provision of Information.

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

         (b)      The Trustee shall provide to any person to whom a Prospectus
was delivered, upon the request of such person specifying the document or
documents requested, (i) a copy (excluding exhibits) of any report on Form 8-K
or Form 10-K filed with the Securities and Exchange Commission pursuant to
Section 9.23(b) and (ii) a copy of any other document incorporated by reference
in the Prospectus. Any reasonable out-of-pocket expenses incurred by the Trustee
in providing copies of such documents shall be reimbursed by the Depositor.

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

         Section 11.06     Governing Law.

         THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN

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ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED
IN NEW YORK.

         Section 11.07     Notices.

         All requests, demands, notices, authorizations, directions, consents,
waivers and communications hereunder shall be in writing and shall be deemed to
have been duly given when received by (a) in the case of the Depositor, Merrill
Lynch Mortgage Investors, Inc., 250 Vesey Street, 4 World Financial Center, 10th
Floor, New York, New York, 10080, telecopy number (212) 449-9015, Attention:
Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C, (b) in the case of
the Originator, Merrill Lynch Credit Corporation, 250 Vesey Street, 4 World
Financial Center, 10th Floor, New York, New York, 10080, telecopy number (212)
449-9015, Attention: Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C,
(c) in the case of the Seller, Redwood Holdings Inc. 591 Redwood Highway, Suite
3100, Mill Valley, CA 94941 and (d) with respect to the Trustee or the
Certificate Registrar, P.O. Box 98, Columbia, Maryland 21046, Attention: Client
Manager - MLMI Trust Series MLCC 2003-C, with a copy to it at its respective
Corporate Trust Office, or as to each party such other address as may hereafter
be furnished by such party to the other parties in writing. All demands, notices
and communications to a party hereunder shall be in writing and shall be deemed
to have been duly given when delivered to such party at the relevant address,
facsimile number or electronic mail address set forth above or at such other
address, facsimile number or electronic mail address as such party may designate
from time to time by written notice in accordance with this Section 11.07.

         Section 11.08     Severability of Provisions.

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

         Section 11.09     Indulgences; No Waivers.

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

         Section 11.10     Headings Not To Affect Interpretation.

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

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         Section 11.11     Benefits of Agreement.

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

         Section 11.12     Special Notices to the Rating Agencies.

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

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

                  (ii)     the occurrence of any Event of Default;

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

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

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

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

         If to Moody's, to:

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

         If to S&P, to:

         Standard & Poor's Ratings Service,
           a Division of The McGraw-Hill
           Companies, Inc.
         55 Water Street
         New York, New York 10041
         Attention: Residential Mortgages

         If to Fitch Ratings, to:

         Fitch, Inc.
         One State Street Plaza
         New York, New York 10004

                                      121

<PAGE>

         Attention: Residential Mortgages

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

         Section 11.13     Conflicts.

         To the extent that the terms of this Agreement conflict with the terms
of the Servicing Agreement, the Servicing Agreement shall govern.

         Section 11.14     Counterparts.

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

         Section 11.15     No Petitions.

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

                                      122

<PAGE>

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

                                               MERRILL LYNCH MORTGAGE INVESTORS,
                                               INC., as Depositor

                                               By: _____________________________
                                                   Name:  Matthew Whalen
                                                   Title: President

                                               WELLS FARGO BANK MINNESOTA,
                                               NATIONAL ASSOCIATION,
                                               as Trustee

                                               By: _____________________________
                                                   Name:  Amy Doyle
                                                   Title: Vice President

<PAGE>

Solely for purposes of Section 2.04,
accepted and agreed to by:

MERRILL LYNCH CREDIT CORPORATION

By: ____________________________
    Name:  Kathy Ciaffa
    Title: Vice President

<PAGE>

Solely for purposes of Section 2.06,
accepted and agreed to by:

RWT HOLDINGS, INC.

By: ____________________________
    Name:
    Title:

<PAGE>

                                    EXHIBIT A

                              FORMS OF CERTIFICATES

                             [INTENTIONALLY OMITTED]

                                      A-1

<PAGE>

                                    EXHIBIT B

          FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)

STATE OF                   )
                           )        ss.:
COUNTY OF                  )

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

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

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

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

         4.       That the Purchaser either (x) is not, and on
                  __________________ [date of transfer] will not be, an employee
                  benefit plan subject to Title I of the Employee Retirement
                  Income Security Act of 1974, as amended ("ERISA"), or Section
                  4975 of the Code or any provisions of federal, state or local
                  law substantially similar to the foregoing provisions of ERISA
                  or the Code ("Similar Law"), the trustee of any such plan or a
                  person acting on behalf of any such plan or investing the
                  assets of any such plan to acquire a Residual Certificate; or
                  (y) herewith delivers to the Certificate Registrar an opinion
                  of counsel satisfactory to the

                                      B-1

<PAGE>

                  Certificate Registrar, and upon which the Certificate
                  Registrar shall be entitled to rely, to the effect that the
                  purchase and holding of such Residual Certificate by the
                  Investor will not result in the assets of the Trust Fund being
                  deemed to be plan assets and subject to the prohibited
                  transaction provisions of ERISA or the Code or Similar Law,
                  and will not subject the Trustee or the Depositor to any
                  obligation in addition to those undertaken by such entities in
                  the Trust Agreement, which opinion of counsel shall not be an
                  expense of the Trust Fund, the Trustee, the Certificate
                  Registrar or the Depositor.

         5.       That the Purchaser hereby acknowledges that under the terms of
                  the Trust Agreement dated as of June 1, 2003 (the
                  "Agreement"), by and between Merrill Lynch Mortgage Investors,
                  Inc., as Depositor and Wells Fargo Bank Minnesota, National
                  Association, as Trustee with respect to Merrill Lynch Mortgage
                  Investors Trust Series MLCC 2003-C Mortgage Pass-Through
                  Certificates, no transfer of the Residual Certificates shall
                  be permitted to be made to any person unless the Certificate
                  Registrar and Trustee have received a certificate from such
                  transferee containing the representations in paragraphs 3 and
                  4 hereof.

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

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

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

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

         10.      That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
                  Non-U.S. Person that holds a Residual Certificate in
                  connection with the conduct of a trade or business within the
                  United States and has furnished the transferor, the Trustee
                  and the Certificate Registrar with an effective Internal
                  Revenue Service Form W-8ECI (Certificate of Foreign Person's
                  Claim for Exemption From Withholding on Income Effectively
                  Connected With the Conduct of a Trade or Business in the

                                      B-2

<PAGE>

                  United States) or successor form at the time and in the manner
                  required by the Code. "Non-U.S. Person" means an individual,
                  corporation, partnership or other person other than (i) a
                  citizen or resident of the United States; (ii) a corporation,
                  partnership or other entity created or organized in or under
                  the laws of the United States or any state thereof, including
                  for this purpose, the District of Columbia; (iii) an estate
                  that is subject to U.S. federal income tax regardless of the
                  source of its income; (iv) a trust if a court within the
                  United States is able to exercise primary supervision over the
                  administration of the trust and one or more United States
                  trustees have authority to control all substantial decisions
                  of the trust; and, (v) to the extent provided in Treasury
                  regulations, certain trusts in existence on June August 20,
                  1996 that are treated as United States persons prior to such
                  date and elect to continue to be treated as United States
                  persons.

         11.      The Purchaser will not cause income from the Residual
                  Certificate to be attributable to a foreign permanent
                  establishment or fixed base (within the meaning of an
                  applicable income tax treaty) of the Purchaser or another U.S.
                  taxpayer.

         12.      That the Purchaser agrees to such amendments of the Trust
                  Agreement as may be required to further effectuate the
                  restrictions on transfer of any Residual Certificate to such a
                  "disqualified organization," an agent thereof, a Book-Entry
                  Nominee, or a person that does not satisfy the requirements of
                  paragraph 7 and paragraph 10 hereof.

         13.      That the Purchaser consents to the designation of the Trustee
                  to act as agent for the "tax matters person" of each REMIC
                  created by the Trust Fund pursuant to the Trust Agreement.

         14.      That the Purchaser agrees to be bound by Section 3.03(f) of
                  the Agreement.

                                      B-3

<PAGE>

         IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[title of officer] this _____ day of __________, 20__.

                                               _________________________________
                                               [name of Purchaser]

                                               By: _____________________________
                                                   Name:
                                                   Title:

         Personally appeared before me the above-named [name of officer]
________________, known or proved to me to be the same person who executed the
foregoing instrument and to be the [title of officer] _________________ of the
Purchaser, and acknowledged to me that he [she] executed the same as his [her]
free act and deed and the free act and deed of the Purchaser.

         Subscribed and sworn before me this _____ day of __________ 20__.

NOTARY PUBLIC

________________________________

COUNTY OF_______________________

STATE OF________________________

My commission expires the _____ day of __________ 20__.

                                      B-4

<PAGE>

                                    EXHIBIT C

              RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)

                                                    ____________________________
                                                               Date

Re:      Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C
         Mortgage Pass-Through Certificates

         _______________________ (the "Transferor") has reviewed the attached
affidavit of _____________________________ (the "Transferee"), and has no actual
knowledge that such affidavit is not true and has no reason to believe that the
information contained in paragraph 7 thereof is not true, and has no reason to
believe that the Transferee has the intention to impede the assessment or
collection of any federal, state or local taxes legally required to be paid with
respect to a Residual Certificate. In addition, the Transferor has conducted a
reasonable investigation at the time of the transfer and found that the
Transferee had historically paid its debts as they came due and found no
significant evidence to indicate that the Transferee will not continue to pay
its debts as they become due.

                                               Very truly yours,

                                               _________________________________
                                               Name:
                                               Title:

                                      C-1

<PAGE>

                                    EXHIBIT D

                        MORTGAGE LOAN SERVICING AGREEMENT

                        See Exhibit 99.9, filed herewith

                                      D-1

<PAGE>

                                    EXHIBIT E

                     MASTER MORTGAGE LOAN PURCHASE AGREEMENT

                        See Exhibit 99.1, filed herewith

                                      E-1

<PAGE>

                                    EXHIBIT F

                      LIST OF LIMITED PURPOSE SURETY BONDS

         Ambac Assurance Corporation Surety Bond No. AB0039BE, issued February
26, 1996, for Merrill Lynch Credit Corporation.

                                      F-1

<PAGE>

                                    EXHIBIT G

                     FORM OF RULE 144A TRANSFER CERTIFICATE

Re:      Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C
         Mortgage Pass-Through Certificates

         Reference is hereby made to the Trust Agreement, dated as of June 1,
2003 (the "Trust Agreement"), by and between Merrill Lynch Mortgage Investors,
Inc., as Depositor and Wells Fargo Bank Minnesota, National Association, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Trust Agreement.

         This letter relates to $__________ initial Certificate Balance of Class
Certificates which are held in the form of Definitive Certificates registered in
the name of (the "Transferor"). The Transferor has requested a transfer of such
Definitive Certificates for Definitive Certificates of such Class registered in
the name of [insert name of transferee].

         In connection with such request, and in respect of such Certificates,
the Transferor hereby certifies that such Certificates are being transferred in
accordance with (i) the transfer restrictions set forth in the Trust Agreement
and the Certificates and (ii) Rule 144A under the Securities Act to a purchaser
that the Transferor reasonably believes is a "qualified institutional buyer"
within the meaning of Rule 144A purchasing for its own account or for the
account of a "qualified institutional buyer," which purchaser is aware that the
sale to it is being made in reliance upon Rule 144A, in a transaction meeting
the requirements of Rule 144A and in accordance with any applicable securities
laws of any state of the United States or any other applicable jurisdiction.

         This certificate and the statements contained herein are made for your
benefit and the benefit of the Underwriters and the Depositor.

                                               _________________________________
                                               [Name of Transferor]

                                               By: _____________________________
                                                   Name:
                                                   Title:

Dated: ___________, ____

                                      G-1

<PAGE>

                                    EXHIBIT H

                         FORM OF PURCHASER'S LETTER FOR
                        INSTITUTIONAL ACCREDITED INVESTOR

                                                           Date

Dear Sirs:

         In connection with our proposed purchase of $______________ principal
amount of Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C Mortgage
Pass-Through Certificates (the "Privately Offered Certificates") of Merrill
Lynch Mortgage Investors, Inc. (the "Depositor"), we confirm that:

(1)      We understand that the Privately Offered Certificates have not been,
         and will not be, registered under the Securities Act of 1933, as
         amended (the "Securities Act"), and may not be sold except as permitted
         in the following sentence. We agree, on our own behalf and on behalf of
         any accounts for which we are acting as hereinafter stated, that if we
         should sell any Privately Offered Certificates within two years of the
         later of the date of original issuance of the Privately Offered
         Certificates or the last day on which such Privately Offered
         Certificates are owned by the Depositor or any affiliate of the
         Depositor we will do so only (A) to the Depositor, (B) to "qualified
         institutional buyers" (within the meaning of Rule 144A under the
         Securities Act) in accordance with Rule 144A under the Securities Act
         ("QIBs"), (C) pursuant to the exemption from registration provided by
         Rule 144 under the Securities Act, or (D) to an institutional
         "accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or
         (7) of Regulation D under the Securities Act that is not a QIB (an
         "Institutional Accredited Investor") which, prior to such transfer,
         delivers to the Certificate Registrar under the Trust Agreement, dated
         as of June 1, 2003, by and between Merrill Lynch Mortgage Investors,
         Inc., as Depositor and Wells Fargo Bank Minnesota, National
         Association, as Trustee, a signed letter in the form of this letter;
         and we further agree, in the capacities stated above, to provide to any
         person purchasing any of the Privately Offered Certificates from us a
         notice advising such purchaser that resales of the Privately Offered
         Certificates are restricted as stated herein.

(2)      We understand that, in connection with any proposed resale of any
         Privately Offered Certificates to an Institutional Accredited Investor,
         we will be required to furnish to the Certificate Registrar a
         certification from such transferee in the form hereof to confirm that
         the proposed sale is being made pursuant to an exemption from, or in a
         transaction not subject to, the registration requirements of the
         Securities Act. We further understand that the Privately Offered
         Certificates purchased by us will bear a legend to the foregoing
         effect.

                                      H-1

<PAGE>

(3)      We are acquiring the Privately Offered Certificates for investment
         purposes and not with a view to, or for offer or sale in connection
         with, any distribution in violation of the Securities Act. We have such
         knowledge and experience in financial and business matters as to be
         capable of evaluating the merits and risks of our investment in the
         Privately Offered Certificates, and we and any account for which we are
         acting are each able to bear the economic risk of such investment.

(4)      We are an Institutional Accredited Investor and we are acquiring the
         Privately Offered Certificates purchased by us for our own account or
         for one or more accounts (each of which is an Institutional Accredited
         Investor) as to each of which we exercise sole investment discretion.

(5)      We have received such information as we deem necessary in order to make
         our investment decision.

(6)      If we are acquiring ERISA-Restricted Certificates, we understand that
         in accordance with ERISA, the Code and the Exemption, no Plan and no
         person acting on behalf of such a Plan may acquire such Certificate
         except in accordance with Section 3.03(d) of the Trust Agreement.

         Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Trust Agreement.

                                      H-2

<PAGE>

         You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.

                                               Very truly yours,

                                               _________________________________
                                               [Purchaser]

                                               By: _____________________________
                                                   Name:
                                                   Title:

                                      H-3

<PAGE>

                                    EXHIBIT I

                        FORM OF ERISA TRANSFER AFFIDAVIT

STATE OF NEW YORK          )
                           )       ss.:
COUNTY OF NEW YORK         )

         The undersigned, being first duly sworn, deposes and says as follows:

              1. The undersigned is the ______________________ of ______________
     (the "Investor"), a [corporation duly organized] and existing under the
     laws of __________, on behalf of which he makes this affidavit.

              2. The Investor either (x) is not, and on ___________ [date of
     transfer] will not be, an employee benefit plan subject to Title I of the
     Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
     Section 4975 of the Internal Revenue Code of 1986, as amended (the "Code")
     or any provisions of applicable federal, state or local law substantially
     similar to the foregoing provisions of ERISA or the Code ("Similar Law"),
     the trustee of any such plan or a person acting on behalf of any such plan
     or investing the assets of any such plan; (y) if the Certificate (other
     than the Class A-R Certificate) has been the subject of an ERISA-Qualifying
     Underwriting, is an insurance company that is purchasing the Certificate
     with funds contained in an "insurance company general account" as defined
     in Section V(e) of Prohibited Transaction Class Exemption ("PTCE") 95-60
     and the purchase and holding of the Certificate are covered under Sections
     I and III of PTCE 95-60; or (z) herewith delivers to the Certificate
     Registrar an opinion of counsel satisfactory to the Certificate Registrar,
     and upon which the Certificate Registrar shall be entitled to rely, to the
     effect that the purchase and holding of such Certificate by the Investor
     will not result in the assets of the Trust Fund being deemed to be plan
     assets and subject to the prohibited transaction provisions of ERISA or the
     Code or Similar Law, and will not subject the Trustee or the Depositor to
     any obligation in addition to those undertaken by such entities in the
     Trust Agreement, which opinion of counsel shall not be an expense of the
     Trust Fund, the Trustee, the Certificate Registrar or the Depositor.

              3. The Investor hereby acknowledges that under the terms of the
     Trust Agreement dated as of June 1, 2003 (the "Agreement"), by and between
     Merrill Lynch Mortgage Investors, Inc., as Depositor and Wells Fargo Bank
     Minnesota, National Association, as Trustee, no transfer of the
     ERISA-Restricted Certificates shall be permitted to be made to any person
     unless the Certificate Registrar has received a certificate from such
     transferee in the form hereof.

                                      I-1

<PAGE>

         IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this ____ day of _______________ 20___.

                                               _________________________________
                                               [Investor]

                                               By: _____________________________
                                                   Name:
                                                   Title:

ATTEST:
___________________________

STATE OF                    )
                            )        ss.:
COUNTY OF                   )

                  Personally appeared before me the above-named
         ________________, known or proved to me to be the same person who
         executed the foregoing instrument and to be the ____________________ of
         the Investor, and acknowledged that he executed the same as his free
         act and deed and the free act and deed of the Investor.

                  Subscribed and sworn before me this _____ day of _________
         20___.

                                               _________________________________
                                               NOTARY PUBLIC

                                               My commission expires the
                                               _____ day of __________, 20___.

                                      K-2

<PAGE>

                                    EXHIBIT J

                        FORM OF LETTER OF REPRESENTATIONS
                        WITH THE DEPOSITORY TRUST COMPANY

                             [INTENTIONALLY OMITTED]

                                      J-1

<PAGE>

                                    EXHIBIT K

                              INITIAL CERTIFICATION
            MERRILL LYNCH MORTGAGE INVESTORS TRUST SERIES MLCC 2003-C

                                                              ____________, 2003

To:      Merrill Lynch Mortgage Investors, Inc.
         250 Vesey Street
         4 World Financial Center, 10th Floor
         New York, New York 10080

         Cendant Mortgage Corporation
         3000 Leadenhall Road
         Mt. Laurel, New Jersey 08054

         RWT Holdings, Inc.
         591 Redwood Highway, Suite 3140
         Mill Valley, CA 94941

         Reference is made to the Trust Agreement between Merrill Lynch Mortgage
Investors, Inc. (the "Depositor") and Wells Fargo Bank Minnesota, as Trustee
(the "Trustee"), dated as of June 1, 2003 (the "Trust Agreement"), pursuant to
which the Depositor has delivered to the Trustee, with respect to each Mortgage
Loan set forth on Schedule A hereto (the "Mortgage Loan Schedule"), the
documents set forth in Section 2.01 of the Trust Agreement.

         With respect to each Mortgage Loan listed on the Mortgage Loan Schedule
and except as otherwise noted on the Schedule of Exceptions set forth on
Schedule B hereto, the Trustee confirms that (1) the Trustee has received all of
the documents required to be delivered to the Trustee pursuant to Section 2.01
of the Trust Agreement, (2) the Trustee has reviewed each Trustee's Mortgage
File in accordance with Section 2.02(a) of the Trust Agreement, and the
documents contained in each Trustee's Mortgage File conform to the requirements
set forth in such Section 2.02(a), and (3) the Trustee has physical possession
of the documents in each Trustee's Mortgage File. The Trustee has not
independently verified the validity, enforceability, sufficiency, recordability,
due authorization or genuineness or any document in any Trustee's Mortgage File
or any related Mortgage Loan, nor the collectibility, insurability,
effectiveness or suitability of any related Mortgage Loan.

         All terms used herein and not otherwise defined herein shall have the
respective meaning ascribed to such term in the Trust Agreement.

                                      K-1

<PAGE>

                                               WELLS FARGO BANK MINNESOTA, N.A.,
                                               as Trustee

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

                                      K-2

<PAGE>

                                    EXHIBIT L

                           FORM OF FINAL CERTIFICATION

                                                             _____________, 2003

To:      Merrill Lynch Mortgage Investors, Inc.
         250 Vesey Street
         4 World Financial Center, 10th Floor
         New York, New York 10080

         Cendant Mortgage Corporation
         3000 Leadenhall Road
         Mt. Laurel, New Jersey 08054

         RWT Holdings, Inc.
         591 Redwood Highway, Suite 3140
         Mill Valley, CA 94941

         Reference is made to the Trust Agreement between Merrill Lynch Mortgage
Investors, Inc. (the "Depositor") and Wells Fargo Bank Minnesota, National
Association, as Trustee (the "Trustee"), dated as of June 1, 2003 (the "Trust
Agreement"), pursuant to which the Depositor has delivered to the Trustee, with
respect to each Mortgage Loan set forth on Schedule A hereto (the "Mortgage Loan
Schedule"), the documents set forth in Section 2.01 of the Trust Agreement.

         With respect to each Mortgage Loan listed on the Mortgage Loan Schedule
and except as otherwise noted on the Schedule of Exceptions set forth on
Schedule B hereto, the Trustee confirms that (1) the Trustee has received all of
the documents required to be delivered to the Custodian pursuant to Section 2.01
of the Trust Agreement, (2) the Trustee has reviewed each Trustee's Mortgage
File in accordance with Section 2 of Amendment No. 1 to the Custody Agreement,
and the documents contained in each Trustee's Mortgage File conform to the
requirements set forth in such Section 2, and (3) the Trustee has physical
possession of the documents in each Trustee's Mortgage File. The Trustee has not
independently verified the validity, enforceability, sufficiency, recordability,
due authorization or genuineness or any document in any Trustee's Mortgage File
or any related Mortgage Loan, nor the collectibility, insurability,
effectiveness or suitability of any related Mortgage Loan.

         All terms used herein and not otherwise defined herein shall have the
respective meaning ascribed to such term in the Trust Agreement.

                                      L-1

<PAGE>

                                               WELLS FARGO BANK MINNESOTA, N.A.,
                                               as Trustee

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

                                      K-2

<PAGE>

                                    EXHIBIT M

                           LIST OF SERVICING OFFICERS

                             [INTENTIONALLY OMITTED]

                                      M-1

<PAGE>

                                    EXHIBIT N

                               REQUEST FOR RELEASE

To:      Wells Fargo Bank Minnesota,
         National Association
         1031 10th Avenue S.E.
         Minneapolis, Minnesota 55414
         (Attention: Merrill Lynch Mortgage Investors Trust Series MLCC 2003-C)

                  Re:      Trust Agreement, dated as of June 1, 2003 by and
                           between Merrill Lynch Mortgage Investors, Inc. and
                           Wells Fargo Bank Minnesota, National Association, as
                           Trustee

         In connection with the administration of the pool of Mortgage Loans
held by you as Trustee for the benefit of Certificateholders, we request the
release of the (Trustee's Mortgage File/[specify documents]) for the Mortgage
Loan described below, for the reason indicated.

File/document to be sent to:
         [Company]
         [Address]
         [Attn:]
         [Telephone Number ____]

Mortgagor's Name, Address & Zip Code:

Mortgage Loan Number:

Reason for Requesting Documents (check one)

________ 1.       Mortgage Loan Paid in Full

                  ([Seller/Depositor] [Servicer], hereby certifies that all
                  amounts received in connection therewith have been credited to
                  the Custodial Account or the Distribution Account, as
                  applicable.)

________ 2.       Mortgage Loan in Foreclosure

________ 3.       Mortgage Loan Repurchased or Substituted For
                  ([Seller/Depositor] [Servicer], hereby certifies that any
                  applicable repurchase price or substitution shortfall amount
                  has been credited to the Custodial Account or the Distribution
                  Account, as applicable.)

________ 4.       Mortgage Loan Liquidated
                  ([Seller/Depositor] [Servicer], hereby certifies that all
                  proceeds of foreclosure, insurance or other liquidation have
                  been finally received and credited to the Custodial Account or
                  the Distribution Account, as applicable.)

                                      N-1

<PAGE>

________ 5.       Other (explain) ________________________________

         If box 1, 2 or 3 above is checked, and if all or part of the Trustee's
Mortgage File was previously released to us, please release to us our previous
receipt on file with you, as well as any additional documents in your possession
relating to the above specified Mortgage Loan.

         If box 4 or 5 above is checked, upon our return of all of the above
documents to you as Trustee, please acknowledge your receipt by signing in the
space indicated below, and returning this form.

                                               [SELLER/DEPOSITOR]
                                               [SERVICER]

                                               By: _____________________________
                                               Date: ___________________________

Documents returned to Trustee:

_____________________________,
as Trustee

By: _________________________
Date: _______________________

                                      N-2

<PAGE>

                                    EXHIBIT O

                               CUSTODIAL AGREEMENT

                  THIS CUSTODIAL AGREEMENT dated as of December 15, 2000 (this
"Agreement"), between MERRILL LYNCH CREDIT CORPORATION ("MLCC") having an
address at 4802 Deer Lake Drive East, Jacksonville, Florida 32246 and WELLS
FARGO BANK MINNESOTA, N.A. ("Custodian"), having an address at Sixth and
Marquette, Minneapolis, Minnesota 55479- 0031.

                              PRELIMINARY STATEMENT

                  MLCC may, from time to time, purchase certain Mortgage Loans
from third party sellers pursuant to the terms and conditions of certain
mortgage loan purchase agreements entered into between MLCC and such third
parties (each, a "Purchase Agreement"). MLCC desires that the Custodian act as
custodian with respect to the documents for the Mortgage Loans delivered from
time to time to the Custodian hereunder, and the Custodian desires to act as
custodian with respect to the documents for the Mortgage Loans.

                  NOW, THEREFORE, in consideration of the mutual covenants set
forth herein and for other good and valuable consideration, the sufficiency and
receipt of which is hereby acknowledged, the parties hereto hereby agree as
follows:

         1.       Definitions.

         "Additional Collateral Mortgage Loan": Each Mortgage Loan that is
either a Mortgage 100(sm) Loan or Parent Power(R) Mortgage Loan as to which the
Additional Collateral is provided. For purposes hereof, the term "Additional
Collateral" shall mean (i) with respect to any Mortgage 100(sm) Loan, the
marketable securities subject to a security interest pursuant to the related
Mortgage 100(sm) Pledge Agreement, or (ii) with respect to any Parent Power(R)
Mortgage Loan, the related Parent Power(R) Agreement.

         "Agreement": This Custodial Agreement and all amendments and
attachments hereto and supplements hereof.

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

         "Business Day": Any day other than (i) a Saturday or Sunday, or (ii) a
day on which banking or savings associations in the State of New Jersey or the
State of Minnesota are authorized or obligated by law or executive order to be
closed.

         "Closing Date": With respect to each Mortgage Loan, the date upon which
the MLCC completes the purchase of such Mortgage Loan.

                                      O-1

<PAGE>

         "Custodian": Wells Fargo Bank Minnesota, N.A., or its successor in
interest or assigns.

         "Custodian's Mortgage File": As to each Mortgage Loan, all Mortgage
Loan documents delivered to the Custodian pursuant hereto and held by the
Custodian with respect to each Mortgage Loan.

         "Custody Receipt": An Initial Custody Receipt and/or a Final Custody
Receipt.

         "Cut-off Date": With respect to each Mortgage Loan, the first day of
the month in which the related Delivery Date occurs or such other date specified
by the Registered Holder.

         "Delivery Date": The date on which MLCC delivers or causes to be
delivered to the Custodian the Mortgage Loans listed on the related Mortgage
Loan Schedule.

         "Exception Report": The Exception Report prepared by the Custodian as
part of the Initial Custody Receipt and as updated thereafter.

         "Final Custody Receipt": A final custody receipt as to each Mortgage
Loan, which final custody receipt is delivered to MLCC, or its successor in
interest or assigns, by the Custodian in the form annexed hereto as Exhibit Two.

         "First Mortgage Loan": A Mortgage Loan that is secured by a first lien
on the Mortgaged Property securing the related Mortgage Note.

         "Gross Margin": With respect to each adjustable rate Mortgage Loan, the
fixed number of basis points set forth in the Mortgage Loan Schedule that is
added to the Index on each Interest Rate Adjustment Date in accordance with the
terms of the related Mortgage Note to determine the Mortgage Interest Rate for
such Mortgage Loan, subject to any applicable Periodic Rate Cap or Lifetime Rate
Cap.

         "Index": With respect to each adjustable rate Mortgage Loan, a rate per
annum to which the Gross Margin is added on each Interest Rate Adjustment Date
to determine the new Mortgage Interest Rate for such Mortgage Loan.

         "Initial Custody Receipt": An initial custody receipt as to each
Mortgage Loan, which initial custody receipt is delivered to MLCC, or its
successor in interest or assigns, by the Custodian in the form annexed hereto as
Exhibit One.

         "Interest Rate Adjustment Date": With respect to each adjustable rate
Mortgage Loan, the date on which the Mortgage Interest Rate is adjusted in
accordance with the terms of the related Mortgage Note.

         "Lifetime Rate Cap": With respect to each adjustable rate Mortgage
Loan, the maximum Mortgage Interest Rate that may be borne thereby, as set forth
in the related Mortgage Note.

                                      O-2

<PAGE>

         "Loan-to-Value Ratio": With respect to any First Mortgage Loan, as of
any date of determination, the ratio on such date of the outstanding principal
balance of such Mortgage Loan to the Appraised Value of the related Mortgaged
Property.

         "Mortgage": The mortgage, deed of trust or other instrument creating a
first or second lien on real property securing the Mortgage Note.

         "Mortgage Interest Rate": The annual rate at which interest accrues on
any Mortgage Loan and with respect to any adjustable rate Mortgage Loan, as such
annual rate may be adjusted on any Interest Rate Adjustment Date and subject to
the limitations on such interest rate imposed by any Lifetime Rate Cap or any
Periodic Rate Cap.

         "Mortgage Loan": An individual Mortgage Loan, including but not limited
to all documents included in the Custodian's Mortgage File, monthly payments,
principal prepayments, proceeds from REO dispositions and any and all rights,
benefits, proceeds and obligations arising therefrom or in connection therewith,
and which is the subject of this Agreement.

         "Mortgage Loan Schedule": The list of Mortgage Loans purchased by MLCC
from a third party seller from time to time that are subject to this Agreement
which list shall set forth the following information with respect to each
Mortgage Loan:

                  (i)      the loan number;

                  (ii)     the Mortgagor's name, social security number, and
                           FICO score;

                  (iii)    the street address of the Mortgaged Property,
                           including city, state and zip code, if available;

                  (iv)     the Mortgage Interest Rate at origination and, in the
                           case of an adjustable rate Mortgage Loan, the
                           Mortgage Interest Rate in effect as of the related
                           Cut-off Date, which rate may vary from that reflected
                           in the Mortgage and Note;

                  (v)      for each adjustable rate Mortgage Loan, the first
                           Interest Rate Adjustment Date;

                  (vi)     for each adjustable rate Mortgage Loan, the Gross
                           Margin;

                  (vii)    for each adjustable rate Mortgage Loan, the Lifetime
                           Rate Cap, if applicable;

                  (viii)   for each adjustable rate Mortgage Loan, the Periodic
                           Rate Cap, if applicable;

                  (ix)     the original term to maturity and remaining term to
                           maturity;

                                      O-3

<PAGE>

                  (x)      the original principal balance;

                  (xi)     the first payment due date;

                  (xii)    the maturity date;

                  (xiii)   the monthly payment in effect as of the related
                           Cut-off Date;

                  (xiv)    the principal balance as of the related Cut-off Date;

                  (xv)     as to any First Mortgage Loan the Loan-to-Value Ratio
                           at origination;

                  (xvi)    a code indicating whether the Mortgaged Property is
                           occupied by the Mortgagor;

                  (xvii)   a code indicating the type of Residential Dwelling;

                  (xviii)  a code indicating the purpose of the Mortgage Loan;

                  (xix)    a code indicating the Mortgage Loan documentation
                           type (i.e. limited documentation, full documentation,
                           easy documentation, etc.); and

                  (xx)     for each adjustable rate Mortgage Loan, a code
                           indicating the type of Index.

         "Mortgage Note": The note evidencing the indebtedness of a Mortgagor
secured by a Mortgage.

         "Mortgaged Property": The underlying real property securing repayment
of a Mortgage Note, consisting of a fee simple estate in a single parcel of real
property improved by a Residential Dwelling.

         "Mortgagor": The obligor on a Mortgage Note, the owner of the Mortgaged
Property and the grantor or mortgagor named in the related Mortgage and such
grantor's or mortgagor's successor in title to the Mortgaged Property.

         "Opinion of Counsel": A document signed by an attorney, explaining the
attorney's understanding of the law as applicable to a state of facts submitted
for the purpose of an opinion.

         "Periodic Rate Cap": With respect to each adjustable rate Mortgage Loan
as to which the related Mortgage Loan Schedule indicates the existence of a
Periodic Rate Cap, the provision of the related Mortgage Note that provides for
a maximum amount by which the Mortgage Interest Rate may increase (or, if so
indicated on such Mortgage Loan Schedule, decrease) on an Interest Rate
Adjustment Date above (or below) the Mortgage Interest Rate in effect
immediately prior to such Interest Rate Adjustment Date.

                                      O-4

<PAGE>

         "Pledge Agreement": Any Mortgage 100 Pledge Agreement, Parent Power
Guaranty and Security Agreement for Securities Account, or Parent Power Guaranty
Agreement for Real Estate related to an Additional Collateral Mortgage Loan.

         "Registered Holder": MLCC, its successors in interest or assigns, in
whole or in part, as the case may be.

         "Residential Dwelling": Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a Fannie Mae-eligible condominium project, or (iv) a
detached one-family dwelling in a planned unit development, none of which is a
co-operative.

         "Second Mortgage Loan": A Mortgage Loan that is secured by a second
lien on the Mortgaged Property securing the related Mortgage Note.

         2.       Delivery of Mortgage Loan Schedule and Custodian's Mortgage
                  File.

         MLCC may, from time to time, deliver or cause to be delivered to the
Custodian a Mortgage Loan Schedule and the following documents for each Mortgage
Loan listed on such Mortgage Loan Schedule, to be held by the Custodian for the
benefit of the Registered Holder, as the owner thereof:

              (a) The original Mortgage Note endorsed, "Pay to the order of
              ___________, without recourse" and signed in the name of the name
              of last endorsee, by an authorized officer of the last endorsee.
              If the Mortgage Loan was acquired by the last endorsee in a merger
              or other type of acquisition, the endorsement must be by "[name of
              last endorsee], successor [by merger to or in interest to, as
              applicable] [name of predecessor]"; and if the Mortgage Loan was
              acquired or originated by the last endorsee while doing business
              under another name, the endorsement must be by "[name of last
              endorsee], successor in interest to [previous name]." The Mortgage
              Note shall include all intervening endorsements showing a complete
              chain of title from the originator to the last endorsee.

              (b) The original recorded Mortgage, with evidence of recording
              thereon, or, if the original Mortgage has not yet been returned
              from the recording office, a copy of the original Mortgage
              certified by the previous owner to be a true copy of the original
              of the Mortgage which has been delivered for recording in the
              appropriate recording office of the jurisdiction in which the
              Mortgaged Property is located.

              (c) The original Assignment of each Mortgage, executed in blank by
              either MLCC or its Servicer. If the Mortgage Loan was acquired by
              the last endorsee in a merger or other type of acquisition, the
              assignment must be by "[name of last assignee], successor [by
              merger to or in interest to, as applicable] [name of
              predecessor]"; and if the Mortgage Loan was acquired or originated
              by the last endorsee while doing business under another name, the
              assignment must be by "[name of last assignee], successor in
              interest to [previous name]."

                                      O-5

<PAGE>

              (d) The original policy of title insurance (or a preliminary title
              report if the original title insurance policy has not been
              received from the title insurance company).

              (e) Originals of any intervening assignments of the Mortgage, with
              evidence of recording thereon or, if the original intervening
              assignment has not yet been returned from the recording office, a
              copy of such assignment certified by the Seller to be a true copy
              of the original of the assignment which has been delivered for
              recording in the appropriate recording office of the jurisdiction
              in which the Mortgaged Property is located.

              (f) With respect to a Mortgage Loan that, according to the
              Mortgage Loan Schedule is covered by a primary mortgage insurance
              policy, the original or a copy of primary mortgage insurance
              certificate, if any.

              (g) If indicated on the Mortgage Loan Schedule, originals of all
              assumption and modification agreements, if any, with originals or
              copies of the underlying instruments being modified.

              (h) With respect to each Additional Collateral Mortgage Loan,

                           1.       Copy of the related Mortgage 100 Pledge
                                    Agreement for Securities Account or the
                                    Parent Power Guaranty and Security Agreement
                                    for Securities Account or the Parent Power
                                    Guaranty Agreement for Real Estate, as the
                                    case may be;

                           2.       copy of the UCC-1 (applicable for South
                                    Carolina and Rhode Island only);

                           3.       an original form UCC-3, if applicable;

                           4.       For loans originated by a correspondent
                                    lender, an original assignment of security
                                    interest of the related Mortgage 100 Pledge
                                    Agreement or Parent Power Agreement, as the
                                    case may be.

                  (i)      With respect to each Cooperative Loan:

                           1.       the original proprietary lease;

                           2.       the original recognition agreement;

                           3.       the original security agreement;

                           4.       the original or copy of the assignment of
                                    proprietary lease;

                           5.       the original cooperative stock certificate
                                    and stock power executed by borrower in
                                    blank;

                           6.       the original UCC-1 Financing Statements; and

                           7.       the original UCC-3 Financing Statements.

                  (j)      Power of Attorney, if applicable.

                                      O-6

<PAGE>

         From time to time, MLCC shall forward or cause to be forwarded to the
Custodian additional documents, original or otherwise, evidencing an assumption
or modification of a Mortgage Loan which documents shall become part of the
Custodian's Mortgage File.

         3.       Obligations of the Custodian.

         (a)      With respect to each Custodian's Mortgage File, the Custodian
is exclusively the custodian for the Registered Holder from and after the
related Delivery Date. The Custodian shall hold all documents constituting the
Custodian's Mortgage File received by it for the exclusive use and benefit of
the Registered Holder, and shall make disposition thereof only in accordance
with this Agreement and the instructions furnished by the Registered Holder. The
Custodian shall segregate and maintain continuous custody of all documents
constituting the Custodian's Mortgage File received by it in secure and
fire-resistant facilities in accordance with customary standards for such
custody. The Custodian represents and warrants that it will verify the receipt
of required documents, the accuracy of certain information, and indicate
discrepancies pursuant to the custody receipt requirements herein. The Custodian
makes no representations or warranties as to, and shall not be responsible to,
verify: (i) the validity, legality, enforceability, sufficiency, recordability,
due authorization or genuineness of any of the documents contained in each
Custodian's Mortgage File or any of the Mortgage Loans or (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan. No provision of this Agreement shall be construed to impose on the
Custodian any obligation of a third party seller under this Agreement or a
Purchase Agreement under any circumstances.

         (b)      The Custodian shall, at its own expense, maintain at all times
during the existence of this Agreement and keep in full force and effect a
fidelity bond, errors and omissions insurance, theft and documents insurance and
forgery insurance in amounts and with standard coverage as is customary for
insurance typically maintained by institutions that act as custodians. The
minimum coverage under any such bond and insurance policies shall be at least
equal to the corresponding amounts required by the Government National Mortgage
Association, Fannie Mae or Freddie Mac either of the Custodian or in their
respective Seller/Servicing Guides. A certificate of an authorized officer for
the Custodian shall be furnished to the Registered Holder upon request as
evidence of its compliance with any such requirement.

         4.       Custody Receipts.

         (a)      Initial Custody Receipt. The Custodian shall review the
documents delivered to it on each Delivery Date and shall deliver to MLCC as
initial Registered Holder within two (2) Business Days following the Delivery
Date, or within a mutually agreed upon time between the Bank and the Custodian,
but prior to the Closing Date, an Initial Custody Receipt with respect to the
Mortgage Loans, in which the Custodian shall certify that such Mortgage Loans
are held for MLCC (as Registered Holder) and that, as to each Mortgage Loan
listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or any Mortgage Loan specifically identified in such certification as not
covered by such certification), (a) all documents described in Paragraphs 2(a)
through 2(e) and to the extent provided in the Custodian's Mortgage Files
Paragraphs 2(f) through 2(j), if applicable, of this Agreement are in its
possession and (b) each Mortgage Note has been endorsed and each Assignment has
been executed as provided in

                                      O-7

<PAGE>

Paragraph 2 hereof. If the Custodian determines from such verification that any
discrepancy or deficiency exists with respect to a Custodian's Mortgage File,
the Custodian shall note such discrepancy on the schedule of exceptions attached
to the Initial Custody Receipt as Schedule B thereto (the "Exception Report").

         The Custodian shall also note on the Exception Report, with respect to
each Mortgage Loan, whether a certified copy of the related Mortgage was
delivered to the Custodian in lieu of the original of such Mortgage, whether a
certified copy of an intervening assignment of the related Mortgage was
delivered to the Custodian in lieu of the original of such assignment, and
whether a preliminary title report with respect to such Mortgage Loan was
delivered to the Custodian in lieu of the original policy of title insurance.

         On the first Business Day of each calendar month following delivery of
the Initial Custody Receipt until the month in which the Final Custody Receipt
is to be delivered pursuant to Subsection (b) below, the Custodian shall deliver
to the Registered Holder of the Initial Custody Receipt, an updated Exception
Report, revised to reflect any changes with respect to the status of the
exceptions noted for the related Mortgage Loans.

         (b)      Final Custody Receipt. Not later than sixty (60) days
following the date of each delivery of an Initial Custody Receipt, the Custodian
shall deliver to the Registered Holder of the Initial Custody Receipt the Final
Custody Receipt, with respect to the Mortgage Loans related to such Initial
Custody Receipt, in which the Custodian shall certify to the Registered Holder
that, as to each Mortgage Loan listed in the related Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in such certification as not covered by such certification), (a) all
documents described in Paragraphs 2(a) through 2(e), and to the extent provided
in the Custodian's Mortgage Files Paragraphs 2(f) through 2(j), if applicable,
of this Agreement are in its possession, (b) such documents have been reviewed
by it and appear regular on their face and relate to such Mortgage Loan, (c)
based on its examination and only as to the foregoing documents, the information
set forth in items (i), (ii), (iii) excluding the zip code requirement, (iv),
(vi), (vii), (viii) and (x) of the definition of "Mortgage Loan Schedule"
respecting such Mortgage Loan is correct, and which as to items (iv), (vi),
(viii), and (x) for adjustable rate Mortgage Loans may reflect interest rates or
amounts that as of the Cutoff Date vary from those provided in the Mortgage Loan
Documents and (d) each Mortgage Note has been endorsed and each Assignment has
been executed as provided in Paragraph 2 hereof. If the Custodian determines
from such verification that any discrepancy or deficiency exists with respect to
a Custodian's Mortgage File, the Custodian shall note such discrepancy on the
Exception Report attached to the Final Custody Receipt as Schedule B thereto.
The Custodian shall also note on such Exception Report, with respect to each
Mortgage Loan, whether a certified copy of the related Mortgage was delivered to
the Custodian in lieu of the original of such Mortgage, whether a certified copy
of an intervening assignment of the related Mortgage was delivered to the
Custodian in lieu of the original of such assignment, and whether a preliminary
title report with respect to such Mortgage Loan was delivered to the Custodian
in lieu of the original policy of title insurance. Except as specifically
provided above, the Custodian shall be under no duty to review, inspect or
examine such documents to determine that any of them are enforceable or
appropriate for their prescribed purpose. Upon delivery of the Final

                                      O-8

<PAGE>

Custody Receipt to the Registered Holder of the Initial Custody Receipt, the
Initial Custody Receipt shall be of no further force or effect.

         (c)      Within five (5) days of receipt of written directions, in the
form attached hereto as Exhibit Six, from the Registered Holder with respect to
all or a portion of the Mortgage Loans owned by such Registered Holder, and upon
the prior tender by such Registered Holder of the applicable Initial and/or
Final Custody Receipt(s), as applicable, the Custodian shall deliver all or any
portion of the Custodian's Mortgage Files held by it to the Registered Holder,
or to such other party as the Registered Holder may direct, as provided in
Paragraph 19, at the place indicated in any such written direction from the
Registered Holder and shall deliver to the Registered Holder a new Initial or
Final Custody Receipt, as applicable, with respect to the Custodian's Mortgage
Files retained by the Custodian. The Registered Holder may require the Custodian
to complete the endorsements on any Mortgage Notes in its possession and to
complete the Assignment of Mortgages prepared by the Servicer in blank, within a
reasonable period of time. The cost of this shall be reimbursed by the
Registered Holder. A list of authorized signatures for such written directions
has been furnished to the Custodian by the Registered Holder pursuant to
Paragraph 20 hereof. Upon the Custodian's receipt of such written notification
from the Registered Holder that the Registered Holder has sold any or all of the
Mortgage Loans, which notification shall be accompanied by the Initial and/or
Final Custody Receipt(s), as applicable that relate to such Mortgage Loans, the
Custodian shall change its records to reflect that such purchaser is the owner
of such Mortgage Loans and shall immediately, upon the direction of such
Registered Holder, either deliver the related Custodian's Mortgage Files to such
purchaser at the expense of such purchaser or issue an Initial or Final Custody
Receipt in the name of such purchaser. Such purchaser, as a Registered Holder,
shall be required to simultaneously furnish to the Custodian a list of
authorized signatures for written directions pursuant to Paragraph 20 hereof.
The Custodian shall then deliver to the Registered Holder a new Initial and/or
Final Custody Receipt, as applicable reflecting all Mortgage Loans with respect
to which the Custodian still holds the related Custodian's Mortgage Files on
behalf of the Registered Holder. The Registered Holder and the Custodian agree
herein that any purchaser of any or all of the Mortgage Loans shall succeed to
the rights and obligations of the Registered Holder under this Agreement with
respect to such Mortgage Loans upon receipt of the related Initial and/or Final
Custody Receipt, as applicable subject to the provisions of Paragraph 15 hereof.

         5.       Fees and Expenses of the Custodian.

         It is understood that the Custodian will charge such fees for its
services under this Agreement as are set forth in a separate agreement between
the Custodian and MLCC, the payment of which, together with the Custodian's
expenses in connection herewith, shall be solely the obligation of the
Registered Holder with respect to the related Mortgage Loans.

         6.       Removal of the Custodian.

         Any Registered Holder with respect to all or a portion of the Mortgage
Loans owned by such Registered Holder, with or without cause, may, upon thirty
(30) days' written notice to the Custodian, remove and discharge or any
successor Custodian thereafter appointed, as to such

                                      O-9

<PAGE>

portion or all of the Mortgage Loans the Custodian, from the performance of its
duties under this Agreement. In the event of any such removal, upon tender of
the Custody Receipts and satisfaction of any outstanding fees and expenses of
the Custodian, the Custodian shall promptly transfer to such Registered Holder
or to a successor Custodian appointed by such Registered Holder at the expense
of such Registered Holder, as directed by such Registered Holder in writing, all
Custodian's Mortgage Files related to the Mortgage Loans as to which the
Custodian is being terminated.

         7.       Examination of the Custodian's Mortgage File.

         Upon reasonable prior written notice to the Custodian, but not less
than two (2) Business Day, any Registered Holder with respect to all or a
portion of the Mortgage Loans owned by such Registered Holder and its agents,
accountants, attorneys, auditors, prospective purchasers, and third-party
contractors authorized by such Registered Holder will be permitted, during
normal business hours, to examine the Custodian's Mortgage Files, documents,
records and other papers in the possession of or under the control of the
Custodian relating to any or all of the Mortgage Loans for which the Custodian
holds the related Custodian's Mortgage File for such Registered Holder at the
expense of the inspecting party.

         8.       Counterparts.

         For the purpose of facilitating the execution of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original and all of which together shall constitute and be
one and the same instrument.

         9.       Periodic Statements.

         Upon the request of any Registered Holder at any other time with at
least two (2) Business Days' notice to the Custodian, the Custodian shall
provide to the Registered Holder with respect to all or a portion of the
Mortgage Loans owned by such Registered Holder, a list of all of the Mortgage
Loans for which the Custodian holds a Custodian's Mortgage File pursuant to this
Agreement. Such list may be in the form of a copy of the Mortgage Loan Schedule
with manual deletions to denote specifically any Mortgage Loans paid off,
liquidated or repurchased or otherwise released by the Custodian since the date
of this Agreement.

         10.      Governing Law.

         This Agreement shall be construed in accordance with the laws of the
State where MLCC is headquartered, and the obligations, rights and remedies of
the parties hereunder shall be determined in accordance with such laws.

                                      O-10

<PAGE>

         11.      Copies of Mortgage Documents.

         Upon the request of the Registered Holder with respect to all or a
portion of the Mortgage Loans owned by such Registered Holder, and at the cost
and expense of such party, the Custodian shall provide such Registered Holder
with copies or originals as provided in Section 21 hereof, of the Mortgage
Notes, Mortgages, Assignments and other documents to the extent that such
documents are part of the Custodian's Mortgage File relating to one or more of
the Mortgage Loans.

         12.      No Adverse Interest of Custodian.

         By execution of this Agreement, the Custodian represents, warrants and
covenants that it currently does not hold, and during the existence of this
Agreement shall not hold, any adverse interest, by way of security or otherwise,
in any Mortgage Loan.

         13.      Termination By Custodian.

         The Custodian may terminate its obligations under this Agreement upon
at least sixty (60) days' notice to the Registered Holder with respect to all or
a portion of the Mortgage Loans owned by such Registered Holder. The Custodian
shall then be responsible for all costs associated with such termination,
including costs associated with the transfer of the Custodial Files. If, in the
event of such termination, the Registered Holder shall appoint a successor
Custodian within such sixty day period, then upon such appointment and tender of
the related Custody Receipts, the Custodian shall promptly transfer to such
successor Custodian, as directed by the Registered Holder with respect to all or
a portion of the Mortgage Loans owned by such Registered Holder, all of the
Custodian's Mortgage Files being administered under this Agreement and shall
either complete the Assignments and endorse the Mortgage Notes as directed by
the Registered Holder or allow the Registered Holder or its agents or attorneys,
access to the Custodian's Mortgage Files for such purpose. Notwithstanding the
foregoing, if the Registered Holder fails to appoint a Custodian within such
sixty day period, the Custodian may petition any court of competent jurisdiction
for the appointment of a successor Custodian.

         14.      Termination of Agreement.

         This Agreement shall terminate upon the earlier of (a) the final
payment or other liquidation (or advance with respect thereto) of the last
Mortgage Loan, (b) the disposition of all property acquired upon foreclosure or
by deed in lieu of foreclosure of the last Mortgage Loan, or (c) the delivery by
the Custodian of the last Custodian's Mortgage File pursuant to the direction of
the Registered Holder hereunder. In such event the Registered Holder with
respect to all or a portion of the Mortgage Loans owned by such Registered
Holder shall so notify the Custodian and tender all Custody Receipts, and
thereafter all documents remaining in the Custodian's Mortgage Files shall be
forwarded to the Registered Holder.

                                      O-11

<PAGE>

         15.      Assignment of Agreement.

         The Registered Holder with respect to all or a portion of the Mortgage
Loans owned by such Registered Holder shall have the right to assign, in whole
or in part, its interests under this Agreement with respect to some or all of
the Mortgage Loans, and to designate any person or exercise any rights of the
Registered Holder hereunder, and such assignee or designee shall accede to the
rights and obligations hereunder of the Registered Holder with respect to such
Mortgage Loans. All references to the Registered Holder shall be deemed to
include its assignee or designee. In connection with any such assignment, the
Registered Holder with respect to all or a portion of the Mortgage Loans owned
by such Registered Holder may require that arrangements reasonably satisfactory
to it be made for the exchange of previously executed and outstanding Custody
Receipt(s) for a Custody Receipt representing such assignment. The Custodian may
not assign its interests or delegate its duties under this Agreement without the
prior written consent of the Registered Holder. In the event of any such
assignment or delegation, the Registered Holder shall not be responsible for any
fees of the successor Custodian in excess of the fees formerly paid by the
Registered Holder to the Custodian.

         16.      Notice.

         (a)      All demands, notices and communications hereunder shall be in
writing and shall be sent to the other party at the address shown on the first
page hereof, or such other address as may hereafter be furnished to the other
party by written notice given to the other party hereto in a notice complying
with the terms and provisions of this Section 16 or on an Exhibit Six notice
provided pursuant to Section 4(c).

         (b)      Any such demand, notice or communication hereunder shall be
deemed conclusively to have been given if personally delivered at or mailed by
registered mail, postage prepaid, and return receipt requested or transmitted by
telex, telegraph or facsimile transmission and by a similar writing to the other
party at its address as described in Subclause (a).

         17.      Indemnification.

         (a)      Neither the Custodian nor any of its directors, officers,
agents or employees, shall be liable for any action taken or omitted to be taken
by it or them hereunder or in connection herewith in good faith and believed by
it or them to be within the purview of this Agreement, except for its or their
own negligence, lack of good faith or willful misconduct.

         (b)      The Registered Holder and the Custodian agree to indemnify and
hold each other and their respective directors, officers, agents and employees
harmless against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever, including reasonable attorney's fees, that may be
imposed on, incurred by, or asserted against it or them in any action taken or
not taken by it or them hereunder. This indemnification shall include, but not
be limited to, the claims of third parties arising from or related to this
Agreement or the Mortgage Loans. This indemnification applies if such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses, disbursements, or claims were imposed on, incurred by or
asserted against the party seeking indemnification because of the breach of the
obligations, negligence, lack of good faith

                                      O-12

<PAGE>

or willful misconduct of the other party or any of its directors, officers,
agents or employees. The foregoing indemnification shall survive any termination
of this Agreement and the resignation or removal of the Custodian.

         (c)      In the event that the Custodian fails to produce a Mortgage
Note, Assignment of Mortgage or any other document related to a Mortgage Loan
that was in its possession pursuant to Section 2 within four (4) Business Days
after required or requested by the Registered Holder or its Servicer (a
"Custodial Delivery Failure"), and provided that (i) Custodian previously
delivered to the Registered Holder an Initial Custody Receipt which did not list
such document as an exception; (ii) such document is not outstanding pursuant to
a request for release in the form annexed hereto as Exhibit Five; and (iii) such
document was held by the Custodian on behalf of the Registered Holder, then the
Custodian shall: (a) with respect to any missing Mortgage Note, promptly deliver
to the Registered Holder upon request, a Lost Note Affidavit in the form of
Exhibit Seven hereto and (b) with respect to any missing document related to
such Mortgage Loan, including but not limited to a missing Mortgage Note, (1)
indemnify the Registered Holder, and its successor in interest, in accordance
with the succeeding paragraph and, (2) obtain and maintain an insurance bond in
the name of the Registered Holder, and its successors in interest and assigns,
insuring against any losses associated with the loss of such document, in an
amount equal to the then outstanding principal balance of the related Mortgage
Loan or such lesser amount requested by the Registered Holder, at the Registered
Holder's sole option, at any time the long term obligations of the Custodian are
rated below the second highest rating category of Moody's Investors Service,
Inc. or Standard and Poor's Ratings Group, a division of McGraw-Hill, Inc.

         (d)      The Custodian agrees to indemnify and hold the Registered
Holder, and its designees, harmless against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever, including reasonable
attorney's fees, that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of a Custodial Delivery Failure, as
defined herein, or the Custodian's negligence, lack of good faith or willful
misconduct. The forgoing indemnification shall survive any termination or
assignment of this Agreement.

         18.      Reliance of Custodian.

         In the absence of bad faith on the part of the Custodian, the Custodian
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any request, instructions, certificate,
opinion or other document furnished to the Custodian, reasonably believed by
Custodian to be genuine and to have been signed or presented by the proper party
or parties and conforming to the requirements of this Agreement. No
representations, warranties, covenants or obligations of the Custodian shall be
implied with respect to this Agreement or the Custodian's services hereunder.

         19.      Transmission of Custodian's Mortgage File.

         Written instructions as to the method of shipment and shipper(s)
Custodian is directed to utilize in connection with transmission of mortgage
files and loan documents in the performance of the Custodian's duties hereunder
shall be delivered by the Registered Holder (the "Requesting

                                      O-13

<PAGE>

Party") with respect to all or a portion of the Mortgage Loans owned by such
Registered Holder to the Custodian prior to any shipment of any mortgage files
and loan documents hereunder. The Registered Holder will arrange for the
provision of such services at its sole cost and expense (or, at Custodian's
option, reimburse Custodian for all costs and expenses incurred by Custodian
consistent with such instructions) and will maintain such insurance against loss
or damage to mortgage files and loan documents as the Requesting Party deems
appropriate. Without limiting the generality of the provisions of Paragraph 17
above, it is expressly agreed that in no event shall the Custodian have any
liability for any losses or damages to any person, including, without
limitation, the Requesting Party, arising out of actions of the Custodian
consistent with instructions of the Requesting Party. In the absence of any
written instructions with respect to the transmission of the Custodian's
Mortgage Files, the parties hereby agree that the Custodian may utilize any
nationally recognized overnight courier service and shall be entitled to
reimbursement from the Registered Holder.

         20.      Authorized Representative.

         Unless the Registered Holder shall have given the Custodian written
notice to the contrary, each individual designated as an authorized
representative of the Registered Holder with respect to all or a portion of the
Mortgage Loans owned by such Registered Holder, and the Custodian, respectively
(an "Authorized Representative"), is authorized to give and receive notices,
requests and instructions and to deliver certificates and documents in
connection with this Agreement on behalf of the Registered Holder with respect
to all or a portion of the Mortgage Loans owned by such Registered Holder, or
the Custodian, as the case may be, and the specimen signature for each such
Authorized Representative of MLCC as the initial Registered Holder and each such
Authorized Representative of the Custodian initially authorized hereunder is set
forth on Exhibit Three and Exhibit Four hereof, respectively. Any subsequent
Registered Holder of the Mortgage Loans shall provide the Custodian specimen
signatures for each Authorized Representative of such Registered Holder. From
time to time, the Registered Holder and the Custodian may, by delivering to the
other party a revised exhibit, change the information previously given pursuant
to this Paragraph, but each of the parties hereto shall be entitled to rely
conclusively on the then current exhibit until receipt of a superseding exhibit.

         21.      Release of Custodian's File for Servicing.

         Upon written request by the Registered Holder or its Servicer with
respect to all or a portion of the Mortgage Loans owned by such Registered
Holder, pursuant to the form attached hereto as Exhibit Five, the Custodian
shall use its best efforts to promptly, and in no event no later than two (2)
Business Days after receipt of such written request completed in accordance with
this Agreement, release to the Registered Holder or its Servicer for the
servicing or foreclosure of any of the Mortgage Loans the related Custodian's
Mortgage File. All Custodian's Mortgage Files so released to the Registered
Holder's Servicer shall be held by such Servicer in trust for the benefit of the
Registered Holder in accordance with the provisions of a servicing agreement
entered into between the Registered Holder and such Servicer. The Registered
Holder or its Servicer shall return to the Custodian the Custodian's Mortgage
File that has been released to the Registered Holder or its Servicer, when the
Registered Holder's or its Servicer's need therefor in connection with such
servicing or foreclosure no longer exists, unless the Mortgage

                                      O-14

<PAGE>

Loan shall be liquidated, in which case, upon receipt of a certification to this
effect from the Registered Holder or its Servicer to the Custodian in the form
annexed hereto as Exhibit Five, and the Custodian shall thereupon reflect any
such liquidation on the list of Mortgage Loans maintained by it pursuant to
Paragraph 9 of this Agreement.

         Custodian shall not release more than 5% of the number of Mortgage
Loans at any time without additional written consent from Registered Holder.
This limitation shall not apply to the release of Custodial Files upon payment
in full.

         22.      Release of Custodian's Mortgage File for Payment.

         Upon the repurchase or substitution of any Mortgage Loan pursuant to a
Purchase Agreement or the payment in full of any Mortgage Loan, which shall be
evidenced by the Custodian's receipt of a request for release, receipt and
certification in the form annexed hereto as Exhibit Five (which certification
shall include a statement to the effect that all amounts received in connection
with such payment or repurchase have been credited to the account of the
Registered Holder), the Custodian shall use its best efforts promptly and in no
event later than two (2) Business Days after receipt of the written request
therefor completed in accordance with this Agreement, release the related
Custodian's Mortgage File to the Registered Holder or, at the request of the
Registered Holder, its Servicer, such repurchase thereupon to be noted on the
list maintained by the Custodian pursuant to Paragraph 9 of this Agreement.

         23.      Reproduction of Documents.

         This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, and (b) certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process. The parties agree
that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

         24.      Severability.

         If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, the invalidity
of any such covenant, agreement, provision or term of this Agreement shall in no
way affect the validity or enforceability of the other provisions of this
Agreement; provided, however, that if the invalidity of any covenant, agreement
or provision shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate in good faith to
develop a structure the economic effect of which is as nearly as possible the
same as the economic effect of this Agreement.

                                      O-15

<PAGE>

         25.      Amendment; Exhibits.

         This Agreement may be amended from time to time by the parties hereto
only by a written agreement signed by the parties hereto. The exhibits to this
Agreement are hereby incorporated and made a part hereof and are an integral
part of this Agreement.

         26.      Captions.

         Section headings are used herein for convenience only and do not limit
or expand the scope of the provisions herein.

         27.      Representations and Warranties of Custodian.

         Custodian represents and warrants to and covenants with MLCC as
follows:

         (a)      Custodian is a corporation duly incorporated, validly existing
                  and in good standing under the laws of Minnesota.

         (b)      Custodian has full corporate power to execute, deliver and
                  perform the obligations under this Agreement. MLCC may rely on
                  the actions of Custodian without further inquiry. No
                  additional consent, authorization, or regulatory filing is
                  required in order for Custodian to legally perform its
                  obligations.

         (c)      This agreement constitutes a legal, valid and binding
                  obligation of Custodian, enforceable against Custodian in
                  accordance with the terms herein except as limited by
                  bankruptcy, insolvency, liquidation or other similar laws
                  affecting generally the enforcement of creditor's rights.

                                      O-16

<PAGE>

         IN WITNESS WHEREOF, the Custodian and MLCC have caused this Agreement
to be executed as of the date and year first written above.

                                               WELLS FARGO BANK MINNESOTA, N.A.
                                               ("Custodian")

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

                                               MERRILL LYNCH CREDIT CORPORATION
                                               ("MLCC")

                                               By: _____________________________
                                               Name: ___________________________
                                               Title: __________________________

                                      O-17

<PAGE>

                                    EXHIBIT P

                       AMENDMENT NO. 1 CUSTODIAL AGREEMENT

                  Amendment No. 1, dated as of January 16, 2002 (this
"Amendment"), between Merrill Lynch Credit Corporation ("MLCC") and Wells Fargo
Bank Minnesota, N.A. (the "Custodian"), to the Custodial Agreement, dated as of
December 15, 2000 (the "Custodial Agreement").

                                    RECITALS

                  WHEREAS, MLCC may from time to time, purchase certain Mortgage
Loans from third party sellers pursuant to the terms and condition of certain
mortgage loan purchase agreements entered into between MLCC and such parties
(each, a "Purchase Agreement");

                  WHEREAS, pursuant to the Custodial Agreement, the Custodian
has agreed to take possession of mortgage notes evidencing Mortgage Loans and
certain other Mortgage Loan Documents delivered from time to time pursuant to
the Custodial Agreement;

                  WHEREAS, MLCC and the Custodian have agreed, subject to the
terms and conditions of this Amendment, that the Custodial Agreement be amended
to reflect the replacement of individual certifications with a Master Trust
Receipt; and

                  Accordingly, MLCC and Custodian hereby agree, in consideration
of the mutual promises and mutual obligations set forth herein, that the
Custodial Agreement is hereby amended as follows:

         SECTION 1.        Definitions:

         (a) Section 1 of the Custodial Agreement is hereby amended by deleting
             the definitions of "Custody Receipt", "Final Custody Receipt" and
             "Initial Custody Receipt."

         (b) Section 1 of the Custodial Agreement is hereby amended by inserting
             the following definition into its proper alphabetical order:

                  "Trust Receipt": A trust receipt in the form annexed hereto as
         Exhibit One delivered to MLCC by the Custodian covering all of the
         Mortgage Loans subject to this Custodial Agreement from time to time,
         as reflected in the Mortgage Loan Schedule and Exception Report
         attached thereto in accordance with Section 4(b).

         (c) Section 1 of the Custodial Agreement is hereby amended by deleting
             the definition of " Exception Report" and replacing it in its
             entirety as follows:

                  "Exception Report": The Exception Report prepared by the
         Custodian as an annex to the Trust Receipt which lists all exceptions
         with respect to the Mortgage Loan

                                      P-1

<PAGE>

         Schedule and attached thereto as Schedule B, as updated from time to
         time in accordance with Section 4 hereof.

         SECTION 2. Trust Receipt. Section 4 is hereby deleted in its entirety
and replaced in its entirety with the following:

         (a)      The Custodian shall review the documents delivered to it on
             each Delivery Date and shall deliver to Registered Holder within
             the time frames outlined in exhibit B to this amendment, but prior
             to Closing Date, a Mortgage Loan Schedule and Exception Report with
             respect to the Mortgage Loans, and the delivery of each Mortgage
             Loan Schedule and Exception Report by the Custodian hereunder shall
             be the Custodian's certification that such Mortgage Loans are held
             for MLCC (as Registered Holder) and that, as to each Mortgage Loan
             listed in the related Mortgage Loan Schedule (other than any
             Mortgage Loan paid in full or any Mortgage Loan specifically
             identified in such certification as not covered by the Exception
             Report), (a) all documents described in Paragraphs 2(a) through
             2(e) and to the extent provided in the Custodian's Mortgage Files
             Paragraphs 2(f) through 2(j), if applicable, of this Agreement are
             in its possession, (b) such documents have reviewed by it and
             appear regular on their face and relate to such Mortgage Loan, (c)
             based on its examination and only as to the foregoing documents,
             the information set forth in terms (i), (ii), (iii) excluding the
             zip code requirement, (iv), (vi), (vii), (viii) and (x) of the
             definition of "Mortgage Loan Schedule" respecting such Mortgage
             Loan is correct, and which as to items (iv) (vi), (viii) and (x)
             for adjustable rate Mortgage Loan Documents and (d) each Mortgage
             Note has been endorsed and each Assignment has been executed as
             provided in Paragraph 2 hereof. The Custodian shall determine
             whether any discrepancy or deficiency exists with respect to a
             Custodian's Mortgage File and shall note such discrepancy on the
             Exception Report. The Custodian shall also note on such Exception
             Report, with respect to each Mortgage Loan, whether a certified
             copy of the related Mortgage was delivered to the Custodian in lieu
             of the original of such Mortgage, whether a certified copy of an
             intervening assignment of the related Mortgage was delivered to the
             Custodian in lieu of the original of such assignment, and whether a
             preliminary title report with respect to such Mortgage Loan was
             delivered to the Custodian in lieu of the original policy of title
             insurance. Except as specifically provided above, the Custodian
             shall be under no duty to review, inspect or examine such documents
             to determine that any of them are enforceable or appropriate for
             their prescribed purpose.

         (b)      On the date of this Amendment, the Custodian shall deliver to
             MLCC, a Trust Receipt with a Mortgage Loan Schedule and Exception
             Report attached thereto reflecting all Mortgage Loans subject to
             the Custodial Agreement as of such date.

         (c)      Each Mortgage Loan Schedule and Exception Report delivered by
             the Custodian to MLCC shall supersede and cancel the Mortgage Loan
             Schedule and Exception Report previously delivered by the Custodian
             to MLCC hereunder, and shall replace the then existing Mortgage
             Loan Schedule and Exception Report to be attached to the Trust
             Receipt. Notwithstanding anything to the contrary set forth herein,
             in the event that the Mortgage Loan Schedule and Exception Report
             attached to the Trust Receipt

                                      P-2

<PAGE>

             is different from the most recently delivered Mortgage Loan
             Schedule and Exception Report, then the most recently delivered
             Mortgage Loan Schedule and Exception Report shall control and be
             binding upon the parties hereto.

         (d)      The Custodian shall deliver to MLCC, electronically a Mortgage
             Loan Schedule and Exception Report reflecting any additional
             Mortgage Loans received and reviewed in accordance with the
             procedures set forth in Section 2(a) hereof.

         (e)      Within five (5) days of receipt of written directions, in the
             form attached hereto as Exhibit Six, from the Registered Holder
             with respect to all or a portion of the Mortgage Loans owned by
             such Registered Holder, the Custodian shall deliver all or any
             portion of the Custodian's Mortgage Files held by it to Registered
             Holder, or to such other party as the Registered Party may direct,
             as provided in Paragraph 19, at the place indicated in any such
             written direction from the Registered Holder and shall deliver to
             the Registered Holder a new Mortgage Loan Schedule and Exception
             Report, with respect to the Custodian's Mortgage Files retained by
             the Custodian. The Registered Holder may require the Custodian to
             complete the endorsements on any Mortgage Notes in its possession
             and to complete the Assignment of Mortgages prepared by the
             Servicer in blank, within a reasonable period of time. The cost of
             this shall be reimbursed by the Registered Holder. A list of
             authorized signatures for such written directions has been
             furnished to the Custodian by the Registered Holder pursuant to
             Paragraph 20 hereof. Upon the Custodian's receipt of such written
             notification from the Registered Holder that the Registered Holder
             has sold any or all of the Mortgage Loans, which notification shall
             be accompanied by a Mortgage Loan Schedule identifying such
             Mortgage Loans, the Custodian shall change its records to reflect
             that such purchaser is the owner of such Mortgage Loans and shall
             immediately, upon the direction of such Registered Holder, either
             deliver the related Custodian's Mortgage Files to such purchaser at
             the expense of such purchaser or issue a Mortgage Loan Schedule and
             Exception Report in the name of such purchaser. Such purchaser, as
             a Registered Holder, shall be required to simultaneously furnish to
             the Custodian a list of authorized signatures for written
             directions pursuant to Paragraph 20 hereof. The Custodian shall
             then deliver to the Registered Holder a new Mortgage Loan Schedule
             and Exception Report, reflecting all Mortgage Loans with respect to
             which the Custodian still holds the related Custodian's Mortgage
             Files on behalf of the Registered Holder. The Registered Holder and
             the Custodian agree herein that any purchaser of any or all of the
             Mortgage Loans shall succeed to the rights and obligations of the
             Registered Holder under this Agreement with respect to such
             Mortgage Loans upon receipt of its own Trust Receipt and Mortgage
             Loan Schedule and Exception Report, as further specified in
             Paragraph 15 hereof.

         SECTION 3.        Termination of Agreement. Section 14 of the Custodial
Agreement is hereby amended by deleting "Custody Receipts" from the sixth line
of the paragraph and replacing it with "Mortgage Loan Schedule and Exception
Report."

         SECTION 4.        Assignment of Agreement. Section 15 of the Custodial
Agreement is hereby deleted in its entirety and replaced in its entirety with
the following:

                                      P-3

<PAGE>

                  "The Registered Holder with respect to all or a portion of the
Mortgage Loans owned by such Registered Holder shall have the right to assign,
in whole or in part, its interests under this Agreement with respect to some or
all of the Mortgage Loans, and to designate any person (such person, an
"Assignee") or exercise any rights of the Registered Holder hereunder, and such
assignee or designee shall accede to the rights and obligations hereunder of the
Registered Holder with respect to such Mortgage Loans. All references to the
Registered Holder shall be deemed to include its assignee or designee. In
connection with any such assignment, the Registered Holder with respect to all
or a portion of the Mortgage Loans owned by such Registered Holder, the
Custodian shall issue (a) a Trust Receipt in the form of Exhibit One hereto with
a Mortgage Loan Schedule and Exception Report with respect to the Mortgage Loans
subject to such assignment to the Assignee and (b) an updated Mortgage Loan
Schedule and Exception Report to the assigning Registered Holder with respect to
the Mortgage Loans which the Custodian holds for the Registered Holder. The
Custodian may not assign its interest or delegate its duties under this
Agreement without the prior written consent of the Registered Holder. In the
event of any such assignment or delegation, the Registered Holder shall not be
responsible for any fees of the successor Custodian in excess of the fees
formerly paid by the Registered Holder to the Custodian."

         SECTION 5.        Indemnification. Section 17 of the Custodial
   Agreement is hereby amended by deleting "an Initial Custody Receipt" from the
   fifth line of subsection (c) and replacing it with "a Mortgage Loan Schedule
   and Exception Report."

         SECTION 6.        Exhibits. The Exhibits of the Custodial Agreement are
   hereby amended by deleting "Exhibit One" and "Exhibit Two" and adding The
   Form of Trust Receipt attached as Exhibit A to this Amendment as Exhibit One
   to the Custodial Agreement.

         SECTION 7.        Delivered Documents. On the date hereof, MLCC shall
   have received the following documents, each of which shall be satisfactory to
   the MLCC in form and substance:

         (a) Amendment. This Amendment No. 1, executed and delivered by a duly
             authorized officer of MLCC and the Custodian; and

         (b) Other Documents. Such other documents as the Purchaser or counsel
             to the Purchaser may reasonably request.

         SECTION 8. Limited Effect. Except as expressly amended and modified by
   this Amendment, the Custodial Agreement shall continue to be, and shall
   remain, in full force and effect in accordance with its terms.

         SECTION 9. Counterparts. This Amendment may be executed by each of the
   parties hereto on any number of separate counterparts, each of which shall be
   an original and all of which taken together shall constitute one and the same
   instrument.

                                      P-4

<PAGE>

         SECTION 10. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
   CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

                            [SIGNATURE PAGE FOLLOWS]

                                      P-5

<PAGE>

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

                                             WELLS FARGO BANK MINNESOTA, N.A.
                                             ("CUSTODIAN")

                                             By: _______________________________
                                                 Name:  Sarah J. Kerr
                                                 Title: Assistant Vice President

                                             MERRILL LYNCH CREDIT CORPORATION
                                             ("MLCC")

                                             By: _______________________________
                                                 Name:
                                                 Title:

                                      P-6

<PAGE>

                                    EXHIBIT Q

                         OFFICER'S CERTIFICATE - TRUSTEE

Merrill Lynch Mortgage Investors, Inc.
250 Vesey Street
4 World Financial Center, 10th Floor
New York, New York 10080

Re:      Trust Agreement (the "Agreement") dated as of June 1, 2003 between
         Merrill Lynch Mortgage Investors, Inc., as depositor and Wells Fargo
         Bank Minnesota, National Association, as trustee - Merrill Lynch
         Mortgage Investors Trust Series MLCC 2003-C Mortgage Loan Pass-Through
         Certificates

         I, [identify the certifying individual], a [title] of the Trustee
hereby certify to the Depositor, and its officers, directors and affiliates, and
with the knowledge and intent that they will rely upon this certification, that:

1. I have reviewed the Monthly Statements delivered pursuant to Section 4.02 the
   Agreement since the last Officer's Certificate executed pursuant to Section
   6.20 of the Agreement [or in the case of the first certification, since the
   Cut-off Date] (the "Trustee Information").

2. Based on my knowledge, the information in the Monthly Statements , taken as a
   whole, does not contain any untrue statement of a material fact or omit to
   state a material fact necessary to make the statements made, in light of the
   circumstances under which such statements were made, not misleading as of the
   date hereof;

3. Based on my knowledge, the Monthly Statements required to be prepared by the
   Trustee under the Agreement has been prepared and provided in accordance with
   the Agreement; and

4. I am responsible for reviewing the activities performed by the Trustee under
   the Agreement and the Trustee has, as of the date hereof fulfilled its
   obligations under the Agreement and there are no significant deficiencies
   relating to the Trustee's compliance with this Agreement.

Date:

                                            Wells Fargo Bank Minnesota, National
                                            Association, as Trustee

                                            By: ________________________________
                                            Name: ______________________________
                                            Title: _____________________________

                                      Q-1

<PAGE>

                                   SCHEDULE A

                             MORTGAGE LOAN SCHEDULE

                             [INTENTIONALLY OMITTED]

                                  Schedule A-1

<PAGE>

                                   SCHEDULE B

                  MORTGAGE LOAN REPRESENTATIONS AND WARRANTIES
                                OF THE ORIGINATOR

         The Originator hereby represents and warrants to the Purchaser, as to
each Mortgage Loan, as of the Closing Date as follows:

         (a)      The information set forth in the Mortgage Loan Schedule is
true and correct in all material respects as of the Cut-off Date;

         (b)      As of the related Closing Date, the Mortgage Loan is not
delinquent in payment more than 30 days and the Mortgage Loan has not been
dishonored; there are no material defaults under the terms of the Mortgage Loan;
the Originator has not advanced funds, or induced, solicited or knowingly
received any advance of funds from a party other than the owner of the Mortgaged
Property subject to the Mortgage, directly or indirectly, for the payment of any
amount required by the Mortgage Loan;

         (c)      To the best of the Originator's knowledge, with respect to
those Mortgage Loans as to which the Mortgagors are required to deposit funds
into an escrow account for payment of taxes, assessments, insurance premiums and
similar items as they become due, there are no delinquent taxes, ground rents,
water charges, sewer rents, assessments or other outstanding charges which
constitute a lien on the related Mortgaged Property, and all escrow deposits
have been collected, are under the control of the Servicer, and have been
applied to the payment of such items in a timely fashion, in accordance with
such Mortgage. No escrow deposits or escrow payments or other charges or
payments due the Servicer have been capitalized under the related Mortgage or
Mortgage Note. With respect to those Mortgage Loans for which escrow deposits
are not required, to the best of the Originator's knowledge, there are no
delinquent taxes or other outstanding charges affecting the related Mortgaged
Property which constitute a lien on the related Mortgaged Property;

         (d)      The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by written
instruments contained in the Mortgage File, approved, if necessary, by the
insurer under any Primary Mortgage Insurance Policy and recorded in all places
necessary to maintain the first priority of the lien, the substance of which
waiver, alteration or modification is reflected on the Mortgage Loan Schedule.
No Mortgagor has been released, in whole or in part, except in connection with
an assumption agreement which assumption agreement is part of the Mortgage File
and the terms of which are reflected in the Mortgage Loan Schedule;

         (e)      Neither the Mortgage Note nor the Mortgage is subject to any
right of rescission, set-off, counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of the Mortgage Note and the
Mortgage, or the exercise of any right thereunder, render the Mortgage
unenforceable, in whole or in part, or subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury and to the best
of the Originator's knowledge, no such right of rescission, set-off,
counterclaim or defense has been asserted by any Person with respect thereto;

                                  Schedule B-1

<PAGE>

         (f)      All buildings upon the Mortgaged Property are required to be
insured by a generally acceptable insurer against loss by fire, hazards of
extended coverage and such other hazards as are customarily included in extended
coverage in the area where the Mortgaged Property is located, pursuant to
standard hazard insurance policies in an amount which is equal to the lesser of
(A) the replacement cost of the improvements securing such Mortgage Loan or (B)
the principal balance owing on such Mortgage Loan. To the best knowledge of the
Originator, all such standard hazard policies are in effect. On the date of
origination, such standard hazard policies contained a standard mortgagee clause
naming the Originator or the Originator of the Mortgage Loan and their
respective successors in interest as mortgagee and, to the best knowledge of the
Originator, such clause is still in effect and, to the best of the Originator's
knowledge, all premiums due thereon have been paid. If the Mortgaged Property is
located in an area identified by the Federal Emergency Management Agency as
having special flood hazards under the National Flood Insurance Act of 1994, as
amended, such Mortgaged Property is covered by flood insurance in the amount
required under the National Flood Insurance Act of 1994. The Mortgage obligates
the Mortgagor thereunder to maintain all such insurance at Mortgagor's cost and
expense, and on the Mortgagor's failure to do so, authorizes the holder of the
Mortgage to maintain such insurance at Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor;

         (g)      To the best of the Originator's knowledge, at the time of
origination of such Mortgage Loan and thereafter, all requirements of any
federal, state or local law including, without limitation, usury,
truth-in-lending, real estate settlement procedures, consumer credit protection,
equal credit opportunity or disclosure laws required to be complied with by the
Originator as the Originator of the Mortgage Loan and applicable to the Mortgage
Loan have been complied with in all material respects;

         (h)      The Mortgage has not been satisfied as of the Closing Date,
canceled or subordinated, in whole, or rescinded, and the Mortgaged Property has
not been released from the lien of the Mortgage, in whole or in part (except for
a release that does not materially impair the security of the Mortgage Loan or a
release the effect of which is reflected in the Loan-to-Value Ratio for the
Mortgage Loan as set forth in the Mortgage Loan Schedule), nor to the best of
the Originator's knowledge has any instrument been executed that would effect
any such release, cancellation, subordination or rescission;

         (i)      Ownership of the Mortgaged Property is held in fee simple or a
leasehold estate. With respect to Mortgage Loans that are secured by a leasehold
estate, (i) the lease is valid, in full force and effect, and conforms to all of
FNMA's requirements for leasehold estates; (ii) all rents and other payments due
under the lease have been paid; (iii) the lessee is not in default under any
provision of the lease; (iv) the term of the lease exceeds the maturity date of
the related Mortgage Loan by at least five (5) years; and (v) the terms of the
lease provide a Mortgagee with an opportunity to cure any defaults. Except as
permitted by the fourth sentence of this paragraph (i), the Mortgage is a valid,
subsisting and enforceable first lien on the Mortgaged Property, including all
buildings on the Mortgaged Property and all installations and mechanical,
electrical, plumbing, heating and air conditioning systems affixed to such
buildings, and all additions, alterations and replacements made at any time with
respect to the foregoing securing the Mortgage Note's original principal
balance. The Mortgage and the Mortgage Note do not contain any evidence on their
face of any security interest or other interest or right thereto.

                                  Schedule B-2

<PAGE>

Such lien is free and clear of all adverse claims, liens and encumbrances having
priority over the first lien of the Mortgage subject only to (1) the lien of
non-delinquent current real property taxes and assessments not yet due and
payable, (2) covenants, conditions and restrictions, rights of way, easements
and other matters of the public record as of the date of recording which are
acceptable to mortgage lending institutions generally, or which are specifically
referred to in the lender's title insurance policy delivered to the Originator
of the Mortgage Loan and either (A) which are referred to or otherwise
considered in the appraisal made for the Originator of the Mortgage Loan, or (B)
which do not in the aggregate adversely affect the appraised value of the
Mortgaged Property as set forth in such appraisal, and (3) other matters to
which like properties are commonly subject which do not in the aggregate
materially interfere with the benefits of the security intended to be provided
by the Mortgage or the use, enjoyment, value or marketability of the related
Mortgaged Property. Any security agreement, chattel mortgage or equivalent
document related to and delivered in connection with the Mortgage Loan
establishes and creates a valid, subsisting and enforceable first lien and first
priority security interest on the property described therein. With respect to
each Co-op Loan, the security instruments create a valid, enforceable and
subsisting first priority security interest in the Co-op Lease and Co-op Stock
securing the related Mortgage Note subject to only to (a) the lien of the
related cooperative for unpaid assessments representing the Mortgagor's pro rata
share of payments for a blanket mortgage, if any, current and future real
property taxes, insurance premiums, maintenance fees and other assessments to
which like collateral is commonly subject, and (b) other matters to which the
collateral is commonly subject which do not materially interfere with the
benefits of the security intended to be provided; provided, however, that the
related Co-op Loan may be subordinated or otherwise subject to the lien of a
Mortgage on the cooperative building;

         (j)      The Mortgage Note is not subject to a third party's security
interest or other rights or interest therein;

         (k)      The Mortgage Note and the related Mortgage are genuine and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms subject to bankruptcy, insolvency and
other laws of general application affecting the rights of creditors. All parties
to the Mortgage Note and the Mortgage had the legal capacity to enter into the
Mortgage Loan and to execute and deliver the Mortgage Note and the Mortgage. The
Mortgage Note and the Mortgage have been duly and properly executed by such
parties. The proceeds of the Mortgage Loan have been fully disbursed and there
is no requirement for future advances thereunder, and any and all requirements
as to completion of any on-site or off-site improvements and as to disbursements
of any escrow funds therefor have been complied with;

         (l)      Originator has good title to, and the full right to transfer
and sell, the Mortgage Loan free and clear of any encumbrance, equity, lien,
pledge, charge, claim or security interest, including, to the best knowledge of
the Originator, any lien, claim or other interest arising by operation of law;

         (m)      To the best of the Originator's knowledge, each Mortgage Loan
is covered by an ALTA lender's title insurance policy or other generally
acceptable form of policy or insurance acceptable to FNMA or FHLMC, issued by a
title insurer acceptable to FNMA or FHLMC and qualified to do business in the
jurisdiction where the Mortgaged Property is located, insuring (subject to the
exceptions contained in paragraph (ix)(1) (2) and (3) above) the Originator, its

                                  Schedule B-3

<PAGE>

successors and assigns, as to the first priority lien of the Mortgage in the
original principal amount of the Mortgage Loan. To the best of the Originator's
knowledge, the Originator is the sole insured of such lender's title insurance
policy, such title insurance policy has been duly and validly endorsed to the
Purchaser or the assignment to the Purchaser of the Originator's interest
therein does not require the consent of or notification to the insurer and such
lender's title insurance policy is in full force and effect and will be in full
force and effect upon the consummation of the transactions contemplated by this
Agreement. To the best of the Originator's knowledge, no claims have been made
under such lender's title insurance policy, and no prior holder of the related
Mortgage has done, by act or omission, anything which would impair the coverage
of such lender's title insurance policy;

         (n)      To the best of the Originator's knowledge, there is no
default, breach, violation or event of acceleration existing under the Mortgage
or the related Mortgage Note and no event which, with the passage of time or
with notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event permitting acceleration, except for any
Mortgage Loan payment which is not late by more than 30 days, and the Originator
has not waived any default, breach, violation or event permitting acceleration;

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

         (p)      To the best of the Originator's knowledge, all improvements
subject to the Mortgage, lay wholly within the boundaries and building
restriction lines of the Mortgaged Property (and wholly within the project with
respect to a condominium unit) and no improvements on adjoining properties
encroach upon the Mortgaged Property except those which are insured against by
the title insurance policy referred to in paragraph (xiii) above and all
improvements on the property comply with all applicable zoning and subdivision
laws and ordinances;

         (q)      To the best of the Originator's knowledge, each Mortgage Loan
was originated by the Originator or by a savings association, a savings bank, a
commercial bank or similar banking institution that is supervised and examined
by a Federal or state banking authority, a mortgagee approved by the Secretary
of HUD pursuant to Section 203 and 211 of the National Housing Act, or a FNMA-
or FHLMC-approved seller. To the best of the Originator's knowledge, each
Mortgage Loan was underwritten generally in accordance with the Underwriting
Standards as in effect at the time of origination. To the best of the
Originator's knowledge, the Mortgage contains the usual and customary provision
of the Originator at the time of origination for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan if the related Mortgaged
Property is sold without the prior consent of the mortgagee thereunder;

         (r)      The Mortgaged Property at origination or acquisition was and,
to the best of the Originator's knowledge, currently is free of material damage
and waste and at origination there was, and to the best of the Originator's
knowledge there currently is, no proceeding pending for the total or partial
condemnation thereof;

                                  Schedule B-4

<PAGE>

         (s)      The related Mortgage contains customary and enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the realization against the Mortgaged Property of the benefits of
the security provided thereby, including, (1) in the case of a Mortgage
designated as a deed of trust, by trustee's sale or judicial foreclosure, and
(2) otherwise by judicial foreclosure. The Originator has no knowledge of any
homestead or other exemption available to the Mortgagor which would interfere
with the right to sell the Mortgaged Property at a trustee's sale or the right
to foreclose the Mortgage;

         (t)      To the best of the Originator's knowledge, if the Mortgage
constitutes a deed of trust, a trustee, duly qualified if required under
applicable law to act as such, has been properly designated and currently so
serves and is named in the Mortgage, and no fees or expenses are or will become
payable to the trustee under the deed of trust, except in connection with a
trustee's sale or attempted sale after default by the Mortgagor;

         (u)      With respect to each Mortgage Loan, there is either (i) an
automated property valuation report or (ii) an appraisal on a FNMA-approved form
(or a narrative residential appraisal) of the related Mortgaged Property that
conforms to the applicable requirements of the Financial Institutions Reform
Recovery and Enforcement Act and that was signed prior to the approval of such
Mortgage Loan application by a qualified appraiser, appointed by the Originator
or the Originator of such Mortgage Loan, as appropriate, who has no interest,
direct or indirect, in the Mortgaged Property or in any loan made on the
security thereof, and whose compensation is not affected by the approval or
disapproval of such Mortgage Loan;

         (v)      No Mortgage Loan contains "subsidized buydown" or "graduated
payment" features;

         (w)      The Mortgaged Property is a single-family (one- to four-unit)
dwelling residence erected thereon, or an individual condominium unit in a
condominium, or a Co-operative Apartment or an individual unit in a planned unit
development or in a de minimis planned unit development as defined by FNMA. No
such residence is a mobile home or a manufactured dwelling which is not
permanently attached to the land;

         (x)      No Mortgage Loan provides for negative amortization;

         (y)      No Mortgage Loan had an original term in excess of thirty (30)
years;

         (z)      [RESERVED]

         (aa)     Each Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code (without regard to Treasury
Regulations Section 1.860G-2(f) or any similar rule that provides that a
defective obligation is a qualified mortgage for a temporary period);

         (bb)     No Mortgage Loan provides for interest other than at either
(x) a single fixed rate in effect throughout the term of the Mortgage Loan or
(y) a single "variable rate" (within the meaning of Treasury Regulations Section
1.860G-1(a)(3)) in effect throughout the term of the Mortgage Loan.

                                  Schedule B-5

<PAGE>

         (cc)     No Mortgage Loan is the subject of pending or final
foreclosure proceedings.

         (dd)     Based on delinquencies in payment on the Mortgage Loans, the
Originator would not initiate foreclosure proceedings with respect to any of the
Mortgage Loans prior to the next scheduled payment date on such Mortgage Loan.

         (ee)     Each Mortgage Note is comprised of one original promissory
note and each such promissory note constitutes an "instrument" for purposes of
section 9-102(a)(65) of the UCC.

         (ff)     No predatory or deceptive lending practices, including but not
limited to, the extension of credit to the Mortgagor without regard for the
Mortgagor's ability to repay the Mortgage Loan and the extension of credit to
the Mortgagor which has no apparent benefit to the Mortgagor, were employed by
the Originator in connection with the origination of the Mortgage Loan.

         (gg)     The Originator has complied with all applicable anti-money
laundering laws and regulations, including without limitation the USA Patriot
Act of 2001 (collectively, the "Anti-Money Laundering Laws"); the Originator has
established an anti-money laundering compliance program as required by the
Anti-Money Laundering Laws, has conducted the requisite due diligence in
connection with the origination of each Mortgage Loan for purposes of the
Anti-Money Laundering Laws, including with respect to the legitimacy of the
applicable Mortgagor and the origin of the assets used by the said Mortgagor to
purchase the property in question, and maintains, and will maintain, sufficient
information to identify the applicable Mortgagor for purposes of the Anti-Money
Laundering Laws.

         (hh)     Each Mortgage Loan is in compliance with the anti-predatory
lending eligibility for purchase requirements of FNMA's Selling Guide.

         (ii)     No Mortgagor was encouraged or required to select a Mortgage
Loan product offered by the Originator which is a higher cost product designed
for less creditworthy mortgagors, unless at the time of the Mortgage Loan's
origination, such Mortgagor did not qualify taking into account credit history
and debt-to-income ratios for a lower-cost credit product then offered by the
Originator or any affiliate of the Originator. If, at the time of loan
application, the Mortgagor may have qualified for a for a lower-cost credit
product then offered by any mortgage lending affiliate of the Originator, the
Originator referred the Mortgagor's application to such affiliate for
underwriting consideration.

         (jj)     The methodology used in underwriting the extension of credit
for each Mortgage Loan employs objective mathematical principles which relate
the Mortgagor's income, assets and liabilities to the proposed payment and such
underwriting methodology does not rely on the extent of the Mortgagor's equity
in the collateral as the principal determining factor in approving such credit
extension. Such underwriting methodology confirmed that at the time of
origination (application/approval) the Mortgagor had a reasonable ability to
make timely payments on the Mortgage Loan.

         (kk)     With respect to any Mortgage Loan that contains a provision
permitting imposition of a premium upon a prepayment prior to maturity: (i)
prior to the loan's origination, the Mortgagor agreed to such premium in
exchange for a monetary benefit, including but not

                                  Schedule B-6

<PAGE>

limited to a rate or fee reduction, (ii) prior to the loan's origination, the
Mortgagor was offered the option of obtaining a mortgage loan that did not
require payment of such a premium, (iii) the prepayment premium is disclosed to
the Mortgagor in the loan documents pursuant to applicable state and federal
law, and (iv) notwithstanding any state or federal law to the contrary, the
Servicer shall not impose such prepayment premium in any instance when the
mortgage debt is accelerated as the result of the Mortgagor's default in making
the loan payments.

         (ll)     No Mortgagor was required to purchase any credit life,
disability, accident or health insurance product as a condition of obtaining the
extension of credit. No Mortgagor obtained a prepaid single-premium credit life,
disability, accident or health insurance policy in connection with the
origination of the Mortgage Loan. No proceeds from any Mortgage Loan were used
to purchase single premium credit insurance policies as part of the origination
of, or as a condition to closing, such Mortgage Loan.

         (mm)     All points and fees related to each Mortgage Loan were
disclosed in writing to the Mortgagor in accordance with applicable state and
federal law and regulation. Except in the case of a Mortgage Loan in an original
principal amount of less than $60,000 which would have resulted in an
unprofitable origination, no Mortgagor was charged "points and fees" (whether or
not financed) in an amount greater than 5% of the principal amount of such loan,
such 5% limitation is calculated in accordance with FNMA's anti-predatory
lending requirements as set forth in the FNMA Selling Guide. All points and fees
related to each Mortgage Loan are accurately described on the Mortgage Loan
Schedule.

         (nn)     All fees and charges (including finance charges) and whether
or not financed, assessed, collected or to be collected in connection with the
origination and servicing of each Mortgage Loan has been disclosed in writing to
the Mortgagor in accordance with applicable state and federal law and
regulation.

         (oo)     The Originator will transmit full-file credit reporting data
for each Mortgage Loan pursuant to FNMA Guide Announcement 95-19 and that for
each Mortgage Loan, Servicer agrees it shall report one of the following
statuses each month as follows: new origination, current, delinquent (30-, 60-,
90-days, etc.), foreclosed, or charged-off.

         (pp)     No Mortgage Loan is covered by the Home Ownership and Equity
Protection Act of 1994 ("HOEPA") and no Mortgage Loan is "high cost" as defined
by any applicable federal, state or local predatory or abusive lending law. Any
breach of this representation shall be deemed to materially and adversely affect
the value of the Mortgage Loan and shall require a repurchase of the affected
Mortgage Loan.

         (qq)     No Mortgage Loan was originated on or after October 1, 2002
and prior to March 7, 2003, which is secured by property located in the State of
Georgia. No Mortgage Loan was originated on or after March 7, 2003 which is a
"high cost home loan" as defined under the Georgia Fair Lending Act. Any breach
of this representation shall be deemed to materially and adversely affect the
value of the Mortgage Loan and shall require a repurchase of the affected
Mortgage Loan.

                                  Schedule B-7

<PAGE>

         (rr)     No Mortgage Loan (a) is secured by property located in the
State of New York; (b) had an original principal balance of $300,000 or less,
and (c) has an application date on or after April 1, 2003, the terms of which
Mortgage Loan equal or exceed either the APR or points and fees threshold for
"high-cost home loans," as defined in Section 6-L of the New York State Banking
Law. Any breach of this representation shall be deemed to materially and
adversely affect the value of the Mortgage Loan and shall require a repurchase
of the affected Mortgage Loan.

         (ss)     No Mortgage Loan originated prior to October 1, 2002 has a
prepayment charge longer than five years after its origination; and no Mortgage
Loan originated on or after October 1, 2002 has a prepayment charge longer than
three years after its origination. Any breach of this representation shall be
deemed to materially and adversely affect the value of the Mortgage Loan and
shall require a repurchase of the affected Mortgage Loan.

         (tt)     The Originator has caused the Servicer to fully furnish and
will fully report, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g., favorable and
unfavorable) on its Mortgagor credit files to Equifax, Experian and Trans Union
Credit Information Company, on a monthly basis. Any breach of this
representation shall be deemed to materially and adversely affect the value of
the Mortgage Loan and shall require a repurchase of the affected Mortgage Loan.

         (uu)     Each Mortgage Loan at the time it was made complied in all
material respects with applicable local, state and federal laws, including, but
not limited to, all applicable predatory or abusive lending laws.

         (vv)     The information set forth in the prepayment charge schedule,
if any, is complete, true and correct in all material respects on the date or
dates when such information is furnished and each prepayment charge is
permissible and enforceable in accordance with its terms except to the extent
that the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws affecting creditor's rights
generally or the collectibility thereof may be limited due to acceleration in
connection with a foreclosure) under applicable law.

                                  Schedule B-8<PAGE>
                                                                     Exhibit 4.2

                               INDEMNITY AGREEMENT

            THIS INDEMNITY AGREEMENT, dated as of January 28, 2002, is entered
into by and among Travelers Insurance Company, a Connecticut corporation
("Travelers Insurance") and Travelers Indemnity Company, a Connecticut
corporation ("Travelers Indemnity" and, together with Travelers Insurance, the
"Holders"), and On2 Technologies, Inc., a Delaware corporation (the "Company").

      WHEREAS, Travelers Insurance is the holder of 1,600,000 shares of the
Company's common stock, par value $0.01 per share ("Common Stock"), and
Travelers Indemnity is the holder of 3,104,717 shares of Common Stock (such
4,704,717 shares collectively, the "Travelers Shares");

      WHEREAS, the Travelers Shares are being registered by the Company pursuant
to a registration statement on Form SB-2 (the "Registration Statement"); and

      WHEREAS, pursuant to that certain (i) Registration Rights Agreement (the
"1997 Registration Rights Agreement") dated as of May 22, 1997 between The Duck
Corporation and Travelers Insurance and (ii) Merger Agreement (the "Merger
Agreement") dated as of June 9, 1999 by and among Allied Capital Funding, Inc.,
Allied Capital Acquisition Corp. and The Duck Corporation, On2 agreed, under
certain circumstances, to register the Travelers Shares; and

      WHEREAS, in consideration of the Holders releasing the Company for any
failure to register the Travelers Shares pursuant to the Merger Agreement and in
substitution of any obligations contained in the 1997 Registration Rights
Agreement, the Company has agreed to register the Travelers Shares pursuant to
the Registration Statement and to indemnify the Holders in connection with
certain matters relating to the Registration Statement.

      NOW, THEREFORE, in consideration of the premises and mutual agreements set
forth herein, the Company and the Holders hereby agree as follows:

            Section 1.  Registration.

            The Company agrees to register the Travelers Shares pursuant to the
Registration Statement (the "Registration"). The Company and the Holders agree
that their respective rights and obligations with respect to the Registration
shall be governed to the fullest extent practicable by the analogous terms and
provisions of the Investor Rights Agreement, dated as of August 10, 2001,
between the Company and Travelers Insurance (the "August Agreement"); provided,
however, that in the case of a conflict between the provisions of the August
Agreement and this Agreement, this Agreement shall govern the parties' rights
and obligations with respect to the Registration.
<PAGE>
            Section 2.  Indemnification.

            (a) The Company agrees to indemnify and hold harmless the Holders
and their directors, officers, employees and agents and each person, if any, who
controls the Holders within the meaning of the Securities Act (collectively, the
"Holder Indemnified Parties") against any losses, claims, damages or
liabilities, joint or several (which shall, for all purposes of this Agreement,
include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees), to which the Holder
Indemnified Parties may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, or any
related preliminary prospectus, final prospectus or amendment or supplement
thereto, in each case as of the respective dates thereof, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case as of the respective dates thereof; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, preliminary prospectus, final prospectus or
amendment or supplement thereto in reliance upon, and in conformity with,
written information furnished to the Company by the Holder Indemnified Parties
specifically for use in the preparation thereof. This Section 2(a) shall not
inure to the benefit of any Holder Indemnified Party with respect to any person
asserting such loss, claim, damage or liability who purchased the Travelers
Shares which are the subject thereof if the Holders Indemnified Party failed to
send or give (in violation of the Securities Act or the rules and regulations
promulgated thereunder) a copy of the prospectus contained in such Registration
Statement to such person at or prior to the written confirmation to such person
of the sale of such Travelers Shares, where the Holder Indemnified Party was
obligated to do so under the Securities Act or the rules and regulations
promulgated thereunder. This indemnity agreement will be in addition to any
liability that the Company may otherwise have.

            (b) The Holders agree that they will indemnify and hold harmless the
Company and its directors, officers, employees and agents and each person, if
any, who controls the Company within the meaning of the Securities Act
(collectively, the "Company Indemnified Parties"), against any losses, claims,
damages or liabilities (which shall, for all purposes of this Agreement,
include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees) to which the Company
Indemnified Parties may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, or any
related preliminary prospectus, final prospectus or amendment or supplement
thereto, or arise out of or are based upon the omission or the alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, but in each case only to the extent
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, preliminary prospectus, final
prospectus or amendment or supplement thereto in reliance upon, and in
conformity with, written information furnished to the Company by the Holders
specifically for use in the preparation thereof. This indemnity agreement will
be in addition to any liability which the Holders may otherwise have.

                                       2
<PAGE>
Notwithstanding anything to the contrary herein, the Holders shall not be liable
under this Section 2(b) for any amount in excess of the gross proceeds to the
Holders as a result of the sale of Travelers Shares pursuant to the Registration
Statement.

            (c) Promptly after receipt by an indemnified party under this
Section 2 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 2, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any indemnified party
except to the extent of actual prejudice demonstrated by the indemnifying party.
In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, assume the defense
thereof, subject to the provisions herein stated and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section 2 for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation, unless the indemnifying party shall not
pursue the action to its final conclusion. The indemnified party shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel shall not be at the
expense of the indemnifying party if the indemnifying party has assumed the
defense of the action with counsel reasonably satisfactory to the indemnified
party; provided that the fees and expenses of such counsel shall be at the
expense of the indemnifying party if (i) the employment of such counsel has been
specifically authorized in writing by the indemnifying party, or (ii) the named
parties to any such action (including any impleaded parties) include both the
indemnified party and the indemnifying party and the indemnified party shall
have been advised by such counsel that there may be one or more legal defenses
available to the indemnifying party different from or in conflict with any legal
defenses which may be available to the indemnified party (in which case the
indemnifying party shall not have the right to assume the defense of such action
on behalf of the indemnified party, it being understood, however, that the
indemnifying party shall, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable only for the reasonable
fees and expenses of one separate firm of attorneys for the indemnified party,
which firm shall be designated in writing by the indemnified party and be
reasonably approved by the indemnifying party). No settlement of any action
against an indemnified party shall be made without the prior written consent of
the indemnified party, which consent shall not be unreasonably withheld.

            All fees and expenses of the indemnified party (including reasonable
costs of defense and investigation in a manner not inconsistent with this
section and all reasonable attorneys' fees and expenses) shall be paid to the
indemnified party, as incurred, within ten (10) business days of written notice
thereof and reasonable supporting documentation has been submitted to the
indemnifying party; provided, that the indemnifying party may require such
indemnified party to undertake to reimburse all such fees and expenses to the
extent it is finally judicially determined that such indemnified party is not
entitled to indemnification hereunder.

                                       3
<PAGE>
            Section 3. Contribution. In order to provide for just and equitable
contribution under the Securities Act in any case in which (i) the indemnified
party makes a claim for indemnification pursuant to Section 2 hereof but is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that the express provisions of Section 2 hereof provide
for indemnification in such case, or (ii) contribution under the Securities Act
may be required on the part of any indemnified party, then the Company
Indemnified Parties and the Holder Indemnified Parties shall contribute to the
aggregate losses, claims, damages or liabilities to which they may be subject
(which shall, for all purposes of this Agreement, include, but not be limited
to, all reasonable costs of defense and investigation and all reasonable
attorneys' fees), in either such case (after contribution from others) on the
basis of relative fault as well as any other relevant equitable considerations.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company Indemnified Parties on the one hand or the Holders
Indemnified Parties on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company Indemnified Parties and the Holder
Indemnified Parties agree that it would not be just and equitable if
contribution pursuant to this Section 2 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 3. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this Section 3
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

            Notwithstanding any other provision of this Section 3, in no event
shall the Holders be required to undertake liability to any person under this
Section 3 for any amounts in excess of the dollar amount of the gross proceeds
received by the Holders from the sale of the Travelers Shares pursuant to any
Registration Statement under which such Travelers Shares are registered under
the Securities Act.

            Section 4. Release and Termination. Travelers hereby releases and
discharges the Company and its officers, directors, affiliates, parents,
subsidiaries, managers, representatives, agents, attorneys, employees,
predecessors, successors and assigns from any and all actions, causes of action
or suits, claims and demands whatsoever, in law or equity relating to the
failure to register the Traveler Shares pursuant to the Merger Agreement. The
parties hereto agree that as of the date hereof the 1997 Registration Rights
Agreement is terminated and shall have no further force or effect.

            Section 5. Notices. Any notice, demand, request, waiver or other
communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand delivery or facsimile at the address or
number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during

                                       4
<PAGE>
normal business hours where such notice is to be received) or (b) on the second
business day following the date of mailing by express courier service, fully
prepaid, addressed to such address, or upon actual receipt of such mailing,
whichever shall first occur. The addresses for such communications shall be:

If to the Company:      145 Hudson Street
                        New York, New York 10013
                        Attn: Chief Financial Officer
                        With a copy to: General Counsel
                        Tel: (917) 237-0500
                        Fax: (917) 237-1544

If to Holders:          Citigroup Investments Inc.
                        399 Park Avenue, 7th Floor
                        New York, NY  10022
                        Attention: General Counsel

Any party hereto may from time to time change its address for notices by giving
written notice of such changed address to the other party hereto in accordance
herewith.

            Section 6. Assignment. Neither this Agreement nor any rights of the
Holders or the Company hereunder may be assigned by either party to any other
person without the other party's prior written consent, provided that without
such consent the Holders' rights may be assigned to an entity controlling,
controlled by or under common control with the Holders.

            Section 7. Counterparts/Facsimile. This Agreement may be executed in
two or more counterparts, each of which shall constitute an original, but all of
which, when together shall constitute but one and the same instrument, and shall
become effective when one or more counterparts have been signed by each party
hereto and delivered to the other party. In lieu of the original, a facsimile
transmission or copy of the original shall be as effective and enforceable as
the original.

            Section 8. Remedies and Severability. The remedies provided in this
Agreement are cumulative and not exclusive of any remedies provided by law. If
any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction to be invalid, illegal, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions set forth
herein shall remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of those that may be hereafter declared
invalid, illegal, void or unenforceable.

            Section 9. Headings. The headings in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

                                       5
<PAGE>
            Section 10. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made in New York by persons domiciled in New York City and without
regard to its principles of conflicts of laws. The Company and the Holders agree
to submit itself to the in personam jurisdiction of the state and federal courts
situated within the Southern District of the State of New York with regard to
any controversy arising out of or relating to this Agreement. Any party shall
have the right to seek injunctive relief from any court of competent
jurisdiction in any case where such relief is available. Any dispute under this
Agreement shall be submitted to arbitration under the American Arbitration
Association (the "AAA") in New York City, New York, and shall be finally and
conclusively determined by the decision of a board of arbitration consisting of
three (3) members (hereinafter referred to as the "Board of Arbitration")
selected as according to the rules governing the AAA. The Board of Arbitration
shall meet on consecutive business days in New York City, New York, and shall
reach and render a decision in writing (concurred in by a majority of the
members of the Board of Arbitration) with respect to the amount, if any, which
the losing party is required to pay to the other party in respect of a claim
filed. In connection with rendering its decisions, the Board of Arbitration
shall adopt and follow the laws of the State of New York. To the extent
practical, decisions of the Board of Arbitration shall be rendered no more than
thirty (30) calendar days following commencement of proceedings with respect
thereto. The Board of Arbitration shall cause its written decision to be
delivered to all parties involved in the dispute. The Board of Arbitration shall
be authorized and is directed to enter a default judgment against any party
refusing to participate in the arbitration proceeding within thirty days of any
deadline for such participation. Any decision made by the Board of Arbitration
(either prior to or after the expiration of such thirty (30) calendar day
period) shall be final, binding and conclusive on the parties to the dispute,
and entitled to be enforced to the fullest extent permitted by law and entered
in any court of competent jurisdiction. The prevailing party shall be awarded
its costs, including attorneys' fees, from the non-prevailing party as part of
the arbitration award. Any party shall have the right to seek injunctive relief
from any court of competent jurisdiction in any case where such relief is
available. The prevailing party in such injunctive action shall be awarded its
costs, including attorney's fees, from the non-prevailing party.

            Section 11. Waivers. No waiver by either party of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any other
provisions, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.

            Section 12. Entire Agreement; Amendment. This Agreement contains the
entire understanding of the parties with respect to the matters covered hereby
and, except as specifically set forth herein, neither the Company nor the
Holders makes any representations, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived or amended
other than by a written instrument signed by the party against whom enforcement
of any such amendment or waiver is sought.

                                       6
<PAGE>
            IN WITNESS WHEREOF, the parties hereto have caused this Investor
Rights Agreement to be duly executed, on this 28th day of January, 2002.

                                          ON2 TECHNOLOGIES, INC.

                                          By:
                                               -------------------------------
                                          Name:
                                          Title:

                                          TRAVELERS INSURANCE COMPANY

                                          By:
                                               -------------------------------
                                          Name:
                                          Title:

                                          TRAVELERS INDEMNITY COMPANY

                                          By:
                                               -------------------------------
                                          Name:
                                          Title:

                                       7

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